NEGOTIATION SLIDES OUTLINE CHAPTER FIVE

NEGOTIATION SLIDES OUTLINE CHAPTER FIVE

•          Perception, Cognition, and Emotion

•          Perception, Cognition, and Emotion in Negotiation

The basic building blocks of all social encounters are:

•          Perception

•          Cognition

–        Framing

–        Cognitive biases

•          Emotion

–        Perception

Perception is:

•          The process by which individuals connect to their environment.

•          A “sense-making” process                                           

•          The Process of Perception

•          Perceptual Distortion

•          Four major perceptual errors:

–        Stereotyping

–        Halo effects

–        Selective perception

–        Projection

•          Stereotyping and Halo Effects

•          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

•          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

–        Selective Perception
and Projection

•          Selective perception:

–        Perpetuates stereotypes or halo effects

–        The perceiver singles out information that supports a prior belief but filters out contrary information

•          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

–        Framing

•          Frames:

–        Represent the subjective mechanism through which people evaluate and make sense out of situations

–        Lead people to pursue or avoid subsequent actions

–        Focus, shape and organize the world around us

–        Make sense of complex realities

–        Define a person, event or process

–        Impart meaning and significance

–        Types of Frames

•          Substantive

•          Outcome

•          Aspiration

•          Process

•          Identity

•          Characterization

•          Loss-Gain

•          How Frames Work in Negotiation

•          Negotiators can use more than one frame

•          Mismatches in frames between parties are sources of conflict

•          Parties negotiate differently depending on the frame

•          Specific frames may be likely to be used with certain types of issues

•          Particular types of frames may lead to particular types of agreements

•          Parties are likely to assume a particular frame because of various factors

•          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

•          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

•          Some Advice about Problem Framing for Negotiators

•          Frames shape what the parties define as the key issues and how they talk about them

•          Both parties have frames

•          Frames are controllable, at least to some degree

•          Conversations change and transform frames in ways negotiators may not be able to predict but may be able to control

•          Certain frames are more likely than others to lead to certain types of processes and outcomes

•          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

•          Irrational Escalation of Commitment and Mythical Fixed-Pie Beliefs

•          Irrational escalation of commitment

–        Negotiators maintain commitment to a course of action even when that commitment constitutes irrational behavior

•          Mythical fixed-pie beliefs

–        Negotiators assume that all negotiations (not just some) involve a fixed pie

•          Anchoring and Adjustment
and Issue Framing and Risk

•          Anchoring and adjustment

–        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

•          Issue framing and risk

–        Frames can lead people to seek, avoid, or be neutral about risk in decision making and negotiation

•          Availability of Information
and the Winner’s Curse

•          Availability of information

–        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

•          Overconfidence
and the Law of Small Numbers

•          Overconfidence

–        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

•          Self-Serving Biases
and Endowment Effect

•          Self-serving biases

–        People often explain another person’s behavior by making attributions, either to the person or to the situation

–        There is a tendency 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

•          Ignoring Others’ Cognitions
and Reactive Devaluation

•          Ignoring others’ cognitions

–        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

•          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

•          Mood, Emotion, and Negotiation

•          The distinction between mood and emotion is based on three characteristics:

–        Specificity

–        Intensity

–        Duration

•          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 create a positive attitude toward the other side

–        They promote persistence

•          Mood, Emotion, and Negotiation

•          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

•          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

–        Not all negative emotion has the same effect

•          Mood, Emotion, and Negotiation

•          Aspects of the negotiation process can lead to negative emotions

–        Negative emotions may result from a competitive mind-set

–        Negative emotions may result from an impasse

–        Negative emotions may result from the prospect of beginning a negotiation

•          Effects of positive and negative emotion

–        Positive feelings may generate negative outcomes

–        Negative feelings may elicit beneficial outcomes

•          Emotions can be used strategically as negotiation gambits