Page 196 - DMGT519_Conflict Management and Negotiation Skills

Conflict Management and Negotiation Skills

Notes

Task Elucidate the following statements:

1. The classic distributive bargaining situation is one that everyone has experienced.
2. Negotiation researchers have concluded that the fairness norm may be the most
commonly employed norm.

3. The reciprocity norm, or the human tendency to respond to the actions of others
with equal or similar actions.

Self Assessment

State whether the following statements are true or False:
6. Future negotiations with the same party are often anticipated, and therefore negotiators
will seek to avoid harming the future relationship between the parties.
7. People from other organizations expect negotiated “favors” to be repaid at a later date.
8. Conflict is critical to a long-term relationship, so agreements must include less nitpicking,
fewer what-ifs or contingency clauses.
9. Making decisions based on a contingency such as fairness is easier than making decisions
on offers that are randomly tossed out.
10. An offer based on a norm is more persuasive than an double number, and thus more likely
to receive serious consideration.

11. Contingency contracts are commonplace in business.

!
Caution In North America and Europe bargaining is restricted to expensive or one-of-a-
kind items (automobiles, jewellery, art, real estate, trade sales of businesses) and informal
sales settings such as flea markets and garage sales. In other regions of the world bargaining
may be the norm even for small commercial transactions.

9.5 The Role of Norms

Once each party has determined its reservation price and the two parties have exchanged initial
offers, now they must arrive at a price somewhere in the range between the two initial offers.
This situation represents the basic distributive bargaining question—how to distribute the
possible gain available to both parties. How do the negotiators proceed? What motivates them
to make a particular counteroffer, or accept or reject a counteroffer made by the other party?
Negotiations seldom take place in a vacuum. Instead they are often guided by social norms and
accepted practices that are based on the context of the situation. The two negotiators in this
situation might proceed according to one or more common norms, which research and theory
indicate, will most likely guide their behavior.

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