Communication and Negotiation in Management

1. m a n a g e m e n t 2eH i t t / B l a c k / P o r t e r Chapter 12: Communication and Negotiation

2. Learning Objectives After studying this chapter, you should be able to: • Explain why communication is vital for effective management • Describe the basic process of communication • Discuss how to choose the best mode and the appropriate media richness for effective communication • Analyze the impact of the organizational context on communication

3. Learning Objectives • Identify key barriers to effective communication • Explain various approaches to overcoming communication barriers, including intercultural barriers • Describe the basic process of negotiation

4. Basic Model of Communication Communication: the process of transferring information, meaning, and understanding from sender to receiver • Encoding • Medium • Decoding • Noise

5. Sender • Encodes message • chooses a medium (channel) • Sends the message • Receiver • Receives message • Decodes message • May send feedback for clarification Noise: Can interfere at any point Basic Model of Communication Adapted from Exhibit 12.1

6. Modes of Communication Adapted from Exhibit 12.2

7. Media of Communication • Different media have different characteristics (media richness) • Personal-impersonal nature • Speed in sending and receiving • Availability of multiple cues • Opportunity to receive immediate and continuing feedback from the receiver • Message should be matched to best medium

8. Rich Media • Personal • Multiple cues to aid in decoding • Immediate feedback • Lean Media • Impersonal • Few cues to aid in decoding • Delayed feedback Rich Lean Factors in Media Richness Examples: Face to face Telephone E-mails, memos Adapted from Exhibit 12.3

9. Organizational Context of Communication Organizational characteristics that affect communication: • Composed of individuals and groups • Oriented toward goals • Differentiated functions • Intended coordination • Continuity through time

10. Supervisor Supervisor Subordinate Subordinate Directions of Communication Lateral communication UPWARD COMMUNICATION Information, questions, suggestions, problems, requests for clarification DOWNWARD COMMUNICATION Goals, objectives, directions, decisions, feedback LATERAL COMMUNICATION Information, (formal or informal) for joint problem solving Adapted from Exhibit 12.4

11. FORMAL CHANNELS Specify individuals responsible for tasks Specify individuals responsible for communicating information above and below them Indicate persons to whom work-related messages should be sent INFORMAL CHANNELS Tend to operate laterally more than vertically Move information quite rapidly Carry both work-related and nonwork information Channels of Communication

12. FORMAL channels of communication INFORMAL channels of communication CEO Vice President of Marketing Manager Toy Manufacturing Advertising Manager Promotions Manager Supervisor Board Games Testing Supervisor Electronic Games Testing Channels of Communication Adapted from Exhibit 12.5

13. INFORMAL CHANNELS Develop through interpersonal activities of organization members Not specified by the organization May be short-lived or long-lasting Are more often lateral than vertical Information flow can be very fast Used for both work-related and nonwork information FORMAL CHANNELS Authorized, planned, and regulated by the organization Reflect the organization’s formal structure Define who has responsibility for information dissemination and indicate the proper recipients of work-related information May be modified by the organization Minor to severe consequences for ignoring them Patterns of Organizational Communication Adapted from Exhibit 12.6

14. Network 1 Network 2 Example of Communication Networks Salt Lake City New York Boss San Diego New York Managers Denver Divisional Marketing Manager, Los Angeles Seattle Chicago, Retired former colleague Irvine Marketing Researchers Portland San Francisco Los Angeles Subordinates Adapted from Exhibit 12.7

15. Barriers to Communication Adapted from Exhibit 12.7

16. HIGH-CONTEXT CULTURES More adjustments in messages Rank of receiver affects message and medium Nonverbal communication cues may be very important Medium may be as important as message LOW-CONTEXT CULTURES Fewer and smaller adjustments in messages Rank or receiver may or may not affect message or medium Nonverbal communication cues not as important Message is more important than medium Communication Differences in High and Low Context Cultures

