CHRO Negotiation Strategies: Final Project Insights

10-2 FINAL PROJECT: SUBMISSION 1 10-2 Final Project: Submission Jamie Butler Southern New Hampshire University

10-2 FINAL PROJECT: SUBMISSION 2 Introduction This essay will begin with a summary of the negotiation fact pattern that the CHRO needs in order to engage in negotiations. We will now talk about the several types of power that the CHRO has and how important they are in this particular negotiation. Options that the CHRO ought to consider in the event that a deal isn't reached. Next, I'll discuss what inferences may be drawn about the company's organizational culture from the way they manage a departing employee. To bolster my case, specific examples from the readings will be provided. Cultural presumptions that affect the organization's policy decisions will be explained with the aid of appropriate examples. I'll also explain how I would use the suppositions to take part in a severance package that would yield the greatest results for the company. Additionally, I will be coming up with suitable wording for the CHRO's opening statements that will set the issue apart from the people. I will then list negotiation stances that are unique to each instance and reword them as interests. Options that cater to the integrative interests of the parties will also be suggested. In addition, I will specify objective standards that will help gauge the negotiation's disruptive aspects. Additionally, there will be instances of successful overt communication that may be applied during the negotiation. Additionally, circumstances that are crucial to this negotiation's success will be noted. I will explain the advantages and disadvantages of employing overt and covert communication techniques in this negotiation will be compared. Lastly, I have included a gambit chart that lists the potential and specific gambits to help advance negotiations, as well as gambit to avoid in this case.

10-2 FINAL PROJECT: SUBMISSION 3 10-2 Final Project: Submission I. Summary Negotiation Fact Pattern Businesses of all sizes use negotiation in their business processes. A mutually agreeable solution to a problem or other circumstance is reached by conversation between two or more parties, which is known as negotiation (Preston, 2023). In this instance, the negotiation is about Alice Jones, Netflix's operations director, and her poor performance. The Chief Human Resources Officer (CHRO) of Netflix, Sharon Slade, has to be aware of a few important details before she can move on with the negotiation to find Alice's best option. The facts are based on the details of what, when, where, why, and how. In this case, Alice's subpar performance is the "what". The "when" alludes to the moment when Netflix began to face challenges in the market and Alice's department was taken over by a new manager. The "where" is the operations department; the "why" is Alice's poor performance and the new supervisor who put her on the Performance Improvement Plan. The final "how" has to do with Alice's performance response; if she improves, it will determine if the negotiation had a major impact. Types of Power Legitimate power, reward power, coercive power, referent power, expert power, and multidimensional power are the six categories of power positions that Sharon owns, and which are directly related to this negotiating process. Being the CHRO at Netflix gives Sharon positional authority, which is derived from her title (Eatough, 2021). As the head of the human resources division, she also prioritizes making sure that staff perform to a high standard and rewarding those who do, which gives her reward authority (Indeed Editorial Team, 2023).

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10-2 FINAL PROJECT: SUBMISSION 4 However, Sharon also has the authority to use coercive power as she controls the severance compensation that is given to underperforming employees like Alice Jones in order to make room for the hiring of qualified candidates (Campbell, 2022). Sharon's wealth of expertise in human resource management, which includes her time spent as vice president of human resources at General Electric, gives her referent power (Wooll, 2021). Sharon has to ensure that Netflix’s mission and values are followed, and she has to relay this to Alice Jones in negotiations. In addition, Sharon's expert power comes from her altruistic efforts to further the objectives of the business and the employees, as well as the superior services she offers to them considering her position as a skilled human resources executive (Wooll, 2022). She will have the power to support her side in the negotiations with Alice Jones. Sharon gets her multidimensional power from her work in human resources, which entails interacting with every worker in a company. In discussions, Sharon will be able to benefit from her outgoing personality, good interpersonal skills, and extensive network of contacts inside the business (McCord, 2023). Appropriate Alternatives As Netflix's CHRO, Ms. Slade has the power to decide what will happen to Ms. Jones' current position. She can also decide whether the PIP Ms. Jones received was effective in assisting her in achieving the goals she had been assigned as well as in enhancing her performance at work. Ms. Slade has concluded that she will be able to make an agreement with Ms. Jones regarding either taking a position in another department or getting a severance payment from the firm after examining material from the findings. Your aim while negotiating is to reach an agreement that benefits both parties. Your ZOPA is the spectrum of probable agreements, and your BATNA is your offer and backup stance.

