CONFLICT MANAGEMENT

AND
NEGOTIATION

Fr. Conceicao Rodrigues COE TE COMPS B

Bandra (W) TEAM 5
Fr. Conceicao Rodrigues College Of Engineering
Bandra (W), Mumbai–400050
University Of Mumbai

Professional Communication and Ethics - II

Department of Computer Engineering

Project Report on
“Conflict Management and Negotiation”

Supervised By:
Dr. Joseph Rodrigues
Department Of Humanities and Sciences
September 2021
 Certificate

This is to certify that the content of this project report entitled “Conflict
Management and Negotiation” is the original work prepared and submitted by:

8960 Candida Noronha (TL)

8953 Brendan Lucas
8954 Aditya Mahamuni
8955 Manobala Subramanian
8956 Kaustubh Mishra
8957 Austin Isaac Mudaliar
8958 Dhananjay Nair
8959 Akshat Nayak
8961 Sven Noronha

The project report embodies the results of referred work and studies carried out
by students themselves.
The reported work is carried under the guidance of Dr. Joseph Rodrigues,
Department of Humanities and Science.

(Signature of Faculty In-charge)

 Preface

As a part of the Professional Communication and Ethics curriculum, it required us to prepare

a report on “Conflict Management and Negotiation”. This report demonstrates that tensions,
differences and conflicts in companies and organisations are normal, necessary and productive
if we take seriously them and it is the responsibility of the employees and managers involved
to find a proactive way to approach them.

When people with different goals and interests work together, there is always the possibility of
conflict. Personal preferences, political differences, or organisational policies and procedures
may be the source of disagreement or conflict. It may exist largely beneath the surface, but it
can also spring up in the open—at the most inopportune times—and, on rare occasions, latent
conflict can erupt into sheer nastiness.

Negotiating with others to reach an agreement, make a deal, or resolve a conflict is also a part
of all relationships, both inside and outside of organisations. You might disagree with a friend,
a classmate, a co-worker, a boss, or a subordinate. It is essential to manage conflict
constructively and negotiate well in organisations, just as it is in personal relationships.
 Acknowledgement

We would like to place on record the valuable assistance we received from various individuals
while preparing this report.

We convey our sincere gratitude to Dr. Joseph Rodrigues, Professional Communication and
Ethics - II Professor, who supervised and guided us in every phase of our project report.
Without his wise guidance, this work would have been a little success.
The completion of this report could not have been accomplished without the support of our
teammates. It would have truly become a failure without their help and contribution to our
project.
 Forwarding Letter

To,
Dr. Joseph Rodrigues
Fr. Conceicao Rodrigues College of Engineering,
Bandra (West),
Mumbai-400050.
September 2021

Respected Sir,

Subject: Submission of the Report entitled “Conflict Management and Negotiation”

It is our great pleasure to present you the report on “Conflict Management and Negotiation”.
We have researched the topic and tried our best to apply our observations and theoretical
knowledge to prepare this report.

This topic helped us to understand how we can deal with various conflicts and be prepared for
such situations throughout our lives. The research on this topic taught us the importance of
working together and respecting everyone’s opinion. Especially being in a developing country
like India, where there are numerous conflicts and disagreements in various sectors and fields
it is our utmost concern to be cautious of such incidents and to deal with them in the best way
possible. This report aims at making people aware of this situation and can help them
understand how important it is to respect another opinion and negotiate your way out of it.

We as Fr. C.R.C.E. students, appreciate having this assignment. We have tried our best to
follow your guidelines in every aspect of our report. We hope you’ll appreciate our integrated
effort put forth hereby.

Yours sincerely,
_____________

TE Computer Engineering B
Team 5
 Table of Contents

Sr. No. Title Page No.

1 Introduction 1
1.1 Concept of Conflict 1
1.2 Need and Importance of Negotiation 2

2 Conflicts in the Workplace: Curse or Blessing? 3

2.1 Sources of Conflict 3
2.2 Conflict and Performance 6
2.3 Consequences of Conflict 7

3 Strategy and Management of Conflict 8

3.1 Conflict Management Styles 8
3.2 Preventing and Reducing Conflict 11

4 Negotiating 12
4.1 The Negotiation Process 12
4.2 Negotiation Strategies 14
4.3 Ethics and Negotiation 15

5 Case Study and Survey 16

5.1 Case Study: TATA-Mistry Conflict 16
5.2 Survey Analysis 20

6 Role of Power in Negotiation 21

6.1 Sources of Power in Negotiation 21
6.2 Negotiating with Someone More Powerful Than You 22
6.3 Power Prompts Action 22

7 Closing the Deal and Post Negotiation Evaluation 23

8 Conclusion 24

9 Bibliography 25
 Abstract

Conflict is an inevitable and universal phenomenon of our individual, team & organizational
life. Conflict often occurs when individuals have different ideas, beliefs or theories regarding
business operations. While some conflict can be minor – may help in pushing things forward
and effecting change from the current situation, most isn’t. Conflict cannot be suppressed or
deferred indefinitely. Conflict Management is the practice of identifying and handling conflict
in a sensible, fair and efficient manner. Unsolved conflicts are a potent source of trouble. Poorly
handled conflicts sap everyone's energy, interfere with interpersonal relationships, and prevent
groups from reaching their goals. However, resolving matters isn’t as simple as removing the
source of the said conflict, especially in cases where the source may not be obvious or isn’t
who (or what) you think it is.
To resolve a conflict, there could be violent or civilized ways. Violent ways leave trails of
bitterness and revenge which lead to the creation of a chain of conflicts. On the other hand,
resolution of conflict through civilized ways results in a win-win situation, in which there is no
victor and no vanquished. The most effective and ubiquitous of such methods is negotiation,
which seeks mutual agreement through dialogue. This is very much practised in both, our
personal and professional lives.
A majority of the people view conflict as inevitable. A manager's job involves negotiating to
resolve such conflicts or to reach agreements. As our world becomes smaller, the potential for
conflict grows. Ethnic, religious, political, and personal differences cause division in all types
of organisations and institutions, with potentially disastrous outcomes. It's the task of effective
leaders with mediator skills to bring people together again.
 1. Introduction

