Econstudentlog

Negotiation Theory and Research (2)

Here’s my first post about the book. In this post I’ll talk some more about the findings described in the book; I have included more quotes from the book in this post than I did in the first post because it’s very time-consuming to blog books the way I’ve tried to do over the last week, and I’ll never cover anywhere near the amount of material I’d like to cover if I limit myself to doing things that way.

“experiments by Yukl (1974) traced the location of demands, goals, and limits over time. His data suggest that at the early stages of negotiation, demands are placed well in advance of goals and limits (called overbidding, which may reflect negotiator efforts to create an image of firmness). But over time, overbidding diminishes, and demands come close to or identical with goals. Goals, in turn, tend to approach limits, as wishful thinking becomes eroded. The upshot of these trends is that limits are usually the most stable and demands the least stable of demands, goals, and limits.
A large body of work suggests that the impact of goals on negotiation is similar to those of limits. Higher goals produce higher demands, smaller concessions, and slower agreements; because higher goals produce higher demands, they lead to larger profits if agreement is reached […] There is some evidence that an “anchoring-and-insufficient- adjustment” (Tversky & Kahneman, 1974) process may mediate the impact of goals on negotiation. […] anchoring effects hold for individuals as well as groups of negotiators, and generalize across novices (e.g., students) and professionals (Whyte & Sebenius, 1997).”

The books talks a bit about the dual concern model – see the wiki for a general description. The model’s part of a literature which has focused on how the extent to which individuals care about the outcomes of others relate to their behaviours and outcomes during negotiations. Here’s a relevant quote:

“In a meta-analysis, De Dreu, Weingart, and Kwon (2000b) tested the effects of (a) individual differences (mainly social value orientation), (b) incentives, (c) instructions, and (d) implicit cues (group membership, future interaction, friend vs. stranger) on joint outcomes. For all four, effect sizes indicated that pro-social negotiators achieved higher joint outcomes than selfish negotiators and, importantly, there were no differences between the different operationalizations of social motive. This latter finding indicates a functional equivalence of various ways of implementing social motivation in negotiation.”

More specific findings in this area are probably more questionable than the meta-analytical results, but it’s for example noted in this part of the coverage that one study found that people who were more concerned about the outcomes of others (‘pro-social’) during negotiations saw their negotiation partners as more fair and trustworthy, made greater concessions, and that they both make more generous starting offers yet also end up doing better in the final agreement. Another study found that pro-social individuals were more likely to correctly recall joint-gain task features, whereas people who cared less about the outcomes of others more accurately recalled self-gain features. I would caution that the meta-review finding described above, that the differences in negotiation outcomes between groups of pro-social and selfish negotiators seem to be similar regardless of how the pro-social behaviour comes about, does not necessarily imply that other features of the negotiation process will necessarily be identical across implementation strategies.

People who enter negotiations like to look strong and project an image of toughness, and: “there is evidence that conditions that help negotiators maintain this sense of strength, yet allow them to make concessions, such as the help of a third party, increase the likelihood of agreement”.

“As for the literature on bargaining games, the base finding concerning learning is that inexperienced players often do not know how to maximize their value, but often improve across trials.” However it’s important to note that learning does not always lead to better outcomes: “one’s negotiation experience may also lead to less value creation. There are at least three kinds of reasons. First, prior experience with a skewed sample of negotiation situations (e.g., pure distributive haggling) may lead people to assume that value creation is not possible—and assuming it is not possible should make it less likely to occur […]. Second, prior experience with one kind of counterpart may make it difficult to create value with other kinds of counterparts because of misunderstandings […] Third, O’Connor and Arnold (2001) found that after an impasse, relative to those not experiencing an impasse, negotiators were less interested in working with their counterparts again, planned to share less information in the future, planned to behave less cooperatively, and felt that negotiation was a less effective means for resolving conflicts. And people appear to follow through with these behavioral intentions […], creating a self-reinforcing cycle of poor negotiated outcomes. In short, prior experience can yield lessons that are counterproductive.”

