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Negotiation

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is something that everyone does, almost daily. for a new job to minor things such as who takes out the trash. Friends, business associates, everyone does it.

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To agree on how to share or divide a limited resource To create something new that neither party could attain on his or her own To resolve a problem or dispute between the parties

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negotiations occur for several reasons

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To agree on how to share or divide a limited resource (Negotiations occur for several reasons)

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time or resources, equipment. Land, property or time

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To create something new that neither party could attain on his or her own (Negotiations occur for several reasons)

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two troops of boy scouts one has equipment one has maps so they had to get together.

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To resolve a problem or dispute between the parties (Negotiations occur for several reasons)

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like who goes to take out the garbage

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bargaining

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describes the competitive, win-lose situation. competitive like a yard sale out to win the whole thing. Such as haggling over price that happens at a yard sale, flea marker, or used car lot.

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Approaches to negotiation

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First- bargaining and negotiation are different. Second- many people assume that the heart of negotiation is the give and take process used to reach an agreement. Many of the most important factors that shape a negotiation result occur before the parties start to negotiate or shape the context around the negotiation. Third-our insights into negotiation are drawn from three sources. 1- our experience as negotiators ourselves and the rich number of negotiations that occur every day in our own lives and in the lives of people around the world. 2- the media- television, radio, newspaper, magazine and Internet- that report on actual negotiatins every day. 3- the third source is the wealth of social science research that has been conducted on numerous aspects of negotiation

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negotiation (approach to the subject)

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refers to win-win situations such as those that occur when parties try to find a mutually acceptable solution to a complex conflict

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three sources of insight into negotiation

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our experience as negotiators, the media, social science research that has been conducted on numerous aspects of negotiation

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Three important themes of Negotiation

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The definition of negotiation and the basic characteristics of negotiation situations Interdependence, the relationship between people and groups that most often leads them to negotiate Understanding the dynamics of conflict and conflict management processes which serve as a backdrop for different ways that people approach and manage negotiations

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Characteristics of a Negotiation Situation

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1. There are two or more parties 2. There is a conflict of needs and desires between two or more parties 3. Parties negotiate because they think they can get a better deal than by simply accepting what the other side offers them 4. Parties expect a "give and take" process 5.Parties search for agreement rather than: Fight openly Capitulate Break off contact permanently Take their dispute to a third party 6. Successful negotiation involves: Management of tangibles (e.g., the price or the terms of agreement) Resolution of intangibles (the underlying psychological motivations) such as winning, losing, saving face

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There are two or more parties (Characteristics of a Negotiation Situation)

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You cant negotiate with yourself must have two people and their must be conflict between two parties. Negotiation as a process between individuals, within groups, and between groups. (Joe negotiating with his wife, the purchasing manager, and the auto salesman, and sue negotiates with her husband.

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There is a conflict of needs and desires between two or more parties (Characteristics of aNegotiation Situation)

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What one wants is not necessarily what the other wants- and the parties must search for a way to resolve the conflict. (joe and sue face negotiations over vacations)

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Parties negotiate because they think they can get a better deal than by simply accepting what the other side offers them (Characteristics of aNegotiation Situation)

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Negotiation by choice- negotiate because they think they can get a better deal by negotiating than by simply accepting what the other side will voluntairly give them or let them have. It is a strategy pursued by choice; seldom are we required to negotiate

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Parties expect a "give and take" process (Characteristics of aNegotiation Situation)

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We expect that both sides will modify or move away from their opening statements, requests, or demands. Ultimately both sides will modify their opening position in order to reach an agreement. The movement may be toward the middle of their positions called a compromise. If parties do not consider it a negotiation, then they don't necessarily expect to modify their position and engage in this give and take. Truly creative negotiations may not require compromise, however instead the parties may invent a solution that meets the objectives of all parties

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Parties search for agreement rather than: Fight openly Capitulate Break off contact permanently Take their dispute to a third party (Characteristics of aNegotiation Situation)

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Negotiation occurs when the parties prefer to invent their own solution for resolving the conflict, when there is no fixed or established set of rules or procedures for how to resolve the conflict, or when they choose to bypass those rules. Organizations and systems invent policies and procedures for addressing and managing those procedures. Video rental stores have a policy for what they should charge if a rental is kept too long. Normally people just pay the fine. They might be able to negotiate a fee reduction, however if they have a good excuse for why the video is being returned late

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Successful negotiation involves: Management of tangibles (e.g., the price or the terms of agreement) Resolution of intangibles (the underlying psychological motivations) such as winning, losing, saving face. (Characteristics of a Negotiation Situation)

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Need to defend an important principle or precedent in a or the need to appear fair or honorable or to protect one's reputation. Intangibles are often rooted in personal values and emotions. For example joe may want to save relationship while looking tough to engineers.