1.1 Concept Of Conflict

CONFLICT is a process in which people disagree over significant issues, thereby creating
friction.
Conflict is not only confined to any particular individual. When people with different interests
work together in various firms, organisations etc. the potential for a difference of opinions is
always present. This disagreement or conflict can be in any form, such as cultural, personal or
political, and so on. This conflict or disagreement may be underlying and might have gone
unnoticed for large periods but may surface up at the nastiest of times. Several factors
contribute to the existence of ‘conflict’:
 People having opposing interests, thoughts, perceptions and feelings.
 People with opposing views try to prevent one another from accomplishing their goals.
 The disagreement must be ongoing rather than a single occurrence

Conflict has occupied a man's thoughts more than any other theme in these modern times. It
has always been widespread in society but now it has generated a lot of interest and has become
the prime focus of various research and study. We are living in an age of conflict, whereby we
have to come across various situations where there is a conflict existing. Conflict is inevitable
and a universal phenomenon in our everyday life such as

Organisations are divided by different strategies

 Local communities are divided by race, economic, religion, etc
 Homes were torn apart by chronic feuds between parents and/or children

Conflict may also be very destructive sometimes, as things could escalate quickly during an
argument. Some people also consider conflict as a battle that has to be won no matter what the
cost. These conflicts are genuine, mostly unavoidable and they don’t seem to go anywhere, so
we have to come across the best way to handle such situations.
Conflicts carry not only negative potential but can’t bring about a change of perception,
innovation and the best of development. It has its own pros and cons.

1
 1.2 Need and Importance of Negotiation

NEGOTIATION is a discussion aimed at reaching an agreement between two or more parties..

In these modern times, the nature of business is so dynamic that people have to negotiate and
renegotiate their existence in organisations throughout their careers. The increasing
interdependence of people within organisations, both laterally and hierarchically, shows that
people need to display their interest and work together across units. Negotiation is probably
the best solution we have during a conflict or disagreement, which satisfies both parties.

Pre-conditions for Negotiation:

 Two or more parties present in a conflict or disagreement
 Interdependence, so that the outcome satisfies both parties
 An agreement must be reached within a specific time, which benefits both parties

The need for negotiation is of utmost importance in a situation of a huge conflict, where both
parties are adamant on their opinion, in such cases a mediator or a negotiation taking place will
be the ideal scenario where both parties can be content.
In all negotiations, the concern is either for division and/or exchange of specific resources. The
first is a fixed pie situation where negotiation takes place for a share of the pie. The second is
simply a barter situation, where negotiation takes place as a process of giving and taking.
All negotiations do not always end up in a mutually satisfying memorandum of agreement.
Sometimes the negotiators get so engrossed and single-minded with their opinions, aim and
benefits that they are not able to go beyond them. At this point of time, we may have to involve
a mediator or third party to handle the situation, but all in all, negotiation is our first and best
solution to a conflict.

We see negotiation as a way of getting what one wants by presenting proposals and counter-
proposals for division and/or exchange of resources in mutually dependent relationships. Both
parties must see negotiation as more beneficial or the best possible way to resolve differences
than other methods of dispute settlements.
One of the greatest powers we have in a negotiation is the power to NOT react.
- William Ury

2
 2. Conflicts in the Workplace: Curse or Blessing?

Conflicts swallow up valuable resources of the company. These resources are time and money.
This type of expense is unavoidable, as time and money are essential in balancing competing
goals and interests. If well balanced, the conflict is functional and resources are well invested.

2.1 Sources of Conflict

Personal and organizational factors can both contribute to conflict. While it's not always
possible to distinguish between the two, some disputes are more directly tied to individuals
who have incompatible aims or ideals, while others are related to the structure of the
organization.

1. Personal Sources of Conflict:

Personal roots of the conflict are frequently

interpersonal and can arise from a variety of
sources. Two employees, for example, may
have different work styles, or an employee may
desire more autonomy than her boss is willing
to provide. Individual perspectives and
expectations about how work should be done
and what is important in the workplace are
common sources of conflict. They are impacted
by the individual's personality, style, and
culture. Conflicts based on personal differences
are sometimes extremely emotional and
difficult to resolve since they involve individual
values. A devout religious company owner, for
example, could find it difficult to locate his
establishment near a Planned Parenthood clinic
where abortions are done. A disagreement over location could devolve into a savage debate
on who is ethically correct.
Personal differences may arise as a result of perception. Differing perspectives may be
enough to spark a fight. Because he does not receive regular appreciation for his
accomplishments, an employee may believe that his superior does not value him. In a
difficult financial context, the supervisor values his work and believes he is making
outstanding contributions. She is, however, inwardly motivated, does not require continual
praise, and does not see the value in frequently praising her employee. The disagreement
arises as a result of how each individual views the circumstance.
Many of the disputes that arise as a result of cross-cultural differences are also related to
variations in values and perception. Because culture has an impact on what people value,
it's no surprise that culture can play a role in personal sources of conflict in the workplace.

3
2. Organizational Sources of Conflict:

We often attribute conflict to personal issues when it is the result of corporate structures and
processes. For example, we may believe a co-worker is naturally disagreeable and
unhelpful, while the organization's compensation system, which drives competitiveness, is
to blame. Following are the five different types of organizational conflict.

i. Goal Incompatibility:

Many confrontations are caused by incompatibilities in goals. Organizational conflict is

unavoidable since different departments focus on distinct duties and functions. The
manufacturing department may be concerned with efficiency and cost savings, while the
designers strive to create the most inventive product possible. The Human Resources
manager's purpose is likely to include ensuring that all employment rules are followed in
the recruiting of new employees, generating delays and additional steps, whereas managers
across the firm may be looking to fill their vacancies as soon as possible. Legal departments
are primarily concerned with risk management and paperwork; nevertheless, good
management may conflict with these objectives.

ii. Uncertainty:

Conflict is exacerbated by today's

quickly changing work
environment. Managers find it
difficult to establish a clear
direction when there is uncertainty.
They must either shift course
frequently or remain flexible due to
a lack of information. As
departments and people deal with
altering goals, managers are more
obliged to adapt to fast-changing
environmental restrictions and are under pressure to "do more with less," contributing to
conflict. Uncertainty also calls into question long-held habits and procedures, allowing for
disagreement about both goals and methods.

iii. Resource Scarcity:

Employees and departments must compete for a portion of scarce resources when resources
are few. Conflict is more likely as a result of such competitiveness. The effect of resource
shortage can be seen in cost-cutting operations. Individuals, work teams, and departments
struggle for limited resources as resources decline and the company must do with less. As a
result of this competitiveness, there is more conflict.

