UNIT I Negotiation Negotiation is a technique of discussing issues among one selves and reaching to a conclusion benefiting all involved in the discussion. It is one of the most ways to avoid conflicts and tensions. When individuals do not agree with each other, they sit together, discuss issues on an open forum, negotiate with each other and come to an alternative which satisfies all. In a layman’s language it is also termed as bargaining. Please go through the above two real life situations once again. You want to go for a movie but you know that your parents will never agree to your decision. Will you fight with your parents? Obviously NO, instead you will sit with them and try your level best to convince them and negotiate with them without fighting and spoiling everyone’s mood. Probably you will spend the coming weekend with your parents if they allow you today for the movie else you will negotiate with your friends so that they agree for a noon show. Negotiation helps you to achieve your goal without hurting anyone. Your goal in this case is to go for a movie and you negotiate either with your parents or friends to achieve the same. In the second situation, Tom could not afford to lose the CD player as it was an exclusive one, thus he tries to negotiate with the store owner to lower the price so that it suits his pocket and even the store owner earns his profit as well. Negotiation is essential in corporates as well as personal lives to ensure peace and happiness. Your boss asks you to submit a report within two working days and you know that the report is a little critical one and needs more time. Will you say a yes to your boss just to please him? Your yes might make the boss happy then but later you will land yourself in big trouble if you fail to submit it within the desired time frame. It’s always better to negotiate with your boss rather than accepting something which you know is difficult. Ask for some more time from your boss or probably don’t make an exhaustive report. Negotiation is better as it would prevent spoiling your relation with your superiors later. Negotiator An individual representing an organization or a position who listens to all the parties carefully and comes to a conclusion which is willingly acceptable to all is called the negotiator. Skills of a negotiator A negotiator ideally should be impartial and neutral and should not favour any one. He needs to understand the situation and the parties well and decide something which will benefit all. It is not always that people will easily accept the negotiator’s decision; they may counter it if they feel their personal interests are not satisfied. In such a situation, where the negotiator is left with no choice, he must use
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his power to impose his ideas on all, after all one can’t please everyone. A negotiator has to be a little tactful and smart enough to handle all situations and reach to a conclusion. Elements of Negotiation Negotiation ↓ Process + Behaviour + Substance (Agenda) Process- The way individuals negotiate with each other is called the process of negotiation. The process includes the various techniques and strategies employed to negotiate and reach to a solution. Behaviour- How two parties behave with each other during the process of negotiation is referred to as behaviour. The way they interact with each other, the way they communicate with each other to make their points clear all come under behaviour. Substance- There has to be an agenda on which individuals negotiate. A topic is important for negotiation. In the first situation, going for the late night movie was the agenda on which you wanted to negotiate with your parents as well as your friends. Models of Negotiation Let us go through various models of negotiation:
1.
2.
3.
Win Win Model - In this model, each and every individual involved in negotiation wins. No body is at loss in this model and every one is benefited out of the negotiation. This is the most accepted model of negotiation. Let us understand it with the help of an example: Daniel wanted to buy a laptop but it was an expensive model. He went to the outlet and negotiated with the shopkeeper to lower the price. Initially the shopkeeper was reluctant but after several rounds of discussions and persuasion, he quoted a price best suited to him as well as Daniel. Daniel was extremely satisfied as he could now purchase the laptop without burning a hole in his pocket. The negotiation also benefited the store owner as he could earn his profits and also gained a loyal customer who would come again in future. Win Lose Model - In this model one party wins and the other party loses. In such a model, after several rounds of discussions and negotiations, one party benefits while the party remains dissatisfied. Please refer to the above example once again where Daniel wanted to buy a laptop. In this example, both Daniel and the store owner were benefited out of the deal. Let us suppose Daniel could not even afford the price quoted by the storeowner and requests him to further lower the price. If the store owner further lowers the price, he would not be able to earn his profits but Daniel would be very happy. Thus after the negotiation, Daniel would be satisfied but the shopkeeper wouldn’t. In a win lose model, both the two parties are not satisfied, only one of the two walks away with the benefit. Lose Lose Model - As the name suggests, in this model, the outcome of negotiation is zero. No party is benefited out of this model.
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4.
Had Daniel not purchased the laptop after several rounds of negotiation, neither he nor the store owner would have got anything out of the deal. Daniel would return empty handed and the store owner would obviously not earn anything. In this model, generally the two parties are not willing to accept each other’s views and are reluctant to compromise. No discussions help. Let us understand the above three models with an example from the corporate world. Mike got selected with a multinational firm of repute. He was called to negotiate his salary with Sara- the HR Head of the organization. Case 1 - Sara quoted a salary to Mike, but Mike was not too pleased with the figure. He insisted Sara to raise his salary to the best extent possible. After discussions Sara came out with a figure acceptable to Mike and she immediately released his offer letter. Mike got his dream job and Sara could manage to offer Mike a salary well within the company’s budgets - A Win win Situation (Both the parties gained) Case 2 - Sara with her excellent negotiation skills managed to convince Mike at a little lower salary than he quoted. Mike also wanted to grab the opportunity as it was his dream job and he was eyeing it for quite some time now. He had to accept the offer at a little lower salary than expected. Thus in this negotiation, Mike was not completely satisfied but Sara was - A win lose negotiation Case 3 - Mike declined the offer as the salary quoted by Sara did not meet his expectations. Sara tried her level best to negotiate with Mike, but of no use.-A lose lose model of negotiation. No body neither Mike nor Sara gained anything out of this negotiation. RADPAC Model of Negotiation RADPAC Model of Negotiation is a widely used model of negotiation in corporates. Let us understand it in detail Every alphabet in this model signifies something: R - Rapport A - Analysis D - Debate P - Propose A - Agreement C - Close R - Rapport: As the name suggests, it signifies the relation between parties involved in negotiation. The parties involved in negotiation ideally should be comfortable with each other and share a good rapport with each other. A - Analysis: One party must understand the second party well. It is important that the individual understand each other’s needs and interest. The shopkeeper must understand the customer’s needs and pocket, in the same way the customer mustn’t ignore the shopkeeper’s profits as well. People must listen to each other attentively. D - Debate: Nothing can be achieved without discussions. This round includes discussing issues among the parties involved in negotiation. The pros and cons of an idea are evaluated in this round. People debate with each other
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and each one tries to convince the other. One must not lose his temper in this round but remain calm and composed. P - Propose: Each individual proposes his best idea in this round. Each one tries his level best to come up with the best possible idea and reach to a conclusion acceptable by all. A - Agreement: Individuals come to a conclusion at this stage and agree to the best possible alternative. C - Close: The negotiation is complete and individuals return back satisfied. Let us again consider Mike and Sara’s example to understand RADPAC Model R - Rapport between Mike and Sara. They must be comfortable with each other and should not start the negotiation right away. They must first break the ice. The discussions must start with a warm smile and greetings. A - Both Mike and Sara would try their level best to understand each other’s needs. Mike’s need is to grab the opportunity while Sara wants to hire an employee for the organization. D - The various rounds of discussions between Mike and Sara. Mike and Sara would debate with each other trying to get what they want. P - Mike would propose the best possible salary he can work on while Sara would also discuss the maximum salary her company can offer. A - Both Mike and Sara would agree to each other, where both of them would compromise to their best possible extent. C - The negotiation is complete and probably the next course of action is decided, like in this case the next step would be generation of the offer letter and its acceptance. STRATEGY AND TACTICS OF INTEGRATIVE NEGOTIATION
INTEGRATIVE NEGOTIATION When a negotiation is integrative, it means that negotiation is based on interest or otherwise negotiation
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strategy which lay emphasis on win-win situation. The goal
KEY STEPS IN INTEGRATIVE NEGOTIATION PROCESSS
of Integrative Negotiation is to make the parties’ interest compatible, so that both sides can win. That is, reach an
There are four major steps in the Integrative Negotiation
agreement that satisfies their need. The goals of the
Process:
parties are integrative. Negotiations are not mutually
Ø Identify and define the problem
exclusive. If one party achieves its goals, the other is not
Ø Understand the problem and bring interests and needs
precluded from achieving its goals as well. The
to the surface
fundamental structure of integrative negotiation situation
Ø Generate alternative solution to the problems
is such that, it allows both sides to achieve their objective.
Ø Evaluate those alternatives and select among them.
