AA3308

Final notes

1. Conflict can be divided into one of four levels. Which of the categories below is NOT one of these
levels? – page 19

Intrapersonal conflict
Interpersonal conflict
Intragroup conflict
Intergroup conflict

*Intrapair

2. A good negotiator should keep which of the following concept s in mind?

An initial offer

The target point

The resistance point

The BATNA

*All of the above

Pg. 274 – Best practices

1. Analyze and cultivate your BATNA. In both integrative negotiation and adversarial bargaining,
your best source of power is your ability and willingness to walk away and take another deal.
Before arriving at the bargaining table, wise negotiators spend significant time identifying their
best alternative to a negotiated agreement, or BATNA, and taking steps to improve it.

2. Negotiate the process. Don’t assume you’re both on the same page when it comes to
determining when to meet, who should be present, what your agenda will be, and so on.
Instead, carefully negotiate how you will negotiate in advance. Discussing such procedural issues
will clear the way for much more focused talks.

3. Build rapport. Although it’s not always feasible to engage in small talk at the start of a
negotiation (particularly if you’re on a tight deadline), doing so can bring real benefits, research
shows. You and your counterpart may be more collaborative and likely to reach an agreement if
you spend even just a few minutes trying to get to know each other. If you’re negotiating over
email, even a brief introductory phone call may make a difference. This is one of the most
valuable negotiation skills to master.

4. Listen actively. Once you start discussing substance, resist the common urge to think about
what you’re going to say next while your counterpart is talking. Instead, listen carefully to her
arguments, then paraphrase what you believe she said to check your understanding.

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Acknowledge any difficult feelings, like frustration, behind the message. Not only are you likely
to acquire valuable information, but the other party may mimic your exemplary listening skills.

5. Ask good questions. You can gain more in integrative negotiation by asking lots of questions—
ones that are likely to get helpful answers. Avoid asking “yes or no” questions and leading
questions, such as “Don’t you think that’s a great idea?” Instead, craft neutral questions that
encourage detailed responses, such as “Can you tell me about the challenges you’re facing this
quarter?”

6. Search for smart tradeoffs. In a distributive negotiation, parties are often stuck making
concessions and demands on a single issue, such as price. In integrative negotiation, you can
capitalize on the presence of multiple issues to get both sides more of what they want.
Specifically, try to identify issues that your counterpart cares deeply about that you value less.
Then propose making a concession on that issue in exchange for a concession from her on an
issue you value highly.

7. Be aware of the anchoring bias. Ample research shows that the first number mentioned in a
negotiation, however arbitrary, exerts a powerful influence on the negotiation that follows. You
can avoid being the next victim of the anchoring bias by making the first offer (or offers) and
trying to anchor talks in your preferred direction. If the other side does anchor first, keep your
aspirations and BATNA at the forefront of your mind, pausing to revisit them as needed.

8. Present multiple equivalent offers simultaneously (MESOs). Rather than making one offer at a
time, consider presenting several offers at once. If your counterpart rejects all of them, ask him
to tell you which one he liked best and why. Then work on your own to improve the offer or try
to brainstorm with the other party an option that pleases you both. This strategy of presenting
multiple offers simultaneously decreases the odds of impasse and can promote more creative
solutions.

9. Try a contingent contract. Negotiators often get stuck because they disagree about how a
certain scenario will play out over time. In such cases, try proposing a contingent contract—in
essence, a bet about how future events will unfold. For example, if you doubt a contractor’s
claims that he can finish your home renovation project in three months, propose a contingent
contract that will penalize him for late completion and/or reward him for early completion. If he
truly believes his claims, he should have no problem accepting such terms.

10. Plan for the implementation stage. Another way to improve the long-term durability of your
contract is to place milestones and deadlines in your contract to ensure that commitments are
being met. You might also agree, in writing, to meet at regular intervals throughout the life of
the contract to check in and, if necessary, renegotiate. In addition, adding a dispute-resolution
clause that calls for the use of mediation or arbitration if a conflict arises can be a wise move.

CORE NEGOTIATION CONCEPTS

Rex Mitchell

Opportunities and requirements for negotiation (and persuasion) are everywhere, everyday

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Negotiation:
* Conferring with another so as to arrive at the settlement of some matter (dictionary)

* Negotiation is a basic means of getting what you want from others. It is back-and-forth
communication designed to reach an agreement when you and the other side have some
interests that are ...opposed. (Fisher & Ury)

Negotiation myths (first four from Thompson 1998):

1. Good negotiators are born - they are self-made, requires study and practice
2. Experience is a great teacher - experience can improve negotiation skills to some extent but
have to learn from the experience - not unaided, unreflected, without feedback. Experience
tends to improve our confidence, but not our accuracy/effectiveness
3. Good negotiators take lots of risks - while this may work in the movies, it isn’t in the script for
real negotiations. Some negotiators may do this occasionally, but after carefully considering risks
& potential benefits. They know how to evaluate a situation and make an optimal choice given
the information available.
4. Good negotiators rely on intuition - Effective negotiators are self-aware and very conscious of
what they are doing and why. Most of the important work of negotiation takes place before
meeting (preparation).
5. Negotiations are always win-lose - a vast majority can be win-win.
6. The only negotiations are formal or explicit negotiations - far more negotiations take place
informally every day.
7. Good negotiators are tough, intimidating, and try to get everything they can - sometimes true
(in some one-shot competitive negotiations), but much more often inappropriate and
ineffective. Good negotiators are not in it for their egos - they focus on results.