4
iv. Reward Systems:

The reward system is the fourth organizational source of conflict. Managers that encourage
competitiveness and create a win-lose situation for their employees will promote friction in
their workplaces. Most companies, for example, provide increases and promotions on a
competitive basis. Many companies set up a structure in which only a specific percentage
of their employees, regardless of performance, are eligible for top positions. Employees may
be motivated to achieve their best by such a reward scheme, but it also stimulates
competition for limited positions, resulting in employee strife.
v. Interdependence:

Interdependence, which is defined as the

extent to which employees rely on others
to do their tasks, is the final source of
organizational conflict. There is little
conflict as long as persons with differing
goals can keep their distance from one
another. When interdependence is high,
conflict emerges. Consider three shifts of
workers, each of which continues from
where the preceding one ended. The acts
of each group have an impact on the others. Because of their interdependence, their conflicts
about work processes, cleanliness, documentation, and the organization of their common
workspace will result in conflict.
Many of you have had conflicts in group and team projects for your classes because of
interdependence. You may enjoy your classmates' company but are unconcerned with how
they work or what grade they aim for in class. When you have to collaborate on a paper or
project with them, however, your grade is contingent on them having the same focus and
aim as you. Conflict frequently arises as a result of such interconnectedness.

Stages of Conflict:

Different Stages of Conflict

5
 2.2 Conflict and Performance:

It is expected that well-trained and intelligent employees disagree over a variety of issues.
However, it becomes a problem when conflicts escalate and thereby becomes a struggle
for power. This does not mean that conflicts negatively impact the organization. In fact,
the opposite applies: Tensions along with constructively settled conflicts are a fundamental
part of healthy working relationships.

One troubling sign for a company is

employees agreeing easily on how to
approach important issues. Similarly,
employees not being able to agree on
anything is a sign of dysfunctional conflict
and problematic for the organization. The
ability to create a constructive
disagreement might be a hallmark of the
effective decision-maker. Let us see the
effects of a conflict on the employees of
the organization:

Positive Effects Negative Effects

Identifying problems: Pressure on employees:

Many problems remain undetected if they are not Participants of a conflict experience stress, anxiety,
noticed through conflicts. aggression, lack of esteem and similar feelings.

Conflicts bring change: Fragmentation of teams:

Conflict’s resolution often requires actions or Team members create allies and opponents inside the
decisions to be taken that trigger change and group. Communication behaviour is passive or
thereby prevent deadlock. aggressive

Conflicts ignite curiosity: Unproductive usage of time:

Conflicts add zest to human co-existence. They Colleagues talk about the conflict, speculate about
lead to competition, stimulating the search for causes and relationships, blame people, inflict pain,
creative new solutions and innovations. wasting valuable work time.

Strengthening of the group: Staff turnover and sick leave:

Through constructive disagreements, the weakness
and strengths of each team member can be found.
Thus, it becomes easier to develop trust, and also
to recognize one’s own shortcomings. As a result,
it is possible to work together successfully even
under pressure.
Lengthy conflicts take their toll as the constant
psychological stress eventually manifests itself as
physical illness. This also leads to an increase in
resignations and staff firing. Training new staff is a
costly process, which in turn costs the company.

6
2.3 Consequences of Conflict

Conflicts have both positive and harmful outcomes. On the plus side, we've all felt the rush
of adrenaline and energy that comes with competition. People can be motivated and inspired
to focus on a task through competition and conflict. Participating in competitions brings
members of a group closer together and encourages more discussion of various concerns
and ideas. When external conflict or competition arises, the members of the group band
together and develop inventive solutions. This method improves group cohesion and
efficiency.
Organizations can leverage
competition with other
companies to reduce internal
strife and direct employees'
attention to external competitors.
While conflict is unavoidable
and good in companies, an
excessive amount of unresolved
disagreement can be harmful. In
high-conflict situations,
individuals, teams, or
departments may lose sight of their common goals and become obsessed with winning at
any cost. They could withhold vital information or even intentionally destroy others' efforts.
When there are winners and losers in a battle, losers may get depressed and demotivated.
Consider a company that organizes a competition between four teams to build a new service.
The winning team is praised and rewarded, while the losers are overlooked or even
penalized. All teams may be highly driven to win at the start of the tournament, so they will
work hard on their mission and be creative. The remaining three teams, on the other hand,
lose the desire to contribute when the manager reveals the winner. Long-term relationships
and organizational performance suffer as a result of this loser impact.
Managers should be proactive in fostering an atmosphere that minimizes the likelihood of
dysfunctional disputes by appreciating the diversity of contributions and talents of others.
Managers risk letting conflicting ideas go undirected when conflict isn't addressed or
reaches dangerously high levels, resulting in tension and dysfunction rather than creative
and progressive transformation.

BENEFITS DISADVANTAGES

• High energy • Focus on conflict

• Focus on the task • Concern with
• Stimulate winning at all costs
innovation • Distorted
• Increased in- judgment
group • Lack of
communication cooperation

7
 3. Strategy and Management of Conflict
Have you ever gotten into an argument with a colleague? You've probably done it at some
point. Conflicts in the workplace are very common; there are very few offices where everyone
gets along. As a result, conflict resolution is a necessary component of the workplace, and those
in positions of power must be skilled in conflict management and resolution techniques.

Unresolved conflicts can have a negative impact on productivity and collaboration. Using
conflict management strategies in the workplace will help maintain a healthy work
environment. Conflict management requires certain leadership skills, problem-solving abilities
and decision-making skills.

