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CHAPTER ONE

The Nature of Negotiation

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Introduction

Negotiation is something that everyone does, almost daily

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Characteristics Common to All Negotiation Situations

There are two or more partiesThere is a conflict of interest between themParties negotiate because they think they can

get a better deal than by taking what the other side will give them.

Parties prefer to search for agreement rather than:

– Fight openly– Capitulate – Permanently break off contact– Take their dispute to a third party

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Characteristics Common to All Negotiation Situations (cont.)

Parties expect give and take. They expect both sides will modify or give in somewhat on their opening statements, requests, or demands

Successful negotiation involves:– The resolving of tangibles (e.g., the price or the

terms of agreement)

– The resolution of intangibles (the underlying psychological motivations)

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Interdependence In negotiation, both parties need each

other This mutual dependency is called

interdependence– Interdependent goals are an important aspect

of negotiationWin-lose: I win, you loseWin-win:Opportunities for both parties to gain

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Interdependence One potential consequence of

interdependent relationships is value creation

The other potential consequence of interdependent relationships is conflict

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Value Creation

Synergy: the notion the "the whole is greater than the sum of its parts".

Negotiators should be aware that potential differences can be used to reach agreement

It is also possible to create value through shared interests and through scale (task too big for one party to accomplish alone)

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Conflict

May be defined as a:

"sharp disagreement" and includes "the perceived divergence of interest, or a belief that the parties' current aspirations cannot be achieved simultaneously"

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Levels of Conflict Intrapersonal or Intrapsychic Conflict  

– Conflict that occurs within an individual We want an ice cream cone badly, but

we know that ice cream is very fattening

Interpersonal Conflict  – Conflict is between individual people

Conflict between bosses and subordinates, spouses, siblings, roommates etc.

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Levels of Conflict (cont.) Intragroup Conflict  

– Within-group negotiation Among team and committee members and within

families, classes etc. Intergroup Conflict  

– Conflict can occur within groups and among groups simultaneously

Conflict between unions and management, warring nations, feuding families, or community action groups and government authorities

– These negotiations are the most complex

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Dysfunctions of Conflict Competitive processes

– Parties compete because they believe that their goals are in opposition and that they cannot both achieve their objectives

Misperception and bias– As conflict intensifies:

Perceptions become distorted Thinking tends to become stereotypical and biased

Emotionality– Parties may become increasingly emotional and

irrational as the conflict escalates

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Dysfunctions of Conflict (cont.) Decreased communication

– Parties communicate less with those who disagree with them, more with those who agree

Blurred issues– The parties become less clear about:

How the dispute started What it is “really about” What it will take to solve it

Rigid commitments– Parties become more committed to their points of

view and less willing to back down from them for fear of losing face

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Dysfunctions of Conflict (cont.) Magnified differences, minimized similarities

– This distortion leads the parties to believe they are farther apart from each other than they really are

Escalation of the conflict– Both parties attempt to win by:

Increasing their commitment to their position, Increasing the resources they are willing to put up

to “win,” Increasing their tenacity in holding their ground

under pressure

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Five Major Strategies for Conflict Management:

1 Contending – Actors pursue own outcomes strongly, show little

concern for other party obtaining their desired outcomes

2 Yielding– Actors show little interest in whether they attain own

outcomes, are quite interested in whether the other party attains their outcomes

3 Inaction – Actors show little interest in whether they attain own

outcomes, little concern about whether the other party obtains their outcomes

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Five Major Strategies for Conflict Management:

4 Problem solving– Actors show high concern in obtaining own

outcomes, as well as high concern for the other party obtaining their outcomes

5 Compromising– Actors show moderate concern in obtaining own

outcomes, as well as moderate concern for the other party obtaining their outcomes

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The Dual Concerns Model