Negotiation Ch 10 Relationships In Negotiation[Sav Lecture]

TUNGHAI UNIVERSITYDepartment of International Business - Taichung

Relationships, Trust and Reputation in

Negotiation

10-1

Four Key Dimensions of Relationships

Key Elements in Managing Negotiations within

Relationships

• Reputation

• Trust

10-3

Key Elements in Managing Negotiations within

Relationships• Reputation

– Perceptual and highly subjective in nature– An individual can have a number of different,

even conflicting, reputations– Influenced by an individual’s personal

characteristics and accomplishments.– Develops over time; once developed, is hard

to change. – Negative reputations are difficult to “repair”

10-4

Key Elements in Managing Negotiations within

Relationships• Trust

– “An individual’s belief in and willingness to act on the words, actions and decisions of another”

– Three things that contribute to trust1. Individual’s chronic disposition toward trust2. Situation factors 3. History of the relationship between the parties

10-5

Key Elements in Managing Negotiations within

RelationshipsTwo different types of trust:• Rules (Calculus-based trust)

– Individual will do what they say because they are rewarded for keeping their word or they fear the consequences of not doing what they say

• Relationship (Identification-based trust)– Identification with the other’s desires and intentions.

The parties effectively understand and appreciate each other’s wants; mutual understanding is developed to the point that each can effectively act for the other.

Key Elements in Managing Negotiations within

RelationshipsTrust (cont.)• Trust is different from distrust

– Trust is considered to be confident positive expectations of another’s conduct

– Distrust is defined as confident negative expectations of another’s conduct – i.e., we can confidently predict that some other people will act to take advantage of us

– Trust and distrust can co-exist in a relationship

10-7

Building a Win Win Relationship

1. Transform personal conflict into task conflict ( Interests vs. positions)

2. Agree on a common goal or shared vision

3. Find a shared problem or shared enemy

4. Focus on the future

How to Build Trust

• Similarity-attraction effect (same boat)• Mere exposure (affinity)• Physical presence• Reciprocity• Schmoozing• Flattery• Self-disclosure

How to Avoid Mistrust

1. Breaches or defections

2. Miscommunication

3. Poor pie expansion

4. Threats

5. Focusing on the “bad apple”

6. False representations

How to Fix a Breach of Trust

• Arrange a personal meeting

• Put the focus on the relationship

• Apologize • Let them vent• Do not get defensive• Ask for clarifying

information

• Test your understanding

• Formulate a plan• Think about ways to

prevent a future problem

• Do relationship check-up at a scheduled date

Recent Research on Trust and Negotiation

Good news about trust and negotiation behavior:

• Many people approach a new relationship with an unknown other party with remarkably high levels of trust

• Trust tends to cue cooperative behavior• Individual motives also shape trust and expectations of

the other’s behavior• Greater expectations of trust between negotiators

leads to greater information sharing• Greater information sharing enhances effectiveness in

achieving a good negotiation outcome

Recent Research on Trust and Negotiation

Did you know:

• Trust increases the likelihood that negotiation will proceed on a favorable course over the life of a negotiation

• Face-to-face negotiation encourages greater trust development than negotiation online

• Negotiators who are representing other’s interests, rather than their own interests, tend to behave in a less trusting way