3.1 Conflict Management Styles

Conflict in the workplace can come from a variety of sources. It arises as a result of differences
and will occur in any situation in which people must interact with one another. Dealing with
conflict effectively is a key management skill. Following are five different approaches to
conflict management and the situation they are most appropriate for:

i. Collaboration
Collaboration involves high concern for
satisfying both our own needs and the needs of
others. People with this personality focus on
openness, cooperation, and information sharing.
They emphasise a win-win approach and
finding a solution that is best for both parties.
This style typically takes longer, but it can pay
off in the long run.

ii. Competition
Competition is characterised by a high level of assertiveness and a low level of
cooperation. Individuals who consistently employ this style are preoccupied with their
interests, disregarding the needs of others, and viewing the world as a zero-sum game
with winners and losers. They see conflict as a sport, and their goal is to win. Although
this is a common method of resolving conflict, it is not thought to be beneficial to
individuals or groups who interact frequently. However, it may be appropriate when an
unpopular action is required to be implemented for the greater good of the organization.

iii. Accommodation
Accommodation is a style that emphasises cooperation over assertiveness. The
individuals who rely on accommodation are willing to put their own needs aside in order
to meet the needs of others. The individual doing the accommodating can build
credibility for the next conflict. Accommodation may be beneficial in the short term, but
it can be detrimental in the long run. If one party consistently accommodates while the
other party's needs and concerns are met, the accommodating party will eventually grow
resentful of the other.

8
iv. Avoidance
Avoidance is a low-assertiveness and low-cooperation style. The person who uses it to
resolve conflict does not meet their or the other person's needs. Instead, they avoid the
issues and refuse to look into the conflict's causes or solutions. People can avoid conflict
by withdrawing or creating a physical barrier between themselves and the conflict.
Avoidance can be beneficial in the short term for minor issues because it allows people
to cool off and regain perspective, but it can be harmful in the long run. Individuals may
resent having to suppress their feelings about the conflict, and they might find other
dysfunctional mechanisms of dealing with the issues.

v. Compromise
Compromise lies somewhere between
assertiveness and cooperation. People
who use this style strike a balance. They
investigate issues to some extent before
shifting to a give-and-take position in
which there are no clear winners or losers.
Everyone gets something, but not
everything he wanted. This style
emphasises negotiation and diplomacy.
Although it appears to be ideal and allows
parties to collaborate, it focuses on
satisficing-finding an acceptable solution
that everyone can accept as a minimum;
rather than taking the time to find optimal
solutions.
Furthermore, people who use this style tend to focus on what they have given up rather
than what they have gained. Despite these drawbacks, compromising may be the only
approach that works in situations where the parties have equal power but strongly
opposing viewpoints, as is frequently the case in diplomatic negotiations.

Conflict Management Styles

9
 Using Conflict Management Styles
Style When to Use
Collaboration  When issues are complex and
require input and information from
others
 When commitment is needed
 When dealing with strategic issues
 When long-term solutions are
needed
 When there is time
Competition  When there is no time
 When issues are trivial
 When all solutions are unpopular
 When others lack expertise
 When issues are important to you
Accommodation  When the issues are not important  When others are unethical or
to you
 When your knowledge is limited
 When there is a long-term give and
take
 When you have no power
Avoidance  When issues are trivial
 When conflict is too high and
parties need to cool off
Compromise  When goals are incompatible
 When parties have equal power
 When a quick solution is needed
10
When Not to Use
 When there is no time
 When others are not
interested and do not have the
skills
 When conflict occurs because
of different value systems
 When issues are complex and
require input and information
from others
 When working with powerful
others
 When long-term solutions
and commitment are needed
wrong
 When you are certain you are
correct
 When there is no chance of
future give and take
 When a long-term solution is
needed
 When you are responsible for
resolving the conflict
 Where there is an imbalance
in power
 When the problem is complex
 When long-term solutions are
needed
 When conflict is rooted in
different value systems
 3.2 Preventing and Reducing Conflict

Conflict is detractive in nature. As a result, immediate measures are necessary to resolve it.
Thus, prevention and pro-action are preferable to reaction and firefighting. To effectively
manage conflict, the organisation should strive for a moderate level of conflict, either through
prevention and reduction or by increasing or stimulating conflict. Managers may choose to
manage conflict by focusing on specific behaviours or attitudes.
The behavioural approach focuses on simply stopping the conflict-inducing behaviours. It
doesn't delve into the conflict's origins or examine its sources. The outcomes are frequently
quick and short-term, and they're useful if the parties in conflict aren't interdependent and can
limit or avoid interaction.
The attitudinal approach focuses on emotions, beliefs, and behaviours to address the source of
the conflict. It takes longer than the behavioural approach, but it has the potential to resolve the
conflict permanently. Managers should use the attitudinal approach when conflicting parties
have to work together—such as in a self-managed team or between members of two highly
interdependent departments. They should use behavioural approaches to deal with more minor
conflicts that can be resolved quickly.
The below table summarizes the different methods of conflict prevention and reduction. As
the table shows, the prevention and reduction methods can use either the behavioural or the
attitudinal approach.

Conflict Prevention and Reduction Methods

Method
(B = Behavioural;
A = Attitudinal)
Enforcing Rules (B)
Separation (B)
Clear Tasks (B)
Find common enemy or
encourage competition with
outside group (B or A)
Member rotation (A)
Increasing resources or  When resources are available
rewarding cooperation (B or 
A)
Team Building;
organizational development
(A)
Appropriate When…
 Issues are trivial
 Immediate relief is needed
 Parties are not interdependent
 Ambiguity and uncertainty are the cause
of conflict
 Tasks can be identified
 When competitions with outside is part
of organizational goals
 When there is interdepartmental conflict
When conflict is caused by too much
competition
 Conflict is complex with major impact
 When there is time
 When long-term solution is essential
Consequences
 Quick results
 Causes of conflict not addressed
 No long-term change
 Conflict likely to re-emerge
 Quick results
 May increase conflict
 No long-term change
 Conflict likely to re-emerge
 Quick results
 No long-term effects
 Increased in-group cohesion
 Source of conflict not addressed
 Conflict can re-occur when outside
threat is gone
 Increased empathy for others
 Flexibility in work assignment
 Short-term increase in training costs
 Long-term impact
 Works as long as resources are
available
 Source of conflict not addressed
 Possible long-term impact
 Long term change and impact
 Addresses sources of conflict
 Skill Development
 Requires considerable commitment,
time and resources

11
 4. Negotiating

Whether you manage a small department, own

a business, a major corporation, or hold an
entry-level sales position, you must know how
to negotiate.
Negotiation is a process wherein two or more
parties settle a mutually agreeable arrangement.
It is one of the most commonly used and
beneficial skills an individual can develop. The
global business environment, the diverse
workforce, the rapid pace of change, and the shift toward teams and empowerment all require
individuals who have excellent negotiation skills.

