Negotiation Subprocesses

• The subprocesses of negotiation are covered in this session.

Sub-process #1: Distributive Bargaining

• Distributive bargaining involves a zero-sum game where one party's gain is another's loss.
• Cutting the pie is a common analogy for this process.
• Issues in distributive bargaining include wages and fringe benefits.
• Bargaining power resolves the issues, such as through strikes or lock-out threats.

Sub-process #2: Integrative Bargaining

• Integrative bargaining is a positive-sum game where expanding the pie is the goal.
• Joint gains are possible through changes that augment organizational performance.
• Information sharing and joint problem solving resolve issues, such as forming committees to improve work practices.
• Integrative bargaining is difficult to maintain because of difficulties dividing mutual gains and getting employers to think about long-term goals.
• Trust is essential between and within organizations.

Sub-process #3: Intra-Organizational Bargaining

• Intra-organizational bargaining addresses negotiations within teams and such conflicts are common.
• Poor unity can lead to shadow boxing or surface bargaining if a negotiator lacks sufficient authority.

Sub-process #4: Attitudinal Structuring

• Attitudinal structuring addresses perceptions each side generates over time.
• Collaborative, trusting relationships = integrative bargaining.
• Hostile actions and distrust = distributive bargaining.

Defining Strategy and Tactics

• Strategy is an overall plan for achieving an objective or achieving goals.
• Strategy is applied to achieve a big picture
• Strategy involves focusing on long-term outcomes.
• Tactics are specific actions geared towards achieving the strategy.
• Tactics have a narrow scope and focus on short-term outcomes.

Weighing Alternatives

• Negotiation strategies are weighed against alternatives, reflecting BATNA and WATNA.
• BATNA is the Best Alternative To a Negotiated Agreement; negotiators must consider the best-case alternative to an agreement.
• WATNA is the Worst Alternative to a Negotiated Agreement; negotiators must consider the worst-case alternative to an agreement.
• Factors like information, power, and time influence alternatives.
• Pareto's law, or the 80/20 rule, applies to time management in negotiations.

Common Bargaining Tactics

• Face Saving: Negotiators present concessions in the best light.
• Unions are vocal about gains.
• Management is silent, providing union credibility.
• Throwaway Items: Low-priority items are included to exchange for high-priority items.
• Packaging: Items are put together for negotiations to make negotiating more efficient and mitigate conflict.
• Caucusing: Separate intra-party meetings on proposals are used to maintain a committee "poker face" and promote intra-party solidarity.
• Flexibility and compromise are relevant.
• Effective posturing early in negotiations influences the effectiveness of tactics by setting the pattern, expressing willingness to negotiate, identifying basic positions, and setting the tone.

Distributive Bargaining in Action

• Anchoring: An opening offer that influences a counter-party's zone of agreement.
• Anchoring can use facts, extreme offers, or precedents.
• Bracketing: is moving towards a middle point, as constructed by the opening offers (brackets).
• Norms matter, reflecting social beliefs or attitudes.
• Relational: A desire to maintain relationships.
• Fairness: equality, equity, need, status quo
• Reciprocity: Matching proposals.
• Good Faith: Maintaining integrity of negotiations.
• Framing matters relating to how issues are presented.
• Framing is either slanted or non-judgmental.
• Reframing: Asking questions is useful, such as "Why?", "Why not?", "What if?", or "Advice?"
• Framing and norms interact over the conclusion of a final agreement.
• Framing affects interpretation of norms and vice versa.
• Distributive bargaining is a social process and is not an expression of force.

Integrative Bargaining in Action

• Principled negotiations (interest-based bargaining) act as best practices for integrative bargaining and were developed by Fisher and Ury in the 1980s.
• Principled negotiations offer an alternatives to distributive bargaining.
• Mutual gains are possible through cooperation.
• Focus on interests not positions – for example, avoiding "my position is that we introduce a 2% raise", instead "my interest is in improving the quality of working life for employees”.
• Separate people from isssues, for example avoid "Larry is greedy, always trying to cut costs for a promotion”, instead “cost-cutting is the issue" and not Larry's personality.
• Focus on objective criteria and concrete evidence, such as performance criteria, profits, sales, and employee satisfaction surveys.
• Develop mutual gains options, such as Union's goal is greater quality of life for members and employer's goal is greater productivity and profits – there are ways to achieve both.
• Categorization Method also promotes integrative bargaining by relegating distributive practices to the end.
• Different steps are taken during most of the negotiation, except for the final phases.
• Categorization Method is similar to interest-based bargaining through high road negotiation practices.
• The steps in the Categorization Method:
• Exchange Information
• Develop a common list of all issues; common issues, exchange issues, and distributive issues.
• Reach agreement on common issues, which are then removed from the list.
• Trade issues of equal value
• Distributive bargaining ensues on remaining issues.

This session covers the subprocesses of negotiation, including distributive bargaining. Distributive bargaining involves a zero-sum game where one party's gain is another's loss. Integrative bargaining is also presented and intra-organizational bargaining.