Perception, Cognition, and Emotion in Negotiation

1. CHAPTER 5 Perception, Cognition, and Emotion

2. Learning Objectives • Understand the role of perception, cognition, and emotion (an emergent inquiry) in negotiation. • Learn about the 4 types of perceptual distortions and 12 forms of cognitive biases (psychological traps) and ways to reduce their adverse effects. • Know how mood, emotion and negotiation interact with each other. • Develop(re-)framing skills, and proper use of emotion as influence tactics.

3. Outline • Perception and Perceptual Distortion 知觉扭曲 • Framing as an Advanced Negotiation Skill 框架 • Cognitive Biases in Negotiation 认知偏差 • Managing Mis-perceptions and Cognitive Biases in Negotiation • Mood, Emotion, and Negotiation • Chapter Summary 7. Assignment

4. 1. 1 Perception • Figure 5.1 The Perceptual Process • Perception is a “sense-making ” process; people interpret their environment so that they can respond appropriately. Attention Stimulus Recognition Translation Behavior Perception

5. 1. 1 Perception Perception Defined Perception is the process by which individuals connect to their environment. The process of ascribing/assigning meaning to messages and events is strongly influenced by the perceiver’s current state of mind, role, and comprehension of earlier communications. Comment on the following observation by Robert Burns: To see ourselves as others see us!

6. 1. 2 Perceptual Distortion Perception Distortion In a given negotiation, the perceiver’s own needs, desires, motivation, and personal experiences may create a predisposition about TOS. This is cause for concern when it leads to biases and errors in perception and subsequent communication.

7. 1.2--- Four Types Stereotyping+ Halo Effects (by generalization): common hazards in negotiation e.g. stereotyping (as a mould in printing): a few facts + forced on everybody Danger: a lazy way of categorizing people (short-cuts), incurring potential cost. A pattern once formed is persistent, and difficult to reverse (Acute problem!). Selective Perception + Projection (anticipation/prior belief + self-fulfilling)

8. 1.2 ---Stereotyping and Halo Effects By generalization common hazards in negotiation e.g. stereotyping (as a mould in printing): a few facts + forced on everybody Danger: a lazy way of categorizing people (short-cuts), incurring potential cost. A pattern once formed is persistent, and difficult to reverse (Acute problem!).

9. Sweeping generalizations (danger!) • Heaven is where the cooks are French, the mechanics are German, the policemen are English, the lovers are Italian, and it is all organized by the Swiss. • Hell is where the policemen are German, the mechanics are French, the cooks are British, the lovers are Swiss, and it is all organized by the Italians. What’s the implication?

10. Case: Misinterpretation of John F. Kennedy by Khrushchev Who is seen as a credible person?

11. Kennedy and Khrushchev’s talks in Vienna • During their meeting, the young president JFK recognized that to his regret, the US attack had been a military and political mistake. Khrushchev saw this confession of error as a testimony of JFK’s frank naivety and lack of character. He therefore inferred that it was possible to gain advantage by installing nuclear missiles in Cuba. This led the world to the brink of nuclear war btwn the superpowers. The events which followed showed that Khrushchev had been wrong in evaluating JFK’s credibility. Ultimately, JFK showed great firmness and negotiation skill.

12. 2. Framing as an Advanced Negotiation Skill What is framing and why it is crucial in negotiation? • As a subjective mechanism, a frame directs or orients the reader/listener to examine a message with a certain disposition or inclination. e.g. Our paralysis and fear is our competitors’ greatest asset. • Often two or more people in dispute see the situation/problem/issue or define it in different ways. • Understanding framing helps negotiators evaluate the process, and better control it. • Effective negotiators frame what they ask!

13. 2.1 ---The psychology of Framing Suppose contestants A and B competed on who could complete the same jigsaw puzzle first. A third party buys two copies of the same 350-piece puzzle, dumping the contents of both boxes on a table in front of them. Who will win? Suppose a new condition were introduced: One of them has access to the box with a picture of the completed puzzle. Who will win, then? Implications: Framing gives perspective, rationale, and structure to what you want to say. Without the frame, chaos prevails over coherence.

14. 2.1 Types of Frames (1) Substantive what the conflict is about.实质 (2) Outcome a party’s predisposition to achieving a specific result or outcome. 结果 (3) Aspiration a predisposition toward satisfying a broader set of interest or needs. 奢望 (4) Process how the parties will go about resolving their dispute. 程序 (5) Identity how the parties define “who they are”.身份 (6) Characterization—how the parties define the other parties.特征框架（效应） (7) Loss-gain how the parties define the risk or reward 损益

15. 2.2 How Frames Work in Negotiation • Negotiators can use more than one frame. • Mis-matches in frames between parties are sources of conflict. • Particular types of frames may lead to particular types of agreements. • Specific frames may be likely to be used with certain types of issues. • Parties are likely to assume a particular frame because of various factors.