4.1 The Negotiation Process

A negotiation usually involves many steps, including the exchange of proposals and counter-
proposals. In good-faith negotiation, both sides are expected to make offers and concessions.
One’s goal here is not only to try to solve the problem but to gain information- information that
will enable you to get a clearer notion of what the true issues might be and how your "opponent"
sees reality. Through offers and counteroffers, there should be a goal of a lot of information
exchange that might yield a common definition of the problem.
All negotiations share four common elements:
 The parties involved are in some way interdependent
 The party’s conflict with goals and processes
 The parties involved are motivated and capable of influencing one another
 The parties believe they can reach an agreement

12
These four elements come into play at different stages of the negotiation process presented in
the below diagram. While most of us think of the third and fourth phase— bargaining and
agreement— as the heart of negotiation, most experts emphasize the importance of both careful
and thorough preparation and presentation in negotiating.

Phases of Negotiation

Phase 1:
The first phase includes gathering factual information about the issues and alternatives and
acquiring "softer" information about the other party’s interests, positions, personality, and
style. Thorough preparation not only leads to a better outcome but also reduces the anxiety of
negotiation.

Phase 2:
The second phase is the presentation of initial offers either orally or in writing. In this phase,
careful word choice and self-presentation are critical for projecting the right image through
successful verbal and nonverbal communication.

Phase 3:
The third phase is the actual bargaining in which managers use different negotiating strategies
to reach an agreement. Active listening, feedback, and the various communication techniques
and barriers play an important part in this phase.

Phase 4:
The agreement that concludes the negotiation process is the last phase. The agreement is
completed and formatted in a way that all parties can understand.
The process of negotiation is continuous. Negotiation over-explanation and execution is
expected to continue once an agreement has been achieved. Furthermore, one party can halt
the negotiating process at any point, requiring other parties to resume again.

13
4.2 Negotiation Strategies:

1) Trusting Collaboration
Trusting collaboration involves
coordination and cooperation for problem-
solving so that both achieve a win-win
outcome. Good negotiators use this
strategy to improve the relationship so that
they can work on a task together as
outcomes are important. This strategy is
used when both outcomes and
relationships are important. Parties can
share their ideas and goals openly so that
there will be a mutual agreement with
parties which builds long-term
relationships. Using a trusting
collaboration strategy in teams or within organizations will become essential when people are
dependent on each other.

2) Open Subordination
Open Subordination is used when the outcomes are more important than the relationship. In
this strategy, we accept other party's solutions as the outcome is the necessary factor in this
strategy. Open subordination strategy is used when the parties are not able to fulfill your needs
at the required time. It is also used when you do not have the power to negotiate with the parties.
However, they can also use this strategy to create cooperation and reduce opposition.

3) Firm Competition
Firm competition is also used where
outcomes are more important than the
relationship. It is an aggressive strategy
used by managers to concentrate on using
their own solutions. Using firm
competition gives access to power and
support from organizational support. By
this negotiation strategy, there can be
conflict caused by access to power.

4) Active Avoidance
Active Avoidance strategy is used when the negotiator doesn’t consider the task or relationship.
In this case, the negotiator doesn’t want to listen to your suggestion. Often managers avoid
negotiating because they have no priority for the results.
To determine which of the four strategies to use, managers must consider the situation. Their
conflict management style and personality may also influence their selection of strategies.
14
4.3 Ethics and Negotiation
Negotiating to get what you need raises several ethical dilemmas. Should you always tell the
truth? Should you be upfront and reveal your game plan? What can you ethically not tell? These
are challenging topics that come up in all formal and informal discussions regularly.
The following are some common ethical breaches to avoid, in order of severity:
 Selective disclosure: Negative information is downplayed or not mentioned by
negotiators, who emphasise good information

 Misrepresentation: Negotiators make false statements about facts or their position, such
as the lowest price they are ready to accept.

 Deception and lying: Negotiators provide the opposite side with information that is
factually inaccurate or leads to erroneous assumptions or conclusions.

 False threat and false promises: Negotiators spread false information about their
intentions and the concessions they are ready to make.

 Inflict direct or indirect harm: Negotiators damage the opposing party's chances of
success on purpose.

In negotiations, any of these violations are likely to occur. The final two, providing false
information and causing injury, are the most serious infractions, however how a negotiator
rates them depends on his beliefs and morals, as well as his culture in some situations. The
table below provides some guidelines for monitoring your ethical behaviour.

Advice Description

Learn from your mistakes We all have committed ethical violations; learn
from them and do not repeat them

Do you like what you see? Evaluate your own behaviour and strategies.
Can you look at yourself in the mirror? Are you
proud of yourself?

What does the other person see? Consider how you appear to the other party or
an observer. Are you projecting an image you
like?

15
 5. Case Study and Survey

5.1 Case Study - TATA- Mistry Conflict

Case Overview

On 24 October 2016, Cyrus Pallonji Mistry then Chairman

of Tata Group and its holding company Tata Sons, was
abruptly removed from his positions. He was subsequently
removed from the boards of some Tata Group companies
and thereafter resigned from the remaining boards. The day
after his removal, he questioned the influence of Tata Trusts,
Tata Sons controlling shareholder, and that of Ratan Tata,
his predecessor. Issues relating to fraudulent transactions
were also alleged by Mistry, which were refuted by Tata
Sons. The objective of this presentation is to discuss issues
such as a dysfunctional conflict between parties, personality
clashes, role conflict, power and politics and the negotiation
process. The conflict management style which can be
observed is competition or application of force.
Origin Of Conflict

March 1991 Ratan Tata was appointed as Chairman of Tata Sons and Tata Group.

