1. Perception, Cognition, and Emotion
CHAPTER FIVE
Perception, Cognition, and Emotion
INB 350 Lecture
By: Ms. Adina Malik (ALK)

2. Learning Objectives Perception The process of cognition
How is it related to negotiation
Forms of perception disorder
The process of cognition
To make decisions about tactics and strategy
Framing
Cognitive biases or systematic errors
The role of moods and emotions
For causes of behavior
For consequences of outcome

3. Perception, Cognition, and Emotion in Negotiation
The basic building blocks of all social encounters are:
Perception
Cognition
Framing
Cognitive biases
Emotion

4. Perception Perception is:
The process by which individuals connect to their environment.
A “sense-making” process
A complex physical and psychological process
It is defined as ‘the process of screening, selecting and interpreting stimuli so that they have meaning to the individual’ (Steers,1084).
Negotiators approach each situation guided by their perceptions of past situations and current behaviors and attitudes.
Their expectations of the future behaviors of other parties and subsequent outcomes are based largely on information gained through direct experience or observations.
People interpret their environment so that they can respond appropriately.
Environments are typically complex. This complexity makes it impossible to process all the available information, so perception becomes selective, tuning in on some stimuli while tuning out others.
Stimuli: something that causes physiological and psychological response.
Physiology: function of living organism

5. The Role of Perception
The process of ascribing meaning to messages and events is strongly influenced by the perceiver’s current state of mind, role, and comprehension of earlier communications
People interpret their environment in order to respond appropriately
The complexity of environments makes it impossible to process all of the information
People develop shortcuts to process information and these shortcuts create perceptual errors

6. Perceptual Distortion
Four major perceptual errors:
Stereotyping
Halo effects
Selective perception
Projection
Distortion by Generalization
Distortion based on Attributes
In any given negotiation, the perceiver’s own needs, desires, motivations, and personal experiences may create a predisposition about the other party. This is a cause of concern when it leads to biases and errors in perception and subsequent communication.
Perception distortion by generalization: small amounts of perceptual information are used to draw large conclusions about individuals.
Distortion based on attributes: form of distortion that involves anticipating certain attributes and qualities in another person.
Perceptual distortions are in sense ‘shortcuts’ that individuals use to make sense of very complex environments and situations. Unfortunately these shortcuts come with significant costs-perceptual errors, which typically occur without people being aware that they are happening and which have unfortunate consequences.
If initial assumptions are incorrect, then negotiators may not be able to reverse their effects; by the time negotiators are in a position to judge the predisposition of the other party accurately, the other party may have interpreted the initial competitive mood and defensive posture of the negotiator as offensive and antagonistic.

7. Stereotyping Is a very common distortion
Occurs when an individual assigns attributes to another solely on the basis of the other’s membership in a particular social or demographic category
For e.g.: ‘Old people are conservative; this person is old and therefore is conservative.’
Stereotypes are formed about a wide variety of different groups, for example, younger generation, males or females, Italians or Germans, or people of different races, religions or sexual orientations. People assign an individual to a group based on one piece of perceptual information (e.g. whether the individual is old or young). Then they assign a broad range of characteristics of that group to this individual.
For e.g.: ‘Young people are disrespectful; this person is young and therefore is disrespectful’. There is no factual basis for such conclusion.

8. Halo Effects Are similar to stereotypes
Occur when an individual generalizes about a variety of attributes based on the knowledge of one attribute of an individual
For e.g.: A smiling person is judged to be more honest than a frowning person, even though there is no consistent relationship between smiling and honesty.
It can be positive or negative
It can be positive or negative a good attribute may be generalized so that people are seen in a positive light, while a negative attribute may have a reverse effect.

9. Selective Perception
The perceiver singles out information that supports a prior belief but filters out contrary information
Perpetuates stereotypes or halo effects
For e.g.: Smile as honest or dishonest are likely to affect how the other party’s behavior is perceived or interpreted.
Selective Perception:
It occurs when a perceiver singles out certain information that supports or reinforces a prior belief and filters out information that does not confirm that belief.
Perpetuate: after forming quick judgments about individuals on the basis of limited information, people may then filter out further evidence that might disconfirm the judgment.
For e.g.: the predisposition to view the smile as honest or dishonest are likely to affect how the other party’s behavior is perceived or interpreted.

10. Projection Arises out of a need to protect one’s own self-concept
People assign to others the characteristics or feelings that they possess themselves (position reversed)
For e.g. frustration
Projection:
Self-concept: to see myself as consistent and good.
Negotiators may assume that the other party would respond in the same manner they would if positions were reversed.
For e.g.: if a negotiator feels that he would be frustrated if he were in the other party’s position, then he is likely to perceive that the other party is frustrated

11. Framing
Framing:
The strategic use of information to define and articulate a negotiating issue or situation
Represent the subjective mechanism through which people evaluate and make sense out of situations
Lead people to pursue or avoid subsequent actions
Helps to focus, shape and organize the world around us
Make sense of complex realities
Define a person, event or process
Impart meaning and significance
A key issue in perception and negotiation is framing.
It is about making sense of a complex reality and defining it in terms that are meaningful to us.
Frames ‘impart meaning and significance to elements within the frame and set them apart from what is outside the frame’.

