Behaviour Change

PROPAGANDA FOR CHANGE is a project created by the students of Behaviour Change (ps359) and Professor Thomas Hills @thomhills at the Psychology Department of the University of Warwick. This work was supported by funding from Warwick's Institute for Advanced Teaching and Learning.

Friday, April 25, 2025

TUG OF WAR OR TEAMWORK?: AN INSIGHT TO MULTI-PARTY NEGOTIATION STRATEGY

 


Negotiating a Strategic Business Partnership (The negotiation score sheet and contract) 

Note: values were adjusted on the paper copy*

Scenario: You are part of a three-way negotiation involving a tech startup, an investor, and a corporate partner. Your goal is to reach an agreement that maximizes your individual interests while ensuring the deal is acceptable to all parties. The negotiation covers eight key issues:

  1. Equity stake
  2. Investment amount
  3. Board representation
  4. Intellectual property rights
  5. Revenue-sharing model
  6. Product launch timeline
  7. Geographic expansion strategy
  8. Exit strategy

Each party has a different valuation for each issue, presented in the form of ‘points’ on the attached position sheets. Your objective is to maximize your points while reaching an agreement within the given time.

If no agreement is reached, this will be indicated in the final contract.

 

Tech Startup's Position Sheet

Issue

Option

Points

Equity Stake

5%

200

10%

150

15%

100

20%

50

Investment Amount

$1M

50

$2M

100

$3M

150

$4M

200

Board Representation

1 seat

50

2 seats

100

3 seats

150

4 seats

200

Intellectual Property Rights

Retain full rights

200

Shared rights

100

Full transfer

0

Revenue-Sharing

5%

200

10%

150

15%

100

20%

50

Product Launch

6 months

50

12 months

100

18 months

150

24 months

200

Expansion Strategy

Domestic only

50

North America

100

Europe & Asia

150

Global

200

Exit Strategy

IPO

200

Acquisition

150

Buyout

100

No exit plan

50

 

Investor's Position Sheet

Issue

Option

Points

Equity Stake

5%

50

10%

100

15%

150

20%

200

Investment Amount

$1M

200

$2M

150

$3M

100

$4M

50

Board Representation

1 seat

200

2 seats

150

3 seats

100

4 seats

50

Intellectual Property Rights

Retain full rights

0

Shared rights

100

Full transfer

200

Revenue-Sharing

5%

50

10%

100

15%

150

20%

200

Product Launch

6 months

200

12 months

150

18 months

100

24 months

50

Expansion Strategy

Domestic only

50

North America

100

Europe & Asia

150

Global

200

Exit Strategy

IPO

50

Acquisition

100

Buyout

150

No exit plan

200

 

Corporate Partner's Position Sheet

Issue

Option

Points

Equity Stake

5%

100

10%

150

15%

200

20%

50

Investment Amount

$1M

50

$2M

100

$3M

150

$4M

200

Board Representation

1 seat

50

2 seats

100

3 seats

150

4 seats

200

Intellectual Property Rights

Retain full rights

200

Shared rights

100

Full transfer

0

Revenue-Sharing

5%

200

10%

150

15%

100

20%

50

Product Launch

6 months

50

12 months

100

18 months

150

24 months

200

Expansion Strategy

Domestic only

200

North America

150

Europe & Asia

100

Global

50

Exit Strategy

IPO

100

Acquisition

200

Buyout

150

No exit plan

50

 

Contract Agreement

We, the undersigned, have agreed/not agreed to a contract (delete as applicable).

Tech Startup Representative: ________________________

Investor Representative: ________________________

Corporate Partner Representative: ________________________

Agreed Terms:

  • Equity Stake: ____________
  • Investment Amount: ____________
  • Board Representation: ____________
  • Intellectual Property Rights: ____________
  • Revenue-Sharing: ____________
  • Product Launch Timeline: ____________
  • Expansion Strategy: ____________
  • Exit Strategy: ____________

Points Earned by Tech Startup: ______________

Points Earned by Investor: _____________

Points Earned by Corporate Partner: ______________


Negotiation briefs 

Investor’s Brief: 

You are a successful investor with multiple opportunities on the table. This startup is just one option, and you are only interested if the deal is highly favorable to you. You know startups need funding more than investors need deals, so you will push for maximum equity, a strong revenue share, and board control.

You have no interest in charity—this is about return on investment. Intellectual property rights are key; owning them could mean future profits beyond just this startup. You prefer a fast product launch to start generating returns immediately. If the terms don’t serve your financial interests, walking away is always an option. 

