Making the Most of the First‐Offer Advantage: Pre‐Offer Conversation and Negotiation Outcomes

Why do some negotiators benefit from making the first offer during negotiations while others do not? This study explores the contents of conversations that take place before negotiators make their first offers in order to learn more about the differences between ultimately successful first offers that benefit from anchoring effects and ultimately unsuccessful ones in which negotiators apparently derive no benefit from making the first offer. In‐depth qualitative analyses of the conversations that role players engaged in prior to their first offers were conducted in simulated negotiation exercises. Their analysis identified five different conversational tactics that negotiators employed in one‐on‐one negotiations to gain power in the negotiation, or what they call here “power conversation tactics.” Their findings suggest that the negotiation outcome (i.e., net value) was related to how the negotiators employed and combined these tactics during the pre‐offer conversation. Based on these findings, they conceptualized four types of power‐gaining/power‐losing pre‐offer conversation scenarios and explored the link between negotiation outcomes and each of these types of pre‐offer conversations. This study further develops the literature on power dynamics and conversations in negotiations as well as the literature on the anchoring effect of a first offer.     

Negotiators as Mediators: The Case of 1987–1995 Korea–United States Bilateral Trade Negotiations

Despite their widely recognized benefits, integrative approaches to negotiation have seldom been effectively used in interorganizational negotiations. This study analyzes the 1987–1995 Korea–United States Trade Negotiations, identifying elements in those talks that could have moved the negotiations in a more integrative direction. The role of building relationships — especially between key negotiators — is examined. Informal negotiations between the key negotiators from both sides were crucial in building such relationships, which helped both sides create solutions for mutual gains. This process was realized, inter alia, by the dual role that the key negotiators took on as negotiators and as mediators.     

From Lab Experiments to Real Negotiations: An Investigation of International Iron Ore Negotiations

Negotiation researchers have conducted a large number of experimental lab studies to identify the factors that affect negotiation outcomes, but it remains unclear whether those results can be generalized to real‐world negotiations. To explore this question, we analyzed the dynamic international iron ore annual negotiations that took place from 2005 to 2009. We found evidence that supports two important findings from previous experiments. Specifically, we focused on the impact of negotiators’ best alternatives and first offers on negotiation prices using multiple case study analysis. We found that iron ore prices increased more when the gap between the previous year's negotiated price and the price on the alternative spot market, a public market in which commodities are traded for immediate delivery, was larger, which suggested that buyers were sensitive to the strength of this alternative, supporting the literature on the role of alternatives. We also found that the first offer price significantly influenced the final price. Our findings extend two important experimental findings from the negotiation literature to large‐scale business negotiations in the real world.     

Beyond Frogs and Scorpions: A Risk‐Based Framework for Understanding Negotiating Counterparts' Ethical Motivations

Managing the flow of valid information is one of the biggest challenges that negotiators face. The high incidence of questionable or unethical negotiating tactics has been well documented, but ways of dealing with the deceptive practices of a counterpart have received comparatively little attention. In this article, we suggest that, in addition to avoidance and confrontation, negotiators typically attempt to manage the unethical tendencies of their counterparts through twelve neutralizing approaches. These approaches are based on four types of perceived risk that counterparts often consider when deciding whether to use ethically ambiguous negotiation tactics: risks to immediate or short‐term goals/tasks; risks to immediate or short‐term relationship(s); risks to future or long‐term goals/tasks; and, risks to future or long‐term relationships. By applying expectancy theory, resource dependency theory, social identity theory, and social network theory to this framework, we have developed propositions related to these twelve neutralizing approaches. We also discuss the opportunities and challenges related to evaluating these propositions in future research.     

Predicting Competitive‐Unethical Negotiating Behavior and Its Consequences

This study examines the relationships between negotiators' attitudes toward competitive and unethical tactics, their actual use of those tactics, and their subsequent perceptions of performance and reputation in two‐party, e‐mail‐based negotiations. The results indicate several predictors of competitive‐unethical behavior, including a negotiator's attitude toward competitive‐unethical tactics, early use of competitive‐unethical tactics, and the behavior of a negotiating counterpart. Furthermore, it was the perceived honesty of one's counterpart rather than the actual use of competitive‐unethical behaviors that was associated with a negotiator's perceptions of the collective or joint outcome. The implications of these findings are discussed, along with suggestions for future research.     

BABO Negotiating: Enhancing Students’ Perspective‐Taking Skills

Negotiation educators recognize that collaborative problem‐solving is