12. Framing Importance of Framing:
How negotiation issues are framed has a strong link with:
What parties define as central are critical to negotiating objectives
Expectations and preferences for certain outcomes
What types of information they seek to strengthen the case
The procedure they meant to follow, and
Manner in which they evaluate the outcomes actually achieved.

13. Types of Frames
The following examples of frames are used by parties in disputes:
Substantive: core conflict issue (key issue/ concern in the conflict)
Outcome: inclination towards specific outcome or result
Aspiration: inclination towards fulfilling broader set of interest or needs
Process: how the parties will go about resolving their dispute
Identity: how the parties are define and distinguishing themselves from others
Characterization: how the parties are defining their opponents
Loss-Gain: how the parties define the risk or reward associated with particular outcomes
Substantive: what the conflict is about.
Outcome: to the degree that a negotiator has a specific, preferred outcome he or she wants to achieve, the dominant frame may be to focus all strategy, tactics and communication toward getting that outcome. Parties who have a strong outcome frame are more likely to engage in distributive negotiation (win-lose or lose-lose) than in other types of negotiations.
Aspiration: rather than focusing on a specific outcome, the negotiator tries to ensure that his or her needs, basic interests and concerns are met. Parties who have a strong aspiration frame are more likely to engage in integrative negotiation (win-win) than in other types of negotiations.
Process: negotiators who have a strong process frame are less likely than others to be concerned about the specific negotiation issues, but more concerned about how the dispute should be managed.
Identity: how the parties define ‘who they are’. Parties are members of a number of different social groups-gender (male), religion (Roman Catholic), ethnic origin (Italian), place of birth (Dhaka), current place of residence (London), etc.
Characterization: a characterization frame can clearly be shaped by experience with the other party, by information about the other party’s history or reputation, or the way the other party comes across early in the negotiation experience.
Loss-gain: for example a buyer in a sales negotiation can view the transaction in loss terms (monetary cost of purchase) or gain terms (the value of the item).

14. How Frames Work in Negotiation
Negotiators can use more than one frame
Mismatches in frames between parties are sources of conflict
Particular types of frames may lead to particular types of arguments
Specific frames may be likely to be used with certain types of issues
Parties are likely to assume a particular frame because of various factors
It is difficult to know what frame a party is using unless that party tells you or unless you make inferences from the party’s behavior. Even then, such inferences and interpretations may be difficult and error-laden. Also, the frames of those who hear or interpret communication may create biases of their own.
A land developer discussing a conflict over a proposed golf course that will fill in a wetland can speak about the golf course (the substantive frame), his preferences about how the land should be filled in (an outcome frame), and how much input neighborhood and environmental groups should be able to have in determining what happens to that wetland on his private property ( a procedural frame), whether he views these groups favorably or unfavorably ( a characterization frame).
Two negotiators may be speaking to each other from different frames (for e.g. one has an outcome frame while another has a procedural frame); using different content in the same frame (e.g. both have procedural frames, but strong preferences for different procedures), or using different levels of abstraction (e.g. a broad aspiration frame versus a specific outcome frame). Such mistakes cause ambiguity and conflict, which may create misunderstanding, leading to conflict escalation. Both parties may be required to ‘reframe’ the conflict into frames that are more compatible and that may lead to resolution. For highly polarized disputes, mutual framing may not occur without the help of a third party.
For e.g.-parties who achieve integrative agreements may be likely to use aspiration frames and may discuss a large number of issues during their deliberations; while, parties who use outcome or negative characterization frames-negative view of the other party -> strong preference for specific outcome-> increased conflict with the other.
Parties discussing salary may be likely to use outcome frames, while parties discussing relationship issues may be likely to use characterization frames.
Value differences between the parties, differences in personality, power, background and social context of the negotiators may lead the parties to adopt different frames.

15. Interests, Rights, and Power
Parties in conflict use one of three frames:
Interests: people talk about their “positions” but often what is at stake is their underlying interests.
Rights: people may be concerned about who is “right” – that is, who has legitimacy, who is correct, and what is fair
Power: people may wish to resolve a conflict on the basis of who is stronger
Interests: people are often concerned about what they need, desire or want. A person says he ‘needs’ a new cell phone with camera, but what he really wants is a new electronic toy because all his friends have one.

16. The Frame of an Issue Changes as the Negotiation Evolves
The frame of an issue in negotiating can change as the discussion evolves. Dispute tend to be transformed through a process of-
‘naming, blaming, and claiming’
Naming: when parties label or identify a problem and characterize what it is about
Blaming: parties try to determine who or what caused the problem
Claiming: taking actions
It is important to consider patterns of change (transformation) that occur as parties communicate with each other.