Tech Startup’s Brief: 

You’ve built something innovative, and this deal could take your company to the next level. You need investment and a strategic partner, but you must also protect your company’s future.

Corporate Partner’s Brief: 

Your company sees this startup as a long-term asset, not just a quick investment. You are here to secure a stable and profitable partnership that benefits your business for years to come. Control is key—board representation and influence over major decisions will ensure this deal works in your favor.

Unlike the investor, you don’t need immediate returns. A steady, well-planned product launch and a controlled expansion strategy are more important than rushing into global markets. An eventual acquisition would be ideal, allowing your company to fully integrate the startup’s technology and expertise over time.

 

Transcript 

Audio File https://drive.google.com/file/d/1vhS-EysbIhEuhCOaNtsmLxId34w_g9gO/view


Negotiation breakdown

1. First Offer and Anchoring (0:30 - 1:00)

  • Quote: "Who would like to make an offer? 15%."
  • Analysis: This is an example of making the first offer, which acts as an anchor in negotiations. Research suggests that first offers significantly influence final agreements, as counteroffers typically shift toward the initial number.

 

2. Counteroffers and Concessions (1:10 - 2:00)

  • Quote: "I'll be honest. 15 is probably too high for me... I can do middleware and I can go 10. But I'm not going five."
  • Analysis: The response demonstrates a counteroffer strategy. Effective counteroffers are close to the reservation price of the opposing party. Additionally, the use of concessions here aligns with the shrinking pairs principle, where each successive concession is smaller than the previous one.

 

3. Zone of Possible Agreement (ZOPA) (3:00 - 4:00)

  • Quote: "3 million for 10%? I would say that probably two million. 2 million, 10%. Three for 15?"
  • Analysis: The discussion here is about the ZOPA (Zone of Possible Agreement), which is the range where both parties' reservation prices overlap. The negotiators are trying to identify this range by adjusting investment and equity percentages.

 

4. Integrative Negotiation (5:00 - 6:30)

  • Quote: "Board representation. I guess, is the next one... We'd like to be quite involved."
  • Analysis: Instead of solely focusing on financial terms, they introduce board representation, moving beyond a distributive negotiation (where parties argue over a fixed sum) to an integrative negotiation, where multiple issues are considered together.

 

5. BATNA Consideration (7:00 - 8:00)

  • Quote: "I'm definitely not happy to give that. 3 million for 10%? I would say that probably two million."
  • Analysis: The speaker is demonstrating knowledge of their BATNA (Best Alternative to a Negotiated Agreement) by refusing offers that do not meet their minimum acceptable terms. A strong BATNA provides leverage in negotiations.

 

6. Package Deals and Logrolling (9:00 - 10:00)

  • Quote: "If we go for four seats on board representation, then we can agree on revenue share."
  • Analysis: This is an example of logrolling, where negotiators make trade-offs by prioritizing different issues. By offering board representation in exchange for revenue share, they increase the likelihood of a mutually beneficial agreement.

 

7. Exit Strategies and Long-Term Planning (11:00 - 12:00)

  • Quote: "Should we go public or look at acquisition?"
  • Analysis: Discussing an exit strategy is a long-term negotiation approach. This aligns with the principle of expanding the pie, ensuring that both parties consider future gains rather than just immediate benefits


Contract agreement (negotiation exercise)

Tech startup representative: Jack

Investor Representative: Rob

Corporate Partner Representative: Ashley

 

Agreed terms:

Equity stake: Option C

Investment amount: Option C

Board representation: Option D

Intellectual property rights: Option C

Revenue sharing: Option C

Product launch timeline: Option D

Expansion strategy: Option D

Exit strategy: Option C

 

Points earned

Tech startup: 1150

Investor: 1100

Corporate partner: 1250 









Thursday, April 24, 2025

The Godfather - A Negotiation Analysis - Eloise Keeling, Jack Knight, Sebastian Woods

Here we have an in depth analysis of a scene from The Godfather. It is combined with an evaluative podcast, highlighting the mistakes made by characters from one of the most famous films made, and using recent articles to suggest potential improvements and content from the class.

In the current scene, Don Corleone, the head of a large mafia family, is being asked to provide financial and political support by Sollozzo, a rival family member. We examine what went wrong and how it could have been better for both parties.

