P ROGRAM ON N EGOTIATION/C LEARINGHOUSEA T H A R V A R D L A W S C H O O LS ALLY S OPRANO IT E A C H E R’ S P A C K A G EPACKAGE INCLUDES:TEACHING NOTESSAMPLE PREPARATION MEMOCONFIDENTIAL INSTRUCTIONS FOR SALLY’S AGENT CONFIDENTIAL INSTRUCTIONS FOR LYRIC OPERA’S BUSINESS MANAGER Review Copy Do Not ReproduceP R O G R A M O N N E L A W S C H O O LA N INTER-UNIVERSITY CONSORTI PRACTICE OF CONFLICT RESOLUTIONG O T I A T I O N A T H A R V A R D UM TO IMPROVE THE THEORY ANDThese notes were written by the Harvard Negotiation Project. The exercise was written by Norbert Jacker and Mark Gordon. Copies areavailable at reasonable cost from the Program on Negotiation Clearinghouse, online at or by telephone at 800-258-4406. This case may not be reproduced, revised or translated in whole or in part by any means without the written permission of the Director of CurriculumS ALLY S OPRANO IT EACHING N OTESSally Soprano I involves a salary negotiation between an opera singer and an opera company.O VERVIEWSally Soprano is a distinguished older soprano who has not had a lead role in two years. The Lyric Opera has a production of Norma opening in three weeks, and the soprano who had been engaged to sing the title role has developed a condition requiring surgery before theperformance. The Lyric is eager to hire Sally, and the trustees have authorized the business manager to offer up to $45,000 for the lead. Naturally, the Lyric, which is a not-for-profit organization, would like the salary to be lower, if possible. The original soprano hired for the lead was to have been paid $30,000, and the rather inexperienced secondary soprano is being paid $14,000. (Industry practice is that lead roles receive about twice the amount received by secondary role singers.) Four years ago, at the height of her career, Sally received $22,000 for the lead role, but inflation and an increase in opera’s popularity have nearly doubled the salary scale since then.Sally desperately wants this role, which could give her a chance at a forthcoming television special. She would be willing to sing the part for nothing, except for the impact on futureengagements and reputation. Her salaries for secondary roles over the last two years have ranged from $10,000 to $18,000; more than a year ago she received $12,500 for singing the secondary role in Norma at the Lyric. Last year, an inexperienced soprano who sang the lead role is rumored to have been paid more than $24,000.M ECHANICSTime Required: 20 - 60 minutes: preparation (preferably outside of class)20 - 35 minutes: negotiation45 - 60 minutes: debriefingGroup Size: 2 peopleMaterials: Confidential Instructions for Sally’s AgentConfidential Instructions for Lyric Opera’s Business ManagerP ROCEDURE1. Distribute roles before class and ask participants to prepare individually in advance of thenegotiation. (This case can be prepared in class in about 20 to 30 minutes. However, the shorter the preparation time allowed, the more likely that participants will resort to positional bargaining.)2. In class, divide participants into teams of two and allow 20 to 30 minutes for them tonegotiate. You may want to review the roles with the Lyric Opera’s business managers and Sally Soprano’s agents separately before the negotiation.3. Collect the outcomes of the negotiating groups for use in the debriefing. Outcomes includenot only the salary, but perks, intangibles, side agreements (e.g., for advertising), and an assessment of the quality of the working relationship.D EBRIEFINGWhen the outcomes of the negotiating groups are displayed to the class, the wide range in possible outcomes for this negotiation will be apparent. The following questions may be used asa basis for class discussion.1) Strategy and BATNAa) What things might you do if you do not reach an agreement at the bargaining table?b) What strategies did participants use in each role?c) What is your Best Alternative to a Negotiated Agreement (BATNA)?d) What is the value of the BATNA in terms of the “currencies” that will be on the table in thenegotiation, e.g., dollars, publicity, risk, etc.?e) What is the price at which you walk away from the negotiation?The bargaining zone for Sally’s salary in this simulation ranges from zero to $45,000. The first step in preparing to negotiate is for each party to determine his or her BATNA. Each should know exactly what it will do if no agreement is reached. The other side’s BATNA should also be estimated. Once you have estimated your BATNA, you may wish to consider the minimum (or maximum) salary and other conditions that would be of equal utility to your client. That package is the “reservation price” or “reservation value.” Having an estimate of one’s own and the other side’s BATNAs provides a reference point for evaluating offers and gives every player