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Interdependence

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In negotiation, parties need each other to achieve their preferred outcomes or objectives This mutual dependency is called interdependence Interdependent goals are an important aspect of negotiation Win-lose: I win, you lose Win-win: Opportunities for both parties to gain Interdependent parties are characterized by interlocking goals Having interdependent goals does not mean that everyone wants or needs exactly the same thing A mix of convergent and conflicting goals characterizes many interdependent relationships

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Independent (relationships between parties)

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parties are able to meet their own needs without the help and assistance of others; they can be relatively detached, indifferent, and uninvolved with others.

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Dependent (relationships between parties)

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parties must rely on others for what they need; since they need the help, benevolence, or cooperation of the other, the dependent party must accept and accommodate that provider's whims and idiosyncrasies. (ex: employee paid on salary doing what is instructed or not getting anything at all)

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Interdependent (relationships between parties)

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characterized by interlocking goals- the parties need each other in order to accomplish their objectives. (ex people on project management team cant do things alone)

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Types of Interdependence Affect Outcomes

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Interdependence and the structure of the situation shape processes and outcomes Zero-sum or distributive - one winner Non-zero-sum or integrative - mutual gains situation

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zero-sum or distributive I win-you lose (types of interdependence affect outcomes)

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Like running a race. Individuals are so linked together that there is a negative correlation between their goal attainments" also present when parties are attempting to divide a limited or scare resource, such as a pot of money, a fixed block of time, and the like. To the degree that one person achieves his or her goal, the other's goal attainment is blocked.

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non-zero-sum or integrative (types of interdependence affect outcomes

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positive correlation between the goal attainments of both parties. If one person is a great music composer and the other can write good lyrics they can make a hit together. Working together, the other's goals are not necessarily blocked, and may in fact be significantly enhanced.

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Alternatives Shape Interdependence

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Evaluating interdependence depends heavily on the alternatives to working together The desirability to work together is better for outcomes Best available alternative: BATNA (acronym for Best Alternative to a Negotiated Agreement)

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BATNA

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Best available alternative- the better your alternatives are the better you are going to be in a negotiation. If the alternative is I don't win this and I die, you are are really going to work a whole lot harder if say I don't win this imp going to look bad. Need to understand all the alternatives you and the other person has. If you are trying to sell somebody a book and you know yours and the other persons alternatives you can sell at the right price. If the salesman knows I can go three blocks over for the car cheaper its going to effect how he negotiates. In some cases your alternative is to walk away. (for example job salary)

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Mutual Adjustment

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Continues throughout the negotiation as both parties act to influence the other One of the key causes of the changes that occur during a negotiation The effective negotiator needs to understand how people will adjust and readjust and how the negotiations might twist and turn, based on one's own moves and the other's responses. It will change over time. Your goals may change or how you go about it may change. Sometimes u cant be rigid u need to process information before coming to a conclusion.

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Mutual Adjustment and Concession Making

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When one party agrees to make a change in his/her position, a concession has been made Concessions restrict the range of options When a concession is made, the bargaining range is further constrained

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Two Dilemmas in Mutual adjustment

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Dilemma of honesty Concern about how much of the truth to tell the other party Dilemma of trust Concern about how much negotiators should believe what the other party tells them

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Two efforts in negotiation help to create such trust and beliefs

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one is based on perceptions of outcomes and the other on perceptions of the process.

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Outcome perceptions

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can be shaped by managing how the receiver views the proposed result. Max can tell sue that although the salary is low promotion can be high.

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Perceptions of the trustworthiness and credibility of the process

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can be enhanced by conveying images that signal fairness and reciprocity in proposals and concessions. The belief that concessions appear is universal. If one party repeatedly offers concessions with no other proposals from the other side or rejection, they may cut off negotiations. People trust the party and process far more when concessions are made.

