First of all, any negotiation situation has two or more sides involved. Second, needs and desires of the parties may not match at all or the sides may pursue absolutely opposite final goals (Introduction to Negotiation, 2010). Third, negotiations may happen voluntarily which means that the parties are interested in the dialogs hoping that it may result in some benefits for them. Forth, negotiations are a “give and take” process where the parties need to give up certain benefits in order to find a compromise (Introduction to Negotiation, 2010). The fifth characteristic of negotiations is the parties’ preference to resolve the problems in a civilized way by means of a conversation, instead of starting an open conflict (Introduction to Negotiation, 2010).
It is important to mention, that there are no specific instructions as to the ways a conflict should be solved. Finally, the sixth characteristic states that the tangible aspects are to be managed while the intangible ones are to be resolved (Introduction to Negotiation, 2010). Intangible factors are represented by psychological attitudes, emotions, influences, and reputation. These aspects, even though they are intangible, may have a powerful impact on the negotiating sides. In my opinion, fourth and fifth characteristics are more important than some of the others.
They represent accordingly the desire to resolve the problem with a help of negotiation instead of having a confrontation and the understanding of the fact that for the sake of compromise the sides will have to give up some advantages. I believe that these two characteristics are the keys to a civilized negotiation between two sides genuinely willing to avoid an open conflict and help each other achieve what they want to gain some personal benefits in the long run.
Initial Offers, Target Point, and Resistance Point
The initial offer is the very beginning of the negotiation process. The initial offer occurs when one of the negotiating sides starts the dialog by means of proposing certain terms. Initial offer is treated differently by various business makers, some recommend taking initiative and making the first step, while others prefer the opposing side to open the discussion (Business Negotiations: Making the First Offer, n. d.). When it comes to initial offers there are a lot of concerns as to the terms and sizes of the initial offers (is it better to start with high or low offer?), which side is to start the dialog and how to react if an initial offer is declined.
Target point is the moment when a negotiator has achieved desired conditions and would like to stop the negotiations. Resistance point is a bottom line for one of the sides, it is the point that represents minimally acceptable conditions the furthest from what a party desires. Resistance point can be illustrated by a simple sales situation when a customer and a salesperson negotiate the price. Resistance point is the highest price the buyer will agree to pay and the lowest price the seller will accept.
The abbreviation BATNA refers to one’s best alternative to a negotiated agreement, and in other words it is the point where one of the negotiated parties will walk away. Having a beneficial BATNA means having better alternatives which makes one a stronger negotiator. A party that does not have good alternative options is likely to agree to rather unfavorable terms and can be easily manipulated.
Distributive and Integrative negotiation
When it comes to the processes of value claiming and value creation, the negotiations can be divided into two types: distributive and integrative (Introduction to Negotiation, 2010). Distributive negotiations have only one winning side, the other party agrees to accept the terms of the winner. In such situation, the resource is fixed and the task of each party is to claim as much value as possible in order to become the winner of the negotiations. Integrative situations differ from the distributive ones in the aspect of value. In integrative negotiations value is not claimed, it is created.
In other words, the negotiations of this type can be recognized as win-win cases where both sides gain advantages and there is no sole winner. To achieve such outcome, the parties are to cooperate in their search for mutually beneficial solutions. Typically, every negotiation process includes both distributive and integrative processes and the parties may use both approaches simultaneously. Wise negotiators are the ones who know which way to choose – value claiming or creation.
In my opinion, a good contemporary real life demonstration of integrative negotiations is the merger agreement between Tim Horton’s and Burger King. This deal will benefit both parties. The merger will result in the creation of a global corporation with sales income as high as 23 billion dollars a year (Gray, 2014). The new company will be based in Canada and allow both of the merging sides to expand across the border and gain a much larger customer base. Besides, the merger will bring stronger brand awareness for the parties and result in stronger market presence.
Framework in Negotiation
A frame stand for an individual perspective one uses to approach negotiations. Frames can be based on one’s interests, rights, and power. The choice of a frame defines the whole context of the negotiations, the ways that will be used to resolve problems and the course of the dialog in general (Maiese, 2004). In the interest framework, the conflict occurs at the level of the sides’ interests. This frame assumes that the parties are driven by some deeper concerns. The interests of the negotiating sides may be absolutely opposite. In this case, the sides will have to participate in a dialog compromising at the most controversial points.