Three crucial elements in every negotiation (Cohen, p.19 + more):

1. Information
-The life blood in negotiation
-The more you know about the other side, the better
-You not may want the other side to have certain information about you
-Alternatively, you may want the other side to have certain information - some correct,
possibly some incorrect
-Sometimes you have to give information to get information
-Watch for unintentional cues, verbal cues, and behavioral cues - in addition to explicit
information given by the other side
2. Time
-In a competitive negotiation, try not to reveal your real deadline to the other side
-Try to get clues about the deadline of the other side; they usually have one
-Many concessions may occur just before a deadline, so patience pays
-Generally speaking, you can not achieve the best outcome quickly, so using "take it or
nothing" tactics, especially early, may not be effective
3. Power
- You have more potential power sources than you realize
- There are many sources and tactics to gain more
- Sophistication and restraint in using power is important
- Many things affect relative power and power balance, including:

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 Position and privilege
Cultural differences
Developmental ability
Relationship
Also information and time advantages

Negotiation, to be appropriate, requires:

* Usual elements of a conflict situation (opposing interests, although there also may be
some common interests)
* Parties have and recognize their interdependence to at least some degree
* Motivation to engage with each other, rather than avoid
* The situation falls between avoidance and domination
* There is enough power balance that people can "come to the table"
* Parties have reached an active phase in which proposals can be made and explored

Some perspectives on negotiation:

* Although it would be nice to hope that negotiation tactics are used to reach settlement
with the other, this is not always the case
* Contrast implicit negotiations, in many settings:
- Communication is often indirect, yet still trying to settle differences without resorting to force
or avoidance...
* Two main approaches to negotiation:
- Competitive
- Collaborative
- But can combine these in “principled approach” (more later)
* Key differences in the ways these two approaches deal with CRIP goals:
- Content: win-lose (in competitive) vs win-win (in collaborative)
- Relationship: unfriendly vs friendly
- Identity/face-saving: rigid/confrontational vs flexible/supportive
- Process: positional bargaining vs interest-based bargaining (to build solutions)
* I feel that it is desirable to consider (at least partly) collaborative negotiations in a large
majority of situations. However, collaborative negotiations are not always possible, appropriate,
or sufficient. For example, sometimes you need to protect yourself.
* Note that negotiations can and often do combine competitive and collaborative
approaches and tactics

Competitive Negotiations:
*Basic assumptions:
- Negotiating is controlled by egocentric self-interest
- The underlying motivation is competitive/antagonistic
- Limited resources are available and are zero-sum
- This negotiation does not affect the future
- The goal is to win as much as you can, especially more than the other side

*Communication patterns:
- Make high opening demands and concede slowly
- Try to maximize tangible resource gains, within the limits of the current dispute
- Exaggerate the value of concessions that are offered

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 - Use threats, confrontations, argumentation, forceful speaking
Conceal and distort information
Manipulate people and the process by distorting intentions, resources, and goals
- Try to resist persuasion on issues
- Focus on quantitative and competitive goals rather than relational goals

*Disadvantages:
- Can hurt relationships, with mistrust, anger, breakdowns, communication
distortions...
- Blocks creative exploration & potential joint gains
- Payoffs of competitive actions are often overestimated
- Encourages brinkmanship (impasses)
- May undermine implementation (commitment vs. compliance)

Collaborative Negotiations:
* Assumptions:
- Parties have both diverse and common interests
- Common interests are valued and sought
- The negotiation process can result in both parties gaining something
- The negotiating world is controlled by enlightened self-interest
- Interdependence is recognized and enhanced
- Limited resources do exist, but they can usually be expanded through cooperation & creativity
- The goal is a mutually agreeable solution that is fair to all parties
* Follett examples of integrative solutions - window in library and two sisters with one
orange - obtained by understanding interests, rather than arguing for positions
* Places value on relationship, requires trust, relies on good disclosure of relevant
information
* Communication patterns:
- Collaborative tactics such as: non-evaluative descriptive statements, disclosing statements,
honest inquiry, requesting feedback, supportive remarks, concessions, accepting responsibility
- Brainstorm creative new options to meet everyone’s needs, expand the pie
- Use of nonspecific compensation (pay off in other ways for concession here)
- Logrolling (identify & try to deal with top-priority issues for each)
- Bridging (invent new options to meet the other side’s needs)
- Minimize costs to the other for going along with you

* Disadvantages:
- May pressure an individual to compromise and accommodate in ways not in his/her best
interests
- Avoids confrontational strategies (which can be helpful at times)
- Increases vulnerability to deception & manipulation by a competitive opponent
- Makes it hard to establish definite aspiration levels & bottom lines
- Requires substantial skill and knowledge of the process
- Requires strong confidence on one's perceptions regarding the interests and needs of the other
side...

Three Criteria for a Negotiation Method:

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1. Produce a “wise” agreement, if agreement is possible (i.e., an agreement that wisely
reconciles the parties' interests)
2. Efficient
3. Improve or at least not damage relationship
Bargaining over positions goes against all three
Being nice is no answer

Principled Negotiation (from Fisher & Ury, Getting to Yes, 1991)

*Particularly oriented to collaborative negotiations, but can be used in competitive negotiations
*A method centered around four considerations (PIOC)
- People: Separate people from the problem
- Interests: Focus on interests, not positions (interests always underlie positions)
- Options: Generate a variety of possibilities before deciding what to do
- Criteria: Insist that the result be based on objective standards
* Advocates "firm flexibility," i.e., remain firm about goals, but flexible regarding how to
accomplish them

PIOC: People
* Negotiators are people first
* Failure to deal with others as human beings prone to human reactions can be disastrous
* People problems: theirs and yours
* Perceptions (and inferences)
* Emotions
* Communications
* Prevention works better than repair

PIOC: Interests
* Usually are several possible positions that could satisfy any interest
* Behind opposed positions lie shared and compatible interests, as well as conflicting ones
* Usually are multiple interests
* Look forward, rather than back
* Commit to your interests, not your positions
* Stay open to take their interests into account
* Be hard on the problem, soft on the people

Distinguish among interests, goals (=objectives), positions, strategies, and actions. Consider
these examples:
- An interest is a motivator, an underlying need, desire, or concern, e.g., I want to feel financially
secure or I need more money with the arrival of a second child.
- A goal is a desired outcome or result, e.g., I want to make $60,000 this year.
- A position is a stated result or proposal, usually in a negotiation or conflict, e.g., I think I
deserve a 10% salary increase.
- A strategy is the method or path for achieving a goal, e.g., I will first try to negotiate an
increase in my salary; then, if this does not achieve my goal, I will search for a second job on
weekends.
- Tactics and actions are specific steps to be taken, hopefully following a strategy, e.g., contact
the placement office in my professional society to identify possible weekend positions.

