Next I want to think about types of issues in the negotiation and types of negotiations. So we think about different issues in a negotiation. The most simple sort of straightforward ideas, a distributive issue. And by distributive what I mean is one person's gain comes at somebody else's expense. So if I pay you more money that's good for you and bad for me. So price is typically a distributive issue. Integrative issues are issues that might matter more for one person than another. So the vacation time that I get or the rotations I get at work. There are many things that might be more important to one person than the other. And the idea for these integrative issues is we've gotta figure out as a negotiator where they are and how valuable they are to other people. Now we think about the kinds of negotiations we're engaged in. We often think of negotiations as distributive, where one party's gain comes at somebody else's expense. But one of the goals we have is negotiators is to transform negotiations from distributive into integrative negotiations. That is the best negotiators figure out how to add other issues, whether it's timing or a bulk purchase or repeated business or giving reviews, increasing the visibility for somebody else. That is what can we do to make our counterpart better off in ways that expand the pie took me by adding in some other issues. So a great negotiator figures out a way to expand the pie moving away from a simple distributive negotiation, okay? So these issues, there's distributive issues like price or salary, there's integrative issues that matter more to one party than the other. We can also have common interest issues where we both want the same thing. So let's say you're buying a house and we both want an early closing date or in this house example, both the buyer and the seller are happy to leave the large couch. The seller doesn't want to have to move it out and the buyers happy to have it there. So we could have a common interest issue there. Now one key idea about common interest issues is that sometimes people attempted to misrepresent them. So imagine I'm the seller of the house. I have a large couch. I ask you if you want to buy the couch as the buyer and I might misrepresent my interest saying, well, it's really my favorite couch. I really want to take it with me. But I'll tell you what for the right price, you can have it. So I might misrepresent that interest. Or here's an unsavory example that will probably be sticky in memory, sometimes through divorce, both the father and mother wants full custody of the kids or the primary custody kids to be with the mom. But the father might recognize that and say no, I want custody of the children. They might misrepresent that common interest issue to extract concessions from the other party. So in this case the counterpart sort of this mum say no, no, no custody is the most important issue to me. I really want it. And here this sort of unsavory counterpart would say, hey, I'll tell you what that really is super important to me, but I'll give it to you if I get to keep the house, the boat and so on. So people might misrepresent the common interest. Yeah. There are also some issues where people just don't care about those issues, where it's sort of meaningless to me, but I know it's valuable to you, those other interests. And sometimes, as I mentioned before, people might create these idea. So when David Cohen's talking about privatizing trash collection, that's a common interest issue, they both don't want to do that. But he knows he's doing that. There could be other issues they sort of throw in there, where they just don't really care about it. But again, the main issues I want to think about distributive one parties gain is another parties expense. Integrative one party buys at more than the other. And common interest, we both value at the same direction as we think about negotiations. I want to think about two classes of negotiation. We've talked about negotiations as sort of a large set of conversations or getting something from another party. But I want to separate negotiations that are opportunities. So opportunity, negotiations like we're going to form a partnership together. We're going to see if by buying something from you, we might be both better off. Those are opportunities as opposed to disputes. So disputes happen when one party makes a claim, another person rejects it. So disputes are happened when things have gone wrong. So two parties are divorcing or a neighbor's dog came over and ruin your garden. So there's a dispute, something's gone wrong and we need to go resolve that dispute to fix something in disputes, emotions are likely to be much higher. And we've gotta figure out how to focus on the problem when it might be easy for us to get distracted by what I'm upset about in that one issue. Now, for the opportunity side, we can think about the distributive negotiations. We talked about adding an issues to transform it to an integrative negotiation. We can think about multi-party negotiations. We can think about team-based negotiations and these different types of negotiations have more complexity. I just want to add one other idea here about differences. Where I mentioned distributive, integrative and common interest when we find differences, that's great. In a negotiation, if we have differences, say in beliefs or differences in values, we can exploit those differences to create value. So if one side has a difference in timing preferences. So somebody wants money upfront and other parties more patient, we can create value. That's an integrative issue. If we have differences in beliefs. So I'm selling you my business. I think sales are going to rise. I think revenue is going to increase dramatically and you're not as convinced about that, that difference in beliefs should create opportunity. So we can create what's called contingent contracts. So we say, look, we have differences in beliefs about what revenue is going to be like next year. Why don't we include a bonus payment based upon that outcome? And that bonus payment, the likely of getting that bonus payment, I think that's really high. And so I'm counting it as almost for sure money, you're counting it as very low. It's very unlikely to happen. And so we're trading off on these differences in beliefs, we're exploiting that difference to create value. So contingent contracts, like if this happens, then here's what the payment is. Those contingent contracts can really create a lot of value in negotiations. We find space that we couldn't see before. So we might get otherwise hung up about this difference and beliefs, but I would suggest that we can look to that as an opportunity to create value, okay? Finally, we think about leverage in negotiation. We talk about power coming from our partners. We could also have power to make somebody else better off or worse off. That's positive and negative leverage. We can also think about leverage about what's fair, what the precedents are, we'll call that normative leverage. So what standards are out there, what precedents are out there that would favor one outcome or another. And in cases when we often lack power, looking for normative leverage could be a way for us to assert. Hey, this is fair. Here's the precedent, everybody wants to be fair. And so that could help us be persuasive in a negotiation when we lack otherwise formal power.
