question

What are the 4 phases of a negotiation?

answer

1. preparation 2. information exchange 3. agreement proposals 4. resolution

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Different types of preparation

answer

1. internal preparation 2. external preparation 3. synthesis

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internal preparation

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Prior to formal negotiations, determine your own: 1. Interests/needs, concerns, fears and aspirations 2. Options that require the agreement of the other party 3. Alternatives that don't require or involve the agreement of the other party, including their BATNA and RP 5. Relative importance/priority to your various interests 6. Establish an objective standard to measure the bargaining process

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External preparation

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Prior to formal negotiations, determine the other parties: 1. Interests/needs, concerns, fears and aspirations 2. Estimate their available options and alternatives, Including their oppositions BATNA and their RP - Not all of these may be ascertainable

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Synthesis phase in preparation

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Finding a common ground and strategize w/ the goal of creating a win-win agreement for all the parties Operate from the understanding that the interests/needs of the other party must be satisfied, before an agreement can be reached

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What is done in the information exchange phase of a negotiation?

answer

1. acquiring information; and 2. disclosing information

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Acquiring Information

answer

use open-ended questions and probing followup questions to: 1. Determine the other party's interest, 2. Find a common interests 3. Identify the bargaining zone

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3 Purposes of Disclosing information

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1. inform the other party 2. persuade the other party 3. satisfy the need to be heard

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What is done during the agreement proposals?

answer

1. The first offer 2. the counter offer

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The first offer

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The one making the initial offer reveals info, and shapes the other party's expectations about the range of potential possible agreements Be sympathetic to the anchor problem. If you are not prepared you shouldn't make the first offer

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The counter offer

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Can shape the expectations of the other party b/c if an offer is too aggressive or too generous it can be problematic. It should be made w/ the consideration of whether the terms should mirror the terms of the offer or whether they should use the counter to reframe the issue and thus proffer a more true anchor

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What are the 2 options for the resolution phase of the negotiation?

answer

1. agreement 2. impasse

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Agreement

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It should leave both parties better off than they would have been w/o the agreement. If not, then someone has failed It should be a commitment to the negotiation memorialized in writing and signed by both parties

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Impasse

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Happens when no agreement is reached. The most frequent cause is that the best alternatives (i.e. BATNA's) exist outside the agreement. The next most frequent cause is poor negotiating skills. Even if a mutually desirable agreement exists, the parties might reach no agreement b/c: 1. the opportunity costs are greater than the marginal benefit that would come from reaching an agreement 2. time constraints eliminate the value of the agreement before arriving to one 3. one party has staked out a position that is incompatible w/ any mutually desirable agreements and they refuse to accept less.

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Two main models of negotiation

answer

1. Cooperative/problem solving approach 2. Adversarial/distributive approach

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Cooperative/ Problem solving approach

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This approach sees the negotiation as a win-win game, where the negotiators attempt to make both parties better off by finding a solution to each party's set of underlying needs and objectives.

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Adversarial/distributive approach

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This approach sees the negotiation as a zero-sum game, where a party will attempt to capture the most possible gains for themselves at the expense of the other party.

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The bargaining zone

answer

area b/w the reservation points and the BATNA's of the parties where only potential agreements can possibly be made Is expanded or created by using integrative bargaining

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Efforts of persuasion are to satisfy 2 goals?

answer

1. Shift the bargaining zone to your advantage either: - by convincing the opponent that this RP is worse than they believed before beginning, or - that the negotiator's RP is better than previously believed, or 2. Determine an objective standard that is fair method to establish value - ex. market value or blue book value

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surplus allocation

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Effectively divides the cooperative surplus that the parties create by reaching an agreement Sometimes there is only one Must have an appearance of equity to be successful distributive bargaining divides it either by negotiating power or social norms

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Cooperative Surplus

answer

Additional value created in the bargaining zone when an agreement is made the gain results form integrative bargaining that finds casual connections b/w the parties compatible interest which directly results in expanding the bargaining zone The more you expand the bargaining zone, the more surplus who have When parties are able to identify a common interest, then RP's shift in directions that make reaching an agreement more valuable

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What types of barriers impede agreement in a negotiation?

answer

1. strategic barriers 2. cognitive barriers

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What are the 3 types of strategic barriers

answer

1. information asymmetry 2. strategic behavior 3. the principal/agent problem

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information asymmetry

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A party is in possession of information that the other party doesn't have allowing them to bluff and lie about their interests and preferences

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Strategic behavior

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Claiming tactics aimed at maximizing the size of the party's own "slice of the pie" that may result in pushing up the cost of the agreement

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Principal/agent problem

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Incentives for an agent negotiating on behalf of a principal that often motivates the agent in behavior that fails to serve the interest of the principal

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What are the different types of cognitive barriers and its effect?

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1. risk aversion 2. loss aversion The effect is that both sides may fight in order to avoid any losses, even though the continuation involves a gamble in which the actual loss may end up being far greater.

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risk aversion

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most people will take a sure thing over a gamble, even where the gamble may have a somewhat higher "expected" pay off. individuals take a smaller certain gain over an uncertain larger gain

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loss aversion

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in order to avoid what would otherwise be a sure loss, many people will gamble, even if the expected loss from the gamble is larger. individuals will take an uncertain loss to avoid a certain loss

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What is a BATNA?

answer

Best Alternative to A Negotiated Agreement that lie outside of the parties negotiating (is an action not a value or price) is RP adjusted by time, place, and circumstances

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reservation point/price

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is the highest a buyer is willing to offer and the lowest a seller is willing to offer. is the parties walk away points It is merely a point that divides potential deals you will accept from potential deals you will not accept.