While Integrative Negotiation Strategies are preferable,
Increasing Value to Buyer
they are not always possible. Sometimes parties’ interests
Claiming Value
really are opposed as when both sides want a larger share
Creating Value Pareto efficient frontier
of fixed resources.
Increasing Value to Seller The first three steps of the Integrative Negotiation process
CHARACTERISTIC OF INTEGRATIVE NEGOTIATION
are important for “Creating Value”. While the fourth step o
Ø It focus on commonalties rather than differences
the Integrative Negotiation Process, the evaluation and
Ø It attempt to address needs and interests, not positions
selection of alternatives INVOLVE “CLOUMING Value”.
Ø It commit to meeting the needs of all involved parties
Claiming value involves many of the distributive bargaining
Ø Exchange information and ideas
skills discussed earlier.
Ø Invent options for mutual gain Ø Use objective criteria for standard of performance.
1. IDENTIFY AND DEFINE THE PROBLEM
Past experience, based perceptions and truly distributive
The problem identification step is often the most difficult
aspects of bargaining makes it remarkable that integrative
one and it is even more challenging when several parties
agreements occur at all. But they do, largely because
are involved. Negotiator need to consider five aspects
negotiators work hard to overcome inhibiting factors and
when identifying and defining the problems.
search assertively for common ground. Those wishing to achieve integrative results find that they must manage
§ Define the problem in a way that is mutually acceptable
both the contest and the process of negotiation in order to
to both sides.
gain the cooperation and commitment of all parties. Key
§ State the problem with an eye toward practicality and
contextual factors include:
comprehensiveness § State the problem as a goal and identify the obstacles to
- Creating a free flow of information
attaining this goal.
- Attempting to understand the other negotiator’s real
§ Depersonalize the problem
need and objective
§ Separate the problem definition from the search for
- Emphasizing the commonalties between the parties and
solution.
minimizing the differences - Searching for solutions that meet the needs and
2. UNDERSTAND THE PROBLEM FULLY
objectives of both sides. Identify interest needs – Many writers have stressed that a
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key step in achieving an Integrative Agreement is the
The search for alternative is the creative phase of the
ability of the parties to understand and satisfy each others
Integrative Negotiation. Once the parties have agreed on a
interest.2 Identifying interest is a critical step in the
common definition of the problem and understood each
Integrative Negotiation Process. Interests are the
others interests, they need to generate a variety of
underlying concerns, need or desires that motivate a
alternative solution. The objective is to create a list of
negotiator to take a particular position. However, in as
options or possible solution to the problem; evaluating
much as satisfaction may be difficult and understanding of
and selecting from among those options will be their task
the underlying interest may permit them to invent
in the final phase. Several techniques have been suggested
solutions that meet their interest. More so, several types
to help negotiators generate alternative solutions. These
of interests may be at stake in a negotiation and that type
techniques fall into two general categories. 4
may be intrinsic (the parties value it in and of itself) or instrumental (the parties value it because it helps them
i. Redefining the Problem or Problem Set:
derive other outcomes in the futures. 3
This technique call for the parties to define their underlying needs and develop alternatives to meet them.
TYPES OF INTERESTS
Five different methods for achieving integrative agreements have been proposed and are highlighted
§ Substantive Interests - related to the focal issues under
below: 5
negotiation § Process Interests are related to the way a dispute is
ii. Expand the pier:
settled
This involves beginning negotiations with shortage of
§ Relationship Interests – indicate that one or both parties
resources, this is not possible for both parties to satisfy
value their relationship with each other and do not want
their interests or obtain their objectives under current
to take actions that will damage it.
condition. A simple solution is to add resources – expand
§ Finally, Lax and Sebenius point out that “the parties may
the pie.
have interests in principles concerning what is fair, what is right, what is acceptable, what is ethical, or what has been
a. Logroll – for logrolling to be successful, parties are
done in the past and should be done in the future”.
required to find more than one issues in conflict and to have different priorities for those issues. 6 Logrolling is
Some observation on Interests
frequently done by trial and error as part of the process of
(a) There is almost always more than one type of interest
experimenting with various packages of offers that will
underlying a negotiation
satisfy everyone involved. However, logrolling may be
(b) Parties can have different types of interest at stake
effective when the parties can combine two issues, but not
(c) Interest often stem from deeply rooted human needs
when the parties take turns in successive negotiation.
or values (d) Interest can change
More so, logrolling is not only effective in inventing
(e) Surfacing Interests is not always easy or to one’s best
options but also as a mechanism to combine options into
advantage
negotiated packages. Neale and Bazerman identify a
(f) Focusing on interests can be harmful
variety of approaches in addition to simply combining
(g) Generate alternative solutions.
several issues into a package. 7 Three of these in particular, relate to the matters of outcome probabilities,
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and timing in other words what is to happen, the
However, the disadvantage of brainstorming is that it does
likelihood of it happening and when it happens.
not solicit the ideas of those who are present at the
b. Exploit differences in risk preference.
negotiation.
c. Exploit differences in time preferences - Use nonspecific compensation – A third way to generate
4. EVALUATE AND SELECT ALTERNATIVES:
alternatives is to allow one person to obtain his objectives and pay off the other person for accommodating his
The fourth stage in the Integrated Negotiation Process is
interests. For non-specific compensation to work, the
to evaluate the alternatives generated during the previous
person doing the compensating needs to know what is
phase and to select the best ones to implement. When the
valuable to the other person and how seriously she is
challenge is a reasonable, simple one, the evaluation and
inconvenienced.
selection steps may be effectively combined into a singly
- Cut the costs for compliance: Through cost cutting, one
step. For those uncomfortable with the Integrative
party achieves her objectives and the others costs are
Process, though we suggest a close adherence to a series
minimized if she agrees to go along.
of distinct steps: definitions and standards, alternative,
- Find a bridge solution: This involve a situation whereby
evaluating and selection. The following guidelines should
parties invent new options that mete all their respective
be used in evaluating options and reaching a consensus.
needs. § Narrow the range of solution options 3. GENERATING ALTRNATIVE SOLUTIONS TO THE PROBLEM
§ Evaluate solution on the basic of quality, and
AS GIVEN:
acceptability
In addition to the techniques mentioned above, there are
§ Agree to the criteria in advance of evaluating options
several other approaches to generating alternative
§ Be willing to justify personal preferences
solution. These approaches can be used by the negotiators
§ Be alert to the influence of intangibles in selecting
themselves or by a number of other parties. Several of
options
these approaches are commonly used in small groups.
§ Use subgroups to evaluate complex options
These include:
§ Take time out to cool off § Explore different ways to logroll.
§ Brainstorming: In brainstorming, small groups of people work to generate as many possible solutions to the
FACTORS THAT FACILITATE SUCCESSFUL INTEGRATIVE
problem as they can. Someone records; the solutions
NEGOTIATION
without comment, as they are identified participants are urged to be spontaneous, even impractical and not to
We have stressed that successful Integrative Negotiation
censor anyone’s ideas. The success of brainstorming
can occur if the parties are predisposed to finding a
depends on the amount of intellectual stimulation that
mutually acceptable joint solution. Many other factors
occurs as different ideas are generated. The
contribute to a predisposition toward problem solving and a willingness to work together to find the best solution.
(a) Avoid judging or evaluating solutions
These factors are also the preconditions necessary for
(b) Separate the people from the problem
more successful integrative negotiation. These factors
(c) Be exhaustive in the brainstorming process
includes:-
(d) Ask outsider
- some common objective or goal
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- faith in one’s problem – solving ability
There are three reasons that every negotiator should be
- a belief in the validity of one’s own position and the
familiar with Distributive Bargaining. First, negotiators face
other’s perspective
some interdependent situations, that are distributive, and
- The motivation and commitment to work together.
to do well in them, they need to understand how they
- Trust
work. Second, because many people use Distributive
- Clear and accurate communication
Bargaining strategies and tactics almost exclusively, all negotiators need to understand how to counter their
In conclusion, whether a negotiation is distributive or
effects. Third, every negotiative situation has the potential
integrative, negotiation should focus on substance which
to require Distributive Bargaining skills when at the
will produce a mutually beneficial agreement at lower cost
“claiming value” stage 2. Understanding Distributive
and also focus on relations in which the parties maintain
Bargaining strategies and tactics is important and useful,
civil relations of mutual recognition and respect and
but negotiators need to recognize that these tactics can
improve their joint problem solving ability.