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Dilemma of trust

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Concern about how much negotiators should believe what the other party tells them

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Dilemma of honesty

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Concern about how much of the truth to tell the other party

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Creating Value (Opportunities to "win" or share resources)

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result of non-zero-sum or integrative situation where object is to have both parties do well. when we work together to create something that we didn't't have before and we each have opportunity to win something. Integrative negotiation- attempts to find solutions so both parties can do well and achieve their goals. The purpose of the negotiation is to create value- that is, to find a way for all parties to meet their objectives, either by identifying more resources or finding unique ways to share and coordinate the use of existing resources. Ex: this type of negotiation might be planning a wedding so that the bride, groom, and both families are happy and satisfied, and the guests have a wonderful time.

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Claiming Value (Opportunities to "win or share resources)

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result of zero-sum or distributive situations where the object is to gain largest piece of resource. something out there I want it and im going to take it. Distributive bargaining- accepts the fact that there can only be one winner given the situation and pursues a course of action to be that winner. Claim value- do whatever is necessary to claim the reward, the lions share, or gain the largest piece possible. Ex: buying a used car or used refrigerator at a yard sale.

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Most actual negotiations are a combination of claiming and creating value processes

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Negotiators must be able to recognize situations that require more of one approach than the other Negotiators must be versatile in their comfort and use of both major strategic approaches Negotiator perceptions of situations tend to be biased toward seeing problems as more distributive/ competitive than they really are

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Negotiators must be able to recognize situations that require more of one approach than the other

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distributive bargaining is most appropriate when time and resources are limited, when the other is likely to be competitive, and when there is no likelihood of future interaction with the other party. Every other situation should be approached with an integrative strategy.

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Negotiators must be versatile in their comfort and use of both major strategic approaches

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if most negotiation issues or problems have components of both claiming and creating values, then negotiators must be able to use both approaches in the same deliberation.

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Negotiator perceptions of situations tend to be biased toward seeing problems as more distributive/ competitive than they really are

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people bring baggage and their own perceptions to interdependent situations. tendency to assume a negotiation problem is more zero-sum than it may be and to overuse distributive strategies for solving the problem. As a consequence negotiators often leave unclaimed value at the end of their negotiations because they failed to recognize opportunities for creating value.

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Differences in interest Differences in judgments about the future Differences in risk tolerance Differences in time preferences

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Value differences that exist between negotiators include:

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difference in interest

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negotiators almost never value everything equally

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difference in judgements about the future

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I may see a swamp you may see a swimming pool

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differences in risk tolerance

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a young family who are living pay check to pay check are going to be very low in risk tolerance.

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differences in time preferences

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car salesman has to sale so many cars at end of month, if it's the last Saturday knowing this can show how well you may do. A car salesman may want to a close a deal by the end of the week in order to be eligible for a special company bonus, while the potential buyer intends to trade his car in "sometime in the next six months."

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conflict

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"sharp disagreement or opposition" and includes "the perceived divergence of interest, or a belief that the parties' current aspirations cannot be achieved simultaneously." Can result from the strongly divergent needs of the two parties or from misperceptions and misunderstandings. Can occur when two parties are working toward the same goal and generally want the same outcome or when both parties want very different outcomes. Negotiation can play a big role in resolving it effectively.

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Intrapersonal or intrapsychic conflict

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Conflict that occurs within an individual We want an ice cream cone badly, but we know that ice cream is very fattening. sources of conflict can include ideas, thoughts, emotions, values, predispositions or drives that are in conflict with each other.

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Interpersonal conflict (levels of conflict)

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Conflict is between individuals Conflict between bosses and subordinates, spouses, siblings, roommates, etc.

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Intragroup conflict (levels of conflict)

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Conflict is within a group Among team and committee members, within families, classes etc

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intergroup conflict (levels of conflict)

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Conflict can occur between organizations, warring nations, feuding families, or within splintered, fragmented communities These negotiations are the most complex. hardest to resolve, between feuding families and countries. There is a lot of people so there is plenty of baggage brought to the table.

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Functions of Conflict

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Makes organizational members more aware and able to cope with problems through discussion. Promises organizational change and adaptation. Strengthens relationships and heightens morale. Promotes awareness of self and others. Enhances personal development. Encourages psychological development—it helps people become more accurate and realistic in their self-appraisals. Can be stimulating and fun.

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Most people initially believe that conflict is bad or dysfunctional. This belief has two aspects

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first, that conflict is an indication that something is wrong, broken or dysfunctional, and second, that conflict creates largely destructive consequences.