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What are the 2 components to a reservation point?

answer

1. The market value of the BATNA, and 2. The difference TO YOU between the value of the BATNA and the value of the subject mater of the negotiation. (is the BATNA or the subject matter worth more or less to you than the market price)

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What 7 factors that affect calculation in a RP?

answer

1. alternatives 2. preferences 3. probabilities of future events 4. risk preference 5. transaction costs 6. value of time 7. effect on future opportunities

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Define Goal

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your highest legitimate expectation of what you should achieve sets your upper limits triggers psychological striving mechanisms

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Define bottom line

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the minimum acceptable level to say "yes" in a negotiation. Essentially its your RP

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Why is the difference b/w goals and bottom lines important?

answer

Since humans have a limited capacity for maintaining focus in negotiations, it is better to focus on goals rather than bottom lines. Do not treat your goals or aspiration levels as your bottom lines, otherwise you may walk away from a deal that would be superior to your BATNA.

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Aspirations

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The the expectation and goals a negotiator hopes to achieve as opposed to an RP They should be specific and concrete that is justifiable or reasonable Can serve as anchors or framing (when being compared to see if the offer is a loss or a gain)

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What is the power of aspirations?

answer

negotiators with high aspiration obtain more desirable outcomes than negotiators with more modest aspirations

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Why should or why does aspirations affect outcomes?

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We are more persuasive when we are committed to achieving some specific purpose b/c what convinces is conviction and therefore setting the tone for negotiation proceedings Typically what you aim for often determines what you get.

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What is the risk of having high aspirations?

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You may walk away from a possible deal that would be superior to pursuing your BATNA just b/c the terms fail to meet the aspiration level

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Heuristics

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Idea that a person's future decision will be based on past habits on how they deal w/ certain situation in like circumstances They are rules of thumb or mental short cuts for judgment or decision making

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Economic/Rational Choice Theory

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Negotiators will evaluate alternatives w/n their preference structure and the available information They make decisions based on objective information and quantifiable outcomes regardless of how the choices are presented Decision is independent of emotions Predict that rational negotiators will be risk adverse (most people will take a sure thing over a gamble)

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Prospect theory

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Research has found that preferences are sensitive to whether the decision maker views options as a "Gain" or "Loss" relative to a reference point . Evidence suggests that these reference points are easily influenced. predicts that in the usual case, decision makers will exhibit risk seeking tendencies when choosing between certain and probabilistic losses people prefer a probabilistic loss to a certain loss when the two have the same expected value

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Support theory

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Theory that people tend to over estimate the likelihood of an event if it is more vivid in their mind and will under estimate the likelihood of an event if it is less vivid, such as fears and putting a value on something In the absence of not knowing what to do, you will copy others b/c there is safety in numbers People have a more difficult time say no to a person they like

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What 7 psychological factors enter into evaluating alternatives?

answer

1. Self-serving bias 2. Anchoring 3. The framing effect 4. Loss aversion 5. The endowment effect 6. Status quo bias 7. Reactive devaluation

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Self-serving bias

answer

people tend to believe what they want to believe make judgments in a manner skewed to favor one's own self interest w/ the belief that the judgment is fair The psychological tendency to view uncertain events or evidence in the best possible light The tendency that when people are better off if something is true, they become more likely to perceive it as true Things that go well are attributed by the actor to his own skill or hard work, while things that go badly are attributed to bad luck or the shortfalls of others A persons' tendency to believe or to convince one's self that what is best for me must be the best, period

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Anchoring

answer

when people evaluate a situation or information and make estimates, decisions or judgment they start with some initial expectation or at some initial position or point and then make adjustments to that initial expectation or point to arrive at a final estimate, answer, or decision it is the starting points subsequent points tend to be biased toward the original People are reluctant to change their point Some initial starting points are unrelated or even irrelevant to the issue at hand Parties typically establish the entire tone of a negotiation through the first array of moves and gestures Thus, the first impression that one projects in a negotiation will often carry through the entire bargaining sequence

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The framing effect

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Relates to the economic/prospect theory that individual will prefer certain alternatives to risky ones in the realm of gains (risk adverse), but prefer risk seeking alternatives to safer ones in the realm of losses (loss adverse) As a result, negotiation decision are influenced by the risk preference of the parties, which in-turn, are determined by whether the person frames or views the character of the decisions as a gain or as a loss

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The endowment effect

answer

The value an individual assigns to an object that increases substantially as soon as an individual possesses the object Therefore, an individual will usually prefer to keep an item they possess than trade that item for one of objectively identical value

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Status quo bias

answer

all other things equal, individuals on average tend to prefer an option if it is consistent with the norm than if it requires a change Therefore, negotiators will: 1. prefer their initial endowments over endowments they might hope to receive through exchange 2. favor deal terms that are consistent w/ legal default rules 3. prefer terms that are conventional for the type of bargain at issue 4. place more value on an item they have as compared to a person trying to acquire it 5. prefer to keep an item they possess rather than trade it for anther item of same value

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reactive devaluation

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a negotiated agreement may be of less value to a negotiator than it would otherwise be merely because his opponent proposed it. When a particular agreement comes w/n a negotiator's grasp, that agreement might seem less desirable b/c its available "Its not as valuable now that you gave it to me as it was when you wouldn't let me have it."

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integrative bargaining

answer

negotiation that takes advantage of the potential ways to structure a deal that will benefit the parties more than merely dividing a single asset The ideal negotiated agreement that benefits both parties w/o creating additional costs to either party only requires that the parties have different preference structures Allows the parties to redefine the negotiation's subject matter in a way that benefits one party more than it costs the other Goal is to expand a larger bargaining zone or create one by incorporating information sharing and reciprocity w/ the other party in order to generate options is not prevented by opposing interest

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Gains come from differences

answer

Gain from negotiation often exists because negotiators differ from one another Since joint gains often derive from such differences, a primary objective of negotiators should be toward discovering and dovetailing them

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Gains from Differences Strategy

answer

When contemplating the potential gains from agreement, begin with a careful inventory of all the ways that the parties differ from one another—not how they are alike The basic principle underlying the realization of joint gains from differences is to match what one side finds or expects to be relatively costless with what the other finds or expects to be more valuable, and vice versa.

