Negotiation Key Terms – Flashcards
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BATNA
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Best Alternative to a Negotiated Agreement
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Consensus Conflict
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Occurs when one person's opinions, ideas, or beliefs are incompatible with those of another, and the two seek to reach an agreement of opinion
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Contractual Risk
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Refers to the risk associated with the willingness of the other party to honor its terms
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Counterfactual Thinking
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mentally changing some aspect of the past as a way of imagining what might have been
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Dispute Situation
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A negotiation that takes place because a claim that has been made by one party has been rejected by another party.
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Fixed-Pie Perception
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Belief that the other party's interests are directly and completely opposed to one's own interests
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Focal Point
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Salient number, figure, or value in a negotiation that appears to be valid but is actually arbitrary and/or has no basis in fact.
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Hidden Table
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The negotiations that take place behind the scene between a principal and his or her constituents.
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Linkage Effects
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A phenomenon that refers to the fact that some negotiations will affect other negotiations; i.e., resolutions in one situation will have implications for a future situation.
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Monolithic Party
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A member of a group that acts as a single unit; i.e., there is no divergence within the group.
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Party
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A participant in negotiation. Parties can be individuals, groups, organizations, communities, or nations.
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Preference Reversals
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Inconsistencies in choice that are produced when subtle wording differences lead people to make different judgments.
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Ratification
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Approval of a contract by a body or group not necessarily present at the negotiation table.
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Reactive Devaluation
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The tendency for people to devalue an option previously considered to be more attractive, merely as a consequence of it being offered by the other side.
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Reservation Point
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The point at which a negotiator is indifferent between reaching a settlement and walking away from the bargaining table.
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Risk Aversion
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Preference for a sure thing rather than a gamble that has an equal or greater expected value.
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Scarce Resource Competition
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Conflict or competition that exists when people perceive one another as desiring the same limited resources.
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Strategic Risk
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The relative risk levels of the tactics that negotiators use at the bargaining table.
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Sure Thing Principle
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A principle that states that if alternative x is preferred to y, in the condition that some event, a, occurs, and if x is also preferred to y in the condition that some event, a, does not occur, then x should be preferred to y, even when it is not known whether a will occur.
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Target Point
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The ideal or upper limit of what a negotiator expects to get out of a negotiation. Also called the aspiration or aspiration point.
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Time Horizon
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The amount of time between the negotiation and the consequences or realization of negotiated agreements.
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Winner's Curse
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A situation in which a negotiator makes an offer that is immediately accepted by the opponent, thus signaling the fact that the negotiator offered too much.
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Anchor Point
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Number, figure, or value that becomes a salient point of reference in a negotiation.
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Bargaining Surplus
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The amount of overlap between parties' reservation points.
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Bargaining Zone
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The region between parties' reservation points in which a final settlement should be obtained.
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Boulwarism
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A bargaining style named for Lemuel Boulware, former CEO of General Electric, in which one's first offer is one's final offer.
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Equality Rule
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A principle that prescribes equal shares for all.
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Equity Rule
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A principle that prescribes that distribution of resources should be proportional to a person's contribution.
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Face-Threat Sensitivity
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Likelihood that a negotiator will have a negative reaction to a threat to his or her public image, reputation, or status vis-à-vis other people in the negotiation ("face")
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Graduated Reduction in Tension Model
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Unilateral conciliatory actions designed to deescalate a conflict.
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Loyalist
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A person who prefers to split resources equally, except in antagonistic relationships.
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Magnitude of Concessions
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Extent to which one party has conceded from an initial stated position.
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Mixed-Motive Negotiation
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A negotiation in which parties want to cooperate with their opponent to reach mutual agreement, but must compete to maximize their share of the joint gains.
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Needs-Based Rule
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A rule that states that the benefits people receive should be proportional to their needs; also called welfare-based allocation.
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Negative Bargaining Zone
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A negotiation situation in which there is no positive overlap between parties' reservation points.
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Negotiation Dance
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The process of making offers and counteroffers in a negotiation.
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Negotiator's Surplus
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The positive difference between the settlement outcome and the negotiator's reservation point.
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Pattern of Concessions
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In negotiation, the sequence of consecutive concessions made by parties.
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Ruthless Competitor
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A person who prefers to have more resources than the other party, regardless of relationship.
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Saint
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In negotiations, a person who prefers to split resources equally no matter whether the relationship with another party is positive, negative, or neutral.
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Suboptimal Outcome
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In negotiation, an outcome in which negotiators leave money on the table, reach an impasse, or are generally worse off not reaching agreement than reaching agreement.
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Timing of Concessions
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In negotiation, determination of whether concessions are immediate, gradual or delayed.
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Contingency Contracts
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Agreements wherein negotiators make bets based on their differences in beliefs, forecasts, risk profiles, and interests.
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False Conflict
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A situation in which conflict does not exist between people, yet they erroneously perceive the presence of conflict.
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Illusion of Transparency
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The tendency of negotiators to believe that they are revealing more information than they actually are; i.e., they believe that others have access to information about them when they in fact do not.
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Inductive Reasoning
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The process by which a negotiator unilaterally deduces what the other party's true interests are and where the joint gains are by listening to their responses in negotiation.
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Integrative Negotiation
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A process by which negotiators seek to expand the amount of available resources.
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Issue Mix
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The union of both parties' issue sets.
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Logrolling
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The strategy of trading off in a negotiation so as to capitalize on different strengths of preference.
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Lose-lose effect
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The tendency for negotiators to settle for outcomes that both prefer less than some other readily available outcome.
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Multiple Simultaneous Offers
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A strategy that involves a negotiator simultaneously presenting the other party with two or more proposals of equal value to him-or herself.
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Pareto-Optimal Frontier
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A situation in which no other feasible agreement exists that would improve one party's outcome while simultaneously not hurting the other party's outcome.
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Postsettlement Settlements
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Strategies in which negotiators reach a binding settlement, but agree to explore other options with the goal of finding another that both prefer more than the current one; if one is not found, the current settlement is imposed.
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Premature Concessions
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Making concessions on issues before they are even requested.
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Presettlement Settlements
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Formal, partial settlements that occur in advance of the parties' undertaking full-scale negotiations, designed to be replaced by a long-term, formal agreement.
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Resource Assessment
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The identification of the bargaining issues and alternatives in a negotiation.
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Substantiation
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Arguments for one's own position or against the other's position in a negotiation.
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Unbundling
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Division of large, all-encompassing issues into smaller, more manageable ones.
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Win-win Negotiation
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Negotiations in which the parties craft outcomes that are better for both sides than an even split (dividing resources in half).
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Deductive Reasoning
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reasoning in which a conclusion is reached by stating a general principle and then applying that principle to a specific case (The sun rises every morning; therefore, the sun will rise on Tuesday morning.)
