Conflict Negotiation & Resolution Final

How does the cost of aborting a negotiation (impasse) affect an individual's reservation price (resistance point)?

If the cost/penalty of aborting is higher, an individual reservation price will be worst

Lowest transactions costs when resolvacy a dispute

Interests

True or false: individuals that make extreme opening offers generally get higher settlements than those who make modest offers

True

True or false: it is fraud If you claim your going to spend a new loan on paying off an old debt and instead you choose to buy new equipment.

True

True or false: one of the first things your should do when forming an effective coalition is clearly defining issues and strategies

True

True or false: one problem with using agents is that you and the agent can have differing/competing ethical norms

True

True or false: perceived interests (as opposed to actual interest) matter a great deal in negotiations

True

True or false: research has shown that men felt the greatest regard for an individual who flattered then unstintingly - even if the comments were untrue

True

True or false: trade-offs are important because one small issue can divide a coalition

True

True or false: use concessions to build interest

True

True or false: value is created by finding joint gains for all negotiating parties

True

Silence Tactic

When information gathering is best achieved

When are hardball tactics must effective?

When the other party is not prepared

Times when using a delay tactic would likely be more effective

When your lack power

Contingent contracts

Where negotiators make a "bet" on the future in order to resolve a potentially difficult issue facing them in the negotiation, and betting can reduce risk by diffusing it across the parties involved in a negotiation

integrative negotiation

a win-win negotiation in which the agreement involves no loss to either party

BATNA

best alternative to a negotiated agreement

Exploding Offer

proposal made during the closing stage of a negotiation that has a specific time limit for acceptance. This proposal will not be available to the other negotiator once the stated time period expires.

bargaining zone

range between one party's minimum reservation point and the other party's maximum reservation point

The least costly in terms of transaction costs

right-based negotiation

The most favorable person in a negotiation

someone who combined threats and promises

NOT effective approaches to balances cooperation and competition in a negotiation,

- Allow for meaningful communication to erase unfortunate misperceptions - adopt a competitive mindset and minimize the cooperative elements - direct attention to cooperations and minimize competition - treat both as separate but equal

Effective strategies in response to a buyer saying they can get a better deal elsewhere

- Ask what the cheaper rate is - explain that your price is not negotiable - give the prospect more details - introduce a different issue that is negotiable and can provide value

Best true statements regarding BATNA and reservation price? a) reservation price can be a lower (worse) than a BATNA b) BATNA can be lower (worse) than a reservation price c) BATNA and a reservation price can be different d) BATNA can be the same as a Reservation price

- BATNA can be lower (worse) that a Reservation price - BATNA can be the same as a reservation price - BATNA and a reservation price can be different

Guideline for participating in on effective coalition

- Determine a timetable and needs - devise a clear plan of action

Effective strategies to assess which interests are at stake in a negotiation

- Distinguish underlying interests from the issues under discussion - Distinguish between intransitive and instrumental reasons for value in interests -consider subtler interests (reputation, precedent, relationships)

contingent contracts affect information asymmetry in a negotiation

- Extends the final terms of a contract until information can become more symmetrical - decreases the likelihood of overpaying for an asset whose is performance not fully known - levels the playing field between buyer end seller

fundamental strategies of distributive bargaining

- Get the seller to think that the current settlement is best that is possible - if there is a negative bargaining zone (same as negative settlement range), attempt to get the other party to soften their reservation price (same as resistance point) - alter a sellers belief regarding the value of the item in question - push the other party as close to their reservation price (some as resistance point) as possible

Downside of evaluative mediation

- Narrow legal focus - can be chosen because clients are ill- informed

Potential problems coalitions face

- One member often dominates - coalition can be too formal - coalition often have too many meetings - coalition often nave conflicting strategies

Actions evaluative mediators should take in a mediation

- Point out weaknesses of a side's case - predict actions of judges/ juries - make recommendations regarding outcomes of issues - directly influence the outcome of the mediation

Statements regarding using rights to resolve a dispute

- Rights are rarely clear - using rights to determine who gets what can be very difficult - using rights to resolve disputes after result in the need for a third party to determine who is right (mediator/arbitrator)

Downsides of facilitative/transformative mediation

- Takes too much time - often ends without an agreement - mediators do not protect the weaker party

potential tactics made available for employee and agent

- The agent can play the hard-hearted partner game (client is unreasonable even though I am reasonable ) - good cop (client) / bad cop (agent) - the agent car gather intelligence on the clients behalf

What kind of information is the most influential?