Recreation, Analysis and Podcast


If this does not work, please use this link to direct you to YouTube: ( https://youtu.be/N8bmV2_3r_8?si=vWBuYk2nckGAplIz )


Here is the link to the actual scene from The Godfather - from 1:46 to 4:25


If this does not work, please use this link to direct you to YouTube: ( https://youtu.be/j_MMLb2QB5g?si=KbShtwBX94oeAAEv)

Script for the Recreation and Analysis


Sollozzo: Bene. Don Corleone, I need a man who has powerful friends. I need a million dollars in cash. I need, Don Corleone, those politicians that you carry in your pocket, like so many nickels and dimes.

Narrator : Right from the beginning, Sollozzo outlines what he is looking for in the negotiation with Don Corleone. He immediately asks for money, power and political connections that Don Corleone can offer him, and offers Don Corleone a monetary return offer. However, he has failed to know what Don Corleone values (family) and he exhibits an ignorance effect and has made a poor first offer which anchors the rest of the negotiation which places him at a disadvantage.

Don Corleone: What is the interest for my family?

Sollozzo: Thirty percent. In the first year, your end should be three to four million dollars. And then it would go up.

Narrator : Don Corleone frames this question in a deliberate way - he places a large amount of value on his family, hence why he asks the interest for his family. Sollozzo fails to notice this and replies with a monetary offer, rather than focusing on family. Had Sollozzo demonstrated active listening then perhaps he would have noticed the value Don Corleone places of family, and the negotiation could have involved interest-based bargaining.

Don Corleone: And what is the interest for the Tattaglia family?

Sollozzo: I'll take care of the Tattaglias, out of my share.

Don Corleone: So I receive thirty percent for finance,......... political influence, and legal protection; that's what you're telling me?

Narrator : Don Corleone using an information-gathering technique here, whereby he is not reacting to Sollozzo’s requests, and is attempting to find out as much as he can about the pros and cons of the negotiation. We also see here the importance he places on family, which Sollozzo has failed to notice before.

Sollozzo: That's right.

Don Corleone: Why do you come to me? Why do I deserve this generosity?

Sollozzo: If you consider a million dollars in cash just finance, te salute, Don Corleone.

Don Corleone: I said that I would see you because I heard that you're a serious man, to be treated with respect. But I must say no to you, and I'll give you my reasons. 

Narrator : Don Corleone has done two things here. Firstly, he refers to Sollozzo in a positive light through calling him a serious and respectable man. However, when he declines Sollozzo’s offer, he gives Sollozzo his reasons in order to teach Sollozzo about what he values. 

Don Corleone : It's true, I have a lot of friends in politics, but they wouldn't be friendly very long if they knew my business was drugs instead of gambling, which they regard as a harmless vice. But drugs is a dirty business.

Narrator : Don Corleone frames the negotiation as a political risk, rather than a business one, implying how much he values his connections and powerful friends. 

Sollozzo: Don Corleone...

Don Corleone: It doesn't make any difference to me what a man does for a living, understand. But your business is a little dangerous.

Narrator : In his circle, there is a social norm that whilst gambling is seen as harmless, drugs are not and could threaten his political and social standing, for which Don Corleone places great value on. This can further explain his anti-drug default, which he sticks to in order to maintain his long term stability, rather than a short term gain in money. 

Sollozzo: If you're worried about security for your million, the Tattaglias will guarantee it.

Narrator : Sollozzo is attempting to overcome Don Corleone’s rejection by making the monetary factor more credible and stressing how it will be secure. However, he has not understood that this is not what is stopping Don Corleone from accepting the negotiation.

Sonny: Aw, you're telling me that the Tattaglias guarantee our investment?

Don Corleone: Wait a minute...

Don Corleone: I have a sentimental weakness for my children, and I spoil them, as you can see; they talk when they should listen. But, anyway, Signor Sollozzo, my no is final, and I wish to congratulate you on your new business, and I hope you do very well. And good luck to you... as long as your interests don't conflict with my interests. Thank you!

Narrator : The negotiation does not end in a competitive death spiral and both parties remain professional with the rejection of Sollozzo’s offer. However, it was a few turns ago that Don Corleone originally said no to the negotiation, which should have given Sollozzo time to ask questions and loop the conversation for understanding - he should have continued to ask questions to keep the conversation going and keep Don Corleone engaged.

Narrator : Don Corleone refers to Don Corleone as a respectable man and wishes him a positive future, however he does implicitly threaten Sollozzo, ensuring Sollozzo does not forget who that Don Corleone has the authority and power in the negotiation.


Critical Podcast Script

Jack : So now we have analysed the original scene from The Godfather, let’s dive into why this was the outcome and how the negotiations could have been improved! 