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What are the 8 strategies for reaching integrative agreements?

answer

1. focusing on interests rather than positions 2. adding and subtracting issues from the negotiation "package" 3. logrolling 4. avoiding the fixed-sum error 5. confronting adverse selection and moral hazard problems 6. exploring the opponent's interests and preference 7. revealing interests and preferences 8. post settlement agreements

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Focusing on interests rather than positions

answer

Look past superficial demands advanced at the bargaining table by both parties Investigate the general or core interests of other party Maybe relatively low cost to one, but valued by the other --- creating value.

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Adding and subtracting issues from the negotiation "package"

answer

Adding an issue: - will only expand the bargaining zone when that issue is valued more by the buyer than by the seller -is an effective strategy when the parties have common interests, just as it is when the parties have opposing interests, but difference in their preference structure - It is often the case that even more value can be created when the negotiators adds more than one issue to a negotiation Subtracting an issue: - will only expand the bargaining zone when that issue is valued more by the seller than by the buyer - Redefine the subject of negotiation to unbundle items Swap items or issues entirely, subtract one and add another issue

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Logrolling

answer

Is the practice of combining two or more dissimilar subject into a single act to force simultaneous passage of the varied provisions. It a give and take relationship where one party gives something that they value less than the other party receiving it in exchange the other party gives something they value less to the party who gives great value to it. Ex. practice of legislators trading votes on bill that are little importance to them in return for votes on bills that are very important to them.

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fixed-sum error

answer

the tendency to see a complete clash of preferences and priorities when there is actually an opportunity for integrative bargaining. This occurs when parties enter a negotiation assuming that their counterpart's preferences and interests are in complete opposition to their own. This is a mistake is susceptible in achieving poorer results than those who accurately perceive or identify during bargaining interactions that the opponent has a different preference structure

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Confronting adverse selection and moral hazard problems

answer

Adverse selection: - sellers usually have more information about the quality of their products than potential buyers - value can be created for the seller by insuring the quality of the goods (i.e. warranty - this expands the bargaining zone by adding an issue that typically will have great value to the buyer w/ minimal costs to the seller before an agreement has been made. Moral Hazard: - when the seller's actions after an agreement has been reached can affect the value of the subject that was being negotiated. - therefore, structuring an agreement where compensation is dependent upon an objective standard of performance. - ex. services like insurance and warranties. - ex. after a negotiated agreement on a sale of a house, the seller has an incentive to lax on the upkeep of the house b/c he will not capture the benefit. therefore structure the agreement where the sale is conditioned on his maintenance

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Exploring the opponent's interests and preference

answer

Ask "what" questions about the other party's interests and preferences Search for interests under the positions and the relative value opponent placed on each interests Probe priorities directly by asking "what" and "why" questions to which of the many interests expressed by the opponent are most important

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Revealing interests and preferences

answer

It is helpful to explicitly describe your underlying interests Describe how you value and prioritize potential elements of the negotiation package Be clear about what you want, why you want it, how you prioritize issues, and the relative value you place on different aspects of the negotiation To encourage your opponent to fall prey to the fixed-sum error and help identify the integrative potential of a negotiation

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Post settlement agreements

answer

Once negotiators have agreed on a specific transaction, they continue to brainstorm various other agreements that would adjust the initial agreement or add or subtract issues The parties agree to abide by the terms of the original agreement unless both parties agree to revise the agreement based on their further discussions

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Uncertainty

answer

Agreements implicitly assume certain facts about current and future states of the world. Add items that plan for unexpected events-outline the parties rights and liabilities if they occur. ex. parties to a construction K assume that the city has not going to change its permit process in a way that will delay project. therefore, add a provision in order to account for the unexpected event.

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What is the 3 step process that can be used to establishing an accurate RP?

answer

1. Acquiring and analyzing all relevant information available from sources other than the opposing negotiator before the bargaining begins, 2. actively seek to discover information relevant to one's reservation price known only to the opposing negotiator at the bargaining table, 3. viewing information provided with cautious skepticism as the situation warrants and verifying it

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What are the 3 universal sources of successful value creation?

answer

1. avoiding adverse selection 2. minimizing moral hazard 3. reducing uncertainty

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What is negotiation power?

answer

the ability of the negotiator to convince the opposing party to give him/her what he/she wants, even when doing so is incompatible with the opponent's interests. can be misused but can also accomplish important & useful things above all it is a matter of perception-and perceptions are highly changeable

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What are the different sources of negotiation powers?

answer

1. personal 2. organizational 3. informational 4. expertise 5. moral

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Personal power

answer

inherent individual traits, such as intelligence and emotion that give you the ability to influence others

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Organizational power

answer

Power flows to individuals simply by virtue of their positions over others in an organization

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Informational power

answer

Tips the scales in favor of one party The more information one has compared to their opponent creates leverage and thus power with more information the better to see the context of a given situation clearly and respond accordingly Most commonly used in law the power source is most easily increased during negotiations when exchanging information ex. data of info that Google possesses which allows them to have ad's pertaining to your interests

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Expertise power

answer

Is viewed of having mastered an area of knowledge one of the most critical and powerful sources of info can influence a negotiation proceeding by expressing an opinion about a critical issue, often w/o justifying the basis for it

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Moral Power

answer

Refers to power in instances which the negotiator achieves gains by appealing to fairness and morality. Sometimes moral claims are the only source of leverage available against a greater power. It has a great impact when employing empathy to persuade an opponent to "walk in one's shoes."

