Summary Negotiation Strategies

Negotiation strategies – literature
Chapter 1: The Nature of Negotiation
Characteristics of a Negotiation Situation
Negotiation = a process by which two or more parties attempt to resolve their opposing
interests. It can be used to resolve conflicts.
Common characteristics to all negotiation situations:
 There are two or more parties involved, it is always a process between
individuals/groups.
 There is a conflict of needs and desires between two or more parties
 The involved parties negotiate by choice (because they think they can get a better deal)
 When we negotiate we expect a ‘give-and-take’ process that is fundamental to our
understanding of the word negotiation.
o In other words, we expect that both sides will modify/ move away from their
opening statements, requests or demands.
 The parties prefer to negotiate and search for agreement rather than to fight openly,
have one side dominate and the other capitulate, permanently break off contact, or take
their dispute to a higher authority to resolve it.
 Successful negotiation involves the management of tangibles (e.g. the price or terms of
agreement) and the resolution of intangibles (e.g. underlying psychological motivations).
o Intangible factors are often rooted in personal values and emotions and can have
a big influence on the negation processes and outcomes.
Interdependence
One of the key characteristics of a negotiation situation is that the parties need each other in
order to achieve their preferred objectives or outcomes. When parties depend on each other to
help achieve their own preferred outcome, they are interdependent.
 Independent parties = parties are able to meet their won needs without the assistance of
others; they can be relatively detached, indifferent and uninvolved with others.
 Dependent parties = must rely on others for what they need; because they need the
help/cooperation of the other.
 Interdependent parties = characterized by interlocking goals – they need each other in
order to accomplish their objectives and hence have the potential to influence each
other.
 Zero-sum/distributive situation = when the goals of two or more people are
interconnected so that only one can achieve the goal (e.g. running a race where there can
only be one winner), this is a competitive situation. So, individuals are linked together
that there is a negative correlation between their goal attainments.
 Mutual-gains situation/ non-zero-sum/ integrative situation = when parties’ goals are
liked so that one person’s goal achievement helps others to achieve their goals. There is a
positive correlation between the goal attainments of both parties.
 BATNA = Best Alternative to a Negotiated Agreement, this suggests that negotiators need
to understand their own BATNA and the other party’s BATNA.
Mutual adjustment
Mutual adjustment = when parties are interdependent and have to find a way to resolve their
differences, then both parties can influence the other’s outcomes and decisions and their own
outcomes and decisions can be influenced by the other.

, Bargaining range = the range of possible agreements between the two parties’ minimally
acceptable settlements.
Two dilemmas in mutual adjustment
As identified by Harold Kelley (1966):
 Dilemma of honesty = concerns how much of the truth to tell the other party
 Dilemma of trust = how much should negotiators believe what the other party is telling
them?
Value claiming and value creation
Zero-sum/distributive situations can only have one winner. In the non-zero-sum/ integrative/
mutual gains situations are ones in which many people can achieve their goals and objectives.
 Distributive bargaining = negotiations employ win-lose strategies and tactics to beat the
competition.
 Integrative negotiation = attempts to find solutions so both parties can do well and
achieve their goals.
Most actual negotiations are a combination of claiming and creating value processes. The
implications for this are significant:
 Negotiators must be able to recognize situations that require more of one approach than
the other
o Distributive bargaining is most appropriate when time and resources are limited,
when the other party is likely to be competitive and when there is no likelihood
of future interaction with the other party. Most other situations should be
approached with an integrative strategy.
 Negotiators must be versatile in their comfort with 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.
Key differences among negotiators:
 Differences in interests
 Differences in judgments about the future
 Differences in risk tolerance
 Differences in time preference
Thus, while value is often created by exploiting common interests, differences can also serve as
the basis for creating value. The heart of negotiation is exploring both common and different
interest to create this value and employ such interests as the foundation for a strong and lasting
agreement.
Conflict
Conflict = 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.
Conflict results from the interaction of interdependent people who perceived incompatible goals
and interference from each other in achieving those goals.
There are four levels of conflict:
1. Intrapersonal/ intrapsychic conflict
 These occur within an individual (not very important for now)
2. Interpersonal conflict