In the rights framework the negotiators rely on the objective laws, independent rules and standards of legitimacy, equity and fairness (Maiese, 2004). These factors become the main points in the conflict resolution process. Finally, power framework is based on the domination of the stronger party over the weaker one. In such scenario, the conflict is resolved when the dominant side coerces the opponent into following their terms (Maiese, 2004).
The latter frame is definitely a demonstration of a distributive negotiation (because it only has one winner) while the other two are integrative. Unlike power frame, the negotiations based on interests and rights allow the parties achieve mutual agreement and resolve the conflict on terms beneficial for both sides. At the same time, rights framework may also resolve having just one winner in case if one of the sides attempts to win using illegal strategies. In such situation, the right-based approach may quickly reveal the law-breaker, and the other side will automatically become the sole winner.
Barriers to Effective Communication
Every negotiation process is based on communication. This way, the participators obtain the roles of a sender and a receiver of the communicated messages. The sender’s task is to compile and encode a message while the receiver decodes it and responds with a feedback. Filtering is the barrier that is associated with the sender’s manipulations selection of the information they include into the message for the opposing side. Filtering provides the sender with advantages, but the receiver is misinformed. Selective perception is a barrier created by the received. It refers to the sender’s choice to hear and react only to the information that matches their needs and aspirations in the negotiation process.
The whole environment of the negotiation may be disrupted by such barriers as defensiveness (one of the communicators perceives a message of an opponent as threatening and responds negatively causing a chain reaction likely to lead to a conflict), interpretation of language (the sides misinterpret each other’s messages), and information overload (when there is more data shared than the sides can process). These barriers slow down the process of negotiation, lead to miscommunication, may initiate a conflict between the dialoging sides, or even lead to the cancelation of the whole discussion. Barriers negatively affect the productivity of a conversation and result in unnecessary tension between the sides that prevents them from achieving a compromise in a friendly and respectful way and within the shortest period of time.
Active listening stands for the kind of listening that provides one with an opportunity to obtain more information from their opponent, maximize the understanding between the negotiators, and help the sides to cooperate fruitfully (Thompson, 2013). Active listening helps the receiver of the message identify the speaker’s emotions and determine their causes and this way gather more information concerning the speaker’s motivation, interests, passions, and aspiration in a negotiation. Due to its positive effect, active listening helps the listener to ensure trusting and positive attitude from the side of their opponent.
Active listening can be applied in a great variety of fields and situations, it is useful in business negotiations, psychological interventions, political conflict resolutions, crisis response, education, mediation, mentoring, and counseling to name a few. Active listening helps the listener to demonstrate that they follow the conversation and deeply understand it. Moreover, it sends positive signals to the speaker assuring them that their message is received, carefully processed, and appreciated by the opponent. Active listening establishes the atmosphere of friendly cooperation during the negotiation and helps both sides to resolve the problem faster.
Active listening is often used in critical situations requiring professional crisis intervention. An example of such situation is hostage negotiation. Unfortunately, the contemporary history is full of stories about criminals and terrorists using hostages as a shield securing their safety. When people’s lives are at stake active listening is one of the necessary tools required to start and maintain communication between the conflicting sides and at the same time protecting the victims of the crisis. In such cases, professionally trained hostage negotiators are invited to handle the dialog with the offenders helping to achieve a safe conflict resolution. According to the professional hostage negotiators, active listening is a tool that “stimulates positive change” in the opponent and its impact is rather powerful (Thompson, 2013).
Business Negotiations: Making the First Offer. (n. d.). Web.
Gray, J. (2014). Ottawa approves Tim Hortons-Burger King deal. Web.
Introduction to Negotiation. (2010). Web.
Maiese, M. (2004). Interests, Rights, Power and Needs Frames. Web.
Thompson, J. (2013). Active Listening Techniques of Hostage & Crisis Negotiators. Web.