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What are 4 tactics for improving power?

answer

1. Improve own BATNA 2. Reduce the opponents BATNA (shift the bargaining zone) 3. Manipulate opponent's perceptions of bargaining zone - make commitment not to agree to anything less than a particular agreement, even if a less favorable agreement would be superior to impasse. 4. Demonstrate patience w/ the ability to wait longer for concessions than the opponent

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What are the differences between positive and negative negotiating leverage?

answer

positive is needs based (what a party can do FOR the other) negative is threat based (what a party can do TO the other)

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How would you reduce your opponents RP by rebuttal argument?

answer

Convince the opponent that their efforts at reducing your RP have failed (this persuades the opponent that the bargaining zone has not shifted to his advantage) This turns the table on your opponent by attempting to shift their RP

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How could you improve your own RP through rebuttal argument?

answer

convince your opponent of your subjective belief and that you are not risk adverse

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What are the 2 basic methods for dividing cooperative surplus?

answer

1. power used in negotiation 2. Social norms, which governs what constitutes a fair division use social norms when power doesn't work or negotiator is unwilling to use their power

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Power asymmetry/the power paradox

answer

Disproportionately greater power on one party often reduces the likelihood of a favorable outcome for the powerful party The harder you make it for them to say no, the harder you make it for them to say yes Attempts to exercise power can lead to a miscalculation of the Bargaining Zone, and impasse. Power tactics can produce an emotional response that leads to impasse Power tactics can negatively affect relationships Power tactics can negatively affect your reputation Power tactics can negatively affect performance of agreements.

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Distributive v. Integrative bargaining

answer

Distributive bargaining is necessary in any bargaining situation in which the bargaining zone is wider than a single deal point. Distributive and integrative bargaining are complimentary rather than mutually exclusive approaches How the negotiators divide the cooperative surplus is a matter of distributive bargaining, not integrative bargaining.

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what are the prerequisites to successful exercise negotiating power?

answer

1. threat of impasse (i.e. no deal) 2. the threat must be credibility in other words, don't make a threat you can deliver

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what are the 2 reasons why the bargaining zone perceptions can be manipulated?

answer

1. Negotiators rarely know opponent's RP w/ certainty 2. Negotiator may know their own precise RP w/ certainty

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What are the procedural norms in distributive justice

answer

1. convention 2. reciprocity

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Reciprocity norms

answer

Idea that if a party give something of value to another, they expect that the recipient will reciprocate. This creates a social obligation for the receiving party to return the favor.

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Convention norms

answer

Idea that an agreement on standard terms is fair to both parties. The norm is up for debate especially when the standard would affect one party negatively than the other. Ex. the standard remedy for a car crash is to pay $20k, but the D doesn't have that money or is unable to get it b/c of their situation.

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What are the 3 meta-norms of distributive justice?

answer

1. equality based norms 2. equity based norms 3. need based norms

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Equality based norms (parity)

answer

Idea that everyone in negotiation should share the benefits equally w/ identical distribution of the benefits.

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Equity based norms (contributions)

answer

Idea that parties who have contributed more should receive more than those who contributed less. The distribution of benefits should be allocated according to contribution or merits of the parties

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Need based norms:

answer

Idea that the distribution of benefits should be allocated according to the differing individual needs of the parties. Not seen regularly in legal negotiations but are prevalent in other negotiations

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RPs are usually unverifiable, so negotiators often reach an agreement by splitting the difference between ...

answer

2 offers rather than 2 reservations

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How does trust come into play in a negotiation?

answer

when deciding whether to reveal information as part of the bargaining process or whether to promise goods, services, or other consideration as part of an agreement

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Negotiator's bias

answer

Natural tendency to enter deliberations with fear Often leads to judgments (w/ little or no evidence) that their opponents are negotiating aggressively and competitively despite sincere efforts to bargain cooperatively Its a deadly trap

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The negotiators/prisoners Dilemma

answer

Whether to share or conceal relevant info w/ an opposing party whether to cooperate or defect w/ negotiating w/ an opposing party The best strategy for an individual negotiator is to defect Combined strategy: If both players go for their best possible result (dominant strategy), they end up with the worst combined outcome, and each of their individual outcomes is only slightly better than the worst outcome possible. -Therefore you must communication and trust (in the form of an agreement or otherwise) the opposing party A fear that sharing information would be exploited by the opponent in dividing any bargaining surplus can produce, and often does produce, non-optimal results for both sides, or no bargaining surplus at all.

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In a negotiators dilemma, trust is possible for what 3 reasons?

answer

reputation, contract, and pro-social behavior

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Distributive lies

answer

one by which the liar seeks to capture an advantage over the other party If successful, the liar becomes richer to the same degree to which the victim becomes poorer (Zero sum game). Lies told to secure advantages may make it impossible to discover and exploit the integrative opportunities. may also cause defensive lying by others and in other negotiations

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2 types of distributive lies

answer

1. Lies about reservation prices, opinions as to value, undisclosed principal situations. 2. Lies or misrepresentations as to operative facts.

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2 sources of Anger in Conflict

answer

1. The Desire for Interactional Justice. 2. Attribution Biases

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Interactional justice

answer

Generally requires a belief that person had control over the action Challenging aspects of negotiator's self-image can cause anger Blame for event can challenge self image of being competent, careful, selfless. Criticism for obstructing the process can challenge self image of being reasonable and honest.

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Anger affecting emotions in 3 ways

answer

1. Moral outrage and desire to retaliate. 2. Inhibit ability to empathize and work together. - Can create a desire that they not achieve their goals 3. Damage the relationship and ability to work together in the future.

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positive emotions affect negotiations in 5 ways

answer

1. Can facilitate agreement 2. More likely to generate belief of altruistic motives 3. Increase trusting behaviors 4. Create desire to work together in the future 5. tend to achieve better results

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Different 4 types of emotions affecting negotiations

answer

1. Anger can increase preference for risk seeking choice 2. Fear can cause a desire to avoid risk 3. Sadness can cause a desire to change the status quo 4. Disgust can cause a desire to change the status quo

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Attribution biases

answer

When acts of others harm us we tend to conclude they are bad people who acted with malice or indifference. When our acts harm others we tend to conclude our actions were in response to unalterable situational circumstances. We view the victims angry reaction as unwarranted and evidence of the victim bad disposition. We assume we see the world and facts as it really is. When others do not agree, they are misinformed, biased or self-interested. After we explain the situation they can no longer claim to be misinformed, and their different perception of the world is evidence of their bad character.