- Unique and exclusive information

how to respond to hardball tactics

- Use the same hardball tactic - pretend your didn't hear the person and ignore the hardball tactic altogether - explicitly recognize the hardball tactic and expressly use the dealer to negotiate in a different manner

Actions facilitative mediators should take in a mediation

- Validate parties points of view - search for underlying interests - help the parties analyze options

Situations where rights or power would be mare effective in resolving disputes than interests

- When an uncooperative party doesn't want to even discuss the issue - when there is a negative bargaining zone caused by differing perceptions of existing rights to power - when it is not possible to satisfy the interests of both sides - when the dispute resolves questions of public importance

Appropriate/effective situations to use a contingency contract

- When both parties disagree on the future forecast of an outcome - when there is on uncertain events that directly effects a negotiation

Pareto frontier (Pareto efficiency)

- You have achieved the best possible joint outcome - an agreement where one person's additional gain is the others equivalent loss (if I take another dollar, you loss a dollar)

Reasons many negotiators ignore or reject contingent contracts out of hand

- contingent contracts are seen as gambling - many companies lack the ability to systemically evaluate the formulation of contingent contract - negotiators are often unaware of the existence of contingent contract

things to keep in mind before you finalizing a contingent contract

- contingent contracts require continued contract between all parties - you need to think about the enforceability of a contract - contingent contracts require transparency

What can help negotiators create value jointly

- effectively communicate - share information

A leader in a coalition must have what to be successful

- have time to devote to the cause - have commitment to the cause - have expertise on the issue

Basic purposes /goals of a coalition

- join forces together behind a mutual interest - work together for common effectiveness and results

When a buyer offers you an extraordinary low offer what is the best response? a)counter with an extraordinarily high counter offer b) refuse to counter and ask for a different first offer from the potential buyer c) threaten to break off negotiations entirely unless the offer is more reasonable

- refuse to counter and ask for a different first offer from the potential buyer - threaten to break off negotiations entirely unless the offer is more reasonable

Effective ways to assess trade-offs in a negotiation

- specify the best possible outcomes to help define the possible increment - specify the worst possible outcomes to help define the possible increments. - break increments into small places and compare their relative values

Commitments made effectively using the principle of consistency

- voluntary, public, active

Situations that represent when threats are appropriate

- when negotiators need to push past a heated deadlock - when negotiators one dealing with an uncooperative party and need to avoid an imminent impasse -when negotiators are concerned that the outcome will not be honored and/or implemented

Situations that would be better to have an agent

- when there is antagonism between sides -When the relationship between parties is competitive -When there is a low risk of miscoordination, or miscommunication

Features of an effective threat

- you should make sure you are willing to follow through - you should make sure you can survive the negotiation with pride intact - you should make sure the contingencies of a threat are clear

Evaluative mediators concerns

-Legal right of each party - evaluation based on legal concepts of fairness

Demonstrations of the principles of reciprocity

-a manager showing trust in an employee on a project in hopes that the employee will show in the future -A manager intentionally showing a pleasant demeanor, in hopes that other employees will show a pleasant demeanor -Supplier, giving a gift to a buyer in hopes of receiving more orders in the future -Cooperating that the other department will cooperate with you in the future

Effective methods to both create and claim value

-add an issue -Excluding issue -Bring a new party -Leave out a party -Improve no-agreement alternatives (BATNA)

Not effective, uses of the principle of social proof

-charity, giving a gift and hope of receiving more donations -Telling an employee how great they are doing on their project -Demonstrating that you are a subject matter expert on a subject -Highlighting exclusivity of information you are providing to the potential buyer

Behaviors that are most likely to impede mutually beneficial trades

-minimizing the benefits of others' concessions - exaggerating the value of concessions made

Potential benefits of using an agent in a negotiation

-they may have knowledge regarding the subject matter of the negotiation that you do not have -They may be experts at the transactional process of the negotiation -They may have special influence on getting a deal done

Questions you should ask to assess your no-agreement alternative

-what will occur if the group does not reach an agreement? - is the no-agreement alternative the same for all group members? - which group members have better no-agreement alternatives?

