“So you want to be a Chair?” June 24, 2011 American Orthopedic Association Copyright © President & Fellows of Harvard College. ©Copyright 2011 Andy Wasynczuk

©Copyright 2011 Andy Wasynczuk

“So you want to be a Chair?”

June 24, 2011

American Orthopedic Association

Copyright © President & Fellows of Harvard College.

Agenda1.Key Principles in Negotiation

Prof. Andy WasynczukHarvard Business School Faculty; Former Chief Operating Officer, New England Patriots

2.The New Chair’s Challenges Dr. Vincent Pellegrini

James Lawrence Kernan Professor and ChairDepartment of OrthopaedicsUniversity of Maryland Medical Center

3.The Veteran Chair’s Perspective Dr. Terry Light

Dr. William M. Scholl Professor and ChairHand SurgeryLoyola University Health Systems

4.Q & A ©Copyright 2011 Andy Wasynczuk

Negotiator’s Goal:

Create Value?

Claim Value?

BOTH!

But the tactics for each can conflict with one another… leading to

The Negotiator’s Dilemma



Claiming Value: Key Preparation: Assess the Value Opportunity

Identify your alternatives. How do you value them?What are the other side’s alternatives? Is there Zone of Possible Agreement?Learn! Test assumptions!

Key Activity: Shape PerceptionsInfluence by making your proposal superior to their alternativeSet the Frame for your advantageUse anchors with justification

Key Risk: Emotional TrapsPeople are not simply “economically rational”Questionable tactics can poison the deal/relationshipPower plays often lead to escalation



Identify your alternatives. How do you value them? What are the other side’s alternatives? Is there Zone of Possible Agreement? Learn! Test assumptions!

Key Activity: Shape PerceptionsInfluence by making your proposal superior to their alternativeSet the Frame for your advantageUse anchors with justification

Key Risk: Emotional TrapsPeople are not simply “economically rational”Questionable tactics can poison the deal/relationshipPower plays often lead to escalation


The Roosevelt Campaign

1. 1912 – U.S. Presidential election

2. 3 million copies of a photograph have been printed for circulation with Roosevelt’s campaign speech.

3. Campaign manager (for Teddy Roosevelt) discovers that permission to use the photograph had not been granted. No time to reshoot/reprint.

4. Copyright law: owner can demand $1 per copy to use photos.

5. How would you (as campaign manager) handle this?


The Roosevelt Campaign

Campaign manager sends telegram to copyright owner:

“We are planning to distribute millions of pamphlets with Roosevelt’s picture on the cover. It will be great publicity for the studio whose photograph we use. How much will you pay us to use yours? Respond immediately.”

Photographer’s reply:

“We’ve never done this before, but under the circumstances we’d be pleased to offer you $250.”


• The negotiation frame establishes the reference point for various elements of the broader negotiation

• Sophisticated negotiators often focus on defining this frame before exploring any issue or position of the negotiation

Negotiation Frame




Key Activity: Shape Perceptions Influence by making your proposal superior to their alternative Set the Frame for your advantage Use anchors with justification

Key Risk:


The Exchange Game

1. Player A makes an offer

2. Player B accepts or rejects offer and game ends

3. No other communication

4. Accept=split the $20 according to A’s offer; reject=both get $0

5. One time play; Real money at stake!


“I did not earn any money because all the other players are stupid! How can you reject a positive amount of money and prefer to get zero? They just did not understand the game. You should have stopped the experiment and explained it to them…”

Actual subject comment


32 Studies Worldwide

1. Results: Modal offers are fifty percent of the pie: mean is around 40%

Offers less than 25% are commonly rejected

2. The results do not change When the pie is very large (>$100 in US with college student subjects, three months salary in other countries)

When subjects are told other party lives in an entirely different city

When subjects have extensive experience with the game.

Our Brains on Unfairness

Brain Scan after “unfair” offer ($1-$4)

Brain Scan after “fair” offer ($8-$10)

Sanfey, Rilling et al, Science (March 2003)

conflict

disgust

disgust

planning





Key Activity: Shape Perceptions Influence by making your proposal superior to their alternative Set the Frame for your advantage Use anchors with justification

Key Risk: Emotional Traps People are not simply “economically rational” Questionable tactics can poison the deal/relationship Power plays often lead to escalation


Creating Value

Key Preparation: Focus on interests… not just positionsAsk, probe, learn, clarifyMake clear your objectivesIdentify common ground AND differences

Key Activity: Solve their problem as well as yours(Don’t just compromise… Trade on differences)in prioritiesin capabilitiesIn assessments about the future

Key Risk: Cooperating while they’re competingbuilding trustdeveloping relationshipsrelying on reputation


Creating Value

Key Preparation: Focus on interests… not just positions Ask, probe, learn, clarify Make clear your objectives Identify common ground AND differences

Key Activity: Solve their problem as well as yours(Don’t just compromise… Trade on differences)in prioritiesin capabilitiesIn assessments about the future



Creating Value


Key Activity: Solve their problem as well as yours(Don’t just compromise… Trade on differences) in priorities in capabilities In assessments about the future



Creating Value


Key Activity: Solve their problem as well as yours(Don’t just compromise… Trade on differences) in priorities in capabilities In assessments about the future

Key Risk: Cooperating while they’re competing… manage by building trust developing relationships relying on reputation


Agenda1.Key Principles in Negotiation

Prof. Andy WasynczukHarvard Business School Faculty; Former Chief Operating Officer, New England Patriots

2.The New Chair’s Challenges Dr. Vincent Pellegrini

James Lawrence Kernan Professor and ChairDepartment of OrthopaedicsUniversity of Maryland Medical Center

3.The Veteran Chair’s Perspective Dr. Terry Light

Dr. William M. Scholl Professor and ChairHand SurgeryLoyola University Health Systems

4.Q & A

Documents

“So you want to be a Chair?” June 24, 2011 American Orthopedic Association Copyright © President & Fellows of Harvard College. ©Copyright 2011 Andy Wasynczuk