more power at the negotiating table. Options can be evaluated more critically, and parties can be clearer about what they need to reach agreement.f) Did you think your BATNA was stronger or weaker than the other side’s?g) What can each side do to improve its BATNA?Some people have a curious reaction to this game. They feel they should accept less for their client because their client’s alternatives are poor. This feeling is independent of the fact that the other party is unaware of their poor BATNA, and that they are unaware of the relative strength or weakness of the other party’s BATNA. A poor BATNA may justify being more risk-averse, but this does not necessarily mean one must ask for less. Attention would be paid to the effect of a poor (or good) BATNA on one’s negotiation style and strategy.2) Standards and Criteriaa) (To a pair of negotiators): “You settled on a price of $X. Why? Where did that number comefrom?”Criteria or standards for evaluating proposed options should be objective, that is, external to the will of either party, so each feels its interests are being protected. Such criteria can be principles that the parties agree should govern the outcome, such as fairness or efficiency. At times, the objectivity is ensured by outside expertise. The objective criteria themselves can be the subject of much negotiation. An agreement based on such criteria can free up the parties to invent options more creatively, knowing that the final evaluation will exclude those that do not meet the criteria agreed upon. In this instance, there are many standards or criteria upon which to base an outcome. A listing of these standards is supplied in Appendix A.b) Which standards seemed more persuasive? Why?One challenge in this case is the availability of a broad range of external standards. Not all standards are equally persuasive. In general, those standards that fit this situation more closely (e.g., this role, this opera company, this year), are more persuasive than those more general in nature (e.g., general inflation rate in opera salaries over four years). While no one standard is “the most fair,” open-minded negotiators may be able to settle on an appropriate range of fairness. Once that’s done, they may split the difference or try to invent new options that add value to one side at little or no cost to the other.3) Interests and Creative Optionsa) What non-monetary interests does each side have? What monetary interests do they havethat go beyond this particular negotiation? How did you talk about each side’s interests?b) What options, other than straight salary, did you explore?This situation allows for the creation of various options separate from salary that could maximize joint gains for the parties. (See Appendix B.) While this game can be negotiated in a very distributive manner, by focusing only on the salary issue, there is ample room for integrative bargaining.Fisher and Ury, in their book, Getting to YES, distinguish between “interests,” which are the underlying concerns of each party, and “positions,” which are the stands, or positions, taken by each party on the issues being negotiated. They argue that by focusing on interests rather than positions, parties can engage in integrative bargaining and find creative ways to make all partiesto the negotiation better off.Positional bargaining occurs when parties do not focus on interests. In positional bargaining, each party typically identifies a bottom line, an opening, and a fall-back before negotiation begins. After the opening position is offered, each party makes small concessions, based on their fall-back strategy. Concessions are made grudgingly, until a compromise position is found or until the parties reach an impasse. This type of bargaining builds little trust between the parties, as there is no opportunity to develop a relationship and no incentive to explore each other’s interests. The result is a process that moves backward from an opening position, rather than forward toward a creative outcome. Most distributive bargaining follows this positional approach.Focusing on interests compels the parties to listen carefully to each other to discover what each believes is really important. Interests define the problem in a way that allows for collaboration and creativity in fashioning a solution. The endeavor becomes one of joint problem-solving, rather than adversarial positioning. The parties can explore possibilities for joint gains and trade-offs, resulting in a positive-sum rather than a zero-sum agreement.In order to explore the interests of parties at the table, the negotiation process should include the opportunity to “brainstorm” possible approaches to problems without the commitment to options proposed by either party. This encourages creativity and joint problem-solving