the intersection of teaching, technology, and the art .teaching, technology, and the art of the deal

American Journal Of Business Education Third Quarter 2014 Volume 7, Number 3

Copyright by author(s); CC-BY 245 The Clute Institute

Teaching, Technology, And The

Art Of The Deal Jeffrey Schieberl, Pepperdine University, USA

Michael Rainey, Pepperdine University, USA

Lynda Palmer, Pepperdine University, USA

ABSTRACT

This paper illustrates a teaching innovation that took a traditional role playing exercise based on

a case study and added some nuances that amplified the learning experience. The example

illustrated in this paper was a didactic negotiation exercise intended to teach simple, basic

negotiation principles like zone of possible agreement (ZOPA), opening gambit, and the feel of

the deal, but this innovation can be applied to many different types of interactive cases.

Traditionally, an exercise like this is conducted in one class; however, in this case study, we

enhanced the exercise by using two different classes in two different geographical locations1

taught by two different professors with different styles of teaching negotiation. Additionally,

students had a choice of technology by which to perform the negotiation and technology was used

to bring both classes together for a debriefing session. The end result was an exponential increase

in the learning experience. Not only did the students accomplish the key learning objectives of the

case, the negotiation principals, but they also were able to experience different negotiation styles

taught by the two professors and experience the impact technology has on communication

effectiveness.

Keywords: Teaching Strategies; Teaching Innovation; Negotiation, Teaching and Technology; Unique Teaching

Methods; Enhancing Case Learning

THE EXERCISE

he exercise used was The Salt Harbor Case written by Professor Michael Wheeler. The story takes

place in Salt Harbor a quaint town, similar to the Hamptons on Long Island, New York. This vacation

spot grew from primarily a summer vacation spot to a year-round resort destination. The salient facts

of the conflict are:

Three months ago Brims, a national chain of coffee shops, acquired a parcel of property on which it plans to build

and operate a Brims coffee shop. The abutting property to the Brims lot is the Easterly Bed & Breakfast Inn. After

several years in the business, the Easterly is finally becoming profitable. Previously, the Easterlys primary source

of income was the seasonal business. Now the Easterlys reputation is such that it is beginning to cater to

customers on an annual basis with some of these new clients booking rooms a year in advance. The conflict in the

case involves the oddly sized lot purchased by Brims. If Brims develops it, it will obscure the Easterly Inns view,

perhaps causing serious, if not irreparable, damage to their business. The negotiation is between a Brims agent with

the authority to make a deal and the owner of the Easterly.

The two (2) confidential fact sheets are attached as Appendix A and Appendix B. They are given to the

students who participate so that they can prepare the case for their side.

The exercise is solely about price. The parties are told expressly, for the sake of this exercise, please do

not introduce other issues or terms. They are also told financing is not an issueEasterly will take care of the

1 As an interesting aside, one class was in West Los Angeles and the other in Irvineboth very different social and political cultures. This being said, there was no empirical evidence these differences had any influence on the ultimate results.

T

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American Journal Of Business Education Third Quarter 2014 Volume 7, Number 3

Copyright by author(s); CC-BY 246 The Clute Institute

financing. All efforts are made to keep the participants focused solely on price and the steps, tactics, and process to

achieve their best price. Included in the facts are some attorney prognostications on risks and benefits of various

alternatives.

Like a real-world negotiation, the exercise has numerous challenges. It has varying degrees of asymmetric

information and plenty of variables, which give rise to uncertainty for the negotiators. What makes this exercise

most impactful is how it so closely illustrates real-world situations negotiators face every day. Augmenting the

exercise with the challenge of distance, technology, and different teaching styles adds yet another interesting

dimension.

EXECUTION OF THE EXERCISE

This exercise was conducted using two geographically dispersed classes taught by two different professors.

Professor Schieberls Spring 2013 Irvine (IR) class had 13 students. Professor Raineys Spring 2013 West Los

Angeles (WLA) class had 25 students. The distance between the two campuses is about 45 miles, but during high

traffic times, it can be a three hour trip.

These students are Fully Employed Masters of Business & Administration (FEMBA) at Pepperdine

University Graziadio School of Business & Management. In the WLA class, there were two students involved in

residential & commercial real estate and two were involved in law firms. In the IR class, none of the students had

subject matter experience they could draw upon. The classes engaged in the Salt Harbor negotiation approximately

half way through the semester.

The classes were given the Easterly and the Brims fact sheets (Appendices A and B) and allotted a week to

complete the exercise. Because of the disparity in the number of students in each class, negotiation teams were

assigned with two students representing Easterly and one student representing Brims. Students were instructed to

read the facts carefully and prepare a strategy. When they felt adequately prepared, they were to contact an assigned

student partner in the other class and attempt to make a deal.

Students were told they could conduct the negotiation in person, by Facetime, Skype, or, as a last

alternative, by phone. Each team was responsible for setting up their meeting and instructed to treat it as a real-world

transaction. It would be fair to say in-person negotiations were encouraged, but both professors were interested in

any deviations attributed to the mode of the negotiation. After the negotiations were completed, the negotiators were

required to provide a written explanation of their results and then the classes debriefed via video conference (see

below).

A week after the assignment was completed the students met in their respective classrooms. For the first

hour the professors debriefed their students. During the second hour, the classes connected by video conference. The

students could talk to their former negotiation partners. They discussed the nuances of the negotiation, including

what worked for them and how they reached their ultimate number. However, it is important to note, although the

debriefing seemed complete, the subsequent time in class and the following weeks yielded numerous tid-bits of new

information. In essence the learning process appeared to be quite deep, with new information being discussed over

several weeks following the exercise.

RESULTS

One class was almost twice the size of the other class, so one side of negotiators had two people and the

other side had one person. This did not seem to create any problems, as most of the 13 teams negotiated a deal

within the parameters of the given facts. The deals ranged from No Deal to well over a hundred thousand dollars.

Some examples of the discussion of the deals were:

No DealPerhaps the student negotiators in this group collectively misunderstood the assignment. They believed simply getting Easterly to back off a lawsuit, even without a consummated deal, was sufficient.

The negotiators believed their agreement, while not involving a cash payment or a change of ownership,

involved value that was equivalent of a good cash value.

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American Journal Of Business Education Third Quarter 2014 Volume 7, Number 3

Copyright by author(s); CC-BY 247 The Clute Institute

$110,000This price is not a valid result, as one team of negotiators added facts which were not a part of the given facts, and that, if true, would have substantially reduced the value of the property.

2

$135,000

Sale price of land $183,500Brims Coffee gets first right of refusal if you elect to sell the parcel of land in the future. Market price to be determined by a mutually agreeable sales agent and appraisal agent. Brims

Coffee to absorb the cost of creating a copper placard for B & B and Coffee Shop highlighting efforts of

the two businesses to bring a nice gathering place for the community. The relationship was strengthened by

the meeting and sale of the parcel of land. Both sides look forward to working together in the future to

drive business and provide amenities for the client.

Primary strategy is to see if owner of Easterly can be induced to drop the charges. If yes to dropping charges you can trade a contract/agreement for the dismissal. If he cannot be induced, pursue second

strategy, which is to negotiate to sell original parcel at best price possible.3

The parties