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Complex Cognition > Task 7 - Negotiation > Flashcards

Task 7 - Negotiation Flashcards

1
Q

Negotiation

A

Discussion between two or more parties with the aim of resolving a divergence of interests

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2
Q

Four domains of Power in Negotiation

A

Alternatives (BATNA)
Information
Status
Social Capital

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3
Q

Power in negotiations

A

Power that negotiator has to achieve success in bargaining situations
-> probability that negotiator will influence negotiation in direction of desired outcomes

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4
Q

BATNA

A

Best alternative to a negotiated agreement

  • > if you have a n altenative, you don’t depend as much on the outcome of the current bargain
  • > power comes from value or diversity of alternatives
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5
Q

Information

A

Having negotiation-relevant information

  • market information
  • knowledge of cultural practices
  • insight into counterparties anxieties or expertise
  • > gives bargaining power
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6
Q

Status

A

Extent to which a negotiator is respected by the counterparty
-> high status: get more value for same offerings, appear more competent and trustworthy

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7
Q

Social Capital

A

Power in negotiation arising from having established and maintained a large or strong social network
-> facilitates other sources of power

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8
Q

Cultural Differences in negotiation

A

Western: more likely to rely in information exchange strategy
East and South Asian: more likely to adopt persuasion and offer-making strategy

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9
Q

Trust tendencies

A

High trust: direct information sharing

Low trust: persuasion and offer-making

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10
Q

Social Identity Theory (intercultural negotiation)

A

Intercultural negotiations as having highly competitive outgroup-dynamics

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11
Q

Triangle Hypothesis (intercultural negotiation)

A

Cooperative negotiators will remain cooperative unless facing a competitive opponent (then competitive)

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12
Q

Effects of cultural differences

A

Can undermine value creation in intercultural negotiations

-> e.g. bank loans have higher interest rates, more guarantee requirements and are smaller interculturally

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13
Q

Trust

A

Psychological state indicating intention to accept vulnerability based upon positive expectations of the intentions or behaviors of another
-> enables parties to rely on each other in future

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14
Q

Effects of trust

A
  • Strengthens cooperative intentions
  • Reduces uncertainty
  • Minimizes transaction costs
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15
Q

Trust Propensity

A

Expectancy that the counterparty can be relied on, even without prior contact, shaped by prior experiences

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16
Q

High trust propensity negotiation behavior

A

more likely to take leap and signal counterparty about their high expectations of trustworthiness

17
Q

Integrative/cooperative bargaining

A
  • Q&A: sharing info about interests and priorities
  • > risky, only high trust propensitve negotiators engage in it
  • > contributes to trust development
18
Q

Distributive/competitive bargaining

A

S&O: substantiations and offers

  • > about position and influence
  • > used by low trust propensity negotiators, might induce reciprocal wariness
19
Q

Substantiations

A

All influence attempts that negotiators use to justify own positions and challenge counterparty’s logic, assumption or facts

20
Q

Trust influences

A

Signalling vulnerability and using Q&A contributes to trust development
S&O (especially substantiations) jeopardize trust development)
-> trust propensity directly and indirectly predicts trust development in negotiations

21
Q

Decision-Analytic Approach to Negotiations

A

Structure of negotiations determiend by:

  • BATNA
  • each party’s set of interests
  • relative importance of each party’s interests
22
Q

Reservation point

A

Point of value in bargaining below which a party would not accept an agreement

23
Q

Positive bargaining zone

A

Zone in which bot parties would agree

-> overlapping reservation points

24
Q

Negative bargaining zone

A

No resolution can occur between the parties since the reservation points do not overlap

25
Q

Claiming Value in Negotiation

A

Determination of each other’s reservation point and aiming for a resolution that is barely acceptable for the other party

26
Q

Creating Value in Negotiation

A

Trading issues of differential value to different parties based on preferences;
creating value through bets
-> contingent contracts

27
Q

Contingent contracts

A

Bets built on differences to create joint value

  • > help manage biases: parties can make bet on own biased beliefs
  • > diagnose disingenious parties: identifies bluffs and false claims
28
Q

Tools of value creation in Negotiation

A
  • Building trust and sharing information
  • asking questions
  • Strategically disclosing information
  • negotiate multiple issues simultaneously
  • make multiple offers simultaneously
  • search for post-settlement settlements
29
Q

Post-Settlement Settlements

A

Adjusting/improving settlements after having agreed on them

30
Q

Pareto-superior agreement

A

Mutually beneficial agreement done after an initial agreement

  • > still during bargaining, not after settlement
  • > often done by employing third party
31
Q

Negotiation Cultures

A
  • dignity cultures: self-worth based on individual achievements (USA)
  • face cultures (China)
  • honor cultures (Qatar)
32
Q

Key aspects of negotiation

A
  • Competitive aspiration (desire to gain at expense of counterparty)
  • Information sharing
  • Insight (level of awareness of counterpart’s concern
  • Joint gains (sum of negotiation outcomes)
33
Q

Significant cultural differences

A
  • Americans: strongest in joint gains
  • Chinese: most competitive, use most influence
  • Qataris: used more influence than US
34
Q

Negotiation Biases

A
  • Fixed Pie Assumption
  • Framing
  • Escalation of conflict
  • Overestimating own value
  • self-serving bias
  • Anchoring bias
35
Q

Fixed Pie Assumption

A

When negotiators only think of win-lose but do not consider possible win-win

  • > no desire to reach agreement together but both want more than counterpart
  • > don’t consider that there might be “multiple pies” that can be divided
36
Q

Cognitive Trust-Building

A

Trust based on (objective) attributes

  • > e.g. trusting a professors because you believe he/she has been highly educated
  • > also built by perspective-taking
37
Q

Affective Trust-Building

A

Trust based on personal connection

-> e.g. trusting you mom because she’s your mom

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