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Posts Tagged ‘Negotiations

Pareto is a great Italian and why YOU could do better in negotiations!

The Pareto principle (also known as the 80-20 rule, the law of the vital few, and the principle of factor scarcity) states that roughly 80% of the effects come from 20% of the causes. Business management thinker Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed in 1906 that 80% of the land in Italy was owned by 20% of the population; he developed the principle by observing that 20% of the pea pods in his garden contained 80% of the peas. It is a common rule of thumb in business; e.g., „80% of your sales come from 20% of your clients.

Kurt Rohner, a master negotiator for almost two decades, transfers and applies the Pareto principle to negotiations. The first question is: “How much time do you need to invest to the gain know-how of negotiations, to multiply your own capability of negotiating by at least four times?”

The fundamental knowledge is to understand the nature of negotiations with the 4D-Model. Any negotiation, in business, in private life, in conflicts of any kind or even in court proceedings is tied to four dimensions. The first and root dimension is the interest of the involved parties. Parties may be single people, companies or organizations such as unions, political parties or states. Only the overlap of interest between parties defines a common ground as a prerequisite for any negotiation. The common interests define the substance, the content of negotiations as the second dimension in negotiation. Since there are always two or more parties involved the relationship between the parties define the third dimension of any negotiation. The fourth dimension is the process of the negotiation to obtain an agreement.

Understanding the 4D-Model of interest, substance, relationship and the process will give any negotiator a simple map to navigate any kind of negotiation.

In his speech Kurt Rohner will present the 4D model as a base for understanding how to achieve better results in negotiations.

In the substance dimension there are two fundamentally different approaches to reach agreement. The most common and widely ingrained style is the bargaining. Some people call it the bazaar-method to divide one point in discussion. In the orient this method is cultivated to reach agreement on prices on goods traded. This distributive approach in negotiations is a good and efficient method if one single item is under discussion. However in the complex world of today many negotiations embrace several points to negotiate. Having multiple issues to negotiate this method does not produce satisfactory results to any party.

A complete different approach any business person to be familiar with, is the integrative method. Often this method is referred to as the Harvard-Principle. Kurt Rohner will demonstrate and explain the integrative method in an easy to understand and fast to apply method. It is the story of four women haggling for two eggs.

If you are ready to invest two hours to the presentation of Kurt Rohner in the event of Performance Strategies in Bologna you will have return equal to the Pareto principle. Immediately you will achieve better results in your negotiations.

Get in touch with me and you shall receive the details.

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Travelling for business to many places I feel my cultural activities fall short. But that’s only because of the awareness what I miss in my home town. I discovered many years ago that it is not really necessary to starve of culture. Cultural events take place all over the world and while travelling I started to like the adventures of the culture abroad in the Bolshoi, the Concertgebouw, Carnegie Hall, La Scala, the Bastille or any other place.

So whenever I am in a town somewhere in the world and there is an evening without duties I check out the programs for opera and concerts. If I am in command of the language I inform myself what is being played on stage. I want to know the exact time of the appearance and check with the concierge if it is possible to get tickets in the public sale. If the performance is sold out, then you know it is a very good quality and worth while to attend. I plan the transport to be in front of the door about twenty minutes before start of the performance.

In my inner self I tell me, you are going to have a nice evening in the opera or if I do not get any tickets go and have a nice dinner. So I gauge myself not to be disappointed if there are no tickets.

Usually it is very easy to find tickets in the area front of the evening box office. There are two kinds of sellers: the private people who can not attend the opera or the show, because of some misfortune and they try to get some money back from what they have spend for the evening. Often these are tickets of lower quality, because people who can pay really high prices they also do not care so much, if they can not attend the show. If I am satisfied with the ticket usually I ask to know the official price. “Well” I usually reply “I only planned to spend so and so much!” which is about half of the price. Most often you I get the ticket for the amount suggested. These people are afraid they will not get any money at all, so they take the cut in price.

The more interesting kind of negotiation is with the professional people. They usually get some quantities of tickets to sell above the official box office price.

They start their sales in the afternoon or about 1 to 2 hours before the performance. In Verona for example you can find them in the square before the arena already by lunch time. They very often cooperate with the concierges in hotels. The concierge then will tell you at his desk, the performance is sold out, but that he has some special connections to get tickets, but they are more expensive.

Often the professional dealers are 15 minutes before the start sitting on their last investments. If they are very shrewd they will still ask a price higher than printed on the ticket.  It is really the timing of the negotiations, because with every minute before the curtain goes up the probability that they may sell the ticket is becoming slimmer.

I just tell them that I do have only so much cash with me, because I am used to pay everything with the credit card. And that I am sorry not to be able to pay their requested price. I fake the walk away with some steps and prepare the exact amount of money, so I have it ready and I do not need to count the money in front of them. Then I just wait and see. Once it is more or less 5 or 3 minutes before the start they come an offer you the tickets on the price suggested by you. I take the ticket and literally run into the place to take the seat just before the performance starts. If your seat is in the middle of a long row you may inconvenience many people. I usually do that by apologising in my home tongue, so they understand I am a foreigner, which makes the case a little bit less drastic.

In the many years I have hardly ever stayed outside and most often I paid less than the official price. On top I spend my self a nice dinner anyway, since it was mostly a nice performance for good cash.

One hint from an insider: if you have a choice always select the ticket for the private box front seats, they are the best in this last minute venture. You are able to sneak in even, when the performance has started.