September 2006 Cyrus Mistry was appointed on the Board of Tata Son.

December 2012 Ratan Tata retires as Chairman Cyrus Mistry was appointed as Chairman.

April 2014 Article of Association of Tata Sons amended.

October 2016 Cyrus Mistry was removed as Chairman of Tata Sons. Ratan Tata was
appointed as Interim Chairman.

November 2016 Mistry moves NCLT against Ratan Tata, Tata Sons and some of its directors.

Analysis Of The Conflict–Personality Clash

Ratan Tata Cyrus Mistry
The Leader—Type A Personality Type C Personality
 Entrepreneurial band, willing to take risks  Risk-averse
 Independent, direct  Detail-oriented
 Wields influence on subordinates  Approachable and warm
 Cold

16
Transaction Analysis
Ratan Tata was 75 years old and considered an “icon” at Tata. It was his family business.
Mistry, 50, was the first Chairman in 74 years to have come from outside the Tata family. He
was mentored by Tata. There is a case for parent and child ego.
Before the commencement of the fateful board meeting which would result in Mistry’s ouster,
Ratan Tata had spoken personally with Mistry and offered him a chance to voluntarily resign
as Executive Chairman. However, Mistry had refused.
This is an instance of a CROSS TRANSACTION.

Role Ambiguity And Conflict

Upon his retirement as Chairman, Ratan Tata was appointed as Honorary Chairman Emeritus
of Tata Sons. A day after his ouster from Tata Sons, Mistry wrote a letter in which he labelled
himself as a “lame duck” Chairman as he was unaware of Tata Group’s venture into the airline's
industry, with approval having been sought from Ratan Tata instead of him. There was
ambiguity surrounding the role of Honorary Chairman v/s Chairman.
Power And Politics

Power source for Ratan Tata according to Power source for Cyrus Mistry according
Max Weber to Max Weber

Charismatic power
Traditional power Legal-rational power

Reluctance to Part with Power Equalizing Power and Relational Constructs

Several changes were introduced which
granted Tata Trusts greater control of Tata
Sons. With Ratan Tata still heading for the
Trusts. This marked the first time the roles of
Chairman of Tata Trusts and Tata Sons were
occupied by different persons.
Mistry had allegedly reduced the
representation of Tata Sons’ directors on the
boards of other Tata Group companies and
structured directorships in the various
companies such that he was the only director
who sat on the boards of Tata Sons and the
Tata Group companies.

Politics Played

 Many alterations were being made to Tata Sons’ Articles of Association.

 The alterations gave directors nominated by the Trusts more power in the appointment and
removal of the Chairman.
 Trustee-nominated directors were also granted a special veto right to oppose any decisions
made by the board.
 A resolution was passed to allow the Trusts to select the Chairman of the selection
committee for Tata Son’s Chairman and appoint three members to the selection committee.
These changes granted Tata Trusts greater control of Tata Sons.

17
NEGOTIATION
Parties Involved In Negotiation
3rd Party Involvement - NCLT,
NCLAT, the Supreme Court

Conflict Resolution Strategy: Compromising Strategy

According to the Thomas-Kilmann Model, the best strategy for conflict resolution, in this case,
would be the Compromising Strategy - which involves finding an acceptable resolution that
will partly, but not entirely, satisfy the concerns of all parties involved.
Models To Handle Conflict Of Interest
PROHIBITION MODEL

 The prohibition model discourages any arrangement, particularly financial, that might
create a conflict of interest unless that arrangement provides a sufficiently
countervailing social benefit
 Implementing this approach requires that those who advocate it establish a framework
within which certain conflicts of interest may be acceptable.
DISCLOSURE AND PEER REVIEW MODEL

 The disclosure and peer review model holds that conflicts of interest are unavoidable
 Financial conflicts of interest are only the most visible & least dangerous
 Acknowledging potential sources of bias promotes awareness of different points of
view and the possibility of developing some kind of balance within - provided also that
a strong peer-review process is in place and that there are opportunities for secondary
data analysis.
Intra-Role Conflict: Cyrus Mistry
Cyrus Mistry made some major decisions as the CEO of Tata Sons which was to be monitored
by the Chairman (himself), ideally, it should not happen within any organization. Necessary to
have clarity of different roles in one domain of life and act in a manner that does not
compromise the integrity & dignity of any of the roles.
Separation of CEO and Chairman in the organization.
Ambiguous Position Of The Chairman Emeritus
The relationship that should exist between a company’s senior management like its Chairman,
MD and its Emeritus—Emeritus being an honorary position, should be solely governed by a
contract with the company which should be clearly defined along with his powers.
The Emeritus is likely to continue possessing influence despite retirement as the company’s
key official. This is because, the person has served the company exceptionally well while being
a key officer and, secondly, is one of its controlling shareholders or their representative.
Under a contractual arrangement with the company, the Emeritus, who is often the
company’s past key official, gets the privilege to participate in the company’s board meetings
without having the capacity to vote therein. Board Members should act independently and not
on the behest of the Chairman Emeritus.
18
Discontentment Between Ratan Tata & Cyrus Mistry
Crossed Transaction (Parent & Child Ego)

In Transaction Analysis, according to the

Communication Rule,
Cross Transactions are an interruption to the flow of
communication. For the flow to continue, at least one
person has to switch the ego state to enable a constructive
flow and have a parallel transaction.

Ratan Tata was a mentor to Cyrus Mistry

When Cyrus was elected as the deputy chairman of the Tata group in 2011, Ratan Tata said in
a statement that the appointment is a "good and far-sighted choice". "He has been on the Board
of Tata Sons since August 2006 and I have
been impressed with the quality and calibre of
his participation”. But his blue-eyed boy
became his rival in 2016.

