Chapter 9

Question 1

What are the three reasons why negotiations occur?

Answer 1

To agree on how to share or divide a limited resource

To create something new that either party could attain on his or her own

To resolve the problem or dispute between the parties

Question 2

What is conflict?

Answer 2

A process that begins with one party perceives that another party has negatively affected, or is just about negatively affect, something that the first party cares about

Question 3

Define functional and dysfunctional conflict

Answer 3

Functional conflict: conflict that supports the goals of the group and improves its performance

Dysfunctional conflict: Conflict that hinders group performance

Question 4

Define cognitive and affective conflict

Answer 4

Cognitive conflict: conflict related to differences in perspectives and judgements
– task oriented, results in identifying differences, usually functional conflict

Affective conflict: conflict that is emotional and aimed at a person rather than an issue
–dysfunctional conflict

Question 5

Define the 3 sources of conflict

Answer 5

Communication: through Semantic difficulties, misunderstandings, noise in the communication channels

Structure: includes variables such as size of the group, degree of specialization in the tasks assigned to group member, leadership style, composition of the group, jurisdictional clarity, reward systems, goal capability, and degree of dependence between groups

Personal variables: Potential sources of conflict is personal variables which include personality, emotions, and values

Question 6

What is the dual concern theory and what are the two components of it? In other words what are the two dimensions of conflict resolution

Answer 6

-The duel concern theory is used to describe people’s conflict management strategies

Cooperativeness (relationship) is one of the components it is the degree to which one tries to satisfy the other person’s concern

Assertiveness (task) is another one of the components it is the degree to which one tries to satisfy one’s own concerns

Question 7

What are the five conflict handling strategies identified by the dual concern theory

Answer 7

Forcing: imposing ones well on the other party (win/lose). It is also known as to satisfy personal needs at the expense of the other person. For example formal authority, bullying, manipulation, etc

• outcome: you feel vindicated; other person feels defeated
• Breeds hostility, resentment, retaliation

problem-solving (collaborating): trying to reach an agreement that satisfies both one’s own and the other parties aspirations as much as possible (win/win). Seek to address concerns of both parties. No assignment of blame
-outcome: one cloud Brady is possible, problem likely can be resolved

avoiding: ignoring or minimizing the importance of the issues creating the conflict (lose/lose). Or in other words to neglect interests of both parties by sidestepping or postponing. It reflects inability to handle emotion of conflict
- outcome: nothing (or things get worse)
- tends to be used more by collectivistic cultures

yielding (accommodating): excepting and incorporating the will of the other party (win/lose). Or in other words to satisfy other parties concerns but neglect your own. Preserve a relationship at the expense of genuine appraisal of issues

• outcome: other person takes advantage of you; decreased power and credibility
• May be able to get more out of next negotiation

compromising: balancing concern for oneself and concern for the other party in order to reach a solution (lose/lose). Or in other words seek partial satisfaction for both parties. Expedient, not effective, solutions
- outcome: gamesmanship (sometimes) and sub optimal resolution

Question 8

What are the four hallmarks of successful negotiation? **

Answer 8

Value is created
Value is claimed
Other party feels good
Protect or enhance the negotiation relationship

Question 9

Three ways of how to get integrative outcomes

Answer 9

Understand the problem fully

Generate alternative solutions

Never quit negotiating

Question 10

Out of all the conflict resolution strategies talked about what is the most effective/creates the most value

Answer 10

Collaboration (integrative negotiation)

-also takes more time

Question 11

Who are the four different people That can help resolve a conflict?

