Negotiation

people must renegotiate their existence in organizations throughout their careers

whatever is good for 1 pty must be bad for other pty.

negotiation mixed motive enterprise, parties have incentives to cooperate as well as compete

principled

most excellent negotiators are self made.

experience in absence of feedback largely ineffective in improving negotiation skills. Memories tend to be selective. Experience improves confidence but not always accuracy

tough negotiators are rarely effective.

implies people need to know how to integrate their interests and work across business units and functional areas

interpersonal decision making process necessary whenever we can’t achieve our objectives singlehandedly

negotiators need to know how to operate in uncertain and ambiguous environments

presents challenges in terms of diff norms of comm

lose-lose- occurs when negotiators fail to recognize and capitalize on win win potential

winners curse- when negotiators make too large concessions resulting in too small share of bargaining pie

when reject terms offered by other pty that are demonstrably better than any other option available

agreement bias- when feel obligated to reach agreement even when settlement terms not as good as other alts

tendency for people to view exps in way that is flattering or fulfilling for them

tendency of people to see what they want to see when appraising own performance. Leads to selectively seek info that confirms what they believe is true

opposite of optimizing- settle for something less than they could otherwise have

people must have insight into their limitations. “blissfully unaware of own incompetence”

opposite of satisficing – set high aspirations and attempt to achieve as much as possible.

anticipate the reactions of your opponents

dependent of the reactions ans actions of their opponent

usually adopt one of 3 mindsets – 1. soft bargaining (capitulate to the other side. 2. prepare for attack (hard bargaining). 3. compromise to reach a midpoint (false win-win)

involves both cooperation and competition

the thing or point that constitutes an ideal outcome

sets target too low; can result in winner’s curse

negotiator makes an offer that is immediately accepted by the other party

aka positional negotiator; sets target too high and refuses to make concessions

does not know what he/she really wants; only that they want what the other party doesn’t want to give and doesn’t want what the other party is willing to offer. reactive devaluation

when you want what you aren’t being offered and don’t want what you are. grass is greener

best alternative to a negotiated agreement

determined by what the batna represents

1. brainstorm alternatives, 2. evaluate alternatives, 3. attempt to improve batna, 4. determine reservation price

salient numbers, figures, values that appear legit but have no basis in fact

money you have invested and you won’t get back

choose a sure thing over a gamble

determines what a person considers to be a gain or a loss

riskiness of the tactics negotiator uses at the bargaining table

risk associated with the willingness of the other party honoring its terms

lead buyers and sellers to have different valuations for objects

thinking about what might have been but did not occur; important component in determining whether a person experiences regret; reference point for psychological evaluation of actual outcomes

rational theory of decision making under certainty; it’s a sure thing something will occur regardless of other factors

unwarranted levels of confidence in people’s judgement of their abilities and likelihood of positive events and underestimating negative events

person or group w common interests acting in accord with their own preferences

parties not present at the table

parties on same side in agreement with one another concerning their interests in the negotiation

everything happens in one time w no future ramifications

most negotiations – bc reputation information carries in social/professional networks

evolution of relationship and maintaining trust must be considered; most important is employment negotiation; negotiators must renegotiate terms on regular basis

beliefs differ btwn two parties/ppl and they seek to reach agreement

people vie for limited resources

claim made by one party and rejected by the other

some negotiators affect other negotiators; ie precedents in law cases

the amount of time btwn the negotiations and the consequences or realization of negotiated agreement

entire process of making an opening offer and reaching a mutually agreeable settlement

bargaining zone; zone of possible agreement; range btwn negotiators reservation points

parties fail to reach agreement; negotiators leave money on the table and are worse off by not reaching agreement

no positive overlap btwn parties’ reservation points; negotiators should exercise BATNA

amount of overlap btwn reservation points

positive difference btwn the settlement outcome and the negotiator’s reservation point

represented by your first offer bc you will never get more than that

asking for something outrageous. “chills the negotiation

named after lemuel boulware; former CEO of GE; avoid this; making first offer final offer

make more then one concession in a row before the other party responds or counteroffers

1. pattern of concessions. 2. magnitude of concessions. 3. timing of concessions

concessions made by one party

concessions made by both sides

GRIT – avoid escalating conflict to reach mutual settlement within bargaining zone; one party makes a concession and then the other party reciprocates by making a concession.