His Blue-Eyed Boy became his rival

Ratan felt compelled to remove Cyrus
because he had either changed since
becoming chairman or, appearances to the
contrary notwithstanding, proved to be the
wrong choice in the first place whereas Cyrus
claimed that various decisions taken by Ratan
Tata were to satisfy his ego which resulted in huge financial loss for the Tata Group. This
showed a clear conflict of interest resulting in a Parent & Child Ego state.

Role Of Mediators

Mistry’s sacking in October 2016 started an acrimonious, protracted legal battle that is far from
over. In brief, the Mumbai National Company Law Tribunal in July 2018 had summarily
dismissed Mistry’s petition that minority investors were oppressed as Tata Sons’ affairs were
mismanaged. Then, in December 2019, the National Company Law Appellate Tribunal
(NCLAT) ruled in the favour of Mistry firms. This seesaw battle has now landed with the
Supreme Court. Supreme Court will continue to play a major role given that the stake buyout
may be a staggered process. A court-monitored mediation process would involve both the
groups appointing mediators and agreeing on a principal mediator. Mediators would look into
valuation, the timeline of exit, interim solutions and processes. “The Supreme Court typically
does not want to interfere in private disputes and would anyways suggest a mediation-based
approach based on company valuations and timelines” said H.P. Ranina, senior Supreme Court
advocate.

19
5.2 Survey Analysis
A survey was conducted among 50 people of various sectors like corporate, government,
healthcare, education and the following data was collected and analyzed.
The questionnaire consisted of 10 questions:
1. Have you ever gotten into a conflict with a co-worker?
2. Do you believe that conflicts are necessary while working in a team?
3. Do you agree that differences of opinion are helpful and beneficial for progress in a team?
4. Do you believe that in every conflict situation, mutually acceptable solutions exist or are
available?
5. Has lack of conflict management affected your work/project outcome?
6. What do you think are the different ways to deal with a disagreement?
7. In a conflict, will you be able to understand another person's point of view?
8. Conflicts can sometimes clarify communication.
9. Do you agree that the most critical skill in conflict resolution is negotiation?
10. Which Negotiation Outcome is most desirable?

Few key points from the results obtained were as follows:

 Around 82% of people agree to the fact that differences of opinion are helpful and
beneficial for progress in a team.
 73% of people believe that the most critical skill in conflict resolution is negotiation.
 And 96% of people think that the win-win outcome is the most desirable negotiation result.
(Fig a)
 Approximately 50% of people think that it is better to listen to other’s perspective and give
proper suggestions to deal with a disagreement while the rest 50% believes in
understanding conflict’s reason and solve it. (Fig b)

Figure (a) Figure (b)

20
 6. Role of Power in Negotiation
Power is the most significant part of negotiating. That ability comes from knowing yourself and
using all of your interpersonal skills.
6.1 Sources of Power in Negotiation:
The genesis from where the power derives in a negotiation comes from various sources and the
extent, we recognize these perceive these or have access to these will have to affect the level of
power that's present. Some factors arise
within the negotiation process that is
usually stated as sources or forms of power.
It is important to not be intimidated by
these factors. Power comes in several
forms. Television broadcasts, particularly
news channels and documentaries, are
examples of this power.

 Position Power:
Position or Title carries a form of legitimacy power often cited as position power. This category
includes positions, professional licenses, and degrees of education. When your counterpart
knows that you are aware of their position power, it would be disrespectful to deny it.
 Reward Power:
Reward power can also be real or imagined. If you think that someone can affect you, that person
has power over you. It can relate to tangible things or emotions. The authority to promote is
another example of reward power.
 Referent Power:
It is referent power that sells a large volume of merchandise. People buy particular brands of
sports shoes because they subconsciously identify with the famous athlete who wears the brand
and, they want to be like them. Referent power is closely associated with your personality and
your style. It is not present in all negotiations; however, do not ignore to look for it.
 Situation Power:
The facts and circumstances you face may occasionally be to your disadvantage. In such
situations, you must determine in your preparation stage whether there exists an acceptable
alternative to a negotiated agreement.
 Identification Power:
Identification power is the power to relate to the other person. It is different from the referent
power. When you convey knowledge, empathy, cooperation, and admiration, as well as an
enthusiasm to create a mutual solution, you create a power of identification.
 Persistence Power:
Quiet but resolved determination is a powerful tool in negotiation. A plan rejected once is not
necessarily dead! Using the persistence power is not constantly repeating the identical words. It
is to resist giving up. It is to find several ways to define and support your proposal. It is to find
additional shared benefits in your proposal.
 Patience:
Patience is often neglected as a power, but it can be the greatest power of all. Patience is also
essential when analyzing your choices and preparing for negotiation.

21
6.2 Negotiating with Someone More Powerful Than You:
Control the Conversation by Using Framing
Framing is a technique that relates to how you describe your offer strongly influences how others
view it. Framing is also how you can build a conversation around a particular point of the
proposal. Another practice of framing is using the “yes and yes” response.
Understand your goals and theirs
Create a list of what you want from the negotiation. This practice will help you decide what
would cause you to step away so that you build your strategy within agreeable terms.
Listen and ask questions
The most prominent influential approaches you can deploy are to listen well, which develops
confidence and pose questions that encourage the counterpart to defend their positions.

6.3 Power Prompts Action:

Leverage is the name of the game when we talk about power in negotiation. Leverage prompts
the negotiator to be increasingly bold when they negotiate. So how do the best negotiators procure
this leverage to get themselves a cosy win-win situation?

External Conflict Negotiation

If we are talking about conflicts like negotiating prices for a certain product the company needs,
perhaps from an external supplier, then the negotiator will have to be well prepared with agendas
like raw materials used, yield at each stage, quality consistency. The negotiator should also back
themselves with the competitor’s prices to give themselves an extra edge in the negotiation.
However, before discussing all these points the negotiator will have to try and probe whether the
company representative who has come to offer the goods is agreeable to follow the "open book
policy." In case the price at which the goods
are offered by the supplier is not in line with
the product costing being done by the
negotiator in advance then the negotiator will
have to challenge the price offered by the
company vis a vis his internal costing.

