Topic 16: Negotiation

Question 1

What is negotiation?

Answer 1

Negotiation is the process whereby two or more conflicting parties attempt to resolve their divergent goals by redefining the terms of their interdependence.

Where:

• Agreement is voluntary.
• Deadlock is a possible outcome.

Question 2

What is a BATNA?

Answer 2

Best alternative to a negotiatied agreement.

Question 3

In negotiation, what are interests and positions?

Answer 3

• Interests: What a party really values as important to achieve.
• Positions: What a party states as a claim to the other side.

Question 4

What is positional bargaining?

Answer 4

• Distributive Negotiation. (win-lose.)
• Limited resources view - what one side gains the other must lose.

Question 5

What is principled bargaining?

Answer 5

• Integrative Negotiation. (win-win.)
• Focus on the real interests of each party - these may differ enough to enable both sides to gain what they value most.

Question 6

How is the duel concern model modified for negotitation?

Answer 6

Assertaveness = Concern for self / own outcome and goals.

Cooperativeness = Concern for others outcomes / relationship maintaince.

Question 7

What are some tactics to distribututive negotiation?

Answer 7

• Exaggerate true interested by stated position to influence opponents belief about possible settlements.
• Get opponent to alter reservation/resistance point.
• Emphasise risks of not settling on curent offer.

Question 8

What are the dangers to distributive negotiation?

Answer 8

• Overcommitment to own initial position.
• Excessive focus on opponents position.
• Blindness to trade offs that help one side without damaging other.
  
  • Myth of the fixed pie.

Question 9

What are some tactics to integrative negociation?

Answer 9

• Expand the pie. (Requires more then one aspect of interest.)
• Unbundle the issues. (create dimensions of interest.)
• Introduce non-specific compensation.
• Give big concessions to the other side that are cheap for you, valuable to them.

Question 10

What factors effect negotiation outcomes?

Answer 10

• Negotiator power.
  
  • This could mean a better BATNA.
  • Greater power -> less integrative bargaining.
• Cognitive biases in negotiation, which affect perception of:
  
  • Positions.
  • Concessions
  • Risk.

Question 11

What is the process of negotiation?

Answer 11

1. Time management.
2. Phases of the negotiation.
3. Tactics in the negotiation.

Question 12

What are the phases of negotiation?

Answer 12

• Preperation.
• Contact.
• Explore interests.
• Create options.
• Endgame.

Question 13

Describe the preperation phase in negotiation.

Answer 13

• Identify your side’s needs
• Research your BATNA
• Research the other side
• Develop your power

Question 14

What is process power?

Answer 14

Power you hold in negotiations, due to situation factors like:

• Timing of meetings.
• Place.
• People to be present.
• Agenda.
• Concession moves.

Question 15

Outline the contact phase in negotiations.

Answer 15

• Gather information.
• Listen.
• Understand.
• Acknowledge. (describe problem in terms of their interests).
• Act. (focus on and explore interests.)

Question 16

Outline the explore phase in negotiations.

Answer 16

• Ask lots of questions.
• Substantive interests (outcome desired).
• Procedural interests (to be fully heard).
• Psychological and emotional interests.

Question 17

Outline the create options phase in negotiations.

Answer 17

• Suggest more dimensions
• Non-specific compensation
• Make some concessions to create new packages.
• Support with research.

Question 18

Outline the last phase in negotiations.

Answer 18

The endgame.

• Usually distributive on remaining competing interest.
• Concessions in ever smaller increments
• Power used to trigger agreement.