Assuming the close

A closing tactic in which one party assumes the other party has agreed to the deal, even though the other party has not done so

Most effective response to hearing "No" in a negotiation

Ask why

Why are group members with better no-agreement alternatives more powerful?

They are less dependent on the group's decision

Important considerations of transformative mediators

They see each sides needs, interests, values, and point review

True or False: in a distributive negotiation, one parties gain is the other party's loss

True

True or false: if negotiated rationally, distributive agreements can still be promotable for both sides (AKA-Both parties leave happy)

True

True or false: in general, negotiable issues are more straight forward and clear, but interests in a negotiation are often vaguer

True

True or false: in transformative mediations, the parties structure both the process and the outcome of the mediation

True

True or false: A statement is fraudulent when the speaker knowingly misrepresents a material fact on which the victim of said fraud reasonably relies and the statement causes damages

True

True or false: before you attempt to exert influences you should expend a lot of effort to establish your own expertise

True

True or false: contingent agreements enable all parties to bet on their biased views of the outcomes

True

True or false: contingent contracts are an effective way to identity and neutralize the risks of someone lying to you in a negotiation

True

True or false: each mediation style has its usefulness and its place in the pantheon of dispute resolution processes.

True

True or false: expertise on the part of ALL member representatives of the coalition on the subject matter of the coalition and its ramification is important for an effective coalition

True

True or false: guilt can be used as a form of intimidation in negotiations

True

True or false: hardball tactics generally do more harm than good

True

When a buyer is attempting to only CLAIM VALUE and the seller is attempting to only CREATE VALUE, what is the most likely outcome of the negotiation for the buyer?

Great

True or False: when negotiating, it is generally more useful to understand the public statement other party than to understand their interests.

FALSE - it is more useful to understand their interest

True or false: a negotiator has been given approval to sell a business for a minimum of $100,000. The seller offers $105,000 and the negotiator says that the deal can't be closed for this price. This would be considered fraud.

False

True or false: all negotiations should focus on reconciling interests alone

False

True or false: contingent contract enable negotiators to spend mare venue discussing their speculative disagreements and less fame discussing their mutual interests

False

True or false: contingent contracts are extremes rare in business - particularity in areas lake CEO compensation

False

True or false: expressing underlying emotions is detrimental to negotiating a resolution

False

True or false: revealing information about arrest relative preferences in a negotiation has minimal risk and nigh potential removes

False

True or false: saying a choice out loud, writing it down, or leaving it unspoken all affects someone's future conduct about the same so long as a chance is made

False

True or false: the currency of negotiation generally involves furthering underlying interests, but results are measured by new positions on issues are furthered

False

True or false: the facilitative mediator in charge of the outcome, while the parties are in charge of the process

False

True or false: the leader of a coalition usually represents the groups that has neither the most nor the least to goin so that they can be objective

False

True or false: the principles of liking, reciprocity, social proof, consistency, authority, and scarcity are the best used in isolation (meaning if they are combined each loses their individual impact)

False

True or false: there are generally more concerns about facilitative mediation than evaluators and transformative mediation

False

True or false: to have a effective coalition, it is important to focus an past differences and concentrate on the past goals of the coalition members

False

True or false: using an agent for a negotiation inherently makes a transaction less complicated

False

True or false: you are selling a business and suspect your most recent quarter was much worse than expected. You put off some meetings with your finance department and intentionally avoided, checking your financials before meeting with your prospective buyer. Because you are not specifically "knowing" of the poor performance next quarter this is not technically fraud..

False

Fundamental (most important) challenge of leadership

Getting things done through others

When a buyer and a seller are attempting to CREATE VALUE what is the outcome negotiation for the buyer?

Good

When a buyer and seller are attempting only to CLAIM VALUE in a negotiation what is most likely the outcome of the negotiation for the buyer?

Mediocre

Most reliable to increase now much someone takes you

Praise and similarity

Guideline to an effective coalition

Strategize detail by detail so nothing is left undone

reservation price determines

The point at which your are indifferent to whether a negotiation reaches an agreement or not

negative bargaining zone

indicates that there is no positive overlap between the parties reservation points

BATNA determines

lowest value acceptable to you for a negotiated agreement

What does it mean to resolve a dispute?

opposed positions result in a single outcome