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2 types of attribution biases

answer

1. Dispositional Characteristics 2. Situational Characteristics

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Dispositional characteristics

answer

Concern the character or personality traits of the actor and usually considered to be within the control of the actor creating the negative situation. a negative event tends to cause a feeling of anger

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Situational characteristics

answer

Concern external circumstances usually beyond control of the actor a negative event tend to be more neutral.

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Fundamental attribution error

answer

People tend to attribute the behavior of others to that persons disposition not situation. People tend to attribute the behavior of themselves to the situation not their disposition.

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Assertiveness

answer

Identifying & advocating own interests & positions Make arguments and explaining position

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Empathy

answer

Perspective taking Expression of other's viewpoint for purposes of correction

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Competing conflict style

answer

Is strong on assertion, but weak on empathy. They focus on their own needs and pursue their concerns at the other party's expense. They're focused on winning and will try control the agenda in order to influence perceptions. If the other party's view is different, they will be aggressive by making arguments, debating w/ the opposition, and assert their position. They tend to give little feedback in their assertions, which leads to a failure of information disclosed to them. As a result this reduces their knowledge or ability to learn about the issue, equating to low empowerment. Therefore, they have difficulty in identifying integrative solutions and solving problems.

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Accommodator conflict style

answer

Is strong on empathy, but weak on assertion. Empathy may take the form of valuing good relationships, being good listeners, or basing a decision on good faith, while focusing little on their own needs. However, they're easily exploited that affects their ability to identify integrative solutions and comes at the expense of satisfying their own needs by yielding to another's point of view.

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Avoider conflict style

answer

Is both weak on assertion and empathy. They neither pursue their own concerns nor those of the other individuals, which leads to both parties being unsatisfied w/ the resolution. They do not deal with the conflict. This may take the form of taking steps to delaying the negotiation or by simply disengaging from the conflict entirely.

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Compromisers conflict style

answer

Is both moderate in assertion and empathy. They attempt to work with and communicate w/ others to find a fair solution that splits the difference b/w the parties in conflict. The compromise is usually a backup for unsuccessful competing and collaborating styles, but may come at the expense of a resolution w/ moderate satisfaction.

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Collaborators conflict style

answer

Is strong on both assertion and empathy concerned w/ finding a mutually beneficial solution that satisfies both parties into a win-win agreement. They are able to integrate solutions by addressing the issue more directly than avoiding it. They're able to merge the differing perspectives by exchanging concessions and seek a middle ground where commitments can be gained. As a result, their able to improve relationships b/w the parties.

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How is stereotyping dangerous?

answer

they are likely to be misleading In addition, studying them also carries the risk of unconsciously and unintentionally reinforcing them

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2 reasons how gender stereotype inquiry's might be justifiable?

answer

1. some generalizations may be accurate 2. can affect the way negotiators bargain w/ those genders, b/c a significant number of negotiators may assume the stereotypes to be true - even if the generalizations have little validity

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Why can the gender of the bargaining parties be relevant to the study of negotiation? (2 reasons)

answer

1. it is conceivable that men and women, on average, tend to adopt different negotiating tactics or interpersonal styles. 2. it is conceivable that men and women, on average, achieve different negotiation outcomes.

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Typical assumptions of males

answer

1. Focus on results 2. Favor equitable division 3. Enjoy (or tolerate) conflict 4. Controlling in conversation 5. More self-interested

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Typical assumptions of females

answer

1. Focus on relationships 2. Favor equal division 3. Avoid conflict 4. Passive in conversation 5. More altruistic (also more likely to punish)

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Male and Female differences on locus of control

answer

Men more likely to believe that they can influence their circumstances Women more likely to believe that their circumstances are controlled by others

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Male and Female differences on likability

answer

Women: - influence increases the more they are liked - Assertive women are less well-liked - Self-promotion may make women less likable Men: - No connection of assertiveness & likability - Self-promotion tend to not affect their likability

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Male and Female differences on negotiation styles

answer

Women seem to be: - More anxious about negotiations - More cooperative - More integrative Men tend to be: - Less anxious about negotiations - More competitive - More distributive

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Individualism culture

answer

Norms and institutions promote autonomy of the individual Tend to have strong self-interests Unconcerned with how the negotiation is going for the other party, so long as it is going well for self Individualist does not change behavior regardless of who they are interacting with

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Collectivism Culture

answer

Norms and institutions promote interdependence of individuals through emphasis on social obligations Identify more strongly with their in-groups Goals should be aligned with in-group's goals

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Hierarchical Culture

answer

Social status confers social power knowledge of status dictates how people will interact Conflict poses a threat to the social structure Conflict between members of different social ranks is likely to be less frequent Conflict between members of the same social rank is likely to be handled by deference to a superior Interpersonal relationships are vertical.

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Egalitarianism culture

answer

Social boundaries are permeable Superior social status may be short-lived No obligation to look out for the needs of social inferiors Conflicting members resolve the conflict themselves Support direct, face-to-face negotiations Power in negotiations tends to be evaluated with respect to the situation under negotiation and the alternatives, if no agreement can be reached. Every negotiator has a BATNA. BATNAs are not fixed.

