Emergic: Rajesh Jain's Blog

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Digital Dealmaking

September 11th, 2003 · No Comments

NYTimes writes about a software from SplitTheDifference which “makes proposals on behalf of insurers, relying on algorithms to gauge what discount a doctor might accept in exchange for a faster payment…The software, which has been used in 20,000 negotiations over the past 18 months, is just one of the ways in which computers are playing a larger role in a growing variety of everyday transactions. The innovations are rooted in advances in mathematics that enable computers to mimic human behavior and in some cases replace them altogether.”

Software advances have extended the automated negotiators’ potential scope. Instead of considering price alone, computers can weigh the relative merits of variables including quantity, delivery time and technical specifications. Computers have moved beyond merely matching bids with offers or arbitrating between adversaries; they now can incorporate into the negotiations factors that people may not have considered.

The trick to making automated negotiation software work is finding a niche where the humans involved will not feel either that the computer is fleecing them or giving too much away to the other side. To be effective, the software must give both sides some control over the process.

Now, only if computers could automate the marketing process and help us sell more software….!

Tags: General

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