Negotiations, Lecture by Stan Christensen / Arbor Advisors (2007)

Video Lectures

Displaying all 4 video lectures.
Lecture 1
Negotiations are Serial Events
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Negotiations are Serial Events

Stan Christensen highlights the fact that negotiations are serial events. He notes that it is important for one to realize this as you would encounter the same people in the future. He illustrates this fact from his experience in Seoul.




Transcript



So just quickly, a couple of these points: people often assume that negotiations are one-time events. In fact, I think that almost all negotiations in life are repeat. They're serial. You're going to see the people you negotiate with more than once, yet almost everybody negotiates as if it's a one-time deal, as if they're buying a car from a car dealer, and price is the only thing that matters. When in fact, you would probably negotiate very differently if you knew you were going to see people again. And most of you will find that, in your lives, people you thought you'd never run into again, you will. I remember, about 4 or 5 years ago, I was in South Korea. I was doing some advisory work on a negotiation between North and South Korea. I was in an Intercontinental Hotel, I got in the elevator, and I was at about the 30 th floor. And I just kind of glanced at the other guy in the elevator, and I thought, "Oh my gosh. That looks like this kid I got in a fight with in high school. It can't possibly be him!" And you know, I said, "Rob, is that you? Is your name Rob?" And he said, "Yeah, I'm Rob." I would've hoped and thought I would never see him again in my life, and there he was, Intercontinental Hotel in Seoul.

Lecture 2
What is Effective Negotiation?
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What is Effective Negotiation?

Stan Christensen throws light on the art of effective negotiation. He defines it as any attempt to persuade or influence a party to do something. He adds a note of humor by illustrating it with a story of one his students.
Lecture 3
Communication and Negotiation
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Communication and Negotiation

Stan Christensen believes that communication is a key element in negotiation. He stresses the fact that communication is about convincing the other side that you can hear them and that they are being heard. He illustrates it with anecdotes and his personal experiences in negotiating deals.
Lecture 4
Negotiating Salaries
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Negotiating Salaries

Stan Christensen talks about his experience in negotiating salaries and fills the conversation with interesting personal experiences. He believes that developing a best alternative to a negotiated agreement and having a good idea about the objective criteria is key to effective negotiation of salaries.




Transcript



Salaries and pay increases, how do you negotiate them? So salaries and pay increases are about two things: and they happen to be the same two elements of the last question. They're about alternatives and criteria. So the most important is having objective criteria. So if you're in an organization, and let's say that it's IBM, you want to know what do other people at your level get paid, how quickly have they been increased in their salaries? You want to have some good internal objective criteria. You'd also like to have some external criteria. What are they paying at HP for similar roles? What are they paying at Dell, if it's an OEM kind of a job, for the similar kind of role? So you want to have objective criteria. Number two, you want to think about your alternative. Now, sometimes you need to let the other side know, or at least be prepared, if you don't get the salary increase, maybe you'll go work at HP. And often - I'm not saying you need to threaten with your alternative, but you'd at least like to know that if you walked away, you'd like to have that in your back pocket. So if I know when I go in to negotiate with my manager, that I've got a job waiting at Hewlett Packard and it's 15 % more salary than I'm getting at IBM, I'm feeling more powerful when I go into the negotiation. And so developing a good - what's called BATNA, the best alternative to a negotiated agreement when you go in, and having good data about objective criteria, I think, is really important. Students - I hire a lot of students, because we're an investment bank, and we hire a lot of young people. And there are people that - there are students that will come in, and whatever salary you offer them, they ask for more. "You can have $30 million." "No, that's crazy. I've got to have more." And it's not very persuasive. Now, if they said, "Gee, the other investment banks are paying more. I've done some research. You guys are 5 % lower." That would be super, super persuasive. Or, "Hey, I've got this offer at Goldman Sachs, they're paying more." That's persuasive. But people who just ask more no matter what, not so persuasive.