essential to integrative bargaining.4) Agency Issuesa) What was the nature of the commitment you gave to your client?b) Was it final and binding?c) Was it subject to client approval?d) Was it discussed explicitly or just “assumed?”Given that the negotiator is an agent, questions may arise as to the scope of the authority of the agent and the role of the principal in the negotiation. Generally, the principal would be present if there is a need for education of the principal or for reality-checking. Many clients feel anxious during the negotiation and find it difficult to hold firm where appropriate.Whatever the authority, in most cases the agent would wish to reserve final decisions for the client and to allow time to consider the proposed agreement. This does not mean the agents cannot or should not agree on a recommended settlement, which would not be renegotiated without new information.C ONCLUSIONThis case offers participants insight into what they believe constitutes success in a negotiation. Is it “winning” by doing better than the other side? Or is it achieving an objectively good outcomefor both parties? Some participants will not settle this case, although that is against the interests of both clients. The question, “Would more information about the other side’s BATNA and interests have made this case easier or more difficult to negotiate?” may reveal how participants define success in a negotiation. Collaborative problem-solvers tend to say that more information would have made it easier to negotiate a good outcome, because it is easier to maximize joint gains and to decide on an appropriate salary standard when there is full information. Those who say it would be harder may be out to “win” the negotiation; they fear that revealing their BATNA may weaken them and that the negotiation will deadlock with each side trying to extract the last dollar from the other. [Special note: This issue can be tested by following-up the Sally Soprano I debrief with negotiation of Sally Soprano II, also available from the PON Clearinghouse. The facts are the same as in Sally Soprano I, except that as a result of a discussion between Sally and the Lyric Opera’s artistic director, all available information is known by both sides.]S OME P OSSIBLE C RITERIA FOR E STABLISHING A S ALARYBelow are some of the possible standards by which one can establish a salary for Sally for her performance of Norma. Note: The first and the last are not independent or objective standards.$45,000 what Lyric is willing to pay to get her to sing$45,000 last title role in Norma x 2 (for inflation in opera salaries) + $1,000 (because time is short)$44,000 last title role x 2 (for inflation in opera salaries)$38,500 same premium (2.75 x secondary) Sally received 4 years ago when she sang lead $36,000+ best recent secondary role x 2 (for lead) + some adjustment for inflation$31,250 what Lyric paid last year’s lead + 25% for inflation$31,250 Sally’s last secondary role with the Lyric x 2 (for lead) + 25% (one year’sinflation in opera salaries)$30,000 what Lyric would have paid Renata Risingstar, the soprano originally cast asNorma$30,000 last year’s secondary role x 2 (for lead) + 25% (one year’s inflation in operasalaries)$29,999 less than Lyric would have paid the other singer because Lyric preferred her to Sally$28,000 current secondary role x 2 (for lead)$25,000 Sally’s lowest-paying secondary role in the past 2 years x 2 (for lead) + 25%(inflation)$25,000 what Lyric paid Sally last year (secondary role) x 2 (for lead)$20,000 Sally’s lowest-paying secondary role in the last two years x 2 (for lead)highest-paying recent (secondary) role$18,000 Sally’s$15,000 lowest payment Sally has received in the last 2 years + 50% (inflation)$12,500 what Lyric paid Sally last year for secondary role$10,000 lowest payment Sally has received in the last 2 years$0 what Sally said she’d be willing to accept for the lead role in NormaI LLUSTRATIVE C OMPONENTS OF A GREEMENTSPercentage of gate to go to Sally:•X percent of excess over average gross ticket sales•X percent of excess over last five operas put on by Lyric•X percent of ticket revenues after Sally’s name is publicly announced minus average ticket sales in three weeks prior to opening•X percent of ticket revenues over Lyric’s break-even point•After 75 percent of seats sold for a given performance, X percent of ticket revenues if house is 75 to 85 percent full, Y percent of ticket revenues if house is 85 to 95 percent full, and Z percent of ticket revenues if house is 95 to 100 percent fullAdvertising•Lyric agrees to $X advertising budget•Lyric agrees to increase existing advertising budget by $X (or X percent)•For every three dollars increase in the Lyric’s advertising budget, Sally will contribute a dollar to the Lyric (subject to ceiling of $X contribution by Sally)•Sally and her agent get input into content of ad campaign•Sally gets superstar comeback buildup in Lyric’s advertisingSuperstar perks for Sally:•Enormous limo for Sally during entire run of Norma•Dressing room and hospitality room, each with big star on door, fully stocked with goodies •Dozens of roses to be thrown up on stage by adoring fans (to be planted by Lyric) after each performance•Huge opening night gala, complete with show-biz stars, searchlights, and lots of mediaOther components•Sally and Lyric agree to create records and tapes of the performance; they will cut a deal on the royalties and jointly negotiate with the recording company.