10-2 FINAL PROJECT: SUBMISSION 5 If the participants in the negotiations could reach an agreement and find some common ground, the ZOPA may be taken into consideration (Halton, 2021). If Alice Jones were to be transferred to a different area where her abilities would be useful, that would be an example of a ZOPA that would benefit Netflix and Alice Jones. A BATNA is a course of action that a party engaged in negotiations has determined should be taken if talks stall and a compromise cannot be reached (Chen, 2023). A wise negotiator will have BATNA ready before the talks even begin. A contract that nonetheless benefits the bottom line is a prime example of a BATNA benefiting both parties, like in the case when Alice Jones accepted a reduced position so she could hone her leadership abilities. II. Cultural Analysis Overview Organizational Culture Netflix encourages its employees to seek jobs at other companies because it wants them to learn how those businesses run. Employees at Netflix were also encouraged to speak with recruiters at other organizations. We felt that if they thought that it was a better fit for them and were willing to take a chance and apply for the position there (McCord, 2023). This gives me the idea they weren’t bothered by employees leaving to pursue other avenues. Netflix has established the expectation of a high-performing organization, is extremely honest, and lives up to the phrase "we're not family" by being clear about their corporate principles and the policies they have in place (McCord, 2023). Cultural Assumptions The corporation established performance metrics, and the most talented employees who demonstrated good performance were let go along with a very sizable severance package from

10-2 FINAL PROJECT: SUBMISSION 6 Netflix (McCord, 2023). The business exclusively concentrated on employee freedom in order to recruit creative individuals since it believed that this kind of approach would enable it to retain successful staff members. According to Netflix, in order to create a strong, successful team, they must have faith in every one of its workers to make the best choices for both the business and them (First Round Review, n.d.). Netflix doesn't have a set vacation policy because they trust their staff to make the best decisions, take whatever much or little vacation time they need, and finish the work assigned to them (McCord, 2023). Every employee wants to have control over their freedom at work, and it may have a beneficial effect, as it has at Netflix. On the other hand, if employees at Netflix can't stay productive in their jobs, the firm will let them leave with a severance payout. This would lead to severance talks with the business. Severance Negotiation Netflix is a business that values completely open communication with its staff regarding expectations. Employees are aware of Netflix's work environment and how well-performing employees are given severance benefits leaving the business. Employees who don't succeed in living up to the company's standards are let go from their employment. A severance negotiation may not be necessary due to the fact that the employees were made aware of the corporate culture when they were employed. The employee should feel content about leaving the organization because of the significant severance package. If a worker who has a reputation for good performance is let go, it's possible that some sort of negotiating may be required. Only if the individual is interested in negotiating for a greater severance package because they performed better than the typical employee would this be necessary.

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10-2 FINAL PROJECT: SUBMISSION 7 In Alice's situation, the transparency culture at Netflix means that she is not startled by the fact that her performance has to be improved. Alice should have the ability to share her suggestions for what her severance payout should be as Netflix encourages open dialogue. Given that Alice was regarded as a valuable employee, the discussions ought to result in a favorable outcome for her. Alice ought to be content with her experience and delighted to leave the business. III. PIOC Analysis Overview CHRO’S Opening Remarks Sharon has to make sure Alice is at ease and focus on developing a rapport throughout her opening remarks. Sharon ought to arrange the meeting at an area devoid of disturbances or diversions. Sharon has to maintain her composure during the meeting. Sharon needs to try to put herself in the place of Alice and imagine the situation from her point of view. Sharon may boost her chances of getting a yes by finding out Alice's interests and sharing hers. This will also create an opportunity to investigate alternatives across concerns. Sharon has to make sure Alice and her have plenty of time to talk about and express any intense feelings around this discussion (Shonk, 2023). Sharon ought to deal in a win-win manner. Positive communication is a far more efficient technique to gain a yes than accusatory or critical language. Speak just for yourself rather than on behalf of your group (Shonk, 2023). Case Specific Negotiating Considering Alice's long and loyal work history at Netflix, any severance payout she gets ought to take her duration into consideration and offer benefits that are on par with those of her sacked colleagues. As such, an inadequate severance package would offer her less than what her peers have received in comparable situations—for instance, 20 weeks' pay for her ten years of

