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Negotiation “A discussion between two or more disputants who are trying to work out a solution to their problem. ”

Competitive Cooperative Issues Interests Positions McGraw-Hill/Irwin©2006 The McGraw-Hill Companies, Inc. All rights reserved. Negotiation

“A discussion between two or more disputants who are trying to work out a solution to their problem. ” Positional bargaining - Competitive Interest-based (Integrative) bargaining – Cooperative Integrative bargaining – Creating Value Distributive bargaining – Claiming Value

Negotiation - Planning Frame the problem (conceptions that parties have of the situation and its risks) Determine and assemble goals; negotiation procedures Prioritize goals and evaluate trade-offs Sequencing of issues for discussion Define specific targets Anticipate different ways of packaging issues Develop supporting arguments Assessing other party’s priorities and interests

Negotiation – Power to Influence Good alternative Knowledge of people, positions, and facts Selection and presentation of facts Message consistent with opponent’s values Invent a good solution to the problem

Negotiation – Barriers BATNA (Best Alterative to a Negotiated Agreement) ZOPA (Zone of Possible Agreement) Compromise is the name of the game Dilemma of Honesty Perceptual Bias Hostility

Pre-negotiation – preparation is tantamount to any successful activity and negotiation is no different. 1. Agenda 2. Rapport Negotiation – Phases

Pre-negotiation – preparation is tantamount to any successful activity and negotiation is no different. Conceptualization – developing the foundation by framing the issues. 1. Principles 2. Concessions Negotiation – Phases

Pre-negotiation – preparation is tantamount to any successful activity and negotiation is no different. Conceptualization – developing the foundation by framing the issues. Setting the details Negotiation – Phases

Pre-negotiation – preparation is tantamount to any successful activity and negotiation is no different. Conceptualization – developing the foundation by framing the issues. Setting the details Follow-up Counterparts Negotiation – Phases

Integrative Bargaining “A negotiation strategy in which parties collaborate to find a win-win solution to their dispute. ” Aim is to develop mutually beneficial agreements based on the interests of the disputants.

Positional Disputants are adversaries Goal is victory Demand concessions Disputants are joint problem-solvers Goal is wise decision Work together to determine who gets what Integrative McGraw-Hill/Irwin Positional vs. Integrative Bargaining Dig into position Focus on interests, not positions

Positional Mislead, use tricks Insist on your position Apply pressure Be open about interests, use fair principles Insist on objective criteria; consider multiple answers Use reason; yield to principle, not pressure Integrative McGraw-Hill/Irwin Positional vs. Integrative Bargaining Look for win for you alone Look for win-win opportunities

Integrative Bargaining Steps Identifying interests Identifying perceptions Identifying potential consequences Identifying multiple interests Creating options

Integrative Bargaining Basics Multiple issues Sharing Problem-solving Bridge Building

Distributive Bargaining “A competitive negotiation strategy that is used to decide how to distribute a fixed resource, such as money. ” Integrative bargaining enlarges the pie; distributive bargaining divides and distributes the pie.

Distributive Bargaining Basics Give little or no information Try to pry as much information from the other side Only reveal alternative options Let them make the first offer Be realistic

A branch of philosophy dealing with what is good and bad and with moral duty and obligation. The principles of moral conduct governing an individual or group. Ethics refers to right and wrong conduct of individuals and institutions of which they are a part. What is Ethics?

Comprises moral principles and standards that guide behavior in the world of business. –Businesses must make a profit in order to survive. –Business profits should not be obtained by any means necessary. A trade-off must exist between the firm’s desire for profits and what is good for individuals and society. What is Business Ethics?

What is Ethics? “…that behavior which is the ‘right’ thing to do, given the circumstances” Four principles: Honesty Integrity Fairness Concern for others

Theory in Ethics Teleology Consequentialism Egoism Utilitarianism Deontology Relativism

Act is morally acceptable if it produces some desired result. Form of consequentialism--morality of decisions are based on their consequences. Methods for Ethical Decision Making Teleology

Egoism--acts that benefit the individual’s self- interest. Utilitarianism--acts that maximize total utility--the greatest good for the greatest number of people. Methods for Ethical Decision Making Teleology

The inherent rightness or wrongness of an act guides behavior, regardless of the outcome. Believes that there are some things people should never do. Methods for Ethical Decision Making Deontology

The correctness of decisions is thought to change over time. Uses others to judge the ethicality of decisions. Methods for Ethical Decision Making Relativism

Five Common Ethical Traps The False-Necessity Trap The Doctrine-of-Relative-Filth Trap The Rationalization Trap The Self-Deception Trap The Ends-Justify-the-Means Trap

Tools for Doing the Right Thing Is the action you are considering legal? How would you see the problem if you were on the opposite side? What are alternate solutions? Can you discuss the problem with someone whose advice you trust? How would you feel if your family, friends, employer, or coworkers learned of your actions?