reductions a negotiator makes during negotiation

can be a problem bc values are arrived at arbitrarily

value placed on his/her public image; threatening results in competition not cooperation

method of fair division; blind justice; outcomes distributed w/o regard to inputs

method of fair division; proportionality of contributions principle; distribution proportional to contribution

welfare-based allocation; divide proportionally according to need; method of fair division

compare to someone who is better off

compare to the less fortunate

for accurate appraisal of your ability

people compare themselves with others who can serve as models of success

desire to enhance or maintain a positive view

truthful self knowledge

alter inputs; alter outcomes;

people denied the opportunity to restore equity they bring down others

distribution of resources; consistency, simplicity, effectiveness, and justifiability

all creative opportunities are leveraged and no resources are left on the table; win-win

no other feasible agreement exists that would improve one’s party outcome while simultaneously not hurting the other party’s outcome

illusory conflict; one party believes their interests are not compatible with the other party’s interests but they aren’t

failed to recognized overlap in compatible interests and reached an agreement that was suboptimal for both parties

giving up ground before being asked to

belief that the other party’s interests are completely opposed to your own

split difference; does not ensure win-win (misconception)

high concern for the other party as well as high concern for one’s own interests; developed by Pruitt and Carvonale

negotiators believe they are revealing more than they actually are

present two proposals of equal value – you must make multiple offers they must be of equal value and they must be at the same time.

interferes w win-win; arguments for one’s own position or against the other’s position

negotiator can deduce where the other party’s interests and see the join gain

trading off to capitalize on different strengths of preference

optimistic; half full glass; more likely to logroll

half-empty; less likely to accept contingent contract

contract contingent on something occurring; should satisfy 4 criteria: 1. don’t create conflict of interest. 2. must be enforceable. 3. clear measurable and readily evaluated. 4. date or timeline mutually agreed upon

PreSS 3 characteristics: 1. formal – binding obligations 2. initial – intended to be replaced 3. partial – parties do not address or resolve all outstanding issues

agree to explore other options with goal of finding another more preferable option

identification of the bargaining issues and alternatives

union of both party issues

hard tough stance for success

so busy expanding the pie they forget to claim resources. they never slice the pie

expands and slices the pie

maximize own gain indifferent towards other’s gain

maximize the difference btwn results – wants to win and by the most possible

equality; minimize the difference between negotiated outcomes

rights procedure in which disputants present evidence and arguments tot he neutral third party with the power to hand down a binging decision

type of power based approach; one or more party makes threat

type of power based approach; parties take action to determine who will prevail

senior executives selected to consider disputes

negotiators have several points of access for resolving disputes

can provide a way for reluctant negotiators to come to the table

better prepared to negotiate in an interest based fashion

third party negotiation allows focus on interests

managers provided with info that would likely result from going to court

high level executives act as “lawyers” and represent different sides of the dispute. remove emotion while keeping the company’s interests in mind

guidelines for emergency communications written in advance

can halt power contest

hybrid – if mediation fails the moderator can act as arbitrator

must accept one of the final offers made – no compromise

final offer in sealed envelope – if no mutual agreement then the parties are stuck with unknown offer

intense, fleeting, result of an experience

chronic more diffuse – not directed at a particular person

behavioral manifestation of felt emotion

orchestrated to take counter-party off guard

understand emotions in yourself and effect positive outcomes thru the use of emotions

belief in your abilities to claim resources effectively

belief in ability to create resources

money, trust, security, happiness, etc

how much utility we derive depends on who is providing it

how tangible is it

consistency of behavior; people will follow thru on what they promise to do

grounded in predictability; i know him enough to understand them and accurately predict their behavior

reverse psychology; telling someone they don’t’ want to do something so they do it

grounded in empathy w another person’s desires and intentions

building trust based on rational and deliberate thoughts and considerations

building trust based on intuition and emotion

aka emotional conflict; personal , defensive, resentful

aka cognitive conflict; largely depersonalized

the more we are exposed to something the more we like it; very powerful; occurs below the level of our awareness

has to do with functional distance; idea that you are more likely to become friends with people you sit next to than people you site near

we feel obligated to return in kind what others have offered or given us

sharing information about ones-self w another person; build relationship while making yourself vulnerable

defection; biggest threat to trust in a relationship; to violate the established trust

one that calls into question another person’s character by criticizing them as the cause

judgmental, consistent, immediate, inferential

believing that people we like and trust are also intelligent and capable

once we form a negative impression of someone – everything else they do is negative

we should take care of people we love etc; opposite exchange norms

equity rule; more contribution =more return

everything is reduced to a single value or utility metric