also be counter productive and costly. Often they cause negotiating parties to focus so much on their differences
STRATEGY AND TACTICS OF DISTRIBUTIVE BARGAINING
that they ignore what they have in common 3. These negative effects notwithstanding, Distributive Bargaining
The distributive bargaining competitive, or win-lose,
strategies and tactics are quite useful when a negotiator
bargaining is a situation where the goals of one party are
wants to maximize the value obtained in a single deal,
usually in fundamental and direct conflict with the goals of
when the relationship with the other party is not
the other party.
important, and when they are at the claiming value stage
Resources are fixed and limited, and both parties want to
of negotiation.
maximize their share. As a result, each party will use a set of strategies to maximize his or her share of the outcomes
Before negotiation, both parties to a negotiation should
to be obtained. One important strategy is to guard
establish their starting, target and resistance point.
information carefully – one party tries to give information
Starting points are often in the opening statements each
to the other party only when it provides a strategic
party makes (i.e. the seller’s listing price and the buyer’s
advantage. Meanwhile, it is highly desirable to get
offer). The target point is usually learned or inferred as
information from the other party to improve negotiation
negotiations get under way. People typically give up the
power. Distributive bargaining is basically a competition
margin between their starting points and target points as
over who is going to get the most of limited resources,
they make concessions. The resistance point, the point
which is often money. Whether or not one of both parties
beyond which a person will not go and would rather break
achieve their objectives will depend on the strategies and
off negotiations, is not known to the other party and
tactics they employed.
should be kept secret 4.
For many, the strategies and tactics of distributives bargaining are what negotiation is all about. Others are
One party may not learn the other’s party resistance point
repelled by distributive bargaining and would rather walk
even after the end of a successful negotiation. After an
away than negotiate this way they argue that distributive
unsuccessful negotiation, one party may infer that the
bargaining is old fashioned, needlessly, confrontational
other’s resistance point was near the last offer the other
and destructive.
was willing to consider before the negotiation ended.
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The spread between the resistance points, called the
distributive bargainers identify their realistic alternatives
bargaining range, settlement range, or zone of potential
before starting discussions with the other party so that
agreement, is particularly important. In this area, the
they can properly gauge how firm to be in the negotiation.
actual bargaining takes place, for anything outside these
Good bargainers 6 also try to improve their alternatives
points will be summarily rejected between one of the two
while the negotiation is underway.
negotiators. When the buyer’s resistance point is above the seller’s, he is minimally willing to pay more than she is
Negotiators need to ensure that they have a clear
minimally willing to sell.
understanding of their best alternative to a negotiated
However, because negotiators don’t begin their
agreement (BATNA) 7. Having a number of alternatives can
deliberation by talking about their resistance points, it is
be useful, but it is really one’s best alternative that will
often difficult to know whether a positive settlement
influence the decision to close a deal or walk away.
range exist until the negotiators get deep into the process.
Negotiators who have stronger BATNAs, that is, very
It is worthy of note that, negotiations that started with
positive alternatives to a negotiated agreement, will have
negative bargaining range are likely to stalemate. Target
more power throughout the negotiation and accordingly
points, resistance points and initial offers all play on
should be able to achieve more of their goals.
important role in Distributive Bargaining. Target point influence both negotiators outcomes, opening offers play
In almost all negotiations, agreement is necessary on
on important role as a warning for the possible presence
several issues: the price, the closing date of sales
of hardball tactics5.
renovation, price of items forgone etc. The package of issues for negotiation is refers to as the barraging mix.
In addition to opening bids, target points and resistance
Each item in the mix has its own starting target and
points a fourth factor may enter the negotiations: and
resistance points. Some items are of obvious importance
alternative outcome that can be obtained by completing a
to both parties, others are important only to one party.
deal with someone else. In some negotiations, the parties
Negotiators need to understand what is important to them
have only two fundamental choices: (a) reach a deal with
and to the other party and they need to take these
the other party, or (b) reach no settlement at all. In other
priorities into account during the planning process 8.
negotiations, however, one or both parties may have the possibility of an alternative deal with another party.
Within the fundamental strategies of distributive bargaining, there are four important tactical tasks,
An alternative point can be identical to the resistance
concerned with targets, resistance points, and the cost of
point, although the two do not have to be the same.
terminating negotiations for a negotiator in a Distributive
Alternative are important because they give negotiators
Bargaining situation to consider:
the power to walk from any negotiation when the
· Assess the other party’s target, resistance point, and cost
emerging deal is not very good. The number of realistic
of terminating negotiations
alternatives that negotiators have will vary considerably
· Manager the other party’s impression of the negotiators’
from one situation to another. In negotiations, where they
target, resistance point and cost of terminating
have many alternatives they can set their goals higher and
negotiation.
make fewer concessions. In negotiations where they have
· Modify the other party’s perception of his or her own
no attractive alternatives, such as when dealing with a sole
target, resistance point and cost of terminating
supplier, they have much less bargaining power. Good
negotiation and
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· Manipulate the actual cost of delaying in terminating
stance, meeting belligerent stance with belligerence. It is
negotiations.
important for negotiators to think carefully about the message that they wish to signal with their opening
POSITION TAKEN DURING NEGOTIATION
because there is a tendency for negotiators to respond in
Effective distributive bargainers need to understand the
kind to distributive tactics in negotiation11. That is
process of taking positions during bargaining, including the
negotiators tend to match distributive tactics from the
importance of the opening offer and opening stance and
other party with their own distributive tactics, so
the role of making concessions throughout the negotiation
negotiators should make conscious decision about what
process. 9 At the beginning of negotiations, each party
they are signaling to the other party with their opening
takes a position. Typically, one party will then change his
stance and subsequent concession.
or her position in response to information from the other party or in response to the other party’s behaviour.
An opening offer is usually met with a counter offers and
Changes in position are usually accompanied by new
these two offers define the initial bargaining rang.
information concerning the other’s intentions, the value of
Sometime the other party will not counter offer but will
outcomes and likely zones for settlement. Negotiation is
simply state that the first offer is unacceptable and ask the
interactive. It provides an opportunity for both sides to
opener to come back with a more reasonable set of
communicate information about their positions that may
proposals. Note that it is not an option to escalate one’s
lead to change in those positions.
opening offer that is, to set an offer further away form the other party’s target point that one’s first offer. Opening
OPENING OFFER
offers, opening stance, and initial concessions are elements at the beginning of a negotiation that parties can
When negotiation begins, the negotiator is faced with a
use to communicate how they intend to negotiate an
perplexing problem. What should the opening offer be?
exaggerated opening offer, a determined opening stand, and a very small opening concession signal a position of
Research by Adam Galinsky and Thomas Mussiveiler
firmness. Firmness can create a climate in which the other
suggest that making the first offer in a negotiation is
party may decide that concessions are so meager that he
advantageous to the negotiator making the offer. 10 It
or she might as well capitulate and settle quickly rather
appears that first offer can anchor a negotiation especially
than drag things out. Paradoxically, firmness may actually
when information about alternative negotiation outcome
shorten negotiation12
is not considered. Negotiator can dampen “first offer effect” by the other negotiator, however, by concentrating
However, negotiations can be flexible. There are several
on their won target and focusing on the other negotiator’s
good reasons for adopting a flexible position. 13 First,
resistance point.
when taking different stances throughout the negotiation, one can learn about the other party’s target and perceived
A second decision to be made at the outset of Distributive
possibilities by observing how he or she respond to
Bargaining concerns the stance or attitude to adopt during
different proposals. Negotiators may want to establish a
the negotiation. Will you be competitive (fighting to get
comparative rather than a competitive relationship,
the best on every point) or moderate (willing to make
hoping to get a better agreement. In addition, flexibility
concessions and compromise?). Some negotiators take
keeps the negotiations proceeding; the more flexible one
belligerent stance, the other party may mirror the initial
seems the more the other party will believe that a
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settlement is possible.
not effective negotiators. 17 Many negotiators consider these tactics out-of-bounds for any negotiation situation.
FINAL OFFERS The followings are the hardball tactics Eventually a negotiator wants to convey the message that there is no further room for movement that the present
§ Dealing with Typical Hardball Tactics
offer is the final one. A good negotiator will say, “this is all
§ Ignore Them
I can do” or “this is as far as I can go”. Sometimes,
§ Discuss Them
however, it is clear that a simple statement will not suffice;
§ Respond in Kind
an alternative is to use concessions to convey the point.
