Bargaining for Advantage: Negotiation Strategies for Reasonable People

2006·1.3 MB·English

by  G. Richard Shell

Table of Contents
Title Page
Copyright Page
Dedication
Preface to the Second Edition
Acknowledgements
Introduction

PART I - THE SIX FOUNDATIONS OF EFFECTIVE NEGOTIATION
Chapter 1 - The First Foundation: Your Bargaining Style
Chapter 2 - The Second Foundation: Your Goals and Expectations
Chapter 3 - The Third Foundation: Authoritative Standards and Norms
Chapter 4 - The Fourth Foundation: Relationships
Chapter 5 - The Fifth Foundation: The Other Party’s Interests
Chapter 6 - The Sixth Foundation: Leverage

PART II - THE NEGOTIATION PROCESS
Chapter 7 - Step 1: Preparing Your Strategy
Chapter 8 - Step 2: Exchanging Information
Chapter 9 - Step 3: Opening and Making Concessions
Chapter 10 - Step 4: Closing and Gaining Commitment
Chapter 11 - Bargaining with the Devil Without Losing Your Soul: Ethics in Negotiation
Chapter 12 - Conclusion: On Becoming an Effective Negotiator

Appendix A: - Bargaining Styles Assessment Tool
Appendix B: - Information-Based Bargaining Plan
Notes
Selected Bibliography
For Further Information
Index
FOR THE BEST IN PAPERBACKS, LOOK FOR THE
Praise for Bargaining for Advantage
“Readers interested in developing or refining their negotiation skills should run, not walk, to the nearest
bookstore for a copy of Bargaining for Advantage. . . . It belongs on any list of required reading for
practitioners or educators in the field of negotiation and is also highly recommended to the general public.”
—Alternative Dispute Resolution Report

“Not only is Professor Shell’s book one that no business man or woman should overlook, it is also very
readable and enjoyable ... regardless of what business you’re in, this is one of those invaluable tools to make
use of over and over again.”
—The Update

“Whether you’re buying a car, trying to get the kids into bed, or brokering a major business deal, Bargaining for
Advantage teaches you to think on your feet and discover imaginative ways to come to terms with anyone.”
—Laurie Calkhoven, editorial director, The Money Book Club

“Articulate, well-researched and tightly organized.... A smart, readable, helpful and nicely different take on
negotiations.”
—The Pennsylvania Gazette

“A new book that could really shift your sensibilities about the art of negotiation—taking out the mystery and
replacing it with a success ‘toolbox’ ... A volume that gives direct and practical fundamentals to becoming an
effective bargainer in any situation.”
—Business Digest

“When it comes to negotiation, Richard Shell at Wharton is the best. His book and workshop show how to play
the game without giving up your self-respect or threatening the other party’s self-esteem. Bargaining for
Advantage is a must for everyone who wants to feel more comfortable and effective at the bargaining table.”
—Max J. Garelick, president and CEO, Perry Ellis International

“Packed with well-selected examples of negotiating strategies from the business world and fascinating cultural
observations, Bargaining for Advantage details every aspect of the fine art of negotiating. Should be required
reading for anyone who is about to make a deal.”
—Ann McLaughlin, chairman, The Aspen Institute

“Wise, persuasive, and entirely readable, Bargaining for Advantage provides practical step-by-step advice for
negotiators who want to bargain effectively without compromising themselves or their values.” —Michael
Wheeler, Harvard Business School, coeditor of The
Negotiation Journal
“Tightly written, entertaining, and smart, Richard Shell’s Bargaining for Advantage is a must read for anyone
seeking greater insight into the art and science of negotiation.”
—Judith Rodin, president, University of Pennsylvania, professor of psychology, psychiatry, and medicine

“Richard Shell’s book is the first step toward going into a negotiation with confidence. His logical and specific
advice is extremely helpful for any businesswoman trying to succeed in a negotiation with both skill and
grace.”
—Hilary B. Rosen, president and CEO, Recording Industry Association of America

“Bargaining for Advantage delivers just the sort of real world tools we are constantly looking for at Compaq to
help our managers negotiate and form alliances more effectively. Research-based but highly accessible, Richard
Shell’s work will become a cornerstone in our negotiation training efforts.”
—Myles A. Owens, director, Strategic Alliances and Partnership, Compaq Computer Corporation

“Richard Shell is known to be a star teacher of negotiation. His expertise comes through in this book ... a
wonderful integration of practical advice that will be useful to all readers.”
—Max H. Bazerman, Gerber professor of dispute resolution and organization, Kellogg School of Management at
Northwestern University

“Shell’s insights as a scholar, and his years of experience as a negotiation teacher at one of the world’s leading
business schools, come together on every page of this very readable book. The writing is clear; the ideas are
sound; and the narrative is crisp and compelling. The book is rich in cogent observations and vivid examples
that help connect academic bargaining concepts to the real-world arenas in which they play out.”
—Stanford University Professor Roderick M. Kramer in The Negotiation Journal
PENGUIN BOOKS
BARGAINING FOR ADVANTAGE
G. Richard Shell is the Thomas Gerrity Professor at the Wharton School of the
University of Pennsylvania, where he is academic director of the Wharton Executive
Negotiation Workshop. BusinessWeek’s biannual “Guide to the Best Business Schools”
named him three times as one of the nation’s top business school professors. He consults
widely and trains business executives, nonprofit leaders, and government officials from
all over the world to be more effective negotiators. He lives with his wife and two sons
near Philadelphia in Wynnewood, Pennsylvania.

