Negotiating Power

Bargaining power

Usually my posts are 100% original, but today I want to talk a Harvard Business School exercise that shows a simple example using the strategy of bargaining power.

Place: Hall of clasesSujetos: 1 - profesor50 - students

The teacher gives each one of his students a red card. A total of 50 cards.

For its part, the teacher has 50 cards in black.

The teacher proposes a deal: School (Harvard) will pay $ 100 for each pair of cards (black - red) you get. (Harvard pays well ...)

Negotiate one on one with each student the distribution of money if they give red card.

Both teacher and each student, have the same bargaining power as 50/50 without each other they have nothing. They can not make money.

The deal clearly and without either party giving is $ 50 USD for everyone. HAVE THE SAME POWER OF NEGOTIATION. The teacher does not make any deals yet.

After seeing this, the teacher calls on all students and in front of them, burning with a lighter black 5 cards.

Re-negotiation have one on one with each student. Now do not give each student can stay as one of the students have not pair (which burned).

So, in seeking not to be out, opting to receive a lower percentage with respect to the teacher. No ... 70/30.

If a student does not seem, may run out of treatment. And not knowing how many students are already out, accessing them.

The teacher could earn in a 50/50 situation: $ 2.500 USD

With a 70/30 situation, even having burned 5 cards wins: $ 3.150 USD

Reflection: If the teacher had burned more cards, students have yielded even more profit. How many cards can burn the teacher to make the most profit?

Now, apply it. Seek to negotiate to have the bargaining power. Although not applicable to every situation. But it is a tool (or weapon) that should always have up his sleeve.

Franco Salzillowww.unemprendedor.blogspot.com