Negotiation

• A joint process of finding a mutually

acceptable solution to a complex conflict
 The Negotiation Process
• BATNA
– The Best Alternative To a
Negotiated Agreement
– The lowest acceptable
value (outcome) to an
individual for a negotiated
agreement
Types of negotiation in organization
Distributive Bargaining
Negotiation that seeks to divide
up a fixed amount of resources;
a win-lose situation.

Integrative Bargaining
Negotiation that seeks one or more
settlements that can create a win-win
solution.
 Distributive versus Integrative Bargaining

Bargaining Characteristic Distributive Bargaining Integrative Bargaining

Goal Get all the pie you can Expand the pie

Motivation Win-Lose Win-Win

Focus Positions Interests

Information Sharing Low High

Duration of Relationships Short-Term Long-Term

 Important Factors that affect the Process
of Negotiation
• Authority:
• Credibility:
• Information:
• Time:
• Emotional control:
• Communication Skills:
 Issues in Negotiation Effectiveness
(Personal factors)
• Personality Traits
– Extroverts and agreeable people weaker at distributive
negotiation – disagreeable introvert is best
– Intelligence is a weak indicator of effectiveness
• Mood and Emotion
– Ability to show anger helps in distributive bargaining
– Positive moods and emotions help integrative bargaining
• Gender
– Men and women negotiate the same way, but may experience
different outcomes
– Women and men take on gender stereotypes in negotiations:
tender and tough
– Women are less likely to negotiate

Cont..
Cont..
Issues in Negotiation Effectiveness (other
factors)
• Conflict and Culture
– Japanese and U.S. managers view conflict differently
– U.S. managers more likely to use competing tactics while
Japanese managers are likely to use compromise and avoidance
• Cultural Differences in Negotiations
– Multiple cross-cultural studies on negotiation styles, for
instance:
• American negotiators are more likely than Japanese bargainers to
make a first offer
• North Americans use facts to persuade, Arabs use emotion, and
Russians used asserted ideals
• Brazilians say “no” more often than Americans or Japanese

Cont..
 Third-Party Negotiators
– Arbitrator
• A third party to a negotiation who has the authority to dictate an
agreement.
– Conciliator
• A trusted third party who provides an informal communication link
between the negotiator and the opponent
– Mediator
• A neutral third party who facilitates a negotiated solution by using
reasoning, persuasion, and suggestions for alternatives
– Consultant
• An impartial third party, skilled in conflict management, who
attempts to facilitate creative problem solving through
communication and analysis