§ Co-opt the Other Party
The final offer has to be large enough to be dramatic yet
§ Typical Hardball Tactic
not so large that it creates the suspicion that the
§ Good Cop-Bad Cop
negotiator has been holding back and that there is more
§ Lowball/Highball
available on other issues in the bargaining mix. 14
§ Bogey § The Nibble
Closing the Deal
§ Chicken
After negotiating for a period of time, and learning about
§ Intimidation
the other party’s needs, positions, and perhaps resistance
§ Aggressive Behaviour
point, the next challenge for a negotiator is to close the
§ Snow Job
agreement. Several tactics are available to negotiators for closing a deal, 15 choosing the best tactic for a given negotiation is as much as a matter of art as science. These
NEGOTIATION: strategy and planning
tactics are:
In simplest terms, negotiation is a discussion between two or more disputants who are trying to work out a solution
§ Provide Alternatives
to their problem. This interpersonal or inter-group process
§ Assume the Close
can occur at a personal level, as well as at a corporate or
§ Split the Difference
international (diplomatic) level. Negotiations typically take
§ Exploding Offers
place because the parties wish to create something new
§ Sweeteners
that neither could do on his or her own, or to resolve a problem or dispute between them1. The parties
HARDBALL TACTICS
acknowledge that there is some conflict of interest between them and think they can use some form of
We now turn to a discussion of hardball tactics in
influence to get a better deal, rather than simply taking
negotiation. Many popular books of negotiation discuss
what the other side will voluntarily give them. They prefer
using hardball negation tactics to beat the other party. 16
to search for agreement rather than fight openly, give in,
Such tactics are designed to pressure negotiators to do
or break off contact.
things they would not otherwise do and their presence
While they have interlocking goals that they cannot
usually disguises the user’s adherence to a decidedly
accomplish independently, they usually do not want or
distributive bargaining approach. They also can backfire,
need exactly the same thing. This interdependence can be
and there is evidence that every adversarial negotiator is
either be win-lose or win-win in nature, and the type of
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negotiation that is appropriate will vary accordingly. The
fair, efficient in terms of time and money, involved in all
disputants will either attempt to force the other side to
the relevant stakeholders, consistent with applicable
comply with their demands, to modify the opposing
regulations, and did not establish limiting precedents for
position and move toward compromise, or to invent a
third-parties. Focusing on relations, successful
solution that meets the objectives of all sides4. The nature
negotiations are those in which the parties maintain civil
of their interdependence will have a major impact on the
relations of mutual recognition and respect, and improve
nature of their relationship, the way negotiations are
their joint problem-solving abilities. Generally the
conducted, and the outcomes of these negotiations.
substantive measure tends to dominate.
Mutual adjustment is one of the key causes of the changes
One key negotiating strategy is to focus on interests rather
that occur during a negotiation. Both parties know that
than positions. A party's interests are the reasons they
they can influence the other's outcomes and that the
have for holding a particular position on an issue.
other side can influence theirs5. The effective negotiator
Negotiations based on positions tend to devolve into
attempts to understand how people will adjust and
contests of will. They are less successful by any measure.
readjust their positions during negotiations, based on what
Incompatible positions may be backed by compatible
the other party does and is expected to do. The parties
interests, and so negotiating on interests is more likely to
have to exchange information and make an effort to
produce fair, mutually beneficial outcomes without
influence each other. As negotiations evolve, each side
generating added hostility. In addition to separating
proposes changes to the other party's position and makes
interests from positions, it is helpful to generate a wide
changes to its own. This process of give-and-take and
range of possible solutions before trying to come to a
making concessions is necessary if a settlement is to be
decision. It is also helpful for the parties to agree on the
reached6. If one party makes several proposals that are
criteria by which possible solutions will be evaluated
rejected, and the other party makes no alternate proposal,
before actually setting down to evaluate the proposals.
the first party may break off negotiations. Parties typically
Negotiating strategies may be integrative (win-win) or
will not want to concede too much if they do not sense
distributional (zero-sum). Negotiating on interests is often
that those with whom they are negotiating are willing to
integrative. The goal is to make the parties' interests
compromise.
compatible, so that both sides can win that is, reach an
The parties must work toward a solution that takes into
agreement that satisfies their needs. While integrative
account each person's requirements and hopefully
negotiation strategies are preferable, they are not always
optimizes the outcomes for both. As they try to find their
possible. Sometimes parties' interests really are opposed,
way toward agreement, the parties focus on interests,
as when both sides want a larger share of a fixed resource.
issues, and positions, and use cooperative and/or
In these cases distributional negotiations, which seek to
competitive processes to come to an agreement.
distribute the costs and benefits fairly, are necessary. Sometimes disputes which appear to be zero-sum can be
NEGOTIATION STRATEGIES
reframed so that an integrative approach is possible. One
Negotiation success can be measured in different ways.
way to do this is to find creative ways to increase or use
Focusing on substance, negotiations may be called
the apparently "fixed" resource. Another way is to
successful when they produce a mutually beneficial
reinterpret the parties' interests to make them
agreement at lower cost that an alternative forum, and
compatible, or to find more basic interests which are
when that agreement is implemented. Focusing on
compatible.
process, a successful negotiation would be one which was
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10
APPROACHES TO NEGOTIATION
but then they must use competitive processes to claim value (that is, "divide up the pie")12.
Fisher,R.,Ury,W.,Patton,B. make several overlapping
However, a tension exists between creating and claiming
distinctions about approaches to negotiation. They
value. This is because the competitive strategies used to
distinguish between positional bargaining, which is
claim value tend to undermine cooperation, while a
competitive, and interest-based bargaining or principled
cooperative approach makes one vulnerable to
negotiation, which is primarily cooperative. But they also
competitive bargaining tactics. The tension that exists
make the distinction between soft, hard, and principled
between cooperation and competition in negotiation is
negotiation, the latter of which is neither soft, nor hard,
known as "The Negotiator's Dilemma”
but based on cooperative principles which look out for
If both sides cooperate, they will both have good
oneself as well as one's opponent9.
outcomes.
However distinctions were also made
If one cooperates and the other competes, the co-
between competitive and cooperative approaches. The
operator will get a terrible outcome and the competitor
most important factors that determine whether an
will get a great outcome.
individual will approach a conflict cooperatively or
If both compete, they will both have mediocre outcomes.
competitively are the nature of the dispute and the goals
In the face of uncertainty about what strategy the other
each side seeks to achieve. Often the two sides' goals are
side will adopt, each side's best choice is to compete.
linked together, or interdependent. The parties'
However, if they both compete, both sides end up worse
interaction will be shaped by whether this
off.
interdependence is positive or negative10.
In real life, parties can communicate and commit
Goals with positive interdependence are tied together in
themselves to a cooperative approach. They can also
such a way that the chance of one side attaining its' goal is
adopt norms of fair and cooperative behaviour and focus
increased by the other side's attaining its goal. Positively
on their future relationship. This fosters a cooperative
interdependent goals normally result in cooperative
approach between both parties and helps them to find
approaches to negotiation, because any participant can
joint gains.
"attain his goal if, and only if, the others with whom he is
From the above discussion, we are able to understand that
linked can attain their goals.
effective strategy and planning are the most important
On the other hand, negative interdependence means the
critical factors for achieving negotiation objective.
chance of one side attaining its goal is decreased by the
However, proper attention should be directed at
other's success. Negatively interdependent goals force
addressing basic causes of failure in strategic and
competitive situations, because the only way for one side
systematic in negotiation. In the long run, with effective
to achieve its goals and "win" is for the other side to
planning, and target setting, most negotiators can and will
"lose."
achieve their objective.
Fisher,R.,Ury.,W.,Patton,B.also argue that almost any dispute can be resolved with interest-based bargaining (i.e., a cooperative approach), other theorists believe the two approaches should be used together. Some for example, argue that negotiations typically involve "creating" and "claiming" value. First, the negotiators work cooperatively to create value (that is, "enlarge the pie,")
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11
UNIT II
the same dispute and perceive it in very different ways as a result of their background, professional training or past
PERCEPTION ,COGNITION,AND EMOTION
experiences”3.Aframe is a way of labelling these different individual interpretations of the situation.
Perception, cognition and emotion are the building blocks
Types of frames;
of all social encounters, including negotiation, in the sense
Substantive
that our social actions are guided by how we perceive and
Outcome
analyze the other party, the situation, and our interests
Aspiration
and positions. A working knowledge of how humans
Process
perceive and process information is important to
Identity
understand why people behave the way they do during
Characterization
negotiations.