•Sally and Lyric agree to pack first three rows with enthusiastic fans each night to precipitate tumultuous ovations.•Sally agrees to conduct master classes at the Lyric, locking in long-term employment for Sally and opera world notoriety for Lyric.•Sally agrees to specifically plug the wonderful people at the Lyric on national prime-time TV if the television deal comes through.•Lyric agrees to hire the best make-up artist in the business to make Sally appear more youthful and vibrant.•Lyric agrees to pay Sally $100,000 for the role (payable over 20 years, so present value is about $20,000).•Lyric pays Sally $45,000 and she agrees to contribute half to Lyric’s newly established “Sally Fund” to aid struggling young sopranos.•Sally sings for nothing in charity run of Norma and Lyric contributes all net proceeds to the Sally Fund.•Lyric pays Sally $45,000 and she agrees to match dollar for dollar any corporate contributions to the Sally Fund that are raised by the Lyric’s business manager.•Sally gets an extra $5,000 and agrees to buy any unsold tickets at half the box office price (up to a ceiling of $10,000) and to arrange for distribution of those tickets to students in arts programs, retirement homes, widows, orphans, etc.•Lyric flies Sally down to Brazil for a quick face lift.P R O G R A M O N N E G O T I A T I O N A T H A R V A R D L A W S C H O O LA N INTER-UNIVERSITY CONSORTI PRACTICE OF CONFLICT RESOLUTION UM TO IMPROVE THE THEORY ANDThese notes were written by the Harvard Negotiation Project. The exercise was written by Norbert Jacker and Mark Gordon. Copies areavailable at reasonable cost from the Program on Negotiation Clearinghouse, online at or by telephone at 800-258-4406. This case may not be reproduced, revised or translated in whole or in part by any means without the written permission of the Director of CurriculumS ALLY S OPRANO IS AMPLE P REPARATION M EMOI SSUES T O B E C ONSIDERED1. Salary2. Publicity• What will Lyric do?• What could Sally do?3. Future contracts between Sally and Lyric4. Rehearsals5. Work-related benefits and incentives, e.g., flowers in dressing room, limousine6. Joint ventures e.g., create records and tapes of performance7. Other joint gains?S ALLY ’S A LTERNATIVESSally’s alternatives to an agreement include:• Sit home and watch TV on opening night• Hope for the TV special to come through based on her past performances• Look for another role• Volunteer to teach classes on performing arts to get publicity Review Copy Do Not ReproduceDiscussion of alternatives from the perspective of Sally’s representative:None of these alternatives is appealing to Sally. She would much prefer reaching an agreement with Lyric. Her BATNA with Lyric seems to be for her to find another role for this season. We must determine how likely such an alternative would be, especially since the season is only three weeks away. Before going into the negotiation, however, I will want to discuss with Sally what might be done to improve her alternatives. For example, could she start talking to other opera companies about roles (hopefully, roles which she already knows) or could she set up a TV or radio interview to discuss her past performances and her upcoming return to the opera world? I would be stronger in the negotiation if Sally and I could improve her BATNA by having already set up another role, even one that she would prefer not to take given the choice between it and the lead in Norma .L YRIC O PERA ’S A LTERNATIVESThe Lyric Opera’s alternatives to an agreement include:• Use the inexperienced secondary soprano in the lead role and probably pay her less than$28,000 (twice her salary in the secondary role)• Look for other lead opera singers• Cancel the show• Start a large-scale publicity campaign featuring the secondary soprano• Start a publicity drive to lower expectations for this season because of RenataRisingstar’s sudden unfortunate illness.Discussion of alternatives from the perspective of Lyric’s representative:Canceling the show right now would be devastating from a financial perspective and from the perspective of the opera’s reputation in the