Answer 11

Mediator: a neutral third-party who facilitates a negotiated solution by using reasoning, persuasion, and suggestions for alternatives

Arbitrator: a third-party to a negotiation who has the authority to dictate an agreement

Conciliator: a trusted third-party who provides an informal communication link between the negotiator and the opponent

Consultant: an impartial third party, skilled in conflict management, who attempts to facilitate creative problem-solving through communication and analysis

Question 12

What are the three desired outcomes for a conflict

Answer 12

Agreement

Stronger relationships

Learning

Question 13

Within the negotiation what are issues, positions, and interests

Answer 13

Issues are items that are specifically placed on the bargaining table for discussion

Positions are individual stand on the issues

Interests are the underlying concerns that are affected by the negotiation resolution

Question 14

What are the two bargaining strategies?

Answer 14

Distributive bargaining

Integrative bargaining

Question 15

What is fixed pie?

Answer 15

The belief that there is only one set amount of goods or services to be divvied up between the parties

Question 16

What is distributive negotiation? What are the key concepts and targets?

Answer 16

negotiation that seeks to divide up a fixed amount of resources; a win lose situation

• goals of one party are in fundamental, direct conflict to another party
• One person’s game is another’s loss
• maximizing one’s own share of resources is the goal

Key concepts: minimum preparation for any negotiation will involve establishing the following: target point (aspiration point), resistance point (walk away), asking price (initial offer), BTNA this will influence the other three points

Target:

• your goal in the negotiation
• what price would you like to sell/buy the item for?
• should be realistic, based on the available information

Question 17

What is resistance/reservation point?

Answer 17

• The point at which you are indifferent to whether you achieve a negotiated agreement for walk away
• Beyond the resistance point, you prefer no agreement
• never reveal your resistance point

Question 18

What is the bargaining zone?

Answer 18

It is defined as the space between the two parties reservation points and it is also known as the zone of potential agreement

When a buyers and the sellers resistance point overlap It is called a positive bargaining zone and some form of agreement should be possible

When the buyers and sellers resistance points do not overlap it is called a negative bargaining zone and it is better to walk away rather than to negotiate

Question 19

What is BATNA?

Answer 19

Best Alternative To a Negotiated Agreement

Alternatives give the negotiator power to walk away from the negotiation

If alternatives are attractive, negotiators can set their goals higher, or make fewer concessions

If there are no attractive alternatives negotiators have much less bargaining power

Question 20

How are BATNA and resistance point different?

Answer 20

Reservation price is BATNA +/- things that make you want to do the deal
Ex. Switching costs, ego, miscellaneous preferences

• the BATNA serves to help you set the correct resistance point
• the resistance point is what you use in bargaining
• knowing the value if your BATNA helps you protect your resistance point from influence by the other party

Question 21

What is the anchoring effect? How is it relevant?

Answer 21

• people believe it is best to sit back and wait fir the first offer
• when it reality it is better to back the first offer
• also low starting bids attract more bidders and therefore more competitive bidders the the ending price will be higher

Question 22

What is integrative negotiation?

Answer 22

Integrative bargaining: negotiation that seeks one or more settlements that can create a win-win solution

• aka non-zero-sum or win-win
• finding new ways to increase the amount of pie on the table
• finding solutions that are of value to both parties
• value creation (and claiming)

RECOGNIZING POTENTIAL:

• the negotiation includes more than one issue
• It is possible to add more issues into the mix
• The negotiation is likely to recur overtime
• The parties have varying preferences across the issues

Question 23

What makes integrative negotiation different to distributive?

Answer 23

Focus on commonalties rather than differences

Address needs and interests, not positions and issues

Commit to meeting the needs of all involved parties

Exchange information and ideas

Invent options for mutual gain

Question 24

What is the negotiation process? (5 points)

Answer 24

• Developing a strategy
• defining groundrules
• clarification and justification
• bargaining and problem-solving
• closure and implementation

Question 25

What is “logrolling”?

Answer 25

When issues are traded because of differences in preferences

Often value was created when we trade an issue if less importance for an issue of more importance

We often feel the need to defeat our counterpart this destroys value

Question 26

What is negotiation?

Answer 26

Decision-making situations in which two or more interdependent parties attempt to reach agreement