Negotiating Case — the Beatles
In a situation when a person is a manager of a promising young band, one needs to be extremely cunning and cautious in order to win the best possible conditions for the ensemble and avoid making a bad bargain.
A band manager/negotiator like Brian Epstein would need to take several steps.
The first step would be identifying the amount and range of power that his opponents possess. Otherwise, it is impossible to cooperate with a contractor that a manager does not thoroughly understand. In other words, the manager has to assess the intimidation that the other negotiating party is able to inflict upon him. According to Dawson (2012), there are eight factors that can cause you to “blink first”: legitimate power, reward power, coercive power, reverent power, charismatic power, expertise power, situation power and information power (p.61). Most often, the opponent possesses an amalgam, a mixture of several of these power leverages. The primary goal is to discover how one can minimize the influence of each of these. For example, if the opponent has a high-profile situation advantage, one needs to postpone the meeting to enter the next round more prepared. If the other negotiating party pressurizes one with charismatic persuasive powers, it might be a good idea to ask somebody as powerful to accompany a manager the next time to balance the situation. In this manner, one avoids informational and power asymmetry.
Bracketing is the next step the manager must take. This involves naming an excessive price, which is more than the desired one by about 20 per cent, at the very beginning. Therefore, an effective negotiation manager will attempt to make the other side name their price and commit to the project first, in addition to holding the discussion over the price within the acceptable range.
Also, Epstein in his situation could have resorted to playing dumb to get smart, if only his ego had not kept him from doing it. By pretending to experiences lack of information and not have the decision making authority, the manager gets the other party to relax, lose vigilance and maybe expose some of the hidden agenda and strategies. At least Epstein should have stood against the aggressive cherry-picking tactics that the United Artists Company obviously used. They certainly analyzed the pros and cons of each option.
It is useful to scrutinize the two parallel or counter approaches for negotiation, for instance “Avoid Confrontational Negotiation” and “Good Guy/Bad Guy”, or, as a variant, “Vise Gambit” versus “Asking for a Trade-Off”. The first couple is absolutely controversial. Where an adept of “Vise Gambit” utters “You have to do better than that” position falls into silence, the “Trade-Off” negotiator tries to keep the conversation going in the tempo of a brainstorm to keep his opponent from thinking too much and regaining shrewd judgment.
There are 5 basic skills that a person needs to effectively negotiate with individuals mentioned in the model scenario. The first skill is analytical thinking. Dawson (2012) exemplifies this ability as follows:
Gambit is a chess term meaning any maneuver for advantage. We gain power in the negotiating process by learning the rules of the game, how and when to apply them, and how to recognize and defend against them when they are used against us. (p.17).
Therefore, a manager, who wants his band to be successful, needs to see the bigger picture, notice and analyze the strings that are being pulled in order to act accordingly.
The second skill one needs is basic fairness. Some Machiavellian-style coaches and negotiators might argue on this point, claiming that it is acceptable to distort the truth in order to win over and that the ends will justify the means. However, in a long-term perspective this is a losing strategy, because unfair play and dirty tactics devoid one of the first and foremost asset in this industry, which is reputation. Thus, negotiating must be fair and truthful.
The third skill is more of a practical trained ability that is an inherent trait of character: rhetoric, also known as public speaking skills or eloquence. One cannot underestimate the power of persuasion, because with its help even a manager of a new unknown band can result in a very advantageous contract. If this kind of verbal communication is trained on the unconscious level, then adequate reaction or attention is likely to take place. Simon Garrod from the University of Glasgow mentions that unconscious mimicry of speech rate and emotional language can display how much this person is admired by others (Bower, 2010). The recent study has shown that there is a unanimous interpretation of communication interdependence.
The fourth skill is creativity. It seems that this ability is crucial for virtually every realm of human activity. The manager needs to be able to look at things at a different angle and not engage into the mind playing games that the opponent will probably try to impose. The good manager comes to the negotiating meeting with a certain plan in mind and an agenda. In case he realizes within the course of conversation that the tactics needs to be changed, then he should change them. Creativity in this case borders with flexibility and enables one to react more swiftly to the ever-changing environment.
Last but not least, skill is patience. A negotiator has to be patient enough not to be provoked or pressurized. It would be a major mistake to initiate the process too soon or to push the contractors too hard to accept the presented conditions. This would create an undesirable impression that the manager is too desperate, while the image has to be radically different: the reluctant buyer.
The paradigm for promotion of this promising new band needs to be the following: rationality, flexibility and ethics. There has to be a specific plan for negotiating. First of all, the manager defines the maximum and the minimum acceptable conditions for the band. Secondly, he tries to find out what those indicators would be for the other party. Afterwards, a reluctant buyer tactic should be used. If this does not work, the manager should try playing dumb to get what he wants. This might take several rounds of discussions. When the consensus if finally reached, it is crucial to read the drafted contract to the final letter and, more importantly, not leave the contract-making to the other party. This is done in order to avoid misunderstandings and have control over the situation.
It is vitally important for the manager of the band to grasp the right and privilege to draft the contract and to win over in negotiations. At first sight, this seems to be conventional wisdom that is taken for granted. However, some managers wrongly and foolishly disregard this task based on the assumption that a good product sells itself. It is a serious mistake, because if one does not control a bilateral process, it will inevitably be controlled by the other party. A good manager has to make a clear understanding with the record label that the represented band is a profitable bargain that cannot be exploited. The band knows its price and will stick to it. A correct behavior model must be selected or developed. The researchers distinguish five styles of negotiations, such as accommodating, avoiding, collaborating, competing and compromising. During accommodating each party should employ body language and verbal signals. In case of avoiding the parties are usually not interested in reaching the common agreements, but mostly in defending their positions on the market (Churchman, 1993). This way the international delegates are often involved in criticizing, speculating and discussing of controversial aspects. If the parties want to develop the collaboration, they should be able to transform their simple plans into complex ones. When competing, both parties are seen to neglect the importance of relationships, preferring to dominate during the bargaining process.
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