11.Negotiation - Negotiation MGT 315 Scott Class Agenda l...

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Negotiation MGT 315 Scott
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Class Agenda l Preparing for a Negotiation l Distributive Bargaining l Integrative Bargaining
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Organizing Model
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Introduction What is Negotiation? l Negotiation is something that everyone does, almost daily Negotiation is a “discussion between two or more parties with the apparent aim of resolving divergent interests” l Negotiation examples Friends Colleagues/classmates/coworkers Significant others
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Introduction Characteristics Common to All Negotiation Situations l There are two or more parties l There is a conflict of interest l Parties negotiate because they think they can get a better deal than by taking what the other side will give them l Parties prefer to search for agreement over: - Fight openly - Break off contact - Capitulate - Take dispute to a 3rd party
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Introduction The “Major Sins” of Negotiation l Leaving money on the table ( “lose-lose” negotiation ) l Settling for too little ( winner’s curse ) l Walking away from the table l Settling for terms worse than your alternative ( agreement bias )
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Preparation: Bargaining Zone Example Employer’s aspiration range Your aspiration range $50,000 $45,000 $40,000 $30,000 Settlement Range reservation point reservation point target point target point
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Preparation: BATNA (B est A lternative T o N egotiated A greement) l Distinguish reservation point (indifference point) from target point (aspiration level) l BATNA should equal reservation point You generally should not accept an over lower than your BATNA
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Preparation: Fixed Pie Perceptions l Assuming your interests and other party’s interests are opposed 80% of negotiators have this perception Leads to information availability errors (Pinkley, l More prevalent in individualist cultures like U.S. due to focus on self (vs. other) interests (Gelfand & Christakopulou, 1999) l Fixed pie perceptions made worse under high time pressure (De Dreu, 2003)
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l Goals of one party are in fundamental, direct conflict to another party l Resources are fixed and limited “Fixed Pie” l Maximizing the share of resources is the goal Distributive Bargaining The Distributive Bargaining Situation
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Distributive Bargaining Keys to Effectiveness
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This note was uploaded on 10/17/2011 for the course ECON 101 taught by Professor Thompson during the Spring '11 term at Michigan State University.

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11.Negotiation - Negotiation MGT 315 Scott Class Agenda l...

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