MARSHALL SCHOOL OF BUSINESS
UNIVERSITY OF SOUTHERN CALIFORNIA
MOR 569: Negotiation and Deal-Making
Spring 2008
F 2:00-4:50pm JKP202
Professor Peter Carnevale
Office hour: 4:00-4:30pm M & W, or by appointment
Office:
E-Mail:
620 HOH
peter.carnevale@marshall.usc.edu
COURSE DESCRIPTION
Negotiation is the art and science of creating agreements between two or more parties. This
course is designed to improve your skills in negotiation, persuasion, deal-making, and dispute
resolution. This course has two purposes. First, we will discuss and apply theories developed as
guides to improving negotiation (the science). Second, students will develop and sharpen
negotiating skill by actually negotiating with other students in realistic settings (the art).
We will look at negotiation and mediation as it is practiced in a variety of settings; the course is
relevant to the broad spectrum of negotiation problems that are faced by managers and
professionals who negotiate in domains as diverse as marketing, real estate, consulting,
entrepreneurship, mergers and acquisitions, and political leadership. In addition, the course will
cover negotiations that occur in the daily life of the manager. Each week, we will cover an aspect
of negotiation in depth, explicate some key issues, discuss the reading, and examine critical
issues that have been raised with regard to your experience.
This course is designed to complement the skills learned in other courses at Marshall. A basic
premise of the course is that while analytical skills are vital to the discovery of optimal solutions
to problems, businesspeople need a broad array of negotiation skills to get those solutions
accepted and implemented. The course will provide participants the opportunity to develop those
negotiation skills through direct experience and to understand negotiation in useful analytic
frameworks.
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COURSE OBJECTIVES
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To understand and think about the nature of negotiation. This objective is paramount
because many of the important phenomena in negotiation, e.g., interests, goals, and
cooperation, are ambiguous and often do not have “right” answers - we cannot teach a set
of formulas that will always maximize your profit (although they might help).
To gain a broad intellectual understanding of a set of central concepts in negotiation.
These concepts will be the building blocks from which we can systematically understand
and evaluate a negotiation process.
To develop confidence in the negotiation process as an effective means for resolving
conflict in organizations.
To improve analytical abilities in understanding the behavior of individuals, groups, and
organizations in competitive situations.
To provide experience in the negotiation process, including learning to evaluate the costs
and benefits of alternative actions and how to manage the negotiation process.
COURSE FORMAT
The course is built around a series of negotiation exercises and debriefings. All exercises require
some preparation in advance. Students are expected to be fully prepared for these exercises prior
to class and to participate in the debriefings. While some class time will be provided when group
preparation is required, students may occasionally have to meet outside of class face to face or
online.
COURSE MATERIALS
These are required:
1. Fisher, R., Ury, W., and Patton, B. (1991). Getting to Yes. New York: Penguin.
2. Cialdini, R. (2001). Influence: Science and Practice (4th ed.). Boston, MA: Allyn and
Bacon.
3. Shell, G. R. (2006). Bargaining for Advantage: Negotiation Strategies for Reasonable
People. 2nd edition, Viking Press/Penguin Books: New York.
4. Course Case Packet (Order Online: http://www.universityreaders.com/students). This will
not look like much, but it covers the licensing fees for all the negotiation exercises for the
class. Five of the cases have “general information” pages in the packet, and you will
need to bring these to class on the appropriate days. You must buy this.
5. A few articles and handouts in class or downloaded from Blackboard. These will include
just a few noteworthy papers such as Carnevale (2006), Follett (1940).
6. Recommended (but no need to buy): Thompson, L. L. (2005). The mind and heart of the
negotiator (3rd ed.). Upper Saddle River, NJ: Prentice-Hall.
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COURSE REQUIREMENTS: Five Parts
1. Attendance and Participation (25%; 3 areas as indicated below)
(15%) This is for preparation and execution of the exercises, and contribution to debriefing
discussions. Being here is key. Your preparation involves having completed the assigned
readings and prepared the negotiation exercise for that day. Since I try to observe as
many negotiations as possible, it is often quite obvious when a student is not prepared.