17. The Frame of an Issue Changes as the Negotiation Evolves
Negotiators tend to argue for stock issues or concerns that are raised every time the parties negotiate
Each party attempts to make the best possible case for his or her preferred position or perspective
Frames may define major shifts and transitions in a complex overall negotiation
Multiple agenda items operate to shape issue development
Wage issues or working conditions may always be discussed in a labor negotiation; the union always raises them, the management expects them to be raised and is ready to respond.
One party may assemble facts, numbers, testimony, or other compelling evidence to persuade the other party of the validity of his or her argument or perspective.

18. Cognitive Biases in Negotiation
Negotiators have a tendency to make systematic errors when they process information. These errors, collectively labeled cognitive biases, tend to impede negotiator performance.
Cognitive Biases:
Irrational escalation of commitment
Mythical fixed-pie beliefs
Anchoring and adjustment
Issue framing and risk
Availability of information
The winner’s curse
Overconfidence
The law of small numbers
Self-serving biases
Endowment effect
Ignoring others’ cognitions
Reactive devaluation

19. Irrational Escalation of Commitment and Mythical Fixed-Pie Beliefs
Negotiators maintain commitment to a course of action even when that commitment constitutes irrational behavior
To avoid it parties should involve advisor who will work as a reality check point
Mythical fixed-pie beliefs
Negotiators assume that all negotiations (not just some) involve a fixed pie
To avoid it parties should introduce accountability in the negotiation context

20. Anchoring and Adjustment and Issue Framing and Risk
The effect of the standard (anchor) against which subsequent adjustments (gains or losses) are measured
The anchor might be based on faulty or incomplete information, thus be misleading
Thorough preparation, along with reality check can help to avoid it
Issue framing and risk
Frames can lead people to seek, avoid, or be neutral about risk in decision making and negotiation

21. Availability of Information and the Winner’s Curse
Operates when information that is presented in vivid or attention-getting ways becomes easy to recall.
Becomes central and critical in evaluating events and options
The winner’s curse
The tendency to settle quickly on an item and then subsequently feel discomfort about a win that comes too easily
The best remedy for winner’s curse is to prevent it from occurring

22. Overconfidence and The Law of Small Numbers
The tendency of negotiators to believe that their ability to be correct or accurate is greater than is actually true
The law of small numbers
The tendency of people to draw conclusions from small sample sizes
The smaller sample, the greater the possibility that past lessons will be erroneously used to infer what will happen in the future

23. Self-Serving Biases and Endowment Effect
People often explain another person’s behavior by making attributions, either to the person or to the situation
The tendency, known as fundamental attribution error, is to:
Overestimate the role of personal or internal factors
Underestimate the role of situational or external factors
Endowment effect
The tendency to overvalue something you own or believe you possess

24. Ignoring Others’ Cognitions and Reactive Devaluation
Negotiators don’t bother to ask about the other party’s perceptions and thoughts
This leaves them to work with incomplete information, and thus produces faulty results
Reactive devaluation
The process of devaluing the other party’s concessions simply because the other party made them

25. Managing Misperceptions and Cognitive Biases in Negotiation
The best advice that negotiators can follow is:
Be aware of the negative aspects of these biases
Discuss them in a structured manner within the team and with counterparts
According to Arunachalam & Dilla
negotiators in structured communication condition negotiated higher profit outcomes and made fewer fixed pie errors.
Negotiators in the face-to-face condition negotiated higher profits.

26. Reframing
During negotiation it might become necessary for the negotiators
to reframe the negotiation systematically,
to assist other party in reframing, or
to establish common frame,
especially then when both the parties apply different frame or their frame mismatches.
Reframing facilities the whole negotiation process.

27. Mood, Emotion, and Negotiation
The distinction between mood and emotion is based on three characteristics:
Specificity
Intensity
Duration

28. Mood, Emotion, and Negotiation
Negotiations create both positive and negative emotions
Positive emotions generally have positive consequences for negotiations
They are more likely to lead the parties toward more integrative processes
They also create a positive attitude toward the other side
They promote persistence
Aspects of the negotiation process can lead to positive emotions
Positive feelings result from fair procedures during negotiation
Positive feelings result from favorable social comparison

29. Mood, Emotion, and Negotiation
Negative emotions generally have negative consequences for negotiations
They may lead parties to define the situation as competitive or distributive
They may undermine a negotiator’s ability to analyze the situation accurately, which adversely affects individual outcomes
They may lead parties to escalate the conflict
They may lead parties to retaliate and may thwart integrative outcomes

30. Mood, Emotion, and Negotiation
Aspects of the negotiation process can lead to negative emotions
Negative emotions may result from a competitive mindset
Negative emotions may result from an impasse
Effects of positive and negative emotion
Positive emotions may generate negative outcomes
Negative feelings may elicit beneficial outcomes
Emotions can be used strategically as negotiation gambits