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* Note examples of polar opposites that can be reconciled in integrative negotiation, if
done skillfully (from Fisher & Ury, 1991):
One party might care more about: Other party might care more about:
form, appearance substance
economic considerations political considerations
external considerations internal considerations
symbolic considerations practical considerations
immediate future more distant future
ad hoc results the relationship
hardware ideology
progress respect for tradition
precedent this case
prestige, reputation results
political points group welfare

PIOC: Options (creative ones)

* Library window, Sinai Peninsula & orange examples
* Avoid:
- Premature judgment
- Searching for the single answer
- Assuming fixed pie
- Stance that solving their problem is their problem
* Look for shared interests and mutual gain
* Develop creative new options (brainstorm to expand the pie)
* Make their decision easy

PIOC: Criteria (objective criteria)

* Commit to reaching a solution based on principle, not pressure
* Be open to reason, closed to threats
* Discuss objective standards for settling a problem instead of trying to force each other to back
down
* Frame issue as joint search for objective criteria
* Reason & be open re which standards are appropriate & how to apply
* Yield only to principle & facts, not pressure
* Note that your position "is a matter of principle"

Wilmot & Hocker (2010 ch.8) suggest a slight modification to the PIOC, worth consideration:
1. Attend to the relationship
2. Attend to all elements of communication
3. Focus on interests, not positions
4. Generate many options
5. Find legitimate criteria
6. Analyze the BATNAs (best alternatives to a negotiated agreement)
7. Work with fair and realistic commitments

More re Collaborative Negotiation

* Transforming negotiations requires some special things:

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- moving from self-interest to shared concerns
- moving from competitiveness to cooperativeness
- moving from an exchange model to a more intuitive, emotional stance
* Many conflicts would profit from realizing that "we are all downstream from each other"
(borrowed from the ecology movement re dumping pollutants)
* Some collaborative actions:
- Assume there is a solution
- Join “with” the other
- Control the process, not the person
- Be firm in your goals and flexible in your means
- Use principles of productive and effective communication

Key elements in effective planning for a negotiation:

* Define your interests (don't confuse these with positions you might take at times)
* Define issues (usually are hidden ones, in addition to conspicuous ones)
* Assemble issues and define the bargaining mix. A larger bargaining mix takes longer to
negotiate, but opens up more opportunities for collaborative solutions.
* Consult with your team and constituencies (and the other side, when appropriate)
* Analyze the other party (gather information and make sense of it)
* Prioritize interests and issues (your own and those of the other side)
* Set goals, target points, resistance points (understand and identify your own limits,
recognizing trade-offs)
* Identify your BATNAs (best alternative to a negotiated settlement - see terms at end;,
possibly develop more and/or better ones
* Develop starting points and supporting arguments (do your homework - research and
organize information)

What If They Are More Powerful?

• Develop your BATNA (one of best ways to deal with a more powerful other side, ch.6)
• Know & improve your BATNA
• Measure proposed agreement against your BATNA (not your bottom line)
• Don't add various BATNAs
• Consider the other side's BATNA
• Decide whether to disclose your BATNA

What If They Won't Play Fair?

* Four basic approaches
- Use principled negotiation
- Use a third party
- Negotiation jujitsu
- Don’t negotiate (if you the option)

* Principled Negotiation
• Same four basic principles (PIOC)
• Change the game by starting a new one (apartment example p.117ff)
• Remain open to persuasion by objective facts and principles
• Stick to principles without blaming or attacking
• Communicate information by means of questions

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• Give personal support to the opposite person
• Inquire about reasons for the other’s positions
• Use effective listening
• Present your reasons before offering a proposal
• Present proposal as one fair solution, rather than your proposal

* One-Text Process
• Best with a third-party
• Single draft text
• Attempts to integrate various interests & concerns
• Multiple drafts
• Feedback & critique from both sides on each draft
• Eventually, yes or no

* Negotiation Jujitsu (see F&U)

• Prevent the cycle of action & reaction by not pushing back
• Don't attack their position, look behind it, channel it into exploring interests
o Don't reject or accept it
o Assume every position is a genuine attempt to address the basic concerns of each side
o Ask them how it does this
o Seek & discuss principles underlying their positions
• Invite feedback & advice, rather than re-defending your ideas
• Reframe an attack on you as an attack on the problem
• Inquire and pause ("Some of the most effective negotiating you will ever do is when you
are not talking")

Sometimes you should try to avoid negotiating (modified from Lewecki, 2007, Essentials of N.,
p.7)
* When you don’t care
* When you could lose everything
* When there is nothing you could gain (the other has nothing you want)
* When the demands are illegal or unethical
* When they act in bad faith
* When you don’t have time
* When waiting would improve your position
* When you’re not prepared

Some Terms (for reference)

a. Bargaining mix: the set of issues that are or could be considered in the negotiations.
Often, there will be substantial differences between the parties in the importance of various
issues. Having multiple items in the bargaining mix and being creative in dealing with them can
be very helpful - in both competitive and collaborative negotiations.
b. BATNA (best alternative to a negotiated settlement): the best alternative a negotiator
has other than completing the present negotiation with the other side
- Sometimes there are only two choices: reach a deal with the other party or no settlement at
all
- Other times, there may be multiple alternatives that exist or can be developed

