CH.3 Flashcards
How to recognize an integrative situation? (4)
The negotiation includes more than one issue
It is possible to add more issues to the mix
The negotiation is likely to recur over time
The parties have varying preferences across the issues
The key steps in the integrative negotiation process
claiming value
creating value
pareto efficiency
Negotiator’s dilemma
Explain creating value
When parties with conflicting yet compatible interests trade low-priority issues for higher-priority issues
Explain the Pareto Efficiency
Find the point where there is “no agreement that would make any party better off without decreasing the outcomes to any other party
No change can be made without making someone worse off.
Based on the Pareto Efficient frontier, Deal A falls on the ________ _____ _____ and is _____ divided between the buyer and the seller.
Deals B and C also fall on the Pareto efficient frontier, but they are not ____ ______ deal as A
the Pareto Efficient frontier, equally
as good of a deal as A
Explain the Negotiator’s Dilemma
Tension between engaging in competitive and cooperative behaviour in a negotiation. “No matter how much creative problem solving enlarges the pie, it must still be divided; value that has been created must be claimed.”
Substantive interests
relate to key issues in the negotiation
Process interests
related to the way a dispute is settled
Relationship interests
indicate that one or both parties value their relationship
Interests in principle
principles deeply held by the parties serving as the dominant guide to their actions (doing what is fair, right, acceptable, ethical, etc.)
True or false: There is almost always more than one type of interest underlying a negotiation
True
True or false: Parties cannot have different types of interests at stake
False:
Parties can have different types of interests at stake
True or false: Focusing on interests can be harmful
True
True or false: Surfacing interests is not always easy or to your best advantage
True
What are interests
Interests are the underlying concerns, needs, desires, or fears that motivate a negotiator to take a particular position
What are some alternative solutions in integrative negotiation(5)
Expand the pie
Logroll
Use non-specific compensation
Cut the costs for compliance
Find a bridge solution
What are some types of interests
substantive interests
process interests
relationship interests
Explain substantive interests
economic and financial issues, such as price or rate; or the substance of a negotiation, such as the division of resources
Process interests
related to the way a dispute is settled. One party may pursue distributive bargaining because he enjoys competition. Another may enjoy negotiating because she believes she has not been consulted in the past and wants to have some say.
Process interests can also be both intrinsic and instrumental.
Relationship interests
indicate that one or both parties value their relationship with each other and do no want to take actions that will damage it.
Explain expand the pie
A simple solution is to add resources ( expand the pie) in such a way that both sides can achieve their objectives. The approach assumes that simply enlarging the resources will solve the problem.
However, expanding the pie would not be a satisfactory solution is their disagreement was based on other grounds.
Logroll
What are higher priorities to me and the other negotiations. By unbundling, I can get something of high value that doesn’t cost as much
They find more than one issue in conflict and to have different priorities for those issues. Then, they agree to trade off among these issues so that one party achieves a highly preferred outcome on that first issue and the other person achieves a highly preferred outcome on the second issue.
Use non-specific compensation
Ex: Employer and management. Employer give service recognition letters to employees.
Allow one person to obtain his objectives and pay off the other person for accommodating his interests.
Cut the costs for compliance
Through cost cutting, one party achieves their objectives and the other’s costs are minimized if they agree to go along.
Minimize the other party’s costs for reaching a negotiated agreement. Need to know what the other party wants.
Find a bridge solution
Invent a new option that meet all their respective needs.
Let’s invent a solution
What are some strategies that facilitate successful integrative negotiation
- create a common objective or goal
- share underlying interests, priorities and preferences, interpretation of key facts
- build trust
- make multiple offers simultaneously
- constructing
multiple equivalent simultaneous offers
Explain “Make multiple offers simultaneously”
Provide options that are similar in value to you, but which demonstrate flexibility and perceived sincerity
By studying the counteroffer and comparing it with your original offer, you are more likely to be able to discern which issues are weighted higher/lower by each of you
You can also ask which of your offers is closest/farthest to matching their preferences in order to acquire information
Explain “constructing multiple equivalent simultaneous offers (MESOs)
- Make a comprehensive list of all issues to be negotiated
- Prioritize issues; assign a value to each option within each issue
- Create 2-3 packages with varying terms that collectively are of equal value to you
- When you present MESOs, let your counterpart know:
a) you are going to make multiple offers
b) each offer is of equal value to you
c) you will give them time to consider the packages
What is the difference between a common goal, a shared goal, and a joint goal
A common goal is one that all parties share equally, each one benefiting in a way that would not be possible if they did not work together.
A shared goal is one that both parties work toward but that benefits each party differently.
A joint goal is one that involves individuals with different personal goals agreeing to combine them in a collective effort.
