MGT 182: Negotiations
Characteristics of Negotiating Situations
1. There are two or more parties
2. There is conflict of needs and desires between two or more parties
3. The parties negotiate by choice
4. When we negotiate we expect a “give-and-take” process that is fundamental to the definition of negotiating itself.
5. The parties prefer to negotiate and search for agreement.
6. successful negotiation involves the management o tangibles and the resolution of tangibles
2. There is conflict of needs and desires between two or more parties
3. The parties negotiate by choice
4. When we negotiate we expect a “give-and-take” process that is fundamental to the definition of negotiating itself.
5. The parties prefer to negotiate and search for agreement.
6. successful negotiation involves the management o tangibles and the resolution of tangibles
There are two or more parties
two or more individuals, groups or organizations. We consider negotiation as a process between individuals, within groups and between groups.
There is conflict of needs and desires between two or more parties.
what one wants is not necessarily what the other one wants. The parties must search for a way to resolve the conflict
The parties negotiate by choice
they negotiate because they think they can get a better deal by negotiating than by simply accepting what the other side will voluntarily give them or let them have. Largely a voluntary process. We negotiate because we think we can improve our outcome or result, compared with not negotiating or simply accepting what the other side offers.
When we negotiate we expect a “give-and-take” process that is fundamental to the definition of negotiating itself.
We expect that both sides will modify or move away from their opening statements, requests or demands. Ultimately both sides will modify their opening positing in order to reach an agreement. Can be called compromise when agreement is met in the “middle”
The parties prefer to negotiate and search for agreement.
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. (policies and procedures)
Successful Negotiations involves the management of tangibles and the resolution of tangibles
Intangible factors are the underlying psychological motivations that may directly or indirectly influence the parties during negotiation. Examples: Need to win or beat the other party, the need to look good, the need to defend and important principle to precedent, the need to appear fair or honorable, the need to maintain a good relationship with the other party.
When you Shouldn’t Negotiate
1. When you’d lose the farm (when you can lose everything)
2. When you’re sold out (running at capacity, raise prices instead)
3. When the demands are unethical (bribes, reputation could be compromised)
4. When you don’t care (if you have no stake in the outcome, everything to lose but nothing to gain)
5. WHen you don’t have time (If time pressure work against you, you’ll make mistakes, give in too quickly)
6. When they act in bad faith ( stop is counterpart shows sign of bad faith, if you can’t trust their negotiating, stick to your guns and cover your position or discredit them)
7. When waiting would improve your position (If the odds are good that you’ll gain ground with a delay, wait)
8. WHen you’re not prepared (Gathering your reconnaissance and rehearsing the negotiation will pay off handsomely. If you’re not ready, just say no)
2. When you’re sold out (running at capacity, raise prices instead)
3. When the demands are unethical (bribes, reputation could be compromised)
4. When you don’t care (if you have no stake in the outcome, everything to lose but nothing to gain)
5. WHen you don’t have time (If time pressure work against you, you’ll make mistakes, give in too quickly)
6. When they act in bad faith ( stop is counterpart shows sign of bad faith, if you can’t trust their negotiating, stick to your guns and cover your position or discredit them)
7. When waiting would improve your position (If the odds are good that you’ll gain ground with a delay, wait)
8. WHen you’re not prepared (Gathering your reconnaissance and rehearsing the negotiation will pay off handsomely. If you’re not ready, just say no)
Value Claiming
to do whatever is necessary to claim the reward, gain the lion’s share, or gain the largest piece possible. Example is purchasing a used car or buying a used fridge at a yard sale.
Distributive Bargaining
To achieve objectives, negotiators usually employ win-lose strategies and tactics. This accepts the fact that there can only be one winner given the situation and pursues a course of action to be that inner.
Integrative Negotiation
Attempts to find solutions so both parties can do well and achieve their goals. The purpose for the negotiation is to create value. Example is planning a wedding so that the bride, groom and both families are happy and satisfied and the guests have a wonderful time.
Claiming and Creating Value Processes
1. Negotiators must be able to recognize situations that require more of one approach than the other.
2. Negotiators must be versatile in their comfort and use of both major strategic approaches.
3. Negotiators perceptions of situations tend to be biased toward seeing problems as more distributive/competitive than they really are.
2. Negotiators must be versatile in their comfort and use of both major strategic approaches.
3. Negotiators perceptions of situations tend to be biased toward seeing problems as more distributive/competitive than they really are.
Creating Value
Differences in interests, differences in judgements about the future, differences in risk tolerance, differences in time preference
Effective Conflict Management
Dual Concerns Model. Contending (competing or dominating), Yielding (accommodating or obliging), Inaction (Avoiding), Problem-solving (Collaborating or integrating), Compromising.
Distributive Bargaining
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