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- (Good) alternatives are important because they give a negotiator the power to walk away from
a competitive negotiation when the deal is not very good
- Good competitive negotiators identify their realistic alternatives before beginning negotiations,
so they can judge how firm to be in the negotiations
c. Target point (aka aspiration): the point at which a negotiator would like to conclude
negotiations, his/her optimal goal. Each item in the bargaining mix will have its own target,
resistance, and starting point.
d. Resistance point (aka bottom line): the point furthest from the target point a negotiator
will go, but the point can change. In a sales negotiation, this would be the most a buyer will pay,
and the least the seller will accept
e. Starting point: the first position a negotiator plans to take. In a sales negotiation, this is
the
asking price stated by the seller, and is the first counteroffer made by the buyer
f. Bargaining range (aka zone of potential agreement):
- In a sales negotiation, there is a positive bargaining range if the buyer's resistance point is
above the seller's (the buyer is maximally willing to pay more than the seller is minimally willing
to sell for)
- If the reverse is true (the buyer won't maximally pay more than the seller will minimally
accept), there is a negative bargaining range - and a likely stalemate
- In a competitive negotiation with a negative bargaining range, there will be no solution unless
one or both parties change their resistance points (or other items can be introduced into the
bargaining mix)
- In a competitive negotiation, it is hard to learn about resistance points and whether a positive
settlement range exists
- In a collaborative negotiation, the parties may talk openly about these matters
g. Settlement point: the final point(s) of agreement, if this happens

PERSUASION

Persuasion:
* Moving by argument, entreaty, or expostulation (reasoning earnestly) to a belief, position, or
course of action (dictionary)

* Persuasion is a negotiating and learning process through which a persuader leads colleagues
to a problem’s shared solution. Persuasion does involve moving people to a position they don’t
currently hold, but not by begging or cajoling (or forcing). (Conger, p.86)

* Persuasion is an important part of negotiation and an important part of leadership and life,
including situations we would not identify as negotiations.

Four Essential Steps in Persuasion

1. Establish credibility
- Earned over time
- Requires expertise and relationships
- Need to be honest, competent, inspiring (Kouzes & Posner 3rd ed, p.21): discovering yourself,
appreciating constituents and their diversity, affirming shared values, developing capacity,
serving a purpose, sustaining hope

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 2. Frame for common ground
- Frame goals and arguments in a way that identifies common ground with those you wish to
persuade
- Outcome must appeal strongly to the people you are trying to persuade
3. Provide evidence
- Reinforce arguments and positions
- Use vivid language and compelling evidence - examples, stories, metaphors, analogies
o MS example p.92 using analogy of supermarket and cooking dinner
4. Connect emotionally with your audience

Four Ways Not to Persuade

* Up-front, hard sell
* Resist compromise
* Rely only on presenting great arguments
* Assume persuasion is a one-shot effort
3. What type of negotiation is characterized by a competitive situation in which there can only be
one winner?

Non-zero sum

Interdependent

*Distributive

Integrative

When the goals of two or more people are interconnected so that only one can achieve the goal-such as
running a race in which there will be only one winner-it is a competitive situation, also known as zero-
sum (or distributive) situation.

zero-sum or distributive situation

A competitive situation in which individuals are so linked together that there
is a negative correlation between their goal attainments
4. An integrative negotiation might employ which of the following strategies in order to create
alternative solutions?

Expanding the pie

Creating BATNA's
Logrolling
*Two of the above

Managing integrative negotiations involves creating a process to identify and define the problem,
surface interests and needs, generate alternative solutions, and evaluate and select alternatives.
(p.61-ebook)
________________________
Expand the Pie Many negotiations begin with a shortage of resources, and it is not possible for both
sides to satisfy their interests or obtain their objectives under the current conditions. A simple
solution is to add resources—expand the pie—in such a way that both sides can achieve their

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 objectives. For instance, Advanced Management Consulting could lease offices both downtown and
in the suburbs to serve both sets of its clients. A projected expansion of the business could pay for
both leases. In expanding the pie, one party requires no information about the other party except
her interests; it is a simple way to solve resource shortage problems. In addition, the approach
assumes that simply enlarging the resources will solve the problem. Thus, leasing both locations
would be a very satisfactory solution if Samantha and Emma like both locations and want to expand
their business. However, expanding the pie would not be a satisfactory solution if their disagreement
is based on other grounds—if, for example, they have different visions about the future of the firm—
or if the whole firm has to gather for meetings frequently. In addition, to the extent that the
negotiation increases the costs of a person or organization not directly involved in the negotiation
(e.g., the employees in this example), the solution may be integrative for the negotiators but
problematic for other stakeholders.

Logrolling (identify & try to deal with top-priority issues for each)
- Bridging (invent new options to meet the other side’s needs)

What is BATNA? Best alternative to a negotiated agreement

Problem solving (also called collaborating or integrating) is the strategy in the upper right-hand
corner. Actors pursuing the problem-solving strategy show high concern for attaining their own
outcomes and high concern for whether the other party attains his or her outcomes. In problem
solving, the two parties actively pursue approaches to maximize their joint outcome from the
conflict. Pg 24

Pg 26
Defining the goal Pg 97-98

5. The planning process for a negotiation includes which of the follow activities or strategies?
Defining issues
Defining alternatives
Employing a field analysis
Defining the bargaining mix
All of the above

Chapter 4 - - Goalsstrategyplanning (p.90 ebook)

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Key elements in effective planning for a negotiation:
* Define your interests (don't confuse these with positions you might take at times)
* Define issues (usually are hidden ones, in addition to conspicuous ones)
* Assemble issues and define the bargaining mix. A larger bargaining mix takes longer to negotiate
but opens up more opportunities for collaborative solutions.
* Consult with your team and constituencies (and the other side, when appropriate)
* Analyze the other party (gather information and make sense of it)
* Prioritize interests and issues (your own and those of the other side)
* Set goals, target points, resistance points (understand and identify your own limits, recognizing
trade-offs)
* Identify your BATNAs (best alternative to a negotiated settlement - see terms at end;, possibly
develop more and/or better ones
* Develop starting points and supporting arguments (do your homework - research and organize
information)

6. Which of the following is the best example of a winner’s curse?

Pg 150, 153

A woman bids on a rare book at an auction. She wins and places it on a bookshelf in her living room.

