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Mediation & Negotiation > Week 1 - Distributive & Integrative Bargaining > Flashcards

Week 1 - Distributive & Integrative Bargaining Flashcards

1
Q

Characteristics of Negotiation

A
  • A basic means of getting what you want
  • Conflict of needs between two or more parties
  • Parties negotiate because they think they can get a better deal
  • Back and forth communication to reach agreement
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2
Q

Partners prefer searching for an agreement rather than:

A
  • Fight openly
  • Capitulate
  • Break off contact permanently
  • Take their dispute to a third party
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3
Q

What does negotiation involve?

A

Tangibles and intangibles

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4
Q

Interdependence

A

In negotiation, parties need each other to achieve their preferred outcomes or objectives

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5
Q

Interdependent goals

A
  1. Win-lose: I win, you lose (conflicting goals)
  2. Win-win: opportunities for both parties to gain (convergent goals)
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6
Q

Type of interdependence shapes processes and outcomes

A
  1. Zero-sum distributive - one winner
  2. Non-zero-sum or integrative - mutual gains
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7
Q

Mutual adjustment

A
  • Throughout the negotiation, both parties act to influence the other
  • An effective negotiator understands how people will adjust and readjust
    and how the negotiation might twist and turn
  • Negotiators face two dilemmas in mutual adjustment
  • Dilemma of honesty
  • Dilemma of trust
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8
Q

Dilemma of honesty

A

How honest should you be in a negotiation

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9
Q

Dilemma of trust

A

How much should you trust the other party

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10
Q

Concession making

A

Part of mutual adjustment.

  • When one party agrees to make a change in his/her position
  • Fairness and reciprocity in concessions is important
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11
Q

Conflict

A

Conflict can be defined as a:
* sharp disagreement
* perceived divergence of interest
* belief that the parties’ current aspirations cannot be achieved simultaneously

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12
Q

Dysfunctions of conflict

A
  • Competitive, win-lose mindset
  • Misperception and bias
  • Emotionally charged
  • Decreased communication
  • Blurred issues
  • Locked into positions
  • Magnified differences
  • Escalation
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13
Q

Functions and benefits of conflict

A

*Content-related discussions
*Creative problem-solving
*Change and innovation
*Awareness of self and others
*Strengthened relationships
*Stimulating and fun

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14
Q

The Dual Concern Model

A

Two axes: Concern about the other’s outcomes and concern about own outcomes

  1. Yielding (accomodating): little concern for own outcomes and high on other’s outcomes. Helpful if you were wrong, or when something is not important
  2. Inaction: doing nothing. Appropriate for a cooling of period, not when you are responsible for a decision;
  3. Compromising: finding each other in the middle;
  4. Contending (forcing): Useful with trivial issues, when something is not complex;
  5. Problem-solving: This is needed with complex situations needing commitment from others for success, not for simple, or timely issues.
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15
Q

Distributive bargaining

A

In distributive negotiations, the goals of one party are in fundamental and direct conflict with the goals of the other party

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16
Q

Purpose of distributive bargaining

A

To claim value:
* A competition over who is going to get the most of a limited resource

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17
Q

Three reasons why a negotiator should understand distributive bargaining

A
  1. In order to do well in interdependent situations that are distributive
  2. To know how to counter the effects of such widely used strategies
  3. Every negotiation requires skills at the “claiming-value” stage
18
Q

Basic elements of distributive bargaining situations

A
  • Positions
  • Opening offers
  • Create room for making concessions
  • Target points
  • Stretch goals that parties aspire to
  • People who aim high get better deals but don’t become too greedy with a large stretch goal
  • Resistance points
  • Negotiators will not go beyond this point (i.e., their bottom line)
  • Should be kept secret from the other party
19
Q

ZOPA

A

Zone of possible agreement

  • When resistance points overlap, there is a positive bargaining range
  • With a negative bargaining range, there is no room for settlement
20
Q

Methods of Distributive bargaining

A
  • Zopa
  • Concessions: patterns of concession making contain valuable information
  • Final offers: “this is all I can do” / “I asked my boss and he allowed me to give you a special deal…”
  • Settlement point
21
Q

BATNA

A

Best Alternative to a Negotiated Agreement

  • People with strong BATNAs
  • Set their goals higher
  • Make fewer concessions

If no attractive alternatives, negotiators have little bargaining power

22
Q

How to develop negotiation power?

