Negotiation Skills Company, Inc.
Negotiation Skills Company, Inc.

The Negotiation Skills Company -- Newsletter August 1999

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$615,384 PER SECOND

In November 1963, Abraham Zapruder used his home movie camera while he watched President John F. Kennedy's motorcade travel through Dallas, Texas. By a stroke of fortune, Zapruder's camera was running when President Kennedy was hit by assassin's bullets. The 'Zapruder Film' is the only film of the tragic event; its duration is 26 seconds.

Ownership of the original film has changed hands several times since 1963; about twenty years ago the film was placed in the National Archives of the United States government as an historic document. The US government made a commitment to purchase the film from the Zapruder family, but the two sides could not reach a negotiated agreement about the purchase price.

Here was a situation where the negotiation was about a very limited issue: What is the money value of an item for which it is effectively impossible to find other similar items for purposes of price comparison. There was no argument about interests, but rather simply a disagreement about money value.

In negotiations about value as measured by price, often the simplest way for the parties to reach agreement is to rely on outside resources for guidance. When buying a new or used car, price comparisons are generally easy to find. The value of a work of art often can be determined by looking at prices paid for other works by the same artist, from the same period, or with other similarities. Experts can be chosen by the parties to the negotiation to determine a fair price. Unfortunately, the Zapruder film's dollar value could not be agreed upon using this negotiation technique.

The parties had to abandon negotiation and resort to a very different of dispute resolution: arbitration. It is important to understand the very significant contrast between mediation and arbitration. Mediation is a voluntary act of the negotiating parties. They rely on a mediator to facilitate their negotiations, but the parties retain complete control of their own decision-making processes. A mediator helps keep the process fair, keeps it moving, and may help the parties develop a better understanding of how to negotiate.

Arbitration is quite different. Once parties agree to place their issues in the hands of arbitrators, they have given up their rights to make independent decisions about the issues under consideration. The arbitrator or arbitration panel is the decision-maker.

In the Zapruder film situation, each side chose one arbitrator, then those two arbitrators chose a third member of the arbitration panel. The arbitrators considered evidence presented by the parties and their experts. While the US Government was prepared to pay one million dollars, the Zapruders wanted thirty million dollars. Each side's experts tried to convince the arbitrators why their price was right.

On Tuesday, August 3, 1999, the arbitration panel announced the US Government must pay $16 million for the film, a price of $615,384 for each of the 26 seconds of film. Because the decision was made using the mechanism of arbitration, the decision of the arbitration panel is final. Unlike mediation, once you enter into arbitration, you are no longer in control of your fate. It is an important distinction to remember.


The July 1999 issue of Training Magazine, which goes to people who make decisions about corporate training has an article of ours entitled 'Am I My Trainee's Keeper'. If you don't see the publication, but would like a copy of the article, let us know.


While most of TNSC's work involves providing training for our corporate clients, we also offer consultation for both individuals and companies. In one recent instance, a corporate client who was reminded to take another look at the interests of the parties saved $600,000 in one element of a deal. Other TNSC consulting activities include management buy-outs and improving contract processes.


While TNSC normally only provides in-house training for corporations or organizations, in March and October 2000 we're scheduled to offer two open programs at a business school in France near Versailles. Let us know if you're interested in attending.


TNSC's Q & A column continues to receive and respond to questions from all over the world. Although we continue to receive many questions about pay increases, the variety of other topics keeps expanding. Come visit our Q & A column every month or so; you never know what new issues have been raised.


When someone offers to sell you a Rolex watch for five dollars, don't bother to read the warranty. (Steven P. Cohen)

Good Luck and Good Negotiating


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The Negotiation Skills Company, Inc.   P O Box 172   Pride's Crossing, MA 01965, USA   
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