Use Negotiation to Manage Conflict. Win-Win Tactics (integrative bargaining). Integrative vs. Distributive Negotiation. Pemberton Payoff Matrix. Country Market. Close Sunday. Open Sunday. -40,000. +20,000. Corner. Corner. Close Sunday. Country. +20,000. Country. +40,000. Corner
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Use Negotiation to Manage Conflict • Win-Win Tactics(integrative bargaining)
Pemberton Payoff Matrix Country Market Close Sunday Open Sunday -40,000 +20,000 Corner Corner Close Sunday Country +20,000 Country +40,000 Corner Store Corner +40,000 Corner -20,000 Open Sunday -40,000 Country Country -20,000 **THE GOAL IS TO MAXIMIZE PROFITS OVER THE NEXT 12-WEEK PERIOD
Win-Win vs. Win-Lose Process • Cooperative gains exceed competitive gains • Win-Win Settles More Quickly • Win-Win Is Friendlier • Win-Win Shares Information Earlier • Win-Win Uses More Positive Body Language • Win-Win Is Quieter, Less Confrontational • Win-Win increases credibility and trust
Key Stages in Win-Win Process • Identify and define the problem • Separate the people from the problem • Understand the problem fully--identify interests and needs • Focus on interests, not positions • Generate multiple alternative solutions • Consider BATNA • Evaluate and select alternatives • Use objective standards for evaluation
Interests: People want? ID Relevant parties, clarify interests, probe for underlying interests YOUR interests and theirs Options Options to meet interests, Maximize joint gain Alternatives (BATNA) My alternate, select and improve, Their alternates, Their BATNA Legitimacy External standards, Fairness of process, Attractive explanation Communication My assumptions, Reframe to help them understand Relationship Separate people/problem, Build good relationship Commitment ID issues to be included, plan steps to agreement Negotiation Preparation
Focus on Interests, not Positions • Some distinctions: • Issue: Topic of negotiation. • Position: One party’s solution to an issue. • Interest: One party’s concern about an issue. • For a wise solution • Reconcile interests, not positions. • How do you identify interests? • Ask! • Talk about interests • Mutual, conflicting, unmatched.
Invent Options for Mutual Gain • Separate inventing from deciding • Brainstorm, nominal groups, surveys • Broaden your options • Expand the pie (more for everyone) • Log-roll (tradeoff where your desires differ) • Use nonspecific compensation • Cut costs for compliance • Bridge solution • Look for mutual gain • Make their decision easy
Look for ways to work together to make more Similar skills and resources: Economies of scale, cheaper to produce for two, combine purchase power for better discount Different skills and resources Create what neither of you can on own. Options for joint benefit Rather than separate or independent benefit, joint sponsorship Value in differences Risk: some like, others hate. One side more easily bear or insure against Timing: different clocks, what is impossible this month is ok next, or unaffordable next year is ok this. Perceptions: what others think. Third parties, public victory if needed, other get something they really want. Marginal value: have some, want less, so trade. Options
1. Create options to meet interests Your interests Their interests Possible options 2. Find ways to maximize joint gains Inventory of skills and resources: me and them Combine similar resources to produce value Combine different resources to produce value Options Forms
1. Think of my alternatives to a negotiated agreement My key interests What could I do to satisfy my interests if we do not reach an agreement? Alternatives, Pros, Cons 2. Select and improve my BATNA Really? Do to improve BATNA 3. Identify alternatives open to the other side Their key interests What could they do to satisfy their interests if we do not reach agreement? Alternatives, pros, cons 4. Estimate their BATNA What would I do in their shoes? How legitimately make their BATNA less attractive? Harder to pursue? Influencing perceptions of unwise or costly? Alternatives Forms
Legitimacy • External (Objective) standards • Fairness of process • Attractive explanation
Insist on Using Objective Criteria • Deciding on the basis of will is costly • The case focusing objective criteria • Developing objective criteria • Negotiating with objective criteria • It’s company policy
BATNA • Brainstorm options • Improve on options • Select the best • Improve it again • Select a tripwire • Their BATNA ? • Diminish in negotiation?
Separate thePeople from the Problem • Negotiators are people first • Two kinds of interests: Substance, Relationship • Separate the relationship from the substance; deal directly with the people problem • Perception • Emotion • Communication • Prevention
1. Question my assumptions and identify things to listen for Intentions and perceptions Phrases that question assumptions. 2. Reframe to help them understand Your perspective How might they hear it? Reframing Communication Forms
1. Separate people issues from substantive issues Describe your relationship Substantive issues and problems Substantive options and remedies Relationship issues and problems Ways to improve relationship 2. Prepare to build a good working relationship What might be wrong now? Cause? Lack of trust? Feel coerced? Disrespected? Get upset? What can I do? Understand them Demonstrate reliability Focus on persuasion Show acceptance and respect Balance emotion and reason Relationship Forms
1. Identify the issues to be included in the agreement Overall purpose of negotiation Expected product Specific purpose of next meeting Tangible product of next meeting Plan the steps to agreement Decision makers: names of those who will sign Implementation: Info agreement should include about what happens next Steps to get binding agreement Commitment Forms