This harms your negotiation partner’s experience as well as your own, and will be noted
by me, and taken into account in the final assignment of preparation scores. To facilitate
this, when possible, for observing a group’s negotiation, I will be stationed in the 3rd floor
ELC room A, inside and to the left of the door. You may negotiate in this room, and get
my comments on your negotiating style (just once so that everyone gets this opportunity).
Also, you can have ELC video parts of your negotiation (15 min max, please), and I am
happy to meet with you to give you feedback on that.
When negotiating, you must follow all the instructions that are provided for your role.
However, you do have freedom to be creative in how you interpret this information and
the kinds of strategies you employ, provided that they do not contradict any of the
explicit instructions or fundamentally alter the negotiation’s structure.
Participation in class discussions involves active participation that contributes to the
class. Active participation means asking questions, answering questions, making
observations, commenting on other students’ comments, or challenging a view. The
second requirement is that what you say actually contributes – merely repeating
comments made by other students or telling the class that you agree with what someone
else said does not count. Your comments should move discussion forward. If you are shy,
prefer to sit quietly in the back, or just do not feel comfortable speaking in front of your
classmates, my suggestion is that you see this class as a challenge to improve those skills.
Note: This course has a strict attendance policy. You must provide prior notice to
the instructor if you have to miss a negotiation. If you do not provide such notice,
your negotiating partner for the day is left hanging and many people can end up
being inconvenienced. If you miss a negotiation without prior notice to the
instructor, you will be penalized in the final grading of the course. Even if you do
provide prior notice, but miss multiple classes, you may also be penalized.
This syllabus contains the dates for all negotiation exercises. This schedule will not be
changed. If you need to miss an exercise, please refer to the latest version of the posted
role assignments for that case, contact your assigned partner(s) to see if alternative
arrangements can be made for negotiating the case [i.e., either with those partner(s) or
with other classmates who have been assigned the requisite role(s) and who would be
willing to switch with your assigned partner(s)] and inform me via e-mail regarding the
outcome of these efforts. You must notify me of your absence from class, and any
arrangements you have made with regard to this absence, at least 24 hours before the start
of class so I can make the necessary classroom adjustments.
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(5%)
Professionalism. Professionalism – in word and in behavior – is a critical part of any
business situation. Here, it includes: 1. On-time arrival for class; 2. In-class comments:
constructive vs. destructive; pithy vs. long-winded...; 3. On-time completion of tasks; 4.
Respecting the norms of the class.
(5%)
Negotiation Report. This assignment is to go out and actually negotiate for something,
bring the object (or a representation of the object) with you to class, write a oneparagraph description of the negotiation process and verbally describe it to the class.
Negotiating for services is fine as well. This assignment must be completed by the 3rd
week of the semester, and we will cover them during a class (the date for this will be
announced in class and posted on Blackboard. Some ideas for where you can find
negotiable items for sale include: Flea markets, garage sales, electronics shops, other
retail stores. I don’t want you to go out and buy something you wouldn’t already have
bought, but instead try to negotiate for a purchase you’re planning to make for which you
otherwise would have simply paid the posted price. When you have negotiated for your
item, write a one-paragraph description of the negotiation process, and bring it in. I’ll
announce the class when we will discuss these, a week in advance.
2. Peer feedback papers (15%)
A 1-2 page evaluation of your self and your counterpart(s) is required for 2 negotiations in which
you have participated (i.e., a negotiation for which you have an excused miss will not require this
paper). Copies of each evaluation should be submitted both to me and your counterpart(s) by the
start of the following class session. These evaluations are assigned to provide meaningful,
personalized, and constructive feedback to your classmates and help them improve their
negotiation skills. I’ll announce (in class, on Blackboard) the 2 negotiations and dates for this.
