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Advantages and disadvantages of different negotiation styles
Distributive or integrative negotiation strategy
Advantages and disavantages of negotiation
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1) The difference between distributive and integrative bargaining Negotiation approaches are generally described as either distributive or integrative. At the heart of each strategy is a measurement of conflict between each party’s desired outcomes. Consider the following situation. Chris, an entrepreneur, is starting a new business that will occupy most of his free time for the near future. Living in a fancy new development, Chris is concerned that his new business will prevent him from taking care of his lawn, which has strict requirements under neighborhood rules. Not wanted to upset his neighbors, Chris decides to hire Matt to cut his grass. In a distributive bargaining approach, each negotiator’s objective is in direct conflict with the other. Looking at our situation, each party is concerned about the final price and has a limited number of resources. In starting a new business, Matt’s cash flow is low and there is limit on what he will spend for the service. On the other hand, Chris wants to ensure a high fee but also guarantee he will not lose money after buying gas for his lawnmower. The goal in distributive bargaining is not to find a mutually accepted outcome, but rather that one side gains preferential treatment. In other words, the final result is a win-lose scenario. In distributive bargaining, each party must decide before the negotiation where certain breakpoints lie. For Chris, maybe he can not afford more than $20 for the service, but is willing to pay $15. Conversely, Matt cannot accept less than $12, but would prefer $18. The spread between the resistance points, $12-$20, defines the bargaining range and where a settlement is likely to occur. If the resistance points did not overlap, a negotiation would no... ... middle of paper ... ...ow to manage the process. Additionally, the importance of decision rules grows in importance. In a multiparty negotiation, the failure to establish decision rules at the outset can make consensus building much more difficult. In a bilateral negotiation, the decision rule is simply that each party comes to an agreement. By adding parties, a clearer decision framework needs to be created. This includes discussions on how decisions should be made, whether it is consensus, unanimity or majority ruled. Finally, the addition of parties makes the gathering and sharing of information much more difficult. Negotiations need to be flexible enough to allow new information into a discussion. However, by increasing the size of a group, the amount of new information grows. This makes is challenging to develop creative alternates to solutions and meet participate objectives.
Distributive bargaining consists of two parties in competition to maximize their share of a limited resource. In distributive bargaining, the goals of one party are in fundamental and direct conflict with the goals of the other party (Lewicki, Barry, & Saunders, 2011). In the negotiation over the job offer at Robust Routers, the resources being distributed were the items in the bargaining mix. As the human resources director, my goal was to gain more by giving less, and Joe’s goal was to gain more by receiving more of the company’s resources.
Lewicki, J. R., Barry, B., & Saunders, M. D. (2011). Essentials of negotiation (5th ed.). New York, NY: McGraw Hill. ISBN-13: 9780073530369
Decisions are difficult, especially between two opposing parties determined to get their way. Most likely, some sort of agreement called a compromise is reached. Compromise, a seemingly perfect concept, can be an essential part of success as it resolves conflicts on both an international or personal level and benefits both sides of any argument. However, if this tool is used incorrectly by means of overuse, underuse, or simply wrong timing, that perfection turns into detriment.
Distributive bargaining is a very important negotiation skill. Used as the core of the core of a negotiation, distributive bargaining is defined as, “a negotiation method in which two parties strive to divide a fixed pool of resources, often money, with each party trying to maximize its share of the distribution” (Michael R. Carrell, 2008). Within the distributive bargaining process, the two parties involved have to negotiate over a set of assets in which one person loses and the other gains. This is why Distributive bargaining is also called zero-sum. Carroll explains that distributive bargaining is called a zero-sum process because one party loses whatever amount is gained by the other” (Michael R. Carrell, 2008).
Negotiations styles are scholastically recognized as being broken down into two general categories and those are distributive bargaining styles and integrative negotiation styles. Distributive bargaining styles of negotiation are understood to be a competitive type of negotiation. “Distributive bargaining, also known as positional bargaining, negotiating zero-sum, competitive negotiation, or win-lose negotiation, is a type or style of negotiation in which the parties compete for the distribution of a fixed amount of value” (Business Blog Reviews, 2011). This type of negotiation skill or style approach might be best represented in professional areas such as the stock market where there is a fixed goal in mind or even in a garage sale negotiation where the owner would have a specific value of which he/she would not go below. In contrast, an integrative negotiation approach/style is that of cooperative bargaining, or win-win types ...
Most of the common activities in our daily life present an opportunity to negotiate, whether or not we realise it. Meta-reflecting upon my negotiation experiences during the class and other activities have led me to identify few common themes. In this assignment, the two themes I will be discussing are (1) the importance of being clear on the strategic intent and big picture thinking, and (2) the importance of managing the negotiation process through understanding the various phases and visualising negotiation as a train journey.
My negotiation style questionnaire indicated that my negotiation style was collaborating and accommodating. In addition, I will not avoid negotiation. I felt the result was reasonable because I like negotiation and have never avoided negotiation when I have a chance. I always try to enlarge the size of the pie to be negotiated. However, the class taught me I sometimes accommodated too much and missed a chance to create value in the end. One of the reasons is that I am afraid of getting nothing and overly cautious. This leads me to compromise before maximizing the pie. I believe I can take more risks to create value.
Lewicki, R. J., Saunders, D. M., & Barry, B. (2005). Negotiation, Fifth Ed. New York, NY: McGraw-Hill Irwin.
Principled negotiation allows disputants to obtain what they are entitled to, while enabling them to be fair, at the same time protecting against those who would take advantage of their fairness . Although the points made are logical and indeed a great approach to certain types of conflict, I found that in some cases the method did not completely come together. More than anything, I found the method altogether was simplistic and for an ideal situation. While going through the four elements, I shall illustrate these points.
Lewicki, R. J., Saunders, D. M., & Barry, B. (2010). Negotiation: Readings, exercises, and cases. New York: McGraw-Hill Irwin
JP excelled in many areas of this negotiation, specifically during the negotiation they were able to expand the pie and unlock a significant amount of joint value. In this specific exercise JP and Erika managed to reach the maximum joint value available, a total of 9600 points. The deal they reached is a level 3 integrative agreement, lying on the Pareto-optimal frontier. For a graphical representation of the Pareto-optimal frontier and the deal reached in this exercise, see Appendix B. The ability to achieve a level three agreement is dependent upon strategies used during the negotiation by both sides. JP demonstrated these skills during the exercise, and it is evident that they he was successful since the deal reached was a level 3 integrative deal. Looking at two approaches JP took in order to avoid the fixed pie perception and create an integra...
Planning for this negotiation was more difficult than the first negotiation in class. The first negotiation had a point system; therefore I knew what the maximum, minimum and average amount points were. Not only does the Texoil negotiation not have a point system, but there were two people on my side (sellers) and only one on the other side (buyer).
Lewicki, R., Saunders, D.M., Barry B., (2010) Negotiation: Readings, Exercises, and Cases. 6th Ed. McGraw-Hill Irwin. New York, NY
Negotiation has been used as a vital communication tool not only in business but also in social intercourse. It helps people make common agreement and avoid conflict. So we need to use the tactics which we learned from this course and books to do more practice, only in this way we can gain advantages in negotiation.
Lewicki, R. J., Barry, B., & Saunders, D. M. (2007). Essentials of Negotiation. New York: McGraw-Hill/ Irwin.