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Dysfunctions of Conflict

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Competitive, win-lose goals Misperception and bias Emotionality Decreased communication Blurred issues Rigid commitments Magnified differences, minimized similarities Escalation of conflict

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Competitive, win-lose goals (Dysfunctions of Conflict)

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parties compete against each other because they believe that their interdependence is such that goals are in opposition and both cannot simultaneously achieve their objectives.

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Misperception and bias (Dysfunctions of Conflict)

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as conflict intensifies, perceptions become distorted. People come to view things consistently with their own perspective of the conflict. They tend to interpret people and events as being either with them or against them. Thinking tends to become stereotypical and biased- parties endorse people and events that support their position reject outright those who oppose them.

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Emotionality (Dysfunctions of Conflict)

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as parties become anxious, irritated, annoyed, angry, or frustrated. Overwhelms clear thinking and the parties may become increasingly irrational as conflict escalates.

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Decreased communication (Dysfunctions of Conflict)

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Don't let your emotions get the best of you.

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Blurred Issues (Dysfunctions of Conflict)

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taking the car out can turn into you don't love me when you really just wanted to take the car out. Central issues become blurred and less well-defined. Generalizations abound and the conflict becomes a vortex that sucks in unrelated issues and innocent bystanders. Parties become less clear about how the dispute started, what it is "really about" or what it will take to solve it.

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Rigid Commitments (Dysfunctions of conflict)

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the parties become locked into their positions. Don't want to back down or look foolish. As thinking processes become rigid, and the parties tend to see issues as simple and "either/or" rather than as complex and multidimensional.

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magnified differences, minimized similarities (dysfunctions of conflict)

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as parties lock into commitments and issues become blurred, they tend to see each other- and each other's positions-as polar opposites. Factors that distinguish and separate them from each other become highlighted and emphasized, while similarities that they share become oversimplified and minimized. This distinction leads the parties to believe they are farther apart from each other than they really may be, and hence they may work less hard to find common ground.

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Escalation of conflict (dysfunctions of conflict)

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each party grows trenched in their own view, less tolerant and accepting of the other, more defensive and less communicative, and more emotional. Both parties attempt to win by increasing their commitment to their position, increasing the resources they are willing to spend to win, and increasing their tenacity in holding their ground under pressure.

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5 Strategies of Dual Concerns Model

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Yielding compromising inaction problem solving contending

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veritcal

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cooperativeness dimension

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horizontal

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assertiveness dimension

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two levels of concern

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own outcome and other persons outcome

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Inaction (avoiding)

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If you don't really care and you don't care for your own self. Withdrawal or passivity; the party prefers to retreat, be silent, or do nothing.

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Contending (competing or dominating)

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If you are in the competing or dominating you care very much about your own outcome and not others. Using intimidation or threat, try to stay away from that.

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Yielding (also called accomodating or obligating)

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If you care very much about the other person but not your own outcome. Lowering one's own aspirations to "let the other win" and gain what he or she wants. Yielding may seem like a strange strategy to some, but it has its definite advantages in some situations.

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Problem solving (also called collaborating or integrating)

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High concern for yourself and the other person, it is called problem solving. Both parties actively pursue approaches to maximize their joint outcome from the conflict.

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Compromise- not really valid.

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Moderate effort to pursue one's own outcomes and and a moderate effort to help the other party achieve his or her outcomes. Seen as lazy problem solving or simple yielding by both parties

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Style of Conflict Management

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Contending Yielding Inaction Problem Solving Compromising

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Contending (Styles of Conflict Management)

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Actors pursue own outcomes strongly, show little concern for other party obtaining their desired outcomes

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Yielding (Styles of Conflict Management)

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Actors show little interest in whether they attain own outcomes, are quite interested in whether the other party attains their outcomes

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Inaction (Styles of Conflict Management)

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Actors show little interest in whether they attain own outcomes, little concern about whether the other party obtains their outcomes

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Problem Solving (Styles of Conflict Management)

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Actors show high concern in obtaining own outcomes, as well as high concern for the other party obtaining their outcomes

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Compromising (Styles of Conflicting Management)

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Actors show moderate concern in obtaining own outcomes, as well as moderate concern for the other party obtaining their outcomes

Chapter 1- The Nature of Negotiation – Flashcards

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