16. 2.3 Alternative Frames: Interests, Right, and Power • Parties have a choice about how they approach a negotiation in terms of interests, rights, and power. (Box 7.1, p. 185, “利”、“理”、“力” ) • The same negotiation can be framed in different ways and will likely lead to different consequences. Illustration: The example of a student who has a dispute with a local car repair shop shows that different frames are very likely to lead to different discussions. Box 5.1 Chinese Negotiation Frames (p.139) (Focus: Misconception and cultural perspective)

17. 2.4 The Frame of an Issue Changes as Negotiation Evolves At least four factors can affect how the conversation is shaped (pp.141-42): (1) Negotiators tend to argue for stock issues, or concerns that are raised every time the parties negotiate. (2) Each party attempts to make the best possible case for his or her preferred position or perspective.申辩 (3) Frames may define major shifts and transitions in a complex overall negotiation. (4) Multiple agenda items operate to shape issue development.

18. 2.5 Summary Prescriptive advices about problem framing: • Frames shapewhat 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 (the 80/20 rule) Implications for us as a ‘trained’ negotiator?

19. 3. Cognitive Biases in Negotiation-1 What are they? How to combat their negative effect? 3.1 Irrational Escalation of Commitment 承诺升级 It is an tendency for an individual to make decisions that stick with a failing course of action. Escalation of Commitment is due in part to biases in individual perception and judgment. One way to combat these tendencies is to have an advisor to serve as a reality checkpoint.

20. 3. Cognitive Biases in Negotiation-2 3.2 Mythical Fixed-Pie Belief The tendency to see negotiation in fixed-pie terms varies depending on how people view the nature of a given conflict situation. It can also be diminished by holding negotiators accountable for the way the negotiate.负有责任

21. 3. Cognitive Biases in Negotiation-3 • 3.3 Anchoring and Adjustment 锚定与调整 The choice of an anchor might well be based on faulty or in-complete information and thus be mis-leading in and of itself. Through preparation, along with the use of devil’s advocate or reality check, can help prevent errors .

22. 3. Cognitive Biases in Negotiation-4 3.4 Issue Framing and Risk The way an issue is framed influences how negotiators perceive risk and behave in relation to it. The tendency to either seek or avoid risk may be based on the reference point against which offers and concessions are judged.

23. 3. Cognitive Biases in Negotiation-5 3.5 Availability of Information 可获得性 Negotiators must also be concerned with the potential bias caused by the availability of information or how easy information is to retrieve. The availability of information also affects negotiation through the use of established search patterns.

24. 3. Cognitive Biases in Negotiation-6 3.6 The Winner’s Curse 赢家诅咒 The winner’s curse refers to the tendency of negotiators to settle quickly on a item and then subsequently feel dis-content about a negotiation win that comes too easily. Case：Dissatisfaction from a Clock Purchase (p.148) The best remedy for winner’s curse is to prevent it from occurring.

25. 3. Cognitive Biases in Negotiation-7 3.7Over-confidence It is the tendency of negotiators to believe that their ability to be correct or accurate is greater than is actually true. It has a double-edged effect. It appears that negotiators have a tendency to be overconfident about their own abilities and that this overconfident affectsa wide variety of perceptions and behaviors.

26. 3. Cognitive Biases in Negotiation-8 3.8 The Law of Small Numbers 小数法则/定律 It applies to the way negotiators learn and extra-polate from their own experience. The implications of the example of “hot hand ” fallacy? (p. 149, 热手谬误): A win or loss is not correlated with the outcome of a preceding game under random conditions. Remember that the more limited the negotiation experience, the greater the possibility that past lessons will be erroneously used to infer what will happen in the future.

27. 3. Cognitive Biases in Negotiation-9 3.9 Self-Serving Biases 自利偏差 Fundamental Attribution Error 基本归因偏差 The effects of self-serving biases 自我偏差 Self-serving biases have recently been shown to influence perceptions of fairness in a negotiation context. Perceptual error may also be expressed in the form of biases or distortions in the evaluation of data.

28. 3. Cognitive Biases in Negotiation-10 3.10 Endowment Effect 资源禀赋 It is the tendency to over-value something you own or believe you possess. In negotiation, the endowment effect can lead to inflated estimations of value that interfere with reaching a good deal.