Loss—gain—low
Perception can be defined as the process by which individuals connect to their environment. The process of
COGNITIVE BIASES IN NEGOTIATION
ascribing meaning to messages and events is strongly influenced by the perceiver’s current state of mind, role,
A cognitive bias in negotiation is the systematic
and comprehension of earlier communications.1 Other
information processing errors that negotiators make and
parties’ perceptions, the environment, and the perceiver’s
that may compromise negotiation performance. Thus,
disposition are also important influence on one’s ability to
rather than being perfect processers of information, it is
interpret with accuracy what the other party is saying and
clear that negotiators have the tendency to make
meaning.
systematic errors when they process information.4 These errors that tend to impede negotiation performance
PERCEPTION DISTORTION
include: 1. Irrational escalation of commitment
In any given negotiation, the perceiver’s own needs,
2. Mythical fixed-pie beliefs
desire, motivations, and personal experiences may create
3. Anchoring and adjustment
a predisposition about the other party. This is cause for
4. Isssue framing and risk
concern when it leads to biases and errors in perception
5. Availability of information
and subsequent communication. However, there are four
6. The winner’s curse
types of perception errors;
7. Overconfidence
Stereotyping
8. The laws of small numbers
Hallo effects
9. Self-serving biases
Selective perception
10. Endowment effect
And, projection.
11. Ignoring other’s cognitions
FRAMING
12. Reactive devaluation
A key issue in perception and negotiation is framing. A frame is the subjective mechanism through which people
MANAGING MISPERCEPTIONS AND COGNITIVE BIASES IN
evaluate and make sense out of situation, leading them to
NEGOTIATION
pursue or avoid subsequent actions.2 Frames are
Misrepresentations and cognitive biases typically arise out
important in negotiation because “people can encounter
of conscious awareness as negotiators gather and process
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12
information. The question of how best to manage
the issue being discussed, it is also clear that the content
perception and cognitive bias is a difficult one. However,
of communication is only partly responsible for
the following solutions to these systematic distortions can
negotiation outcomes2.
be observed: Awareness of the occurrences
FIVE DIFFERENT CATEGORIES OF COMMUNICATION
Problem definition and problem evaluation Careful discussion of the issue and preferences of both
Offer, counteroffer, and motives.
negotiators
Information about alternatives.
Negotiators awareness of the negative aspects of these
Information about outcomes.
distortions
Social account.
Discuss these problems in structured manner within team
Communication process.
and with their counterparts. METHOD OF COMMUNICATION IN NEGOTIATION COMMUNICATION While it may seem obvious that how negotiators communicate is as important as what they have to say, research has examined different aspects of how people communicate. The different methods of communication during negotiation are as follows: Use of language. Use of nonverbal communication. Make eye contact. Adjust body position. Nonverbally encourage or discourage what other says. Reduced to its essence, negotiation is a form of interpersonal communication. Communication processes, both verbal and nonverbal, are critical to achieving goals and to resolve conflicts. However, one of the fundamental questions that researchers in communication and negotiation have examined is, what is communicated during negotiation? The researchers found that 70% of the verbal tactics that buyers and sellers used during negotiation were integrative. In addition, buyers and sellers tend to behave reciprocally-when one party use an integrative tactic, the other tended to respond with integrative tactic. Most of the communication during negotiation is not about negotiator preferences1.although the blend of
SELECTION OF A COMMUNICATION CHANNEL Communication is experienced differently when it occur through different channels. We may think of negotiation as typically occurring face-to-face-an assumption reinforced by the common metaphor of the “negotiation table “but the reality is that people negotiate through a variety of communication media: over the phone, in writing, and increasingly through electronic channels such as e-mail, instant messaging, and teleconferencing’s systems. The use of network-mediated information technologies in negotiation is sometimes referred to as virtual negotiations.
distributive and integrative content varies as a function of
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13
HOW TO IMPROVE COMMUNICATION IN NEGOTIATION
argument for one particular position in debate lead to a “blindness of involvement,” or a self-reinforcement cycle
Given then ways that communication can be disrupted and
of argumentation that prohibits negotiators from
distorted, we can only marvel at the extent to which
recognizing the possible compatibility between their own
negotiators can actually understand each other. Failures
position and that of the other party.
and distortions in perception, cognition,and communication are the paramount contributors to
SPECIAL COMMUNICATION CONSIDERATIONS AT THE
breakdowns and failures in negotiation. Reseach
CLOOSE OF NEGOTIATIONS
consistently demonstrates that even those parties whose goals are compatible or integrated may fail to reach
Avoid fatal mistakes.
agreement or reach suboptimal agreements because of
Achieving closure.
the misperception of the other party or because of
Having carefully examined the importance of
breakdown in the communication process.
communication in negotiation, it is then highly imperative
Three main techniques are available for improving
that parties, during negotiation manage communication
communication in negotiation:
effectively in order to avoid failure to reach an agreement
1.The use of questions-questions are essential elements in
and breakdown in negotiation
negotiations for securing information; asking good questions enables negotiators to secure a great deal of information about the other party’s position, supporting arguments; and needs. Questions can be divided into two basic categories: those that are manageable and those that are unmanageable and cause difficulty3.manageable questions cause attention or prepare the other person’s thinking for further questions, get information, and generate thought. While unmanageable questions cause
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 1.
difficulties, give information, and bring the discussion to a false conclusion. 2. Another technique is listening. There are three major forms of listening:
1.
Passive listening-involves receiving the message while providing no feedback to the sender about the accuracy or completeness of reception. Acknowledgement-is the second form of listening, slightly more active than the passive listening. When acknowledging, receiver occasionally nod their heads, maintain eye contact, or interject responses. Active listening is the third form. When receiver is actively listening, they restate or paraphrase the sender’s message in their own language4. 3.Role reversal –this occur when there is continual
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1.
BEST PRACTICES: NEGOTIATING Preparation Structure diagnosis Batna Be willing to walk Master negotiation paradoxes Intangibles Coalitions Reputation Relativity Life-long learning Be prepared — Understand and articulate your goals and interests — Set high but achievable aspirations for negotiation Diagnose the fundamental structure of the negotiation — Make conscious decisions about the nature of the negotiation: is it a distributive or integrative negotiation or blend of the two — Choose strategies and tactics accordingly Identify and work the BATNA — Be vigilant about the BATNA — Be aware of the other negotiator’s BATNA 4. Be willing to walk away — Strong negotiators are willing to walk away when no agreement is better than a poor agreement — Have a clear walk away point in mind where you will halt the negotiation 5. Master the key paradoxes of negotiation — Claiming value versus creating value
14
— Sticking by your principles versus being resilient to the flow — Sticking with the strategy versus opportunistic pursuit of new options — Facing the dilemma of honesty: honest and open versus closed and opaque — Facing the dilemma of trust: trust versus distrust 6. Remember the intangibles — “see what is not there” — ask questions — take an observer or listener with you to the negotiation 7. Actively manage coalitions — coalitions against you — coalitions that support you — undefined coalitions that may materialize for or against you 8. Savor and protect your reputation — start negotiation with a positive reputation — shape your reputation by acting in a consistent and fair manner 9. Remember that rationality and fairness are relative — question your perceptions of fairness and ground them in clear principles — find external benchmarks of fair outcomes — engage in dialogue to reach consensus on fairness 10. Continue to learn from your experience — practice the art and science of negotiation — analyze each negotiation Plan a personal reflection time after each negotiation Periodically take a lesson from a trainer or a coach Keep a personal diary on strengths and weaknesses and develop a plan to work on weaknesses
So it is not necessarily your ideal outcome--unless your
BEST ALTERNATIVE TO A NEGOTIATED AGREEMENT
revealing it to your opponent. If you have a weak one,
(BATNA) What BATNAs Are....... BATNA is a term coined by Roger Fisher and William Ury in their 1981 bestseller, Getting to Yes: Negotiating Without Giving In.[1] It stands for "Best ALTERNATIVE TO a negotiated agreement." Said another way, it is the best you can do if the other person refuses to negotiate with you--if they tell you to "go jump in a lake!" or "Get lost!"