PENGUIN BOOKS
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First published in the United States of America by Viking Penguin,
a member of Penguin Putnam Inc. 1999
Published in Penguin Books 2000
This edition published 2006

Copyright © G. Richard Shell, 2006 All rights reserved

Grateful acknowledgment is made for permission to use the following selections, which have been adapted for this
book: “When Is It Legal to Lie in Negotiations?” by G. Richard Shell, Sloan Management Review; “Bargaining Styles
and Negotiation: The Thomas-Kilmann Conflict Mode Instrument in Negotiation Training,” by G. Richard Shell,
Negotiation Journal.

PUBLISHER’S NOTE

eISBN : 978-1-101-22137-2
1. Negotiation. 2. Persuasion (Psychology). I. Title.
BF637.N4S44 2006
302.3—dc22 2005056636

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http://us.penguingroup.com
For Robbie, Ben, and Ned,
who have taught me so much.
Preface to the Second Edition
It is with real pleasure that I offer this second edition of Bargaining for Advantage. I
wrote this book in the late 1990s because I was dissatisfied with the existing set of works
for serious students and practitioners of this fascinating process we call negotiation. I
wanted a book that would explore the immense variety of real-world negotiations,
provide both historical context and a social science foundation for dealmaking, and be
fun to read. The appearance of this new edition and the many foreign translations of this
work (more than ten at last count) suggest the book hit its mark.
So why improve on something that works? Four reasons. First and foremost, a new
edition gives me a chance to share with readers a new Bargaining Styles Assessment
Tool, which can be found in Appendix A. I believe that many negotiators have
distinctive talents, strengths, and weaknesses rooted in personality. These traits are not
set in concrete, but they generate biases and preferences that strongly affect how they
behave at the bargaining table. I designed this bargaining styles assessment instrument to
probe such negotiation instincts. By including my new test here, along with a
standardized grid for evaluating your results in comparison with those of more than
1,500 executives from all over the world, I hope readers can come away from the book
with a deeper understanding of the kind of negotiator they are when they are at their
best.
The second reason for a new edition has to do with advancing communication
technology. At the time I was writing Bargaining for Advantage, the world had not yet
become as dependent as it is now on Internet-enabled electronic communication systems
such as e-mail and instant messaging. This second edition gives me a chance to directly
address the perils and promise of electronic negotiations, which I do in Chapter 7. This
same chapter also features a new section on using agents in the bargaining process, an
important topic I neglected earlier.
Third, I have become more aware since publishing the first edition of the importance
of gender and culture as negotiation variables. I therefore address these topics in Chapter
1 in more detail than before. The publication in 2003 of Linda Babcock’s and Sara
Laschever’s Women Don’t Ask: Negotiation and the Gender Divide helped clarify the
gender issue in a particularly helpful way.
Finally, this edition gives me a chance to edit and supplement a variety of stories,
research studies, and topics that will keep the work fresh. Close readers of the first
edition will notice a number of such changes and updates. Throughout, however, my
intention has been to leave what has worked well largely intact.
A number of readers and fellow negotiation teachers who use the book in classes
kindly offered suggestions for this edition. Some of my colleagues at the Wharton
School, especially professors Maurice Schweitzer, Rachel Croson, Ken Shropshire, and
Jennifer Beer, offered ideas and perspectives. Professor Alice Stuhlmacher of DePaul
University generously shared both her ideas and her research on the controversial issue
of gender and negotiation. I am also grateful for suggestions from the negotiations
teaching faculty at the Stanford Law School. Silicon Valley lawyer (and friend) Ralph
Pais was especially helpful. Special thanks go to Chris Guthrie, a law professor at
Northwestern University, whose influential book review of Bargaining for Advantage
introduced it to law school audiences. I could not give legal negotiation the treatment it
deserves without distorting the focus of this book, but I invite readers seeking more
specialized knowledge in this area to consult the excellent Beyond Winning: Negotiating
to Create Value in Deals and Disputes by law school professors Robert H. Mnookin,
Scott R. Peppet, and Andrew S. Tulumello.
With that said, I present this new edition. I sincerely hope it guides you on one of the
most interesting (and potentially profitable) journeys that life has to offer—the journey
toward effectiveness in all of your negotiations.

—G. RICHARD SHELL