29. 3. Cognitive Biases in Negotiation-11 3.11Ignoring Other’s Cognitions (p. 151) The drive to ignore others’ cognitions is very deep-seated. Efforts to ask about others’ perceptions and thoughts and form an accurate understanding of their interests, goals, and perspectives will pay off, e.g. making the complex task of decision making under conditions of risk and uncertainty more manageable.

30. 3. Cognitive Biases in Negotiation-12 3.12 Reactive De-valuation It is the process of de-valuing the other party’s concessionssimply because the other party made them. Such devaluation may be based in emotionality (“I just don’t like him”) or on dis-trust fostered by past experience. Counter-measures: 1) maintain an objective view of the process; 2) assign a colleague to do this task (cartoon, p. 154); 3) clarify each side’s preferences on options and concessions before any are made; 4) use a third party to mediate or filter concession-making processes.

31. 4. Managing Misperceptions and Cognitive Biases • They typically arise out of conscious awareness as negotiators gather and process information. Alert! Box 5.4 (p.153) presents a sizeable inventory of the variety of decision traps that can occur in Negotiation. Any Questions? Countermeasures: 1) Merely discussing how to set opening offers, aspiration levels, and bottom lines with team members will not reduce the effects of perceptual biases. 2) Careful discussion of the issues and preferences by both negotiators may reduce the effects of perceptual biases.

32. 4 Reframing---More demanding Box 5.5 Deal-crafting and Re-framing(p.156） 1-Dimension: “at the table” process 2D: “deal-crafting” 3D: change the rules of the game itself; “-reset the ‘table’ to yield the best possible outcome”, ie reframing a negotiation encounter What’s the point here? (also Table 3.1 Re-focusing Questions to Reveal Win-Win Options, p. 86) (for more, visit the course-site, see Assignment slide)

33. 5. Mood and Emotion in negotiation • Emergent area of inquiry The role of mood and emotion in negotiation has been the subject of an increasing body of recent theory research. • Related but distinctThe distinction is based on three characteristics: specificity, intensity, and duration.

34. 5. … Some Selected Findings 5.1 Negotiations Create Posi/Nega-tive Emotions (p. 156) Consensus: Emotions tend to move the parties toward some of action in their relationship, such as initiating a relationship, maintaining or fixing the relationship, or terminating the relationship. Dejection-related emotions沮丧---act aggressively Agitation-related emotions焦虑---try to retaliate or to withdraw

35. 5. … Some Selected Findings 5.2 Positive Emotions and Positive Consequences Positive feelings 1) more likely lead the parties toward more integrative processes; 2) also create a positive attitude toward TOS; 3) promote persistence. Then, what aspects of the negotiation process are conducive to positive emotions? Maybe fair procedures, favorable social comparisons.

36. 5. ---Some Selected Findings 5.3 Negative Emotion and Negative Consequences Negative emotions may 1) lead parties to define the situation as competitive or distributive; 2) undermine a negotiator’s ability to analyze the situation accurately; 3）lead parties to escalate the conflict; 4）lead parties to retaliate, thuspossibly thwarting integrative outcomes. Then, what aspects of the Negotiation Process can lead to negative emotion? Perhaps, a competitive mindset or impasse.

37. 5. ---Some Selected Findings 5.4 The Effects of Posi&Negative Emotion in Negotiation. Positive feelings may have negative consequences and negative feelings may create positive outcomes (p. 159） 5.5 Emotions Used Strategically as Negotiation Gambits技巧 Given the power that emotions may have in swaying TOS toward one’s own point of view, emotions may also be used strategically and manipulatively as influence tactics within negotiation.

38. 6. Chapter Summary From a negotiation learner’sperspective • Learn about the insightful findings of psychological beings, and watch out “psychological traps” • Know that misconceptions abound, esp. across cultures and cultural perspectives matter. • Remember that effective negotiators need the capacity to manage “cool” and “hot” issues proactively and appropriately.

39. 7 Assignment (visit the course site for more information) 李岩梅、刘长江、李纾（2007）.认知、动机、情感因素对谈判行为的影响，心理科学进展 15(3): 511-517. 李锐、李爱梅、凌文辁（2008）. 承诺续扩现象及其心理机制，心理科学进展 16(5):767-778. Sussman, Lyle(1999). How to frame a message: the art of persuasion and negotiation, Business Horizons, 案例欣赏Dialogue: Reframe negativity in a positive light 案例欣赏Case: Americans’ sorry negotiation with their Mexican counterparts Appendix 4: North American and European behaviors: how they see each other? Video clips (2): Bridging the gap