Week 1 - The Nature of Negotiation

Question 1

Negotiators are ___, not ___

Answer 1

made, not born

Question 2

Negotiations

Answer 2

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

Done when we can’t achieve objectives single-handedly

Question 3

Characteristics of a negotiation situation

Answer 3

• There are two or more parties
• There is a conflict of needs and desires between two or more parties
• The parties negotiate by choice because they think they can get a better deal than by simply accepting what the other side offers them
• Parties expect a “give-and-take” process

Question 4

Parties search for agreement rather than:

Answer 4

• Fight openly
• One side dominate and the other capitulate
• Break off contact permanently
• Take their dispute to a higher authority

Question 5

Successful negotiation involves:

Answer 5

• Management of tangibles (e.g. the price or the terms of agreement)
• Resolution of intangibles (underlying psychological motivations that directly/indirectly influence parties)

Question 6

Examples of intangible factors

Answer 6

• The need to win or avoid losing
• The need to look good, competent, or tough to those you’re representing
• The need to defend an important principle or precedent
• The need to appear fair or honourable or protect one’s reputation

Question 7

Most relationships between parties may be characterized in one of 3 ways:

Answer 7

Independent - parties able to meet their own needs without the help and assistance of others

Dependent - parties must rely on others for what they need

Interdependent - mutual dependency (need each other to achieve their preferred outcomes)

Question 8

Interdependence

Answer 8

• Parties are characterized by interlocking goals
• Having interdependent goals does not mean that everyone wants or needs exactly the same thing
• A mix of convergent and conflicting goals characterizes many interdependent relationships

Interdependence and the structure of the situation shape process and outcomes (distributive/integrative)

Question 9

Zero-sum or distributive situations

Answer 9

One winner only

Question 10

Non-zero-sum or integrative situations

Answer 10

Goals are linked to achieve a mutual gain

Question 11

BATNA

Answer 11

Best alternative to a negotiated agreement
- whether you should or should not agree on something in negotiation depends upon the attractiveness of you BATNA

Evaluating interdependence depends heavily on the alternatives to working together

Question 12

Concessions

Answer 12

Mutual adjustment as each party attempts to have an influence on the other
- Concessions occur when one party alters his/her position based on the other party’s suggestion to do so

Concessions constrain the bargaining range

Question 13

Dilemma of honesty

Answer 13

Concern about how much of the truth to tell the other party

Question 14

Dilemma of trust

Answer 14

Concern about how much negotiators should believe of what the other party tells them

Question 15

Creating trust - outcome perception

Answer 15

Perception of results can create/destroy trust

Shaped by managing how the receiver views the proposed result

Question 16

Creating trust - process perception

Answer 16

The process itself has an effect on trust in negotiations

○ Conveying images that signal fairness and reciprocity in proposals and concessions

○ Making returning concessions after opposing party makes one

○ Not rejecting all proposals and not making any proposals back

Question 17

Distributive bargaining

Answer 17

Purpose: claim value
- Obtain the largest piece of the pie

Question 18

Integrative bargaining

Answer 18

Purpose: create value
- Find a way for all parties to meet their goals and share the reward
- Expansion of the pie

Question 19

Most actual negotiations are a combination of claiming and creating value

Answer 19

• Negotiators must be able to recognize situations that require more of one approach than the other
• Negotiators must be versatile in their comfort and use of both major strategic approaches
• Negotiator perceptions of situations tend to be biased toward seeing problems as more distributive/competitive than they really are

Question 20

Synergy

Answer 20

notion that the whole is greater than the sum of its parts

• successful coordination of interdependence has the potential to lead to synergy

Question 21

Conflict

Answer 21

“sharp disagreement or opposition” and includes “the perceived divergence of interest, or a belief that the parties’ current aspirations cannot be achieved simultaneously”

Question 22

Managing conflict - the dual concerns model

Answer 22

1) Concerns about their own outcome (assertiveness)

2) Concern about the other’s outcome (cooperativeness)

Question 23

5 major strategies for conflict management

Answer 23

1. Forcing - competing/dominating (full assertiveness, no coop)
2. Yielding - accommodating/obliging (full coop, no assertive)
3. Avoiding - inaction (no coop, no assertive)
4. Problem-solving - collaborating/integrating (full assert, full coop)
5. Compromising - mid coop, mid assertive