operatic community. It is probably too late to find another lead opera singer because all of the good ones would be in rehearsal for other operas. Our BATNA is to use our current secondary soprano in the lead role. This is taking a chance since she lacks experience in demanding lead roles. We should improve our BATNA before going into the negotiation with Sally’s agent by starting the secondary singer in rehearsal right away. In fact, tonight I will call the director and voice coach and tell them to start the secondary in rehearsal first thing in the morning.S ALLY ’S I NTERESTSSally’s interests include:• Making a comeback in opera• Proving to the opera world that she’s still good enoughReview Copy Do Not Reproduce• Enhancing her reputation• Performing a primary role • Renewing her relationship with the Lyric Opera• Establishing a precedent of a high salary• Receiving treatment appropriate to her past fameDiscussion of interests from the perspective of Sally’s agent:Before going into the negotiation, I must prioritize these interests. Sally seems most interested in getting the lead role and less interested in what the actual salary is. Of course, I recognize that Sally would be happier singing for more money than for less. She is also concerned, however, that the world views her as a successful and talented star, despite her age and recent withdrawal from the opera world. Since she also wants to get the TV role, any option Lyric’s representative and I come up with should take into account how the media and the TV producers will see Sally. Therefore, whatever publicity we can arrange, the better the deal will be. I think that Lyric may have a strong interest in publicity for this last-minute substitution, as well.T HE L YRIC O PERA ’S I NTERESTSThe Lyric’s interests include:• Successful run of Norma• Establishing the precedent of always paying only the appropriate salary • Not being taken advantage of• Use of the best available opera singer• Good box office sales• Providing and receiving adequate publicityDiscussion of interests from the perspective of Lyric’s representative:Lyric’s highest priority interest is to get the best possible opera singer for the lead role so that the season will be a success. It cannot afford, however, to have opera singers think they can take advantage of Lyric’s misfortune by demanding extraordinary salaries in a situation like thiswhere the original star cannot perform. On the other hand, Lyric wants to maintain its reputation of treating its singers fairly. If we reach an agreement with Sally, both parties will have an interest in a successful run of the opera. There also seems to be a shared interest in good publicity for the opera and for Sally.Review Copy Do Not ReproduceR ELATIONSHIPWhat interest does each party have in pursuing a good working relationship?A good relationship will help Sally in her performance, which benefits both parties.Consequently both parties need to be able to work well together during the run of Norma .Because a success is important to both, neither party wants to create a situation in which one or the other sabotages the performances.How should that be reflected in the negotiation?An ideal negotiation in this situation is an amicable one in which the parties feel like this is a joint problem to be solved by taking into consideration the best outcome for all involved. Pushing to the last dollar could possibly prevent agreement and would be counter-productive since both parties are worse off without an agreement.What interest do the parties have in a long-term relationship?The possibility of a long-term contract should be discussed as a future possibility to keep our options open. I should go back to my client to find out if there is an interest in such a contract. That is not crucial to this negotiation, however.Other long-term relationships could be beneficial to the parties since both Lyric and Sally have a certain amount of fame and expertise. They may be able to help each other out.C OMMITMENTWhat would be possible good outcomes of this meeting?• A firm contract• An agreement in principle to be shown to Sally and Lyric• A press release to the media about Sally’s comeback and Lyric’s new starIn reaching this agreement, the commitment must be:S UFFICIENT : It must cover all interests such as salary, publicity, etc.R EALISTIC : It must be an agreement that both parties can perform.O PERATIONAL : Its terms must be such that it can be carried out as soon as the parties sign the contract. Everyone must know exactly what he or she is expected to do.Among the possible outcomes, I believe my client would prefer a firm contract. I have theauthority to commit to a contract for the run of the Norma season. I would need to consult with my client before agreeing to anything of a more long-term nature.Review Copy Do Not ReproduceC OMMUNICATIONI will be much more persuasive if I can show the other party’s representatives that I am listening to them and that I understand what they are saying. Once they recognize that I hear them, they can hear what I am saying. If they do not believe that I am listening/understanding them, they will expend all their energy advocating their position, and it will be twice as hard for me to persuade them.How can I show that I’m listening?