It will be one early, and one toward the end of the semester. Here is a list of possible topics /
issues you may cover in your feedback:
a) Preparation: Did they prepare adequately for their role (i.e., know the content)? Did they play
their role convincingly?
b) Listening skills: How carefully did they listen? Did they interrupt in ways that were
frustrating? Did they create an atmosphere that encouraged you to divulge your interests?
c) Communication skills: Did they communicate their own interests clearly? How effectively /
persuasively did they present their claims?
d) Critical statements or tactics that benefited or hurt the negotiation: Did they do or say
anything that created suspicion (or put you at ease)? Were there any inconsistencies or
contradictions that caused problems?
e) Body language: (e.g., eye contact, body posture, gestures, revealing ticks)
f) Overall impressions: (e.g., of their effectiveness, confidence, competitiveness,
cooperativeness, competence, integrity, trustworthiness); strengths and liabilities? What type
of agreement was reached?
g) Suggestions for the future: What could they have done differently? How to improve their own
performance? How to improve your collective performance?
3. Midterm Exam (20%)
There will be a midterm exam halfway through the course that will have an in-class and a takehome part. The exam will cover the concepts discussed in class, as well as the readings assigned
to date, and will ask you to analyze a negotiation(s) and/or a deal(s).
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4. Group Project: Paper and Presentation (30%)
A group project and group paper is required, along with a class presentation of it at the end of the
semester. The paper should contain about 15 pages of focused, thoughtful, and insightful
analysis, in addition to the couple of pages necessary to describe the situation or setting. The
target length for the paper is twenty pages of 12 point, double-spaced text. The optimal group size
will be based on the number of students enrolled.
For the project, analyze real-world agreements. This may be one, or several, in which you have
personal knowledge, or have access to participants, or you think is important. Papers usually take
a couple pages to set up and describe the situation. Such papers then concentrate on analysis.
What kind of agreement was it? What were the parties’ interests, what went wrong/well, why?
What could have been done differently? How was the process linked to the outcome?
There will be a handout that provides greater detail on the project; you may negotiate a format
with me. Please turn in a paragraph of your topic for approval and feedback by Week 6.
(10%) Team Presentation. Grading of the presentation will focus on the clarity, style, and
overall effectiveness of your presentation with regard to conveying the learning points of
your group project.
(20%) Team Paper. Grading of the paper will focus on your ability to use concepts from class
to analyze a negotiation and agreement, as described above, and offer thoughtful insights
that can help readers understand the case in question. I expect all members to contribute
equally to the team project and paper. The highest possible individual grade is the group
project grade. If you contribute less than other team members, your individual grade will
be lower than the group grade. At the end of the semester, you will have the opportunity
to evaluate the performance of your team members, and I will consult those evaluations
in determining your individual grades for the group project.
5. Negotiation Performance (10%)
I’ll take the outcome of two of your in-class negotiations and transform that into a grade, that is,
you get points based on how good a deal you made for yourself. Typically you will play one of
two or more roles in a case, e.g., a buyer or a seller. The numerical performance of a student
assigned as buyer will be compared with the performance of other buyers. Let X denote the
numerical measure of our buyer's performance (e.g. value for the item minus price paid). The
buyer's graded score for X is given by the following formula:
Score (X) =
X - Lowest X
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Highest X - Lowest X
This formula assigns the buyer in the class with the lowest X a score of 0 and the buyer in the
class with the highest X a score of 1. All other scores will be between zero and one. A similar
normalization will apply to sellers: the lowest-earning seller receives a score of 0, the highestearning seller earning a score of 1; all other scores being between 0 and 1. Combining a student’s
scores across the 2 graded cases determine the aggregate case grade. The aggregate case grade
will constitute 10% of your course grade. Which 2 cases will get graded?
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COURSE GRADING
Grades for the class will be assigned according to the percentage distribution outlined above. At any time
during the semester you may inquire about your participation score, and I will tell you how you are doing.