A man goes to buy a car. He offers $3,000 below the asking price. The dealer accepts. The man
gives the car to his wife for her to drive.

A man goes to a garage sale. He spots a very nice antique looking bookcase that he has seen valued
at over $1000 in antique stores. He offers $200 and the seller accepts. He takes the bookcase and
later feeling dissatisfied with its appearance , he stores it in a hidden corner of his garage.

A woman goes to the mall and while at Macy's she buys a nice brand name purse. She takes it home
but never uses it because it does not match the rest of her wardrobe.

A man buys a collector's comic book on ebay. Once he receives it by mail he notices that it is the
wrong one and he returns it.

6. The Winner’s Curse

The winner’s curse refers to the tendency of negotiators, particularly in an auction setting, to settle
quickly on an item and then subsequently feel discomfort about a negotiation win that comes too
easily. If the other party capitulates too quickly, the negotiator is often left wondering, “Could I have
gotten this for less?” or asking, “What’s wrong with the item/product/option?” The negotiator may
suspect that the other party knows too much or has insight into an unseen advantage; thus, either “I
could have done better” or “This must be a bad deal.”

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 For example, in an antique store several years ago one of the authors of this book saw a clock that
he and his wife fell in love with. After spending the afternoon in the neighborhood deciding on a
negotiation strategy (opening offer, bottom line, timing, feigned disinterest, the good guy/bad guy
tactic), the author and his wife returned to the store to enact their strategy. The store owner
accepted their first offer. Upon arriving home, suffering from the winner’s curse, they left the clock in
the garage, where it remains collecting dust.

The best remedy for the winner’s curse is to prevent it from occurring in the first place by doing the
advance work needed to avoid making on offer that is unexpectedly accepted. Thorough
investigation and preparation can provide negotiators with independent verification of appropriate
settlement values. Negotiators can also try to secure performance or quality guarantees from the
other party to make sure the outcome is not faulty or defective.
7. Which cognitive bias in negotiation is found in the following scenario? (ch.6)
After graduating from a nationally ranked business school, a man was recently hired in a
negotiation position. His first month he worked on one major negotiation. It was a hard-fought
negotiation with a lot of back and forth between the negotiators, but he won the contract for his
company. He notices that he has an upcoming negotiation next week and briefly researches the
opposing company. The night before the negotiation he goes out drinking with his frat buddies but
wakes up clear headed the next morning and eager to get to work on the negotiation.

Self-serving bias
Overconfidence
Law of small numbers
Endowment effect

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8. Which of the following are characteristics of electronic negotiation?

Electronic negotiation is more likely to end in an impasse than face to face negotiation
Electronic negotiation leads to more balanced and equal settlements than face to face negotiations
Electronic negotiations lack the element of schmoozing found in face to face negotiations
Two of the above
Three of the above

The use of network-mediated information technologies in negotiation is sometimes referred to as

virtual negotiation (also at times “e-negotiation”).

The e-Negotiation makes negotiation process:

•From person dependent to process dependent
•Fast and Extremely effective
•Low cost affair for both buyers and sellers
•Equally useful for C-Category purchase as for A-Category thereby saving in all product categories
•Choice of selection of vendor partners from increased geography
•Fully recorded for further audit purposes
•Having high degree of repeatability
•and finally readies sourcing teams for new-age negotiations with effective use of English, Dutch or e-
RFQ methods of negotiations and methodology of selecting λ-Factors, standalone auctions or
combinatorial auctions etc.

https://www.quora.com/Explain-when-the-negotiator-can-effectively-use-e-negotiation-technique

https://www.researchgate.net/publication/228809445_A_business_model_for_e-
negotiation_in_electronic_commerce_InterNeg_Working_Paper_INR0204

9. A naïve and young negotiator enters a negotiation with no experience. During the negotiation he
listens to the other side, agrees, and settles the negotiation quickly, but unfortunately against his
company’s best interest. This is a good example of which of the negotiation concepts?

Dilemma of honesty
*Dilemma of trust
Misrepresentation
Deception

The dilemma of honesty is that a negotiator who tells the other party all of his exact requirements and
limits will, inevitably, never do better than his walkaway point. To keep the negotiation relationship on
constructive footing, each party has to strike a balance between extremes of openness and deception.

The dilemma of trust is that a negotiator who believes everything the other says can be manipulated by
dishonesty.

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10. You have been involved in a marathon of 10 hours. You have conceded on some points and been
firm on others. In the end there has been progress in arriving at an agreement, but you and your
counterpart are not able to arrive at an agreement on the most important point. You feel your
employer will be very dissatisfied if you have spent so much time working out an agreement without
producing some result. Therefore, you concede on this final point and take the settlement to your
boss who looks it over and fires you for having arrived at an agreement that is detrimental to your
company. Which of the following concepts did you fail to recognize during the negotiation?

The settlement ranges

*The walkaway points
The coalition point
The target point

Response: D. The target points

When we consider how a negotiation functions, we need to remember the end goal while making our
decision to concede and in this case, to confront it the expectations of the employer, the individual
ended up not being able to do justice to the target point and failed the negotiation process.