10-2 FINAL PROJECT: SUBMISSION 8 service. It would also be improper for her severance agreement to have a non-compete clause that prohibited her from working for a competitor, less than 90 days' compensation, and no ongoing health benefits. If Alice is given the opportunity to negotiate her job at Netflix, she might use the opportunity to emphasize her accomplishments and growth since being placed on the PIP as proof of her ability to be effective. The wisest course of action for Alice, barring a negotiated agreement (BATNA), would be to bargain for a sizable severance package if she is unable to continue working at Netflix. This should include transitional benefits, outplacement assistance, healthcare coverage, and severance money to get her through until she finds her next job. It is in Sharon's and Netflix's best interests to maintain the company's success while reducing the costs and hazards associated with failing employees. Sharon's goals are to improve performance and decrease turnover. Netflix has to continue making money while attracting and retaining top personnel in order to achieve its aims and objectives (McCord, 2023). Integrative Interests Determining the interests of both parties is the first stage in integrative bargaining. The negotiation parties will need to put in some effort because interests are sometimes less concrete than stances and are frequently kept secret (Spangler, 2016). Open-ended question What do you think about the way you're doing with the performance improvement plan? When the negotiation begins with Alice, it is crucial that Sharon Slade asks open-ended questions in order to obtain as much information as possible. Because they allow negotiators to choose how much information to offer, open-ended questions are typically seen as less

10-2 FINAL PROJECT: SUBMISSION 9 intimidating than closed ones. An inquiry that invites natural development and description is called an open-ended question; a one-word response is not (Ferree, 2021). Additionally, they advise negotiators to give thorough replies as opposed to succinct ones (Pon Staff, 2023). Closed Question Do you think the actions taken are appropriate? One way to focus attention on a topic or issue is to use closed-ended questions. They frequently assist in more accurately identifying a problem. These kinds of inquiries frequently begin with is, could, should, would, can, isn't, etc. They call for answers in the form of yes or no, that is, to concur or disagree, to affirm or refute. At this point, Sharon has to confirm that Alice is on board and approves of the plan of action that the two have decided upon. This is a method of asking Alice for confirmation through the answer that Alice will give. This is a yes-or-no question and answering "yes" will let Sharon know that Alice is happy, and the negotiation was successful. Alternative Questions Would you feel comfortable continuing with the PIP, or would you rather have other options? In the decision-making process, alternative questions are equally crucial. By asking Alice this question, Sharon will be able to gauge how she feels about her time on the PIP and whether or not she wants to stick with it or go in a new direction. It is up to Sharon to decide whether Alice will remain with Netflix in the future or whether she should look for employment elsewhere. By asking this question, Sharon will gain more insight into whether or not the performance improvement plan was a suitable response to Alice's performance problem. This