At the end of the semester, I look very closely at students that are close to any cutoff between two grade
categories, and try to find a way to boost any such students into the higher category. Because I reserve
this flexibility, you will not be able to ask me questions like "what score do I need to get on the final
project to get the following grade?" This is not something to worry about, it is designed to help you.
In the event of a grading dispute - which would most likely occur following the midterm or the final
project - the procedure is as follows: (1) Think hard about why you believe your grade should have been
different. (2) Write down the reasons why you believe your grade should be changed. (3) Send me the
written explanation via e-mail, and I will respond to it as quickly and fairly as possible.
One final note: I will not accept 'retroactive excuses' by students. By this I mean students bringing up
ameliorating circumstances to justify their poor performance at the end of the semester. If there are
unique or unusual circumstances that prevent you from doing as well as you normally might -- such as
illness or death in your family, a mental or learning disability, a struggle with chemical dependence, etc.;
you must inform me immediately. I make no guarantees as to what is acceptable and what is not, but I
encourage you to communicate any problems to me.
Students with Disabilities
Any student requesting academic accommodations based on a disability is required to register with
Disability Services and Programs (DSP) each semester. A letter of verification for approved
accommodations can be obtained from DSP. Please be sure the letter is delivered to me (or to your TA) as
early in the semester as possible. DSP is located in STU 301 and is open 8:30 a.m. - 5:00 p.m., Monday
through Friday. The phone number for DSP is (213) 740-0776.
Viewing of your negotiation videos:
If your negotiation is video-recorded, make sure to fill out a recording slip and write down the record
number. This will allow you to store and retrieve the video for later viewing. ELC videos are stored at
JKP 201K. At this location there is one dubbing station in JKP 201K, and another in the Dean's
Boardroom. Viewing (not dubbing) can also be done in the JKP ELC rooms on the second and third
floors. These rooms are first come-first served, unless a reservation was made online 24 hours in advance
at (www.marshall.usc.edu/vems). Viewing can also be done at the Keck Center (BRI 200).
Academic Integrity Policy: The Marshall School is committed to upholding the University’s Academic
Integrity code as detailed in the SCampus Guide. It is the policy of the Marshall School to report all
violations of the code. Any serious violation or pattern of violations of the Academic Integrity Code will
result in the student’s expulsion from the degree program. It is particularly important that you are aware
of and avoid plagiarism, cheating on exams, fabricating data for a project, submitting a paper to more than
one professor, or submitting a paper authored by anyone other than yourself. If you have doubts about any
of these practices, confer with a faculty member. Resources on academic dishonesty can be found on the
Student Judicial Affairs Web site (http://www.usc.edu/student-affairs/SJACS.) The “Guide to Avoiding
Plagiarism” addresses issues of paraphrasing, quotations, and citation in written assignments, drawing
heavily upon materials used in the university’s writing program; “Understanding and avoiding academic
dishonesty” addresses more general issues of academic integrity, including guidelines for adhering to
standards concerning examinations and unauthorized collaboration. The “2005-2006 SCampus”
(http://www.usc.edu/scampus) contains the university’s student conduct code, etc.
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COURSE OUTLINE
Please download PowerPoint lecture notes, for easy note-taking in class.
Week 1.
Week 2.
Week 3.
Jan. 18
Introduction to Negotiation
Read:
Shell, Introduction, Chapter 1: Your Bargaining Style..
Fisher, Ury, & Patton, Getting to Yes (yes, all of it)
Class:
Introduction to the Course
Prepare Sugar Bowl
Negotiate Sugar Bowl
Debrief Sugar Bowl
Jan 25
Value Claiming vs. Value Creating (ELC available)
Read:
Shell, Chapter 2: Goals and Expectations.
Shell, Chapter 3: Authoritative Standards and Norms.
Shell, Chapter 4: Relationships.