A
  1. What is my BATNA
  2. Should I disclose my BATNA to the other side during negotiations
  3. If I have a weak BATNA, should I lie about alternatives?
  4. Do I know what the other side’s BATNA is? How can I find their BATNA?
  5. How can I weaken the other side’s BATNA?
  6. How can I strengthen my BATNA?
23
Q

Goals distributive bargaining

A
  • Settlement as close to the other party’s resistance point as possible
24
Q

Strategies in distributive bargaining

A

Strategies in distributive bargaining:
* Learn as much as possible about the other party’s position
- BATNA
- Resistance point
* Influence the other party’s belief about what is possible
- Convince the opponent of your position
- Make the opponent change their mind about their own position
- Put the opponent under pressure

25
Q

Hardball tactics

A
  1. Lowball/highball
  2. Bogey
  3. Intimidation
26
Q

Deception by ommission

A

Not disclosing information that would benefit the other (passive)

27
Q

Deception by commission

A

Actually lying (active)

28
Q

Taking Positions

A

Opening stance
* What attitude will you adopt during the negotiation?
* Competitive or moderate?

Opening offer
* Who makes the first offer?
* Where do you start?
* How do you make the offer?

29
Q

What makes integrative bargaining different?

A
  • Focus on commonalities rather than differences
  • Address needs and objectives, not positions
  • Exchange information and ideas
  • Commit to meeting the needs of all involved parties
  • Invent options for mutual gain
30
Q

Factors that facilitate integrative bargaining

A

*Some common objective
*Faith in one’s own problem-solving ability
*A belief in the validity of the other’s perspective
*Firmness in pursuing one’s own position
*Balance in power
*Trust
*Communication skills
*Multiple issues
*Importance of a long-term relationship

31
Q

Key steps in the integrative negotiation process

A
  1. Identify and define the problem (creating value)
  2. Surface interests and needs (creating value)
  3. Generate alternative solutions (claiming value)
  4. Evaluate and select among alternatives (claiming value)
32
Q

Integrative bargaining: how to identify and define the problem

A

*State the problem in neutral terms
*State the problem as succinctly as possible but comprehensively
*State the problem as a goal
*Identify any obstacles in attaining the goal
*Depersonalize the problem
*Do no jump to solutions until the problem is fully defined

33
Q

Integrative bargaining: how to surface interests and needs

A

Types of interests
* Substantive interests
* Process interests
* Relationship interests
* Interests in principles

Dialogues
* Why do I want this? Why is that important to me?
* Ask probing questions to the other party and pay careful attention

Interest can change (quickly)

34
Q

Integrative bargaining: generate alternative solutions

A

Redefine the problem as win-win
* Expand and modify the pie: add resources so that both
parties can achieve their objectives
* Logrolling: find more than one issue in conflict for
which priorities differ
* Nonspecific compensation: unrelated to substance of
negotiation but helps the other party to agree with the
deal

Generate options to the problem as given:
* Brainstorming
* Survey

35
Q

Integrative bargaining

A
  • Narrow the range of solutions
  • Evaluate solutions on quality and acceptibility
    1. Agree on objective criteria in advance
    2. Explore differences and trade off loss in some issues for gain in others
    3. Hold decisions tentative until final agreement is closed

Don’t lose sight of the integrative process!
* Keep searching for interests and be alert to intangibles
* Keep paying attention to the relationship

36
Q

Four principles for integrative bargaining

A

People
* Seperate the people from the problem

Interest
* Focus on interests, not positions

Options
* Invent options for mutual gain

Criteria
* Insist on using objective criteria

37
Q

The winner’s curse

A

Feeling discomfort about a win that comes too easily

Let the other party throw in the first price when you are dealing with something of which the value is very uncertain

38
Q

How to make the first offer?

A

Point versus range offer

Point offer:
* I want € 50 for my headset

Range offers:
* Backdown range offer: “I want € 30 to € 50 for my headset
* Bracketing range offer: “I want € 40 to € 60 for my headset
* Backdown range offer: “I want € 50 to € 70 for my headset

39
Q

Precision versus round offer

A

The optimal precision of one’s first offer depends on the opponent’s expertise

40
Q

Other methods for making the first offer

A
  1. Add a rationale
  2. Framing: “I offer my headset for a price of € 50” versus “I request a price of € 50 for
    my headset.” Request frames reduce the first-mover advantage because it makes the
    responder concession averse.
  3. Phantom anchors: “I was going to ask for € 70, but I can offer my headset for € 50.” Offers with phantom anchors result in less aggressive counteroffers and
    more beneficial agreements but also in perceptions of manipulativeness

Mediation & Negotiation (6 decks)

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