17. Japan China Italy Germany Canada USA South Korea Saudi Arabia France Australia Vietnam New Zealand High-Context Cultures Low-Context Cultures Communication Differences in High- and Low-Context Cultures Adapted from Exhibit 12.9

18. Cross-Cultural Barriers • ETHNOCENTRISM • The belief in the superiority and importance • of one’s own group • STEREOTYPING • The tendency to oversimplify and generalize • out groups of people • CULTURAL DISTANCE • Difference between two cultures’ basic • characteristics such as language, economic • development, and traditions and customs

19. Improving Listening Skills • Listen rather than talking yourself • Be more open-minded • Develop empathy • Listen actively • Observe nonverbal cues

20. Improving Sending Skills • Simplify the language • Organize your writing • Understand the audience

21. Overcoming Cross-Cultural Communication Barriers • Study general principles that apply to all types of intercultural communication • Learn about the fundamental characteristics of the other cultures with which you will be working • For high-context cultures, learn as many details in advance about the target organization(s) and their specific individual representatives • For high-context cultures, use at least a few words or phrases in the listener’s language • For high-context cultures, be especially careful about body language and tone of voice • For low-context cultures, organize written communications so that the major points are immediately and directly stated • Study and respect communicators’ preference for greater degrees of formality, especially compared with the typical American approach of casual informality Adapted from Exhibit 12.10

22. Improving Communication:Organizational Level Gatekeepers are at the communication interface between separate organizations or different units. They: • Increase formal communication • Replace face-to-face communication with electronic communication • Develop networks • Create centralized office to manage communication activities

23. Communication and Negotiation Negotiation • Process of conferring to arrive at an agreement between different parties, each with their own interests and preferences • Two negotiation activities • Day-to-day activities of the managers organizational unit • Part of a formally appointed negotiating team representing unit or organization

24. Less effective More effective Achieving Effective Negotiations • Positions • People Involved • Maintaining/ Increasing Competition (Win/Lose Focus) • Interests • Problem/Issue • Decreasing/ Lessening Competition (Collaborative Focus) Adapted from Exhibit 12.11

25. Key Factors in Cross-National Negotiations People • Listening skills • Orientation toward people • High self-esteem • Influence in the home organization

26. Important Characteristics Needed by Negotiators Adapted from Exhibit 12.12

27. Key Factors in Cross-National Negotiations (cont.) Situation • Location • Physical arrangements • Emphasis on speed and time • Composition of the negotiating teams Negotiation process

28. Stages in the Negotiation Process Planning and preparation • Advance planning and analysis • Background research • Gathering of relevant information • Planning of strategies and tactics • Setting objectives • Predetermining possible concessions STAGE 1 Planning and Preparation Adapted from Exhibit 12.13

29. Stages in the Negotiation Process Relationship building between negotiation parties • Developing trust • Developing personal rapport • Establishing long-term association STAGE 2 Relationship Building Between Negotiating Parties STAGE 1 Planning and Preparation Adapted from Exhibit 12.13

30. Stages in the Negotiation Process Information exchange • Learning about the needs and demands of the other set of negotiators • Acquiring and exchanging other information STAGE 3 Information Exchange STAGE 2 Relationship Building Between Negotiating Parties STAGE 1 Planning and Preparation Adapted from Exhibit 12.13

31. Stages in the Negotiation Process Persuasion attempts • American managers treat as the most important stage • Mixture of approaches • Assertive and straightforward • Warnings or threats • Calculated delays STAGE 4 Persuasion Attempts STAGE 3 Information Exchange STAGE 2 Relationship Building Between Negotiating Parties STAGE 1 Planning and Preparation Adapted from Exhibit 12.13

32. Stages in the Negotiation Process Concessions/Agreement • Permit each party to take away something of value • American managers tend to have less leeway for concessions • Some use normative appeals such as “it’s your obligation” STAGE 5 Concessions and Agreement STAGE 4 Persuasion Attempts STAGE 3 Information Exchange STAGE 2 Relationship Building Between Negotiating Parties STAGE 1 Planning and Preparation Adapted from Exhibit 12.13