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High-context cultures

answer

Little information is in the message itself Context of the communication stimulates pre-existing knowledge in the receiver Meaning is inferred rather than directly interpreted from the communication Preferences can be determined through the differences in proposals

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Low-context cultures

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Information is contained in explicit messages Meaning is conveyed without nuance and is context free Communication is action oriented and solution minded Preferences can be determined through the use of questions and answers

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Western cultures:

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Focus is on the individual, solving problems, and material progress

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Eastern cultures

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Emphasis is on the collective good and preserving social structures

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Differences between ideology's of Eastern and Western cultures

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Western: - Private investment and profit is good, - Individual rights as important Eastern: - Foreign investment has benefits but must be regulated - Profit is a win-lose situation - The rights of the group are important

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Differences between negotiation culture of Eastern and Western cultures

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Western: - Deal being negotiated is the terms of a K - Detailed K covering future circumstances - One person vests the authority to make the deal - Negotiation as not a social activity Eastern: - Deal being negotiated is based on the relationship of parties - The deal is under general terms w/ trust on the relationship to handle future problems - Collective authority to make the deal - Negotiation is considered a social activity

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Differences between judgment accuracy of Eastern and Western cultures

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Western: - Less attuned to opponents interest - More value claiming and one sided offers - More self promoting Eastern: - More attuned to opponents interest - Less value claiming and one sided offers - Less self promoting

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The role of culture in negotiation is useful for 2 reasons

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1. Understanding cultural differences can be useful to inform you about a negotiator's approach to bargaining with someone from a different culture 2. Their stereotypes of your culture will often affect how they bargain with you

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The 8 benefits for using lawyers as negotiation agents

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1. Technical Expertise 2. Negotiation Expertise 3. Signaling 4. Dispassionate Analysis 5. Justification Generation 6. Access 7. Strategic Advantage 8. Cost Effectiveness

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Pre-litigation game: choosing lawyers

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Dilemma on whether to choose a cooperative lawyer or a non-cooperative lawyer similar to the prisoners dilemma

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3 assumptions during the pre-litigation game: choosing lawyers

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1. clients disclose their choice of lawyer - and thus, whether they have chosen a cooperative lawyer - prior to the beginning of the game. 2. if one client chooses a cooperative lawyer and her opponent does not, the client choosing a cooperative lawyer can change his/her mind without cost before the litigation game begins. 3. after the litigation game begins, clients cannot change lawyers

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Dominant stratgey in the pre-litigation game: choosing lawyers

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choose a cooperative lawyer first. Once you find out other parties selection you can change your mind.

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Issue with the reputation market for cooperative lawyers

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It is assumed that there may be a market for cooperative bargaining lawyers. Lawyers can help to solve the negotiators dilemma by promising in advance to "cooperate" rather than "defect" in negotiations and making that promise credible by pledging as collateral their reputations as cooperators. The problem with relying upon a reputation for cooperation is verification b/c it is difficult to find out whether or not a lawyer is in fact cooperative or not.

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Lawyer's self-perception as negotiation agents

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Most lawyers describe their personal strategy as flexible, either cooperator or gladiator, depending on how the other side plays (i.e., tit-for-tat, I cooperate until the other side defects, then I retaliate.)

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Lawyer agent problems: echoes

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Where one party misinterprets the action of the other, causing defection when it was not intended The response is a retaliation which subsequently echoes The 'self-perception' that each agent is the 'good guy' turns into a negative as each party thinks the other is to blame for the initial defection

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Lawyer agent problems: noise

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Explanation for echoes Though 'self-perception' is generally uniformly positive, not always easy to know whether the other side intended to cooperate or to defect! Often don't know whether actions are intentional

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6 Value creations by Lawyer negotiating agents

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1. Adverse Selection 2. Moral Hazard 3. "Earn-out" or "Contingent Price" 4. Informational Asymmetry 5. "Hostage" Strategy 6. Representations and Warranties

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4 Causes of Principal-Agent Tension

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1. Different Preferences 2. Different Interests 3. Different Personalities 4. Expenses

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Controlling and Mitigating Lawyer Agency Problems

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1. Rules of Professional Conduct 2. Align client and attorney interests though a fee structure 3. Client monitoring

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What are the 2 main reasons why agents might not exhibit the self-serving bias?

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1. agents participate in large numbers of cases providing ample opportunity for learning from experience; after failing to settle a large fraction of cases, they might learn to moderate their demands. 2. it is possible that agents face incentives that discourage self-serving assessments of fairness.

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what are the same fundamentals of the negotiating process in multilateral negotiations?

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1. Parties must still estimate the bargaining zone 2.Find some way to expand the zone through integrative bargaining 3. Divide any cooperative surplus that agreement would create 4. Using power of fairness norms

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3 Multilateral Negotiation Issues

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1. Two or more parties might form a coalition. 2. Complicates fair division when of multiple parties are involved 3. More difficult to identify a deal point that exceeds the RP's of all the parties, even when they don't exist

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Power Dynamics: To Join or Not to Join the Coalition?

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Possibility of Intermediate Coalitions creates new possible intermediate outcome Some, but not all, of the relevant parties agree to cooperate Question for each negotiator is whether to join a coalition at this intermediate stage or to "hold out"

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What is coalition building?

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Bringing other parties together to form a coalition Incorporates the notion of sequencing Exploits patterns of deference where party defers to another Changes no-agreement alternatives where an earlier agreement of some of the parties worsen's the no-agreement alternative of later parties Shapes outcome expectation by using early agreements to shape later parties alternatives Conceals or reveals information (will early info hurt potential prospects)

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Coalition forming power

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Gives the party able to form coalition a great deal of power Can force the other parties to bid against each other to avoid being left out of the coalition

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What is an intermediate coalition?

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Some but not all of the relevant parties agree to cooperate in some situations, one party can form with either (or any) of the other parties, but other parties cannot form with each other Party able to form the coalition has two or more good alternatives to reaching multilateral agreement, while other parties lack any desirable alternatives

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Unstable BATNA's in multiparty situations

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If the best alternative to a unanimous agreement in a multiparty situation is form a coalition with some, but not all, of the other parties, and other parties' best alternative is forming a different coalition, it becomes difficult for a negotiator to know whether the coalition he envisions as his best alternative is viable, in light of the position of other coalitions being formed

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free riding power

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A party gaining a benefit just by the existence of a coalition w/o being a part of it where their benefit is greater than the Initial BATNA Can wait to determine whether joining coalition will give a greater benefit than not joining coalition Power and their BATNA may rise from not joining the coalition.

