A three-year dispute between Starbucks and Kraft Foods over distribution of Starbucks packaged coffee in grocery stores was resolved on November 12, when an arbitrator determined that Starbucks had breached its agreement with Kraft and ordered the coffeemaker to pay the food giant $2.75 billion, Stephanie Strom reported in The New York Times.
The dispute dates back to an agreement negotiated in 1998 when Kraft began selling Starbucks packaged coffee through grocery stores. In 2010, with sales of its ground whole bean coffee reaching $500 million annually, Starbucks offered Kraft $750 million to end their agreement.
Starbucks wanted greater flexibility to sell the single-serve coffee pods that were taking off in the market at the time. The company’s agreement with Kraft limited Starbucks to selling pods that worked in Kraft’s Tassimo machines. Starbucks was in danger of being left behind in a race for market share against Green Mountain Coffee’s Keurig system and K-Cup single serving packs.
On October 1, 2013, nearly 300 Jewish and Arab students from twelve Israeli high schools convened for a conference on negotiation, co-sponsored by the Program on Negotiation. Having learned core negotiation methodology and acquiring concrete tools and skills previously, these students were offered a special opportunity to learn directly from skilled negotiation practitioners in various
When you’re making important decisions during a negotiation and have the luxury of time, what’s the alternative to Blink?
Should you completely ignore your rapid cognitions?
In the article “Strategies for Negotiating More Rationally,” we described University of Toronto professor Keith Stanovich and James Madison University professor Richard F. West’s distinction between System 1 and System 2 thinking.
System 1 roughly corresponds to Gladwell’s notion of rapid cognitions and System 2 refers to more deliberative thought.
Sometimes the goal in negotiation is to improve your fortunes. But sometimes, the best you can hope for is to lessen the fallout from past mistakes.
Take the case of JPMorgan Chase, which in September was threatened with a lawsuit from the U.S. Department of Justice (DOJ) for its sales of troubled mortgage investments during the financial crisis. JPMorgan CEO Jamie Dimon’s hands-on negotiations to settle the potential charges and avoid a lawsuit, as recounted by Ben Protess and Jessica Silver-Greenberg in the New York Times, serve as a reminder of the burdens we must sometimes assume to head off a disaster.
When a negotiation reaches an impasse (or, preferably, sooner), it’s important to consider that you may be at the wrong table.
What other individuals or groups might be able to break the deadlock? Perhaps you should be talking to them instead.
Consider the saga of a company that developed a hot new technology just as it was going public.
The device could detect underground leaks in gas storage tanks much more cheaply and accurately than any other products on the market.
The timing seemed perfect: The Environmental Protection Agency (EPA) was persuading Congress to mandate that gas storage tanks be continuously tested for leaks. Not surprisingly, the company’s board of directors pushed the CEO to get the device on the market, and fast.
A European Union summit held in late October failed to make much headway toward better coordination of economic policies, the Wall Street Journal reports. Facing resistance from Germany in particular, European officials are growing pessimistic regarding their odds of negotiating a deal over the next year to lay the foundation for a banking union for the 17 nations that use the euro. The proposed banking union would pool assets to allow the nations to engage in shared spending and borrowing, among other activities.
The plan for greater financial coordination was conceived at the height of the European financial crisis in 2012. As consensus grew that a shared currency with 17 different economic policies was unsustainable, the European Union began looking for ways to prevent future disasters.
No matter how many right moves you make at the table – however skillfully you read body language, frame arguments, make offers and counteroffers – doing so at the wrong table can undercut your results.
Not only should you negotiate right, you should do the right negotiation. Sometimes this means looking with new eyes for a more promising table.
For example, the owners of a niche packaging company that boasted an innovative technology and a novel product were deep in price negotiations to sell the company to one of three potential industry buyers, all larger packaging operations. The owners’ first instinct had been to persuade their bankers of the need for a higher valuation, refine their at-the-table negotiating tactics for dealing with each major player, and try to spark a bidding war.
It’s a familiar practice in negotiation training: Students are divided up and assigned to engage in role-play exercises known as simulations. Each person reads confidential information about her role, the two (or more) players get together and negotiate, and then the class reconvenes to debrief the experiences.
Simulation took root as a common method for teaching negotiation because it allows students to practice their skills in a low-risk setting and requires them to confront common negotiation problems directly, among other benefits.
On October 31, Time Warner Cable reported a huge quarterly loss of television subscribers, the largest in its history: 306,000 of its 11.7 million subscribers dropped the company, the New York Times reports. The bad news has been attributed largely to an impasse with television network CBS over fees, which led to Time Warner blacking