Equal partners
In business 10yrs
Portfolio $10,000,000
2000 client
Asset - $500,000 office building
Debt $250k total liabilities
Debt - $100k on building for improvements
Debt - $150k operating expenses

John – affair
100K – advertising & business expense
English major, no experience
Employee filed sexual harassment lawsuit

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Doing most of the new client acquisition and day to day work
No Clients at first
good with people, acquired most of the clients

John – rehab for drinking and drugs

finance degree
Has client
5yrs prior experience
Only few clients

Violating partnership agreement

20 yr mediate with experience
Accusing
Personal
Lawyer agitated
Interruptions (using anger in mediation)
Both want 100 of the client accounts (split evenly concept)
John lowers demands and says split equally
Lawyer thinks Jim will reject his (all offers should be presented to client)
Jim thinks with his building and initial -accounts and expertise, John would never be successful
Mediator presents as his idea
Jim agrees to split

Building
Liabilities
1,000,000 lawsuit
$250,000 business debt
Failure to agree will cause this to go to trial
Gives them 30 minutes to resolve

Agree – Jim will assume $250,000 in business debt

John will access lability for sexual harassment
John keeps the building
John receives $30k for capital improvements for the last 10 yrs.

Use the building - Search for smart tradeoffs. In a distributive negotiation, parties are often stuck making
concessions and demands on a single issue, such as price. In integrative negotiation, you can capitalize
on the presence of multiple issues to get both sides more of what they want. Specifically, try to identify
issues that your counterpart cares deeply about that you value less. Then propose making a concession
on that issue in exchange for a concession from her on an issue you value highly.

1. Defend the parties’ decision to move the mediation after negotiations broke down. Evaluate the
outcome of the mediation based on your understanding of negotiation and mediation theory and
the facts of the scenario.

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Negotiation involves dialog between the parties with the end goal of reaching an agreement. (Carnevale,
1992) Mediation is often the best solution for parties that have failed to reach an agreement through
negotiation. Mediation is a variation on negotiation in which one or more outsiders ("third parties")
assist the parties in their discussion. (Carnevale, 1992) In this particular scenario, it was unlikely that the
parties would be able to reach an agreement without a third party to mediator because of their
“partnership/friendship”. The addition of a third party/mediator provides those in dispute with a more
rational and less emotionally charged perspective.

The outcome of this scenario was completely reasonable and fair for both parties. The result is as I
expected because the mediator behaviors encompassed the use of all four distinct components of
mediation: 1) the relationship between the mediator and the disputants; 2) the relationship between the
parties during mediation; 3) the issues; and 4) the individuals (or groups) on each side of the dispute and
their motivation to reach agreement. (Carnevale, 1992) A mediator that understands the value and use
of the negotiation and mediation components has a far greater chance of assisting the parties in coming
to an agreement because the mediator is able to maintain control of the negotiations.

There are multiple types of options available in the form of an alternative dispute resolution for redressal
of serious grievances or conflicts arising out of legally binding contractual relationships, including the
settlement of disputes through bilateral intervention of other third parties. Some of these are mediation,
conciliation, and arbitration which are all preferable to litigation as being cheaper and quicker methods
of resolution. Mediation is essentially a negotiation facilitated by a neutral third party, unlike arbitration,
which is a process of ADR somewhat similar to a trial. Mediation doesn't involve decision making by the
neutral third party. The mediator only puts across the viewpoint of both parties to each other for
providing the third dimension while facilitating consensus among parties on disputed matters. A
mediator facilitates consensus by using expert methods of psychological influence and manipulation to
help the involved parties through conflict resolution by optimally utilizing the specific traits and
knowledge which have been proved to be effective in efficient conflict resolution through optimal people
management. The option of mediation as a means to achieve conflict resolution is especially relevant to
the partners as they are already facing the prospect of financial burden of litigation fees and damages
from a sexual harassment case, John's drug and drinking rehabilitation along with the serious negative
impact of the situation on the existing business and its continuity and sustenance. The best option is the
one with minimal cost implications and mediation will ensure that neither party feels discriminated
against or having received an unjust bargain as the most important attribute of the mediator is the ability
to maintain and present an absolutely unbiased and non-discriminatory approach even when pretending
to favor a certain party to manipulate towards consensus.

2. Assess the mediation session based on mediation theory. In particular, identify all mediation
techniques which you can find in the scenario.

In the given case, the mediator has a broad focus as defined within mediation style and process as
he is an evaluative mediator who successfully defines the problem for both the parties beyond the
narrow legal issues while efficiently guiding and enabling by helping both parties to identify the
interests which have maximum value for them and be willing to negotiate on the others which do
not have similar value as he identifies that except for the client accounts which hold exceptional
value for both the other issues hold different value to both parties and can be resolved to the
satisfaction of both. The mediator establishes conflict goals unrelated to technical goals to
understand effectively the underlying relationship and conflict between the parties to be able to
facilitate conflict-free communication by using manipulation to achieve consensus on the major

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 point of contention the client accounts, which both finally agree to split equally. The mediator
effectively controls the level of conflict escalation by placing both parties in separate rooms to
maintain focus upon conflict resolution without further escalating the conflict two levels where
achieving consensus through the process of mediation maybe come impossible to achieve due to
extensive focus upon the various relationship issues existing between the parties with seriously
restrict maintaining an unbiased and practical view and conducting a rational analysis of the offer of
the other for resolving the conflict. The evaluative broad mediator can be extremely successful in
generating required outcome by providing future predictions of the possible outcomes which may
result and be harmful to both involved parties in case consensus is not achieved which can result in
extreme pressure on the involved parties two seriously assets and analyze the various options and
try the level best to put in an effort to achieve consensus which may be essential for avoiding
arbitration other legal options which can be extremely harmful with serious cost implications for
both involved parties.