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10-2 FINAL PROJECT: SUBMISSION 10 inquiry will also demonstrate Sharon's curiosity about Alice's thoughts on the performance improvement strategy. Alternative questions similar to the one posed will aid Sharon in her decision-making process. Leading Questions Also, to what extent do you worry that the performance improvement strategy won't accomplish its goals? Leading questions, such as "Don't you think this project has been highly successful so far?" are declarations of opinion cloaked in a question form. In addition to failing to elicit fresh information, this kind of query might make the person on the other side defensive if she doesn't agree with you (Pon Staff, 2023). Sharon's ultimate goal is to completely eliminate PIP by whatever method necessary. The point of the question being asked is to demonstrate whether Alice believes the performance improvement plan is useless and has yet to help her achieve the desired level of performance improvement. Objective Criteria One of Netflix's core values is excellent performance, which they uphold. Every employee is informed from day one that they are expected to perform well at work and that they might not be a suitable match for the firm if they fall short of that expectation. Netflix claims that only "talented" candidates make it through their arduous employment procedure; Alice may be able to take advantage of this. In the negotiation, Alice can argue that she should remain on her PIP as it might be more expensive for the business to recruit and hire a new employee rather than keep her employed. IV. Communication Strategies

10-2 FINAL PROJECT: SUBMISSION 11 Overt Communication In this negotiation, overt communication is essential. When Alice is speaking, Sharon should incline forward to demonstrate her interest in what Alice has to say. When communicating with Alice, Sharon should use caution since body language matters too. In order to foster overt communication and a sense of trust with Alice, Sharon should also make sure to maintain eye contact with her when she speaks. Sharon must ensure that the discussion stays business-focused and avoids becoming personal. In order for Alice to fully comprehend Sharon's motives for the meeting, she needs to clarify them. Because specific language in this kind of interaction allows for focal points that are readily related back to Sharon and Netflix's rules, processes, and expectations, it also remains on topic. Tacit Communication A win-win solution should be the objective. Sharon can employ nonverbal cues by making a gesture in response to Alice's comment. Throughout this meeting, Sharon has to be mindful of her body language to show that she is paying attention to what Alice is saying. In order to make sure her argument is understood, Sharon should speak in a composed yet assertive manner. She ought to greet Alice with a smile during the discussion and ensure that she is comfortable. A more human element is added to the discourse through tacit communication. Sharon would exhibit more empathy and sympathy in her conversational style if she were to communicate tacitly. Benefits and Risks It is best to use overt communication with Alice in order to convey a genuine message. Sharon can use tacit communication as a gesture, but in this case, overt communication is preferable since it will be much clearer and less likely to be misunderstood. Overt

10-2 FINAL PROJECT: SUBMISSION 12 communication has the advantage of enabling Sharon to express to Alice exactly what she believes ought to happen. The benefit of tacit communication is that it can help Alice feel comfortable and welcome during the encounter. The discussion will go much more smoothly if both sides feel free to express themselves. V. Negotiation Tactics and Strategies Two Potential Distributive Negotiating Gambits for Sharon Slade to Consider: Two Negotiating Gambits for Sharon Slade to Avoid: Specific Gambits That Would Advance Your Agenda: 1. Print and Policy Power Adhering to their policy and the company culture will enable a more strategic approach and give a clear explanation and direction for why they are conducting this discussion. Documents that are 1. Sharon shouldn't take it or leave it as doing so might come across as confrontational and unlikely to result in a good agreement. Additionally, it can make Alice defensive and foster a climate in which she feels singled out 1. Withdrawing from negotiations will provide both sides the chance—and the willingness—to return to the negotiating table if it is not in everyone's best interests, particularly if circumstances have

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10-2 FINAL PROJECT: SUBMISSION 13 authored, specified, and created govern policies and organizational culture. or subjected to discrimination. Throughout the process, this might give rise to more unwelcome worries. altered. Find out what interests them, and then work together to negotiate creatively to generate new possibilities. 2. Sharon should be patient with Alice, making sure that all questions and concerns are being addressed. Before the final documentation is completed, this will also give time to ensure that Alice has been heard and that everyone has reached an agreeable agreement. 2. Sharon Slade shouldn’t go in with any preconceived assumptions. Being well-prepared, which goes well beyond simply being aware of the figures and facts, is essential to a successful negotiation. According to Fletcher, "not preparing is preparing to fail." "Being prepared entails having a 360-degree perspective in addition to obtaining and 2. Reopening the debate after a negotiation has been reached is not advised. Proceed with caution once a topic has been settled upon, since this may raise unwarranted inquiries or worries throughout the negotiating process.