Finish reading Fisher, Ury, & Patton, Getting to Yes (all of it)
Class:
Prepare Coffee Contract
Negotiate Coffee Contract
Debrief Coffee Contract
Feb. 1
Integrative Bargaining: Creating Value (ELC available))
Read:
Shell, Chapter 5: The Other Party’s Interests.
Shell, Chapter 6: Leverage.
Carnevale (2006). Creativity in the outcomes of conflict.
Follett (1940). Constructive conflict.
Class:
Prepare New Recruit
Negotiate New Recruit
Debrief New Recruit
Prepare Texoil
Negotiate Texoil
Debrief Texoil
Week 4.
Feb. 8
Personality in Negotiation; Emotion (ELC available)
Read:
Shell, Chapter 7: Preparing Your Strategy.
Shell, Chapter 8: Exchanging Information.
Shell, Appendix A: Bargaining Styles Assessment.
Class:
Prepare Viking
Negotiate Viking
Debrief Viking
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Week 5.
Feb. 15
Lies in negotiation and detecting lies (ELC available)
Read:
Shell, Chapter 9: Opening and Making Concessions.
Shell, Chapter 10: Closing and Gaining Commitment.
Thompson, Appendix 2: Nonverbal Communication and Lie Detection.
Class:
Prepare At Your Service
Negotiate At Your Service
Debrief At Your Service
Feb. 22
Power, persuasion, influence (ELC available)
Read:
Cialdini, Influence: Science and Practice (yes, all of it)
Class:
Video: Canadian UAW/GM Strike
Turn in:
Group Project Paper Topic
Feb. 29
Ethics in Negotiation (ELC available)
Read:
Shell, Chapter 11: Ethics.
Class:
Prepare Bullard Houses
Negotiate Bullard Houses
Debrief Bullard Houses
Mar. 7
Team Negotiation (ELC available)
Read:
Teams handout.
Class:
Prepare Chestnut Drive
Negotiate Chestnut Drive
Debrief Chestnut Drive
Mar. 14
Technology in Negotiation (ELC available)
Read:
Communication handout.
Class:
Prepare Hollywood
Negotiate Hollywood
Debrief Hollywood
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Week 6.
Week 7.
Week 8.
Week 9.
Demo of online negotiation sites: Onlineresolution.com,
smartsettle.com, interneg.org, squaretrade.com, cybersettle.com, …
™ Midterm Exam: Take-Home part is due; in class part occurs (on the 14th).
Note: March 21: No Class – SPRING BREAK
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Week 10.
Week 11.
Week 12.
Mar. 28
Cross-Cultural Negotiations (ELC available)
Read:
Culture handout.
Class:
Prepare Mouse
Negotiate Mouse
Debrief Mouse
Apr. 4
Negotiating in a Long-Term Relationship (ELC available)
Read:
Look at Shell, Chapter 4, again.
Class:
Prepare ABC / Local 190: 1978 Negotiation
Negotiate ABC / Local 190: 1978 Negotiation
Apr. 11
Negotiating in a Long-Term Relationship (cont) (ELC available)
Class:
Prepare ABC / Local 190: 1983 Negotiation
Negotiate ABC / Local 190: 1983 Negotiation
Prepare ABC / Local 190: 1985 Negotiation
Negotiate ABC / Local 190: 1985 Negotiation
Week 13.
Week 14.
Week 15.
Apr. 18
Claiming and Creating Value, Revisited (ELC available)
Read:
Shell, Chapter 12: Conclusions.
Thompson, Appendix 4: Negotiating a Job Offer.
Class:
Video: American Dream
Debrief ABC / Local 190
Apr. 25
Mediating Deals and Disputes (ELC available)
Read:
Carnevale (1986), Strategic choice in mediation.
Class:
Prepare Quickstop Mall
Negotiate / Mediate Quickstop Mall
Debrief Quickstop Mall
May 2
Grand Finale! Group Presentations in Class
™ May 7: Final Paper and Group Evaluation Form Deadline
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