3. Defend the mediator’s use of heavy-handed techniques toward the end of the mediation session.
The major goal to be achieved for the success of the mediation process is the facilitation of
consensus between the parties by effective conflict resolution. This becomes the all-important goal
to be achieved for the mediator as the responsibility and duty that is owed to the stakeholders. It
becomes important from a professional and ethical viewpoint that a mediator Putin all required
effort to achieve the goal my optimal utilization of the inherent skills and traits which have resulted
in his appointment as a mediator. Any mediator who does not think out of the box and employee
innovative means and methods to achieve the goal facilitating consensus especially when the
process seems to be sabotaged due to personal bias existing between the parties it becomes
important that the mediator employ all possible ethical means the situation requires achieving
consensus and rendering the process as successful. In this case the mediator emphasizes the option
of legal proceedings for dispute resolution with serious consequences for both parties in case the
options provided under the mediation process are not accepted within the short time available for
the proceedings to end as a means to pressurize the parties to put aside their personal issues and
bias to focus on analyzing the options in a rational manner to take a decision which would be
favorable to all stakeholders and to themselves. The means employed in the given circumstances are
justified and in no way unethical, as the mediator is only attempting to optimally fulfill his duties and
responsibilities towards all stakeholders.

Negotiation Terms
For what three reasons do negotiations occur?
1. to agree on how to share or divide a limited resource
2. to create something new that neither party could do on his own
3. to resolve a problem between the parties

What is bargaining?.
The competitive, win-lose situation such as haggling over price

What is negotiation? Win-win situations such as those that occur when

parties find a mutually acceptable solution

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Define negotiation - A process by which two or more parties attempt to
resolve their opposing interests

What are some characteristics common to all negotiation situations?

1. Two or more parties
2. Conflict of needs/desires between the parties
3. Parties negotiate by choice!
4. Give and take process
5. Negotiate and search for agreement rather than to fight openly
6. Successful negotiation involves management of tangibles and also the
resolution of intangibles

Why do we voluntarily negotiate?

Because we believe it will improve our outcome or result

When shouldn't you negotiate?

When you'd lose it all; when you're sold out; when the demands are
unethical; when you don't care; when you don't have time; when they act in
bad faith; when waiting would improve your position; when you're not
prepared

What is the management of tangibles?

e.g. the price or the terms of an agreement

What are intangible factors?

The underlying psychological motivations that may directly or indirectly
influence the parties during a negotiation

Give some examples of intangible.

The need to win
The need to look good
The need to defend an important principle
The need to appear fair
The need to maintain a relationship

Describe interdependence in negotiations.

The parties need each other in order to achieve their preferred objectives so
they must either coordinate with each other or choose to work together

Most relationships between parties may be characterized in one of

three ways: independent, dependent or interdependent. Explain.
I: able to meet own needs without help/assistance of others
D: must rely on others for what they need
IN: must accommodate each other

Interdependent parties are characterized by what?

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Interlocking goals- need each other to accomplish objectives

What is the zero-sum or distributive situation?

A competitive situation in which individuals are so linked together that there
is a negative correlation between their goal attainments

When else are zero-sum game situations present?

When parties are attempting to divide a limited or scarce resource

When parties' goals are linked so that one person's goal

achievement helps others to achieve their goal it is a mutual-gains
situation known as what?
A non-zero-sum game or integrative situation

Agreeing on something in a negotiation depends upon the

attractiveness to you of the best available alternative. What is
BATNA?
Best alternative to a negotiated agreement

How do negotiations begin?

With statements of opening positions- each party states its most preferred
settlement proposal

If the initial proposal is not accepted, what do negotiators do?

Begin to defend their own initial proposals and critique the others' proposals

When one party agrees to make a change in his or her position, a

concession has been made. What is a concession?
These restrict the range of options within which a solution or agreement will
be reached. When a party makes a concession, the bargaining range is
further constrained

What is the bargaining range?

The difference between the preferred acceptable settlements

What are the two dilemmas all negotiators face?

Dilemma of honesty and dilemma of trust

What is the dilemma of honesty?

This concerns how much of the truth to tell the other party

What is the dilemma of trust?

How much should negotiators believe what the other party tells them

What two efforts in negotiation help to create trust and belief?

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1. Outcome perceptions
2. Perceptions of the process

Outcome perceptions can be shaped by what?

Managing how the receiver views the proposed result

What is distributive bargaining?

Negotiators employ a win-lose strategy- accepts the fact that there can only
be one winner

What is the purpose of negotiating via distributive bargaining?

To claim value- to do whatever necessary to claim the reward, gain the lion's
share, or gain the largest possible piece

What is integrative negotiation?

Negotiators employ win-win strategies and tactics- attempts to find solutions
so both parties can do well and achieve their goals

What is the purpose of negotiating via integrative negotiation?

To find a way for all parties to meet their objectives

Most negotiations are a combination of claiming and creating value

processes. What are the implications?
1. Negotiators must be able to recognize situations that require more of one
approach that the other.
2. Negotiators must be versatile in their comfort and use of both major
strategic approaches
3. Negotiator perceptions of situations tend to be biased toward seeing
problems as more distributive/competitive that they really are.

Successful coordination of interdependence has the potential to

lead to...
Synergy- the notion that the whole is greater than the sum of its parts

The key differences among negotiators include:

1. Differences in interests
2. Differences in judgement about the future
3. Differences in risk tolerance
4. Differences in time preference

Define conflict.
May be defined as a sharp disagreement or opposition, as of interests, ideas,
etc. and includes the perceived divergence of interest, or a belief that the
parties' current aspirations cannot be achieved simultaneously

What are the four levels of conflict?

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1. Intrapersonal or intrapsychic conflict
2. Interpersonal conflict
3. Intragroup conflict
4. Intergroup conflict

What is Intrapersonal or intrapsychic conflict?

Conflict occur within an individual- ideas, thoughts, emotions etc..

What is Interpersonal conflict?

Between individuals

What is Intragroup conflict?

Within a group (among a team and work members, families)

What is Intergroup conflict?

Between organizations, ethnic groups, warring nations, feuding families etc.

Most people initially believe conflict is bad or dysfunctional. What

are the two aspects of this belief?
1. Conflict is an indication that something is wrong, broken,
2. conflict creates largely destructive consequences

What are some of the elements that lead to a conflict's destructive

image?
1. competitive, win-lose goals
2. misperception and bias
3. emotionality
4. decreased communication
5. blurred issues
6. rigid commitments
7. magnified differences/minimized similarities
8. escalation of the conflict

Describe the dual concerns model.