•Paraphrase what they say and repeat it back with: “If I’ve heard you correctly, I think you’ve said that…”•Maintain good eye contact•Ask questions•Acknowledge their concerns even if I disagree with them by saying, for example, “I understand why you see this as a problem. Let me add my perception of the situation.”First, it is important for me to remember that I can acknowledge what they say without agreeing with them. Second, I must not lead them to believe that my acknowledgements of what they say mean that I am agreeing with them. For example, if I tend to nod my head when I am listening attentively, I must tell them explicitly that I hear what they are saying but that I do not necessarily agree entirely. Third, by the tone I set in the negotiation, I can disagree without being disagreeable.Review Copy Do Not ReproduceP R O G R A M O N N E G O T I A T I O N A T H A R V A R D L A W S C H O O LA N INTER-UNIVERSITY CONSORTI PRACTICE OF CONFLICT RESOLUTION UM TO IMPROVE THE THEORY AND This case was written by Professor Norbert S. Jacker of DePaul University, College of Law. It has been revised, expanded and adapted for the use of the Harvard Negotiation Project by Mark Gordon, Bruce Patton, Wayne Davis and others. Copies are available at reasonable cost from the Program on Negotiation Clearinghouse, online at or by telephone at 800-258-4406. This case may not be reproduced, revised or S ALLY S OPRANO IC ONFIDENTIAL I NSTRUCTIONS FOR S ALLY ’S A GENTYou have just become a partner in a firm that manages and acts as agent for celebrities. Sally Soprano is certainly not a major client, but you want to do a good job with this first assignment as a partner, especially since you have an interest in expanding your firm’s opera practice. This is the first time you have handled Ms. Soprano’s account.You met Ms. Soprano yesterday. She is an older soprano who still has a good voice, particularly for her age. During your discussions with her, you gathered the following information:She has not had a prime role in more than two years, although she has had a number of secondary roles. Her popularity has declined somewhat in the past few years. Lyric Opera, with whom Sally has sung many times over the years, has a production of Bellini’s Norma scheduled to open in three weeks. The challenging title role is generally acknowledged to be a prize for a young soprano. When the Lyric announced this season’s schedule over a year ago, Renata Risingstar was listed in the title role for Norma . Ms. Risingstar is generally regarded as a first-rate performer, although she has not yet attained the popularity Sally enjoyed at the peak of her career. Three weeks ago, Ms. Risingstar’s name was suddenly dropped from the opera’sadvertising, and rumors began circulating that she had either become ill or gotten into a dispute with the artistic director. Sally got in touch with the artistic director to ask if the title role was open. Sally knows the part well and has sung it successfully many times. Yesterday Sally was informed by the Lyric that they might be interested in signing her for the Norma role. A meeting has been scheduled for today between you, as Sally’s agent, and the Lyric’s business manager to discuss the situation.The Lyric Opera is an established institution in a major metropolitan area. As with most opera companies, it is a not-for-profit entity that is financed by a combination of ticket sales,foundation and corporate grants, and income from a modest endowment. It usually breaks even over the course of the year, with fairly good attendance in its 2,000-seat hall. Ticket prices range from $18 to $55. This production of Norma is scheduled to run for six weeks, with three performances per week.Sally desperately wants this role. It could signal a real comeback and would give her a good chance at an important role in a forthcoming television special on opera. The TV special would pay $45,000 and would probably lead to many other singing engagements. Sally was overjoyed at Lyric’s possible interest in her. Sally has told you that getting the part is what counts; the amount of compensation is secondary. She told you that, frankly, she would be willing to sing the part for nothing, except for reasons of professional pride, reputation, and the potential impactReview Copy Do Not Reproduce。
