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Unit 14: Conflict and Negotiation

The conflict of rights occurs where a difference of interpretation arises about the existing Notes
agreement between the two parties. In labour negotiations a dispute can arise over the application
of an existing agreement. In commercial negotiation the conflict could centre on whether the
terms of the existing contract have been met? Did one party fulfill its obligations under the
contract, if not, was it entirely its own fault or did the other party contributed too, if yes, how
much? Again, this is a conflict about rights not interests.
The word ‘Conflict’ is used descriptively because that is what it is. Characterising or categorising
the conflicts of rights or interests, is a prelude to resolving it.
Negotiations as a process for conflict resolution necessarily centers on the issue on which the
two parties are in conflict and not their relationship in total. It is because parties despite all
difference have a common overall interest and common interest in finding a negotiated settlement.
It does not imply that any terms are acceptable.

Task Conduct a debate on following statements and interpret them:
1. “This is an age of negotiation”.

2. “Negotiation is process of adjusting both parties’ views of their ideal outcomes to
an attainable outcome”.

14.5 Need and Importance of Negotiation

Following are the five key reasons that illustrate the importance of negotiation skills (1) the
dynamic nature of business, (2) interdependence, (3) competition (4) the information age, and
(5) globalisation.
14.5.1 Dynamic Nature of Business

Mobility and flexibility are the dictates of the new world of work. The dynamic, changing
nature of business means that people must negotiate and renegotiate their existence in
organisations throughout the duration of their careers. The advent of decentralised business
structures and the absence of hierarchical decision-making provide opportunities for managers,
but they also pose some daunting challenges. People must continually create possibilities,
integrate their interests with others, and recognise the inevitability of competition both within
and between companies. Managers must be in a near-constant mode of negotiating opportunities.
According to Linda Greene, Associate Vice Chancellor for academic affairs at the University of
Wisconsin-Madison, “Many important events essential to professional success and professional
satisfaction happen everyday in the workplace and they are not always announced in advance.”
In reality, negotiation comes into play when people participate in important meetings, get new
assignments, head a team, participate in a reorganisation process, and set priorities for their
work unit. Negotiation should be like second nature to the business manager, but often it is not.

14.5.2 Interdependence

The increasing interdependence of people within organisations, both laterally and hierarchically,
implies that people need to know how to integrate their interests and work together across
business units and functional areas.

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