Postulates that people in conflict have two independent types of concern:
concern about their own outcomes (horizontal) and concern about the other's
outcomes (vertical)

The vertical dimension of the dual concerns model is often referred

to as the ..
cooperativeness dimension

The horizontal dimension of the dual concerns model is often

referred to as the ..
assertiveness dimension

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What are the five major strategies for conflict management
identified in the dual concerns model?
1. contending
2. yielding
3. inaction
4. problem solving
5. compromising

What is contending?
Also known as competing/dominating- actors pursuing this strategy pursue
their own outcomes strongly, and show little concern for whether the other
party obtains his or her desired outcomes

What is yielding?
Accommodating or obliging- show little interest in whether they attain their
own outcomes, but are interested in whether the other party does

What is inaction?
Avoiding- show little interest in whether they or the other party obtain
desired goals.

What is problem solving?

Collaborating or integrating- high concern for attaining own outcomes and
high concern for other party outcomes

What is compromising?
Moderate effort to pursue own outcomes and outcomes of other party

1. Defend the parties’ decision to move to mediation after negotiations broke down. Evaluate the
outcome of the mediation based on your understanding of negotiation and mediation theory and
the facts of the scenario.

The party’s decision to move negotiations to a mediator is the best alternative when an agreement
cannot be reached. The attempted negotiations between John and John were done informally and
without a neutral party to help them reach middle ground. Due to the volatility and personal nature of
the matters involved, no agreement was likely to occur. When an impasse is reached, hiring a mediator is
best alternative because the parties are unable to reach an agreement on their own. In this case,
mediation likely helped the parties avoid the risk of lawsuit and violating their firm’s partnership
agreement.

The outcome of the mediation gives both parties an adequate and fair share of the firm’s assets, debts,
clients and capital. The expertise of the mediator enabled him to redirect focus back to the primary
issues and drive the discussion towards adequate solutions. By leading collaborative negotiations, he
successfully transformed conflict to solution. An example of this is the agreement by the parties
allowing John to retain ownership of the building owned by the firm. Conversely, John will assume
$250,000 of the firm’s business debt. On the other hand, it was agreed that John will accept liability for
the pending sexual misconduct lawsuit. However, John will also be reimbursed for the capital

24
improvements on the office building for the last ten years. The mediator also used Each agree to evenly
split the firm’s client accounts.

2. Assess the mediation session based on mediation theory. In particular, identify all mediation
techniques which you can find in the scenario.

We learned in this course that negotiations theory involves using a careful method for achieving an end.
In the case of John and John, it was imperative for the mediator to use a strategic and integrative
approach to the negotiation. The strategic approach involved keeping a steady focus on the end goal.
The parties were undistinguished, each bearing equal weight as owners of their business partnership.
Likewise, an integrative approach was used to focus on the solving the problems presented and
communicating win-win solutions. This goal of this win-win strategy, was for both parties to walk away
with an equal slice of the pie. Additionally, this case proves the structural analysis theory. The firm was a
partnership formed by equal parties and structural analysis predicts that the strongest in negotiations
will always win. Since the parties here are equal partners and power was evenly distributed, the parties
equally walked away as winners. By using careful planning techniques, communicating clearly,
anticipating the outcome and using the timing, the techniques used by the mediator helped to resolve
the dispute.

3. Defend the mediator’s use of heavy-handed techniques toward the end of the mediation session.

The mediator used his expertise in this case by allowing the parties to use their anger in a heated
exchanged against each other. Next, he separated the two and begin to strategically get John to lower his
demands. Based on his knowledge of the parties, the history of the case and the predictability of their
behavior, the mediator knew that John would be less likely to accept an offer if it was John’s idea. By
telling John splitting the client accounts evenly was not John’s idea, John willingly accepted the offer.
Lastly, the mediator used the time factor to push the parties towards negotiation in the last 30 minutes
of the day. These are all tactics frequently used by tenured mediators.

14. Why is it possible that negotiators in a cross-cultural negotiation should not always follow the
maxim: “When in Rome, act as the Romans do”?

The advice of many theorists has been, “When in Rome, do as the Romans do.” This may not always be
the best strategy for negotiators during cross-cultural negotiations. To be successful, negotiators must
consider the cultural differences but that does not implicitly mean to mimic the behavior of the other
party. One reason for this is risk of offending the other party by not accurately adopting their culture.
Truly adopting another culture can take years of study and practice to use it effectively in negotiations.
For example, if you speak to a telemarketer who has been taught the English language, it is very easy to
tell that they have not fully adopted the English language. Additionally, the other party may adopt his
approach in response to the modified behavior. Lastly, showing respect from the other culture with
moderate adaptions has been found to be more effective than attempting to make large adaptations.
This can show that the negotiator has studied the culture but wishes to respect their traditions by
accurate portrayal.

15. Briefly explain four ways that culture can influence negotiations.

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The differences in culture, personality, or both, can cause negotiators to approach deal making with the
ideal that negotiations are a process in which both can win. Alternatively, some cultures see it differently
and feel one side wins and the other side loses.

Methods of communication vary among cultures. Some emphasize direct and simple methods of
communication while others rely heavily on indirect methods. Some cultures use forms of speech, facial
expressions, gestures and body language to communicate during negotiations. Yet some cultures use the
“poker face” approach

Accounts of negotiating behavior in other cultures almost always point to a particular group’s propensity
to act emotionally. Nonetheless, various cultures have different rules as to the appropriateness and form
of displaying emotions, and these rules are brought to the negotiating table as well.

Negotiators from different cultures may tend to view the purpose of a negotiation differently. For deal
makers from some cultures, the goal of a business negotiation, first and foremost, is a signed contract
between the parties. Other cultures tend to consider that the goal of a negotiation is not a signed
contract but rather the creation of a relationship between the two sides.

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