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NEGOTIATION/ PREPARATION

NEGOTIATION/ PREPARATION. Aiming for a Negotiated Agreement: Aspiration (Target) Point Most preferred or ideal settlement Reservation Point (Bottom Line) Least favorable settlement. --Can settle or walk away to BATNA: B est Alternative T o a N egotiated A greement . PREPARATION.

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NEGOTIATION/ PREPARATION

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  1. NEGOTIATION/PREPARATION Aiming for a Negotiated Agreement: • Aspiration (Target) Point • Most preferred or ideal settlement • Reservation Point (Bottom Line) • Least favorable settlement. --Can settle or walk away to BATNA: Best AlternativeTo a Negotiated Agreement

  2. PREPARATION • BARGAINING ZONE ( Settlement zone) • Region between the parties reservation points Positive bargaining zone (Reservation points overlap) • Settlement possible • Negative bargaining zone (Reservation points do not overlap) • Settlement not possible

  3. PERCEPTUAL DISTORTION • A. Stereotyping • Assigning attributes based on membership in a particular group • B. Halo effects • Generalize on a number of attributes based on knowledge of one attribute. • C. Selective perception • Accepting information that supports prior belief and filtering out nonconforming information

  4. PERCEPTUAL DISTORTION • D. Projection • Ascribing to others the characteristics you have • Assuming that the other party will respond in the same manner you would respond. • E. Framing • Subjective evaluation mechanisms to determine whether to pursue or avoid future actions

  5. Relationships • A. The norm of reciprocity • Duties owned to one another because of prior actions. • Reciprocity traps • B. The similarity principle • We assume others like us act like us

  6. COGNITIVE BIASES • A. Irrational Commitment • Irrational commitment to positions • B. Fixed-Pie Beliefs • Assumption that all negotiations are zero sum • C. Anchoring and Adjustment • Avoid false or inappropriate anchors

  7. COGNITIVE BIASES • D. Information availability bias • Giving greater weight to easily available information and established search patterns. • E. Winners Curse • Settling too quickly • F. Overconfidence • Overestimate chance of success • Discount others advice and information

  8. COGNITIVE BIASES • G. Law of Small Numbers • Tendency to draw conclusions from small sample sizes. • H. Self-serving biases • Fundamental attribution error /False -consensus • Ignoring Other’s Cognition's • Failure to consider other party’s perceptions.

  9. COGNITIVE BIASES • Reactive Devaluation • Devaluing other party’s concessions • Reduces willingness to respond.

  10. FAIRNESS • Principle 1 • Multiple Methods of Fair Division • Principle 2 • Fairness is Context Driven • Principle 3 • Fairness is Often Based on Comparisons

  11. FAIRNESS • Principle 4 • People seek equity • Principle 5 • People will attempt to restore equity from inequity. • Principle 6 • People need to maintain egos

  12. FAIRNESS • Principle 7 • People care about process • Principle 8 • Judgements are affected by relationship • Principle 9 • Egocentrism taints judgement

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