Prof. Amit Kumar
[email protected] FIT Group of Institutions
ideal outcome is something you can get without the cooperation of the other person. It is the best you can do WITHOUT THEM. BATNAs are critical to negotiation because you cannot make a wise decision about whether to accept a negotiated agreement unless you know what your alternatives are. If you are offered a used car for $7,500, but there's an even better one at another dealer for $6,500--the $6,500 car is your BATNA. Another term for the same thing is your "walk away point." If the seller doesn't drop her price below $6,500, you will WALK AWAY and buy the other car. Your BATNA "is the only standard which can protect you both from accepting terms that are too unfavorable and from rejecting terms it would be in your interest to accept."[2] In the simplest terms, if the proposed agreement is better than your BATNA, then you should accept it. If the agreement is not better than your BATNA, then you should reopen negotiations. If you cannot improve the agreement, then you should at least consider withdrawing from the negotiations and pursuing your alternative (though the relational costs of doing that must be considered as well). Having a good BATNA increases your negotiating power. If you know you have a good alternative, you do not need to concede as much, because you don't care as much if you get a deal. You can also push the other side harder. If your options are slim or non existent, the other person can make increasing demands, and you'll likely decide to accept them--because you don't have a better option, no matter how unattractive the one on the table is becoming. Therefore, it is important to improve your BATNA whenever possible. If you have a strong one, it is worth however, it is better to keep that detail hidden. Guy Burgess and Heidi Burgess have adapted the concept of BATNA slightly to emphasize what they call "EATNAs"-estimated alternatives to a negotiated agreement" instead of "best alternatives." Even when disputants do not have good options outside of negotiations, they often think they do. (For example, both sides may think that they can prevail in a court or military struggle, even when one side is clearly weaker, or when the relative strengths are so
15
balanced that the outcome is very uncertain.) Yet,
just one party changes his or her mind, the agreement may
perceptions are all that matter when it comes to deciding whether or not to accept an agreement. If a disputant
well break down. Thus, knowing one's own and one's opponents' BATNAs and EATNAs is critical to successful
thinks that he or she has a better option, she will, very often, pursue that option, even if it is not as good as she
negotiation Determining Your BATNA
thinks it is. BATNA and EATNAs also affect what William Zartman and
BATNAs are not always readily apparent. Fisher and Ury outline a simple process for determining your BATNA:
may others have called "ripeness," the time at which a dispute is ready or "ripe" for settlement.[3] When parties have similar ideas or "congruent images" about what BATNAs exist, then the negotiation is ripe for reaching agreement. Having congruent BATNA images means that
1.
develop a list of actions you might conceivably
2.
take if no agreement is reached; improve some of the more promising ideas and
3.
convert them into practical options; and select, tentatively, the one option that seems
both parties have similar views of how a dispute will turn
best.[4]
out if they do not agree, but rather pursue their other rights-based or power-based options. In this situation, it is
BATNAs may be determined for any negotiation situation, whether it be a relatively simple task such as finding a job
often smarter for them to negotiate an agreement without continuing the disputing process, thus saving the
or a complex problem such as a heated environmental conflict or a protracted ethnic conflict.
transaction costs. This is what happens when disputing parties who are involved in a lawsuit settle out of court,
Fisher and Ury offer a job search as a basic example of how to determine a BATNA. If you do not receive an attractive
(which happens in the U.S. about 90 percent of the time).
job offer by the end of the month from Company X, what
The reason the parties settle is that their lawyers have come to an understanding of the strength of each sides'
will you do? Inventing options is the first step to determining your BATNA. Should you take a different job?
case and how likely each is to prevail in court. They then can "cut to the chase," and get to the same result much
Look in another city? Go back to school? If the offer you are waiting for is in New York, but you had also considered
more easily, more quickly, and less expensively through
Denver, then try to turn that other interest into a job offer
negotiation. On the other hand, disputants may hold "dissimilar
there, too. With a job offer on the table in Denver, you will be better equipped to assess the New York offer when it is
images" about what BATNAs exist, which can lead to a stalemate or even to intractability. For example, both sides
made. Lastly, you must choose your best alternative option in case you do not reach an agreement with the
may think they can win a dispute if they decide to pursue it in court or through force. If both sides' BATNAs tell them
New York company. Which of your realistic options would you really want to pursue if you do not get the job offer in
they can pursue the conflict and win, the likely result is
New York?
a power contest. If one side's BATNA is indeed much better than the other's, the side with the better BATNA is
More complex situations require the consideration of a broader range of factors and possibilities. For example, a
likely to prevail. If the BATNAs are about equal, however, the outcome is much less certain. If the conflict is costly
community discovers that its water is being polluted by the discharges of a nearby factory. Community leaders first
enough, eventually the parties may come to realize that
attempt to negotiate a cleanup plan with the company,
their BATNAs were not as good as they thought they were. Then the dispute will again be "ripe" for negotiation.
but the business refuses to voluntarily agree on a plan of action that the community is satisfied with. In such a case,
The allure of the EATNA often leads to last-minute breakdowns in negotiations, particularly when many
what are the community's options for trying to resolve this situation?
parties are involved. Disputants can negotiate for months or even years, finally developing an agreement that they
•
They could possibly sue the business based on stipulations of the Clean Water Act.
think is acceptable to all. But then at the end, all the
•
They could contact the Environmental Protection
parties must take a hard look at the final outcome and decide, "is this better than all of my alternatives?" Only if
Agency and see what sort of authority that agency has over such a situation.
all the parties say "yes," can the agreement be finalized. If
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16
•
•
They could lobby the state legislature to develop
third party may simply insert new information into the
and implement more stringent regulations on polluting factories.
discussion...illustrating that one side's assessment of its BATNA is likely incorrect. Costing is a more general
The community could wage a public education campaign and inform citizens of the problem.
approach to the same process...it is a systematic effort to determine the costs and benefits of all options. In so
Such education could lead voters to support more environmentally-minded candidates in the future
doing, parties will come to understand all their alternatives. If this is done together and the parties agree
who would support new laws to correct problems
on the assessment, this provides a strong basis upon which
like this one. It might also put enough public pressure on the company that it would change its
to come up with a negotiated solution that is better than both sides' alternatives. But if the sides cannot come to
mind and clean up voluntarily. In weighing these various alternatives to see which is
such an agreement, then negotiations will break down, and both parties will pursue their BATNA instead of a
"best," the community members must consider a variety
negotiated outcome.
of factors. • Which is most affordable and feasible? •
Which will have the most impact in the shortest amount of time?
•
If they succeed in closing down the plant, how many people will lose their jobs?
These types of questions must be answered for each alternative before a BATNA can be determined in a complex environmental dispute such as this one.
C ASE STUDY- ROLE NEGOTIATION AT BOKARO STEEL PLANT SUMMARY The case study is all about the Role Negotiation between The Bokaro Steel Plant. Their main objectives of Bokaro
BATNAs and the Other Side At the same time you are determining your BATNA, you
plant is to understand each other role in the area of
should also consider the alternatives available to the other
employees as human beings and image building of
side. Sometimes they may be overly optimistic about what their options are. The more you can learn about their
employees service, eliminating hardship, treating
departments along with an improvement in the service
options, the better prepared you will be for negotiation. You will be able to develop a more realistic view of what
rendered to the employees. Almost 32 persons were
the outcomes may be and what offers are reasonable. There are also a few things to keep in mind about
particular exercise continuously for 11 hour. The time
revealing your BATNA to your adversary. Although Fisher and Ury do not advise secrecy in their discussions of BATNAs, according to McCarthy, "one should not reveal one's BATNA unless it is better than the other side thinks it is."[5] But since you may not know what the other side thinks, you could reveal more than you should. If your BATNA turns out to be worse than the opponent thinks it is. Then revealing it will weaken your stance. BATNAs and the Role of Third Parties Third parties can help disputants accurately assess their BATNAs through reality testing and costing. In reality testing, the third party helps clarify and ground each disputing party's alternatives to agreement. S/he may do
participated putting their effort for 2 days working in the
schedule was fixed for microlab, image building, image sharing and clarification ,empathy building (positive image)expectation in home group, exchange of expectation and clarification, discussion in home groups, consolidation by a joint team and listing joint recommendations, signing of agreement and preparation for dialogue with the top management. Role negotiation has three phases with top management and the top purposes of these exercise was to give the judgment on and lead to mutual understanding by keeping positive image in mind. The starting of the microlab
this by asking hard questions about the asserted BATNA: "How could you do that? What would the outcome be?
exercise with the executive of different departments was
What would the other side do? How do you know?" Or the
unpleasant experiences and also came out with their own
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very interesting ,as everyone shared their pleasant and
17
strength ,weakness and perception about their own and
personnel image drawn which points out the negative part
other department including other perception about their
of finance and EDP department.
department. The group formed for this particular exercise
The positive image or strength generated was:
shared their positive image, strength and building their Effective cost control, strong
empathy. The image drawn of executive department related to
budgetary, promptness in making payment, good team
empathy building exercise was helpful, service oriented,
spirit, good system of timely job rotation, team spirit,
humane, effective communicators, change agents,
tactful, human approach, motivating force, cooperative.
accountable, adaptable, easily accessible, more involved in
After deriving the positive image and empathy the home
production by creating conducive environment and
group was formed to reduce the negative image and
actively solving problem. And the image drawn by finance
increase the positive image to make home group more
was: poor record keeping, good team work, problem
effective in their role performance. The ideas and view
solving attitude, projecting good image at the cost of
where exchanged and clarification were sought. The home
other, wrong pay fixation with subsequent corrigendum,
group of executives department continued with
partiality, shifting of blame, bureaucratic approach, ad hoc
•
decision and for all problem blame others.