Internal Conflict Negotiation

Inevitable quarrels often occur amongst

employees. Therefore, a superior to the
employee must have the power to minimize the amount of damage caused by the said quarrels.
In this scenario, the conflict must be analyzed thoroughly before reaching an optimal solution.

Mentality

Having a position of power may enforce an autocratic style of leadership. This may hinder the
ability of the subordinate to present lucrative ideas as well as demotivate them, which further pile
up on the reasons that lead to an inevitable conflict.
Situations, where the person in power is showing favouritism towards a specific employee, can
be nothing short of disastrous for the organization, as the other employee under fire will not even
have a say in the matter(negotiation). In the short term, it may look like a win-win situation for
the superior but over time its effects will translate it into a lose-lose scenario.

22
 7. Closing the deal and Post Negotiation Evaluation
Tactics at the End of Negotiation:
Two negotiation strategies can help you with closing a business deal.
1) To avoid concessions
If you expect that a more attractive offer
from a competitor may close your deal, you
might attempt a shut-down move. Walking
away is one way to avoid concession
because there is no sense to negotiate, and
we have no other option than to move on.
Being silent is one other way to avoid
concessions.
2) To exact concessions
For a good working relationship, parties don’t nickel-and-dime each other for concessions.
Rather, each side should learn about the interests and outcomes of each other so that they can
achieve together. Contingent concessions are almost risk-free. They allow you to signal to the
other party, whereas you’ve got scopes to form a lot of concessions.
Tactics for Success
Following points are a few tactics for successful negotiation:
1) Listen and understand the other party’s issues and point of view.
2) Ask the right questions. (Open-ended questions like what do you think?)
3) Get the help of the best advisors
Bargaining Traps
The bargaining trap is starting to negotiate too early, before justifying your value. This is how
we lost money by discounting too early.
1) Overvaluing your possessions
2) Focusing Too Much on price
3) Compromising your ethics
4) Making Unappealing Offers
Joint Problem Solving to Avoid Bargaining Traps
To avoid overvaluing your possessions, seek out proper values from third-party experts. When
you find yourself worrying about the price, try to add more value to the deal for avoiding
bargaining. In a sales negotiation, examine whether your negotiating behaviour is proper with
your standards.
Building a Relationship
For building a relationship there should be two-way communication and a strong commitment
should be imposed by the leader to the interests of those he or she or she leads. Everyone should
be consistent in the work, which is an important factor in maintaining the relationship.

23
 8. Conclusion

Conflicts do not always have to be destructive. People often think that conflict takes a negative
toll on a person but in real people can truly develop and let a character grow.
In fact, in many instances, conflicts are like incentives that cause us to take action to
accomplish success. Getting problems out in the open and on the table allows the teams to
evaluate an issue with more complete information and, in the end, to make the best decision.
By getting involved in conflicts we get to know more about the other person and also become
aware of their work and what makes them tick.

Conflict in the workplace often isn’t just a disagreement between team members or autocratic
leadership. Thinking it is and opposing that conflict in your workplace exists at all – is the
cause some internal disputes never get resolved for good. Instead, conflict can be far more
prevalent and complex, and therefore destructing, if it is not understood and eventually
addressed correctly. We all know about the saying - one person’s cup of tea is another person’s
poison. Well, this can also be easily applied to the working environment – what works for one
member of your team, won’t always work for another. Failing to recognise that, can lead to
underlying problems that can either cause or lead into a wider conflict.

Luckily there are a number of different conflict management strategies and models that can
help in resolving conflicts. While one may work better than the other, the strategies aren’t
standalone and can be used together to find a way through the conflict more effectively.
We should remember that strategies and conflict management styles we use depend on the root
causes of the conflict, so it becomes important to take the time to identify these. Failing to do
so may lead to the conflict being aggravated or temporarily resolved only for it to rear its head
again in the future. There’s no easy fix for it and it takes work, but it will be worth it in the
long run.

In Negotiation, the process and goal are designed in such a way that it results in a mutually
beneficial and acceptable solution leading to decisions and actions which can resolve the
conflict.

As we go through the process of learning within each negotiation, we understand more about
the causes of conflict and certain measures that we can take when making decisions to diminish
the potential for unnecessary conflict. When conflicts do arise, you will have a pre-existing
relationship and have developed a way of working through problems together.
Sometimes people, motivations and even priorities change creating a need to negotiate conflicts
we did not expect.

Problems and conflicts can be resolved effectively, by taking the time to unite with each other
and by continuing to know and learn about one another which helps in reducing the impact of
conflicts on others and also their effects on us and our business.

24
 9. Bibliography

1. Introduction
 Conflict Management by Stephan Proksch

2. Conflicts in the workplace: Curse or Blessing

 Types of Conflict in the Workplace
 5 Classic Workplace Conflicts and How to Deal with Them
 Types/Levels of Conflict (Individual | Interpersonal | Intergroup Conflict)
 Conflict Management | Conflict Process | 5 stages of Organizational Conflict

3. Strategy and Management of Conflict

 Managing Conflict and Negotiation by B.D. Singh
 Javich, D. (2010). Positive steps for managing conflict. Entrepreneur, March 11.
Retrieved from Positive Steps for Managing Conflict on April 29, 2013.
 Gruber, H. E. (2006). Creativity and conflict resolution. In M. Deutsch, P. T.
Coleman, & E.C. Marcus (Eds.), The handbook of conflict resolution.

4. Negotiating
 Encyclopaedia of Management
 What is Negotiation
 Six Successful Strategies for Negotiation

5. Case Study & Survey

 Tata Sons and the Mystery of Mistry ,First Published December 29 2020.
 Tata vs Mistry – Case Analysis

6. Role of Power in Negotiation

 Conflict Management: A Practical Guide to Developing Negotiation Strategies
Barbara A. Budjac Corvette

7. Closing the deal and Post Negotiation Evaluation

 15 Tactics for Successful Business Negotiations

25
Fr. Conceicao Rodrigues COE TE COMPS B
Bandra (W) TEAM 5