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 NE GOT IAT ING ON T HIN ICE

 NHLPA

Information

  Parties:

1.   NHL - Gary Bettman, Bill Daly2. NHLPA - Bob Goodenow, TakSashin3. Players

  Interests:

1. No cap

2. Salary independent of team revenue

  Values: Negotiate on salaries & benefits

  BATNA:

1.  NHL- Close operations

2.  NHLPA- agreement on present deal

3. Players- Move to other clubs.

  ZOPA ANALYSIS

50 million 43 million

  Our resistance value is $46 million.

Strategy & Plan

  For Salary linkage we started at 75% and we are willing to go down to 62%.  

 Negotiation Process

1.  Information

The Following were the key points laid down for discussion:

1.  The document be audited by 3rd party every year for accuracy

2.  Salary arbitration

3.  Payroll tax system

4.  Guaranteed contract

5.  Revenue sharing

6.  Free agent rule

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7.  Insurance coverage

8.  Rules for calling a lock out

9.  % of roll back of salaries

Value Creation

  We wanted to play in the league as soon as possible and we were willing to come to

an agreement which is favorable for both the sides.

1.  Anchoring

   NHL Anchored the salary cap at $ 43 million. We started at $50 million and we

finally settled at $46 million.

 We anchored the rollback issue at 12% of existing salary contracts and they wanted20%. We finally ended at 16%.

  Salary linkage we anchored at 75% of revenues and they wanted at 55%. Considering

the other league statistics, we agreed to fix at 62% of revenue.

2.  Concessions 

  The issues like changes in payroll tax, rookie salary cap and salary arbitration issues

were discussed and agreed to not change it. 

3.  Results

  Sharing information helped build trust between us. The negotiation proceeded

smoothly.

Key Learning

1.   Negotiation should be done seeing the interests of both the parties. Personal interest

should be kept independent of issues

2.  We can build trust by coming together and discussing transparently.

3.  We can include a neutral third party which helps avoid biases and builds trust.

4.   Negotiate on multiple issues simultaneously and have a scoring system to judge the

importance of issues.

5.  Prior preparation should be done before negotiating.

6.  Structure your deal properly to have a fruitful outcome.

7.  Try to create values for the parties and co-operate for value maximization.