Time schedules prescribed for various payments
The image or personals guess by finance EDP related to
•
Enquiry counters as the shop floor.
empathy building was:
•
Prompt response to final settlement
wrong pay fixation with subsequent corrigendum, poor
•
Prompt payment of travel and
record keeping, inconsistency in application of rules, shifting of blame, blamed personnel department for all
conveyance allowance. •
problems, bureaucratic approach, projecting good image
Disbursement of salary and PF at shop floor
at cost of others, good team work and problem solving
•
Time keeping system
attitude. After generating the image of empathy by
•
Preparation of computerized statement
personnel department. They started to draw out the image
of income tax ,PF absenteeism rate
of finance and EDP and their individual image drawn out
,leave ledger and final settlement,
was timely, punctual, effective, sincere, honest,
•
cooperative, open, communicative, understanding and helping.
,promotion ,transfer and separation •
The personnel image drawn was : •
employees and other department, lack of problem solving approach, more centralized functioning, no involvement in
Certifying claims for payment of PF/gratuity/leave salary etc
•
control, rule oriented, lacking human touch, less accessible, low initiative on communication with
Certifying claims of employees regarding LTC/LLTC
The prompt in payment of certain item, good finance, management and effective cost
Issuing order regarding appointment
Maintaining good personal relation and coordination
•
Working of final settlement cell
No change was made in this because they were the positive image which did not require any type of changes.
plant problem, subordinate oriented approach and lack of coordination with departments isolated, this shows the
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18
The negotiations were conducted on acceptance of each
•
The personnel guess of image by finance in
other expectations. In second round of role negotiation
empathy building was blaming personnel
one team consolidated and integrated the points on which
department for all the problem.
there was unanimous agreement and which could be
•
Projecting good image at the cost of other
implemented without any external help with both the
•
Inconsistency in application of rules
group. The group agreed to implement the final contract
•
Lacking in human touch
and consolidated points which were not within their
•
Less accessible because of distance location
competence and needed the approval and support of the
•
Low initiative on communication with employees
top management.
and other department.
•
Payment of medical advances
•
Lack of problem solving approach
•
Final settlement through signal window clearance
•
Inefficient
system
•
More centralized functioning
•
Decentralization of the pay account section
•
No involvement in plant problem
•
Decentralization of the OD section
•
Lack of co-ordination with the department,
The recommendation was discussed with the top management regarding all points and the
isolated. •
recommendation was approved. The top team gave their
Time for giving pay clearance in final settlement cases
full support in the implementation of the
•
Insisting on individual order
recommendation. The task force was constituted with five
•
Arising for pay slips in support of claims
•
Discrimination in making payment
•
Late arrival of the payment staff at payment
executes to ensure implementing within 15 days and decided to review the implementation after 2 months. PROBLEMS Some of the problems arise in the role negotiation at Bokaro steel plants are as follows: •
The 32 persons participated in the role negotiation, they had to work 11 hours, spread over 2 days for obtaining the objectives.
•
Image generated through empathy building exercise was poor record keeping.
•
The personnel guess of image by finance through empathy building exercise was wrong pay fixation with subsequent corrigendum.
•
There was problem solving attitude
•
Partiality was done in payment
•
Shifting of blame in the field of finance
•
No one accepts their mistake, everyone blames each other for all the problems that had or will
counters •
Raising superficial objection regarding eligibility for payment in compensation cases.
•
Delay in enquiry proceedings regarding suspended employees from their payment.
•
Delay in replying representation
•
Delay in sending DA rate orders
•
Sending incomplete claims files for PF/gratuity payment
•
Delay in processing cases for final settlement
•
No availability of sufficient copies for ensuring prompt action EFFORTS
The efforts done by the executives from different departments are as follows:
arise.
Prof. Amit Kumar
[email protected] FIT Group of Institutions
19
•
•
They put efforts in giving the employees error
They insisted to help the top management to
free service
implement the points as the points were not
•
They tried to eliminate hardships
within their competence and needed the approval
•
Treating employees as human beings
and support of the top management.
•
Image building of department
•
They tried to improve in the service rendered by
•
those points •
them to employees •
The final contracts was done and asked to accept
The recommendation was derived after long
They exchanged their Image and seek
discussion and was asked to accept to top
clarification.
management •
The rules and procedures was agreed to simplify
•
Empathy building
•
Discussion done in home group
and reduced delay and hardship to the
•
Signing of agreement and preparation for
employees.
dialogue. SUGGESTION
•
Working continuously for 2 days(11 hours).
•
Sharing pleasant and unpleasant experiences with
Some of the steps to be taken to reduce these problem
each others to know their strength and weakness.
like:
Trying to find out the individual perception about
•
Improve the record keeping style
their department.
•
Good team work to be formed among employees
•
More involvement in production.
•
Problem solving attitude should not be shown
•
Trying to make their home group role eefective
•
Wrong pay fixation with subsequent corrigendum
•
Preparing list for the reduction of negative image
•
and developing/increasing positive image. •
should be reduced •
and reduced immediately
Started reducing negative images like:
Partiality done with employees should be stopped
Time for giving pay clearance in final
•
Avoid shifting of blames on others.
settlement cases.
•
Stop blaming others for all problem instead of
Insisting on individual orders
Asking for pay slips in support of claims.
Discrimination in making payments
Late arrivals of the payment staff at
looking for the solution. •
Giving reward to one who has worked hard and deserves the reward
•
Giving more time to employees, spending more time with them.
payment counters
Delay in replying representations
•
Should be always ready with the solution
Delay in sending da rate orders.
•
Both centralized and decentralized functioning
Sending incomplete claims files for PF/gratuity payments.
Delay in processing cases for final
should be done •
Coordination should be made with every department.
settlement. •
Implementation was done for the unanimous agreement without any external help
Prof. Amit Kumar
[email protected] FIT Group of Institutions
20
UNIT III INTERNATIONAL AND CROSS-CULTURAL NEGOTIATION
For many people and organization, international negotiation has become a norm rather than an exotic activity that only occasionally occurs. In the last 20 years, the frequency of international negotiation has increased rapidly bolstering the interests in international communication. However, there has been numerous inputs, from both academic and practitioner perspectives about the complexities of negotiation across borders, be it with a person from different country, culture, or region. Although the term culture has many possible definitions, we will use it to refer to the shared values and beliefs of a group of people. Country can have more than one culture, and culture can span national borders. As we have examined earlier, negotiation is a social process that is embedded in a much lager context. This context increases in complexity when more than one culture or country is involved, making international negotiation a highly complicated process. Phatak and Habib suggest that two overall contexts have an influence on international negotiations: THE ENVIRONMENT CONTEXTS: Salacuse identified six factors in the environmental context that make international negotiations more challenging than domestic negotiations: and these include the following; Political and legal pluralism. International economics. Foreign government and bureaucracies. Instability. Ideology. Culture. Phatak and Habib have suggested additional factor which is: External stakeholders. IMMEDIATE COTEXTS: At many points in our discussions, we have discussed aspects of negotiation that relate to immediate contexts factors, but without considering their international implications, at this junction we will list the concepts from the Phatak and Habib model of international negotiation. And the immediate contexts are: Relative bargaining power. Level of conflict. Relationship between negotiators. Desire outcomes. Immediate stakeholders. CONCEPTUALIZING CULTURE AND NEGOTIATION.