Eloise : Just to clarify, what we are going to discuss may not have made Don Corleone accepted the deal but it demonstrates how the negotiation could have worked more in Sollozzo’s favour.


Jack : Yes exactly. And this is how the negotiation ended in a lose-lose situation. Sollozzo was not able to get the political and financial backing he needed and Don Corleone did not make any money. 


Seb : This could be seen as a lose-win situation though, as Don Corleone did not have to risk his power or reputation, which he values more than the opportunity cost of the money he potentially missed out on.


Jack : Yes very true, but ultimately both parties walk away with nothing. Sollozzo could have reshaped the deal and mitigated Don Corleone’s political risk, but he did not. Instead he was desperate for a successful deal, which is never a good position to be negotiating from. 


Eloise : No and the Desperation Threshold Model suggests why this is. Depending on how many existing resources you have, a party may either be risk seeking or risk averse. Sollozzo is below the threshold of resources and is desperate to secure a deal - this might cause him to make concessions and because he has so be risk seeking as he has little to lose and wants to gain so much.


Seb : This is not a good strategy at all. Guta agreed with this and proposed 5 techniques that are required for a successful negotiation.  So lets discuss them in relation to our scene… 


Eloise : Firstly, you have to convince your partner they want what you are offering


Jack : And in this situation, Don Corleone doesn’t need money and he also does not want to threaten his reputation through illegal drug businesses, linking to the overarching issue of value.


Eloise : Guta also highlighted the need to convince your partner that your offer increases their security and also that those who have done it before have made a good choice.


Jack : Sollozzo uses these two techniques by emphasising how his money will increase and that the Tattaglias will guarantee it. 


Seb : Unfortunately though, this is not enough to create successful negotiation. Perhaps if he had used the other two techniques it may have been. These are : convince your partner that it gives them an advantage to others, and that by negotiating in the deal, your partner will have fulfillment and be happier than before the deal.


Eloise : Sollozzo falsely believed that money would make Don Corleone happy. The idea of an illegal drug deal does not appeal to Don Corleone and would not make him better than any of the political friends he compares himself to.


Jack : 100%! To put it into context, we see this type of negotiations in the current U.S.–China tariff conflict. China mirrors the Sollozzo position as he is he desperate to stabilise exports, whilst Trump is the Don Corleone who has world power 


Seb :  If China followed GUȚĂ’s five techniques, they’d be reframing the deal — not as "you get cheaper imports,” but “you gain national security, more jobs, and global dominance.” It’s about matching the offer to what Trump values, not just what they want to sell.


Jack :  But because of desperation — again — they’re not negotiating from strength. They’re reactive, not strategic. And that makes it harder to create a win-win scenario, just like Sollozzo never could.


Eloise :  And that wraps our project. Thanks for listening — and remember: make them an offer they actually want to say yes to.



References


De Courson, B., Frankenhuis, W. E., Van Gelder, J. L., & Nettle, D. (2025). Explaining the paradoxical effects of poverty on decision making: The Desperation Threshold Model.

Dolan, P., Hallsworth, M., Halpern, D., King, D., Metcalfe, R., & Vlaev, I. (2012). Influencing behaviour: The mindspace way. Journal of economic psychology, 33(1), 264-277.

GUȚĂ, A. J. (2023). THE ROLE OF NEGOTIATION TECHNIQUES IN CONDUCTING ILLEGAL NEGOTIATIONS. Annals of the University of Petroşani, 23(2), 119-126. - both the technique sets above are from this paper.

Jäckel, E., Zerres, A., & Hüffmeier, J. (2024). Active Listening in Integrative Negotiation. Communication Research, 00936502241230711.

Loewenstein, G., & Moore, D. A. (2004). When ignorance is bliss: Information exchange and inefficiency in bargaining. The Journal of Legal Studies, 33(1), 37-58.

Michael, B., & Michael, R. (2013). Interest‐based bargaining: efficient, amicable and wise?. Employee Relations, 35(5), 460-478.

O'Connor, K. M., & Arnold, J. A. (2001). Distributive spirals: Negotiation impasses and the moderating role of disputant self-efficacy. Organizational behavior and human decision processes, 84(1), 148-176.

Orr, D., & Guthrie, C. (2005). Anchoring, information, expertise, and negotiation: New insights from meta-analysis. Ohio St. J. on Disp. Resol., 21, 597.

Tversky, A., & Kahneman, D. (1981). The framing of decisions and the psychology of choice. science, 211(4481), 453-458.