10-2 FINAL PROJECT: SUBMISSION 14 comprehending the hard data, like your comparable." The more prepared Sharon is going in the better her ability to navigate the negotiation. Reference

10-2 FINAL PROJECT: SUBMISSION 15 BetterUp. https://www.betterup.com/blog/coercive-power#:~:text=to%20induce %20change.-,What%20is%20coercive%20power%3F,for%20example%2C%20uses%20coercive %20power . Campbell, A. C. (2022, August 30). Coercive power at work: Examples, implications, and more. Chen, J. (2023, July 6). Best alternative to a negotiated agreement (batna). Investopedia. https://www.investopedia.com/terms/b/best-alternative-to-a-negotiated-agreement-batna.asp Eatough, E. (2021, November 1). Legitimate power: What is it & how leaders should use it. BetterUp. https://www.betterup.com/blog/legitimate-power#:~:text=Legitimate%20power %20is%20the%20formal,a%20form%20of%20positional%20power . Eight gambits that could seal the deal in negotiations. Manage Train Learn. (n.d.). https://www.managetrainlearn.com/masterclass/view/master-these-tactics-to-stay-ahead/ Ferree, A. (2021, April 19). How to use effective questioning to unlock value in negotiation. LinkedIn. https://www.linkedin.com/pulse/how-use-effective-questioning-unlock- value-adam-ferree Halton, C. (2021, September 25). Zone of possible agreement (Zopa): Definition in negotiating. Investopedia. https://www.investopedia.com/terms/z/zoneofpossibleagreement.asp Holmes, B. C. (2023, October 24). 10 tips for successful business negotiations. Business News Daily. https://www.businessnewsdaily.com/7349-negotiating-donts.html Importance of negotiation. PON. (2023). https://www.pon.harvard.edu/tag/importance-of- negotiation/ McCord, P. (2023, August 14). How Netflix reinvented HR. Harvard Business Review. https://hbr.org/2014/01/how-netflix-reinvented-hr

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10-2 FINAL PROJECT: SUBMISSION 16 McCord, P. (2023, August 14). How Netflix reinvented HR. Harvard Business Review. https://hbr.org/2014/01/how-netflix-reinvented-hr Shonk, K. (2023, July 31). Six guidelines for “getting to yes.” PON. https://www.pon.harvard.edu/daily/negotiation-skills-daily/six-guidelines-for-getting-to-yes/ Shonk, K. (2023, July 31). What is distributive negotiation and five proven strategies. PON. https://www.pon.harvard.edu/daily/dealmaking-daily/what-is-distributive- negotiation-strategies/ Spangler, B. (2016, July 7). Integrative or interest-based bargaining. Beyond Intractability. https://www.beyondintractability.org/essay/interest-based-bargaining Staff, P. (2023, August 25). Ask better negotiation questions. https://www.pon.harvard.edu/daily/negotiation-skills-daily/ask-better-questions-in-negotiation- nb/ Staff, P. (2023, July 25). 10 hard-bargaining tactics & negotiation skills. https://www.pon.harvard.edu/daily/batna/10-hardball-tactics-in-negotiation/ Team, I. E. (2023, March 3). Guide to the 6 types of power and ways to use them in the ... - indeed. https://www.indeed.com/career-advice/career-development/6-types-of-power . https://www.indeed.com/career-advice/career-development/6-types-of-power The Woman Behind the Netflix Culture Doc. First Round Review. (n.d.). https://review.firstround.com/The-woman-behind-the-Netflix-Culture-doc Wooll, M. (2021, November 15). What is referent power? your guide as a leader. BetterUp. https://www.betterup.com/blog/what-is-referent-power#:~:text=The%20simplest %20referent%20power%20definition,several%20different%20kinds%20of%20power .

10-2 FINAL PROJECT: SUBMISSION 17 Wooll, M. (2022, January 27). Expert power: How to get it, keep it, and use it. BetterUp. https://www.betterup.com/blog/expert-power

WCM510_10-2_Final Project Submission_JamieButler

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