Prof. Amit Kumar
[email protected] FIT Group of Institutions
The most frequently studied aspect of international negotiation is culture and the amount of research on the effects of culture n negotiation has increased substantially in the last 20 years. There are many different meanings of the concept of culture, but all definition share two aspects. First, culture is a group-level phenomenon. That means that a defined group of people shares beliefs, values, and behavioural expectations. The second common element of culture is that cultural beliefs, values, and behavioural expectations are learned and passed on to new members of the group. It is also important to remember that negotiation outcomes, both domestically and internationally, are determined by several different factors. While cultural differences are clearly important, negotiators must guard against assigning too much responsibility to cultural factors. Dialdin, Brett, Okumura, and Lytle have labelled the tendency to overlook the importance of the situational factors in favour of cultural explanations the cultural attribution error. It is important to recognize that even though culture describes group-level characteristics, it doesn’t mean that every member of a culture will share those characteristics equally. In fact, there is likely to be a wide of a variety of behavioural differences within cultures as there is between cultures. Although knowledge of the other party’s culture may provide an initial clue about what to expect at the bargaining table, negotiators need to be open to adjusting their view very quickly as new information is gathered. The two important ways that culture has been conceptualized are: Culture as shared value And, culture as dialectic. THE INFLUENCE OF CULTURE ON NEGOTIATION: Managerial perspectives Cultural differences have been suggested to influence negotiation in several ways. Now let’s examine different ways that culture can influence negotiation. Definition of negotiation: the fundamental definition of negotiation, what is negotiable, and what occurs when we negotiate can differ greatly across cultures.(i.e.) American way and the Japanese ways of viewing negotiations. Negotiation opportunity: culture influences the way negotiators perceive an opportunity as distributive versus integrative. Negotiators in North America are predisposed to perceive negotiation as being fundamentally distributive. But this is not the case outside North America. Selection of negotiators: The criterion used to select who will participate in a negotiation is different across cultures. These criteria can include such subject matter as age, seniority, gender, status, etc. Protocol: cultures differ in the degree to which protocol, or the formality of the relations between the two negotiating parties, is important. Communication: cultures influence how people
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communicate; both verbally and nonverbally. There are also differences in body language across cultures. Time sensitivity: cultures largely determine what time means and how it affects negotiations. For example, comparing North American time consciousness with that of China or Latin Americans. Risk propensity: Cultures vary in the extent to which they are willing to take risks. Some cultures tend to produce bureaucratic, conservative decision makers who want a great deal of information before making decisions. Groups versus individuals: cultures differ according to whether they emphasize the individual or the group.eg the United State is very much an individual-oriented culture. Nature of agreements: culture also has an important effect both on concluding agreements and on what form the negotiated agreement takes. Emotionalism: culture appears to influence the extent to which negotiators display emotions. These emotions may be use as tactics, or may be a natural response to positive and negative circumstances during negotiation.
Adapt to the other negotiator’s approach (unilateral strategy) Coordinate adjustment (joint strategy) HIGH FAMILIARITY: Embrace the other negotiator’s approach (unilateral strategy) Improvise an approach (joint strategy) Effect symphony (joint strategy) Lastly, there has been considerate research on the effects of culture on negotiation in the last decade. Findings suggest that culture has important effects on several aspects of negotiations, including planning, the negotiation process, information exchange, negotiation cognition, and negotiator perception of ethical Behaviour.
THEN INFLUENCE OF CULTURE ON NEGOTIATION: Research perspectives A conceptual model of where culture may influence negotiation has been developed by different scholars, for example Jeanne Brett, suggested that culture will influence, setting of priorities, and strategies, the identification of the potential for integrative agreement, and the pattern of interaction between negotiators. Researchers also explore how intracultural and cross cultural factors will influence the outcome of an agreement. It has also been suggested that overall negotiation process and outcome will be influenced by cultures. CULTURALLY RESPONSIVE NEGOTIATING STRATEGIES Stephen Weiss has proposed a useful way of thinking about the options we have when negotiating with someone from another culture. Weiss observes that negotiators may choose from among up to eight different culturally responsive strategies. These strategies may be used individually or sequentially, and the strategies can be switched as the negotiation progresses. Weiss’s culturally responsive strategies can be arranged into three groups, based on the level of familiarity (.low, moderate, high): LOW FAMLIARITY: Employ agents or advisers (unilateral strategy) Bring in a mediator (joint strategy) Induce the other negotiator to use your approach (joint strategy) MODERATE FAMILIARITY:
Prof. Amit Kumar
[email protected] FIT Group of Institutions
UNIT IV COUNSELLING In general the counseling is to help individuals to overcome many of their problems. It involves two factors. TERMS INVOLVED IN COUNSELING 1. Counselor 2. counselee DEFINITION Acc.to Smith(1955): A process in which the counselor assists the counselee to make the interpretations of facts related to choice, plan or adjustments which he need to make. Acc.to Perez(1965): The counseling is an interactive process conjoining the counselor who needs assistance and the counselor who is trained and educated to give the assistance. FACTORS CONTRIBUTING TO THE EMERGENCE OF COUNSELING 1. Technological factors 2. Psychological factors 3. Educational factors 4. Human factors TECHNOLOGICAL FACTORS Technological changes have made a major impact upon the people’s lives and work. Because of the rapid change in the technology the need of counseling arises and it comes into existence. PSYCHOLOGICAL FACTORS The growth of counseling is also because of Psychological factors. As a part of broader field of psychology the counseling is being introduced for the development into it.
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EDUCATIONAL FACTORS Modern counseling is a product of education system especially American education system. It has deep roots in the concern for an individual’s freedom, rights, and dignity. The development of counseling can best be appreciated by analyzing the various issues that affected and influence its development. HUMAN FACTORS There are several mutually opposed conceptions of the basic human nature. Is human nature either evil, or good, or neutral? This factor of human nature also helps in the emergence of the counseling. GROWTH OF COUNSELING The growth of counseling is divided into four phases. They are: 1. 1850-1900 2. 1900-1930 3. 1930-1940 4. Second world war and after 1850-1900 Under this period the innovations in the field of psychology were made. under this period the the first psychological laboratory was founded at Leipzig by Wilhelm Wundt in 1879. However, it was Jesse b. Davis who first used the term “counseling” in this period. 1900-1930 During the first few years of the twentieth century several significant events took place. These movements boosted efforts to develop knowledge and services in order to assist the individuals. Unfortunately there is a wrong impression that counseling is a poor man’s psychotherapy. All these factors helps in the emergence of the counseling. 1930-1940 Under this era the workers needs the guidance for suitable tools and techniques to understand the concept of counseling. There were very few Psychological tests available and few persons were trained to use them at that time. SECOND WORLD WAR AND AFTER In this era a book was published as “counseling and psychotherapy” by “Carl Rogers” in 1942. Before this there was a hesitation regarding the acceptability of counseling as a form of psychotherapy. In this era counseling obtained the recognition by the American Psychological association(APA). The APA accepted the recommendation of meeting and designated counseling psychology as its seventeenth division.
Prof. Amit Kumar
[email protected] FIT Group of Institutions
LASTLY Over the past five decades counselors have gained overwhelming acceptance from society. A large number of sub-specialities have developed to serve in setting such as schools, mental health clinics, rehabilitation centers, colleges. APPROACHES OF COUNSELING 1. Psychoanalytic approach 2. Bahaviouristic approach 3. Humanistic approach PSYCHOANALYTIC APPROACH Psychoanalysis was originated by SIGMUND FREUD, who developed his theory from his past experiences as a therapist and wrote about his work. In this the client is ignorant And unaware of the reasons for his difficulties or suffering which are deeply embedded in the unconscious. The client is therefore helpless and it is the therapist who has to play the role of interpreting the material. This principle is known as psychological determinism. BEHAVIOURISTIC APPROACH Counseling and psychotherapy are concerned with behavior change. learning here is understood as changes in the behavior which are relatively long-lasting and which are not due to the psychological factors like fatigue etc. one such application is in the form of Bahaviouristic approach. Its purpose is to change the ineffective and self defeating behavior into the effective and self winning behavior.
HUMANISTIC APPROACH The practical application of the humanistic Psychology made a great impact on the academic scene. According to ROGERS in any kind of psychotherapy the basic theme is the helping relationship. In all human Interactions such as mother-child, teacher-pupil, therapist-client The helping relationship is fundamental. This relationship is one in which the counselor seeks to bring about a better expression of the client’s inner resources. Thus the helping relationship helps in the growth of person.
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