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What is a "blocking ability" in a multilateral negotiation?

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if a coalition cannot act without unanimous agreement of all relevant parties, one uncooperative party ( a hold out) can stymie the desires of a group. Can be a strategic opportunity for the party holding out

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When adding a 3rd party, what effect does it have on fair division?

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fair division becomes more difficult if a 3rd party is added, especially if they wish to follow the equity principle this is b/c of their unstable BATNAs.

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What is the Shapley Value Solution?

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is a solution on how to distribute a cooperative surplus fairly b/w 3 parties who contribute different amounts to the starting project

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Shapley Value Solution

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1. Imagines all of the possible orders in which the parties could join a three-way coalition 2. Calculates average marginal value each party would add to project given those possible combinations

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Identifying the bargaining zone using the single negotiation text (SNT)?

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1. In multiparty negotiations -- Parties, lawyers, or neutral third party draft a proposed agreement and asks other negotiators, without commitment, for suggestions and criticisms 2. After receiving suggestions and criticisms, original author redrafts the proposal 3. Revised draft is then resubmitted to parties, and process of receiving suggestions, criticisms, and redrafting continues until agreement is reached

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What are the advantages of a 3rd party neutral in multilateral negotiations?

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SNT is most effective if the individual drafting the proposal, soliciting criticism, and redrafting the agreement is a mediator or other 3rd party. The initial proposal is likely to be an honest attempt to reconcile the conflicting parties' interest. The negotiators feel more willing to offer honest criticisms and suggestions. No one is committed to the initial draft.

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Fraudulent misrepresentation Liability

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making a fraudulent misrep. for the purpose of inducing another to act or refrain from acting, which is justifiably relied upon, is subject to liability for pecuniary losses Misrep can be a fact, opinion, intention or law

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When does a misrepresentation make a contract voidable?

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if a party's manifestation of assent is induced by either a fraudulent or material misrepresentation by the other party, which they justifiably relied upon, the K is voidable by the recipient.

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An agent who fraudulently makes representations, uses duress, or knowingly assists in the commission of tortious fraud or duress by his principal or by others is subject to liability in a tort to...

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the injured person although the fraud or duress occurs in a transaction on behalf of the principal

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With regards to truthfulness... in the course of representing a client a lawyer shall not knowingly do what?

answer

in the course of representing a client, a lawyer shall not knowingly make a false statement of material fact or law to a 3rd person

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Is there an affirmative duty to inform an opposing party of relevant facts?

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no... but there is a misrepresentation if they lawyer incorporates or affirms a statement of another person that the lawyer knows is false.

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What is the distinction b/w a fact and opinion regarding liability?

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generally misrepresentations of fact are actionable... but misrepresentations of opinion are usually not.

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Is trade "puffing" or "sales talk" considered an actionable misrepresentation?

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no

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When can a statement of opinion be actionable as misrepresentation?

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actionable when the opinion is justifiably relied on by the other party or the opinion is a material fact which is lied about

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is lying about competing offers considered puffing and un-actionable?

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recent cases have reasoned that a seller has more information about alternative offers than the buyer and it is reasonable for the prospective buyer to rely on the veracity of the very factual claims made by sellers about the existence of other offers.

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when is non-disclosure treated as misrepresentation?

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when the non-disclosing party actively conceals a material fact from a negotiating opponent or tells a partial truth that implies a falsehood

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when does a fraudulent/material misrepresentation give rise to both contract and tort COA?

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Under contract law, a negotiator's fraudulent or material misrepresentation that induces his opponent to enter into a transaction makes the resulting transaction voidable by the victimized party (i.e. rescission is an available remedy). Under tort law, a fraudulent misrepresentation gives rise to an action for damages caused by the reliance on the misrepresentation gives rise to an action for damages caused by the reliance on the misrepresentation.

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When a lawyer makes a fraudulent misrepresentation, can he or she be held personally liable?

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yes

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The American Rule on Settlement

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Each litigant bears his/her own legal fees regardless of the litigation outcome Subject to statutory or rule exceptions

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Free shifting statutes

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is "access to court" statutes that encourages litigation by allowing a prevailing party to recover attorneys fees despite the American rule. These statutes reinforce the American rule by reinforcing the pro-plaintiff rationale

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The English rule on Settlement

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The loser pays Under this rule the attorney's fees are automatically shifted to the winner May decrease the likelihood of settlement b/c parties are overly optimistic, the rule raises the stakes creating an incentive to spend more at trial, and those w/ large budgets have an incentive to litigate

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The offer of Judgment

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This approach, determines which party "prevails" in court on the basis of whether the judgment for the plaintiff, if any, is more or less than the defendant offered in pre-trail settlement negotiations. offers settlement potential Under this rule, attorneys' fees are shifted to an offeree who refused an opponent's offer to settle and did not do better at trial. Only defendants may use it, and only court costs, and not attorneys' fees, are shifted

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What are the 3 fundamental techniques in handling people discussed in "How to Win Friends and Influence People"

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1. Don't criticize, condemn or complain 2. Give honest, and sincere appreciation 3. Arouse the other person w/ an eager want by talking about what the want and show them how to get it.