“broadly, there are two important conclusions […] concerning expertise and decision biases. First, practitioners with years of experience nonetheless show decision biases […]. Second, decision biases are surely more consequential for practitioners than novices because the former make more consequential decisions. […] there [has been] little attempt to define what constitutes expertise in decision making. For example, in the Northcraft and Neale (1987) study, the expert population was real estate agents with about 9 years of experience, engaging in about 16 transactions per year. This is only 144 total transactions — by contrast, Chase and Simon (1973) estimated that chess experts knew at least 50,000 chess patterns. Further, a given transaction does not provide all that much clear feedback, and there is little in the way of formal training to serve as a substitute. This is typical for negotiation as well — feedback is typically poor and subject to misinterpretation […], and formal training rarely exceeds a course or two. Impoverished training and poor feedback are troublesome because people’s intuitions are not particularly well honed for effective negotiation […], and expertise appears to require planning, monitoring, analyzing, and reflecting on one’s practice, not merely repeated performance […] trial and error is likely to be inefficient, can lead to misunderstandings, and is in itself a poor means of fostering reflection and reframing, given the paucity of information feedback alone provides. […] negotiators may more readily remember their interpretations about their negotiation than the perceptions on which the interpretations were based. This impedes learning, as the more one abstracts away from what happened, the more one is assimilating the experience to old categories (Argyris & Schon, 1996).”

“Most negotiators are neither novices nor experts. They have negotiated repeatedly in a particular setting […] For this reason, negotiators likely use situated, not general, concepts of negotiation […] Because negotiations occur in a wide variety of settings, people’s knowledge about negotiating is fragmented across situations […]. Not only are sophisticated negotiation strategies artificially limited in scope, people are also limited because they do not think of their actions in a variety of settings as all being negotiations. […] One result is that people’s assumptions about what a negotiation is are shaped by the limited situations they actually think about as being negotiations. For example, people may fail to claim value because they do not realize a situation is a negotiation and simply agree to another’s proposal (Babcock, Gelfand, Small, & Stayn, 2002).”

“Taken together, the articles reviewed here demonstrate that negotiators evaluate their own performance based both on their prenegotiation expectations and their perceptions of how opponents and similar (by role) others performed. […] Rationally, it should not matter how one’s opponent fares in a negotiation if one’s own interests are met, however, the empirical evidence reviewed above indicates that negotiators, quite irrationally, weigh their own success in negotiation against the perceived success of others.”

“Results indicate that a basis for a relationship (in-group status or self-disclosure) elicits positive affect within the negotiation, enhancing rapport and diminishing the likelihood of impasse. […] even trivial relationships facilitate rapport among negotiators, which may result in more cooperative behavior and better outcomes. […] The use of emotion-behaviors as tactical maneuvers in negotiation is often commented on and more frequently implied in discussion of emotion in negotiation. We are aware of just one published empirical paper (an edited volume chapter) that explicitly addressed the topic. Barry (1999) found that negotiators perceive the falsification of emotion (e.g., feigning pleasure, shock) more ethically appropriate than other deceptive negotiation tactics. Findings also suggest that negotiators differentiate between the strategic use of positive versus negative emotions, where feigning a negative emotion was considered less ethically appropriate than feigning a positive emotion.”

“An extensive literature has explored the effects of experienced mood or emotion on cognitive processes such as memory, information processing, and judgment. Several general patterns emerge from this research and may be summarized as follows […]: Affective experiences impact memory encoding and later recall; emotional impressions are often remembered more vividly than other details of social encounters. In addition, mood state during recall biases memory retrieval. Generally, happy (sad) memories are recalled when people are in positive (negative) moods. Information processing also seems to be guided by mood state; individuals in a given mood often seek out and pay greater attention to information that is congruent with that mood. Other research finds an increase in creativity and flexible problem solving when people are happy. […] In addition to the actual variability and stability of emotion over time, one’s predictions about affect in response to future events — “affective forecasting” — is likely to be important for decision making in negotiation. Gilbert, Wilson, and colleagues find consistent support for the theory that people overestimate the intensity and duration of their future emotional reactions to a particular event […] Bazerman
and Chugh […] link these heightened expectations to a broader tendency on the part of negotiators and others to overfocus on a narrow subset of information.”

“Empirical evidence confirms what our everyday experience tells us: some people are more emotionally expressive than others. For example, women perceive themselves to be more skilled at expressing emotion, where men view themselves as more skilled at controlling emotion […]. And indeed, women do tend to be more facially expressive of emotions than men […]. Men, on the other hand, report hiding their emotions more than women […] Emotional suppression is physically challenging for the suppressor, resulting in increases in cardiovascular activation and blood pressure […]. Suppression is also cognitively demanding, negatively impacting memory […] Particularly relevant for negotiation is research suggesting that emotional suppression inhibits relationship formation.”

January 17, 2015 - Posted by | books, Psychology

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