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What are the 6 ways to make people like you discussed in "How to Win Friends and Influence People"

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1. Be genuinely interested in other people 2. Smile 3. A persons name is the sweetest and most important sound in any language to that person 4. Encourage them to talk about themselves and be a good listener 5. Talk in terms of the other person's interest 6. Make them feel important and do it sincerely

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What are the 12 ways to win people to your way of thinking discussed in "How to Win Friends and Influence People"

answer

1. Avoid arguments 2. Respect for the their opinions and never say they're wrong 3. If you are wrong, admit it quickly and emphatically 4. Begin in a friendly way 5. Get them to say "yes, yes" immediately 6. Let the them do most of the talking 7. Let the them feel the idea is theirs 8. Try honestly to see things from the their point of view 9. Be sympathetic w/ their ideas and desires 10. Appeal to the nobler motives 11. Dramatize your ideas 12. Throw down a challenge/stimulate a challenge

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What are the 9 ways to be a leader—how to change people w/o giving offense or arousing resentment discussed in "How to Win Friends and Influence People"

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1. Begin w/ praise and honest appreciation 2. Call attention to people's mistakes indirectly 3. Talk about you own mistakes before criticizing the other person 4. Ask Questions instead of giving direct orders 5. Let the other person save face 6. Praise the slightest and every improvement. Be "hearty in your approbation and lavish in your praise." 7. Give the other person a fine reputation to live up to. 8. Make the fault seem easy to correct and use encouragement 9. Make the other person happy about doing the thing you suggest

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What are the 7 triggers to yes

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1. The Friendship Trigger- activates trust and agreement through bonding 2. The Authority Trigger- creates a perception of expertise that activates acceptance 3. The Consistency Trigger- motivates consistence w/ past actions 4. The Reciprocity Trigger- taps into the rationale that when you give you get something back 5. The Contrast Trigger- makes you request better than other available options 6. The Reason Why Trigger- poses reasons that activate an automatic yes 7. The Hope Trigger- instills positive expectations that deliver agreement

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What are the 7 habits of highly effective people

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1. Be proactive- Principles of personal vision 2. Begin with the end in mind- principles of personal leadership 3. Put first things first- principles of personal mgmt. 4. Think win/win- principles of interpersonal leadership 5. Seek first to understand, then to be understood- principles of empathic communication 6. Synergize- principles of creative cooperation 7. sharpen the saw- principles of balanced self-renewal

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Identify the 5 major subparts discussed in getting to yes

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1. Don't bargain over positions 2. Separate the people from the problem 3. Focus on the interest and not the position 4. Invent options for mutual gain 5. Insist on using an objective criteria

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Don't bargain over positions

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Arguing over positions produces unwise outcomes, is inefficient, and endangers an ongoing relationship Being nice is no answer either

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Separate the people from the problem

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Negotiators are people first that have two kinds of interests—in the substance (the matter at hand and in the relationship (relationship b/w the parties) Separate the relationship from the substance by dealing directly w/ the people problem Understand perceptions and emotions Communicate Build a working relationship to prevent people problems

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Focus on interests, not positions

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For a wise solution reconcile your interests, not positions Interests define the problem Behind opposed positions lie shared and compatible interests, as well as conflicting ones Identify those interests by "asking why" and "why not" Recognize each sides has multiple interests The most powerful interest are basic human needs Talk about interests

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Invent multiple options looking for mutual gains before deciding what do to

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Diagnose the obstacles that inhibit invention options Find a solution by separating the act of inventing options from the act of judging them by brainstorming consider brainstorming w/ the other side Broaden your options Multiply options by shuttling b/w the specific and the general Look through the eyes of different experts Invent agreements of different strengths Change the scope of a proposed agreement Look for mutual gains Identify shared interests Dovetail differing interests Ask for their preferences Make their decision easy

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Insist that the result be based on a legitimate objective criteria

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Deciding on the basis of will is costly Principled negotiation produces wise agreements amicably and efficiently Make a case for using an objective criteria Develop an objective criteria Base it on fair standards and fair procedures Negotiate w/ objective criteria Frame each issues as a joint search for objective criteria Ask what is their theory Agree first on principles Reason and be open to reason Never yield to pressure Protect yourself w/ a BATNA and RP's

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What are the 5 most powerful interest of basic human needs discussed in "getting to yes"

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1. Security 2. Economic well being 3. A sense of belonging 4. Recognition 5. Control of one's self

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Identify the 7 terms discussed in getting to yeas

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1. interests 2. options 3. alternatives 4. legitimacy 5. relationship 6. communication 7. commitment

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5 Core concerns in understanding emotions discussed in "getting to yes"

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1. Autonomy: the desire to make your own choices and control your own fate 2. Appreciation: the desire to be recognized and valued 3. Affiliation: the desire to belong as an accepted member of some peer group 4. Role: the desire to have a meaningful purpose 5. Status: the desire to feel fairly seen and acknowledged

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Interests

answer

needs, concerns, fears, and aspirations that is the underlining motivation it defines the problem identify them by asking "why" and "why not" compatible and different ones are important b/c it leads to successful negotiations

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Options

answer

different way on how to solve a problem that requires the agreement of the other party "if then" statements often create them

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Alternatives

answer

actions that a negotiator can take that do not require or involve the agreement of the other party Can give a negotiator power by establishing ways they can function w/o the other party Cam consider the other sides alt.'s Helps to estblish your walk away point

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Legitimacy

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a fair and objective standard relied on when deciding a problem It should be agreed upon by both parties never yield to threats, bribes, manipulation or trusts

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Relationship

answer

creating a solid and durable partnership in order to solve the problem Build it to prevent people problems Separate it from the substance is premised that the negotiation will have long-term implications whether positive or negative

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Communication

answer

listening actively and acknowledging what is be said by the other party Speak to be understood and speak for a purpose Speak about yourself, and not about them Use symbolic gestures Remember less than full disclosure is not the same as deception

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Committment

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what you are looking to get the deal done, any firm agreements should me memorialized in writing and signed by both parties consider the one-text approach

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Positions

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What a party state what they want in a negotiation includes demand terms and conditions What a party says the will or will not do Don't bargain over them b/c it produces unwise outcomes, is inefficient, and endangers ongoing relationship

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Brainstorming

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Before brainstorming: - Define your purpose - Choose a few participants - Change the environment - Design an informal atmosphere - Choose a facilitator During brainstorming: - Seat the participants side by side facing the problem - Clarify the ground rules, including the no-criticism rule - Brainstorm - Record the ideas in full view on one paper After brainstorming: - Star the most promising ideas - Invent improvements for promising ideas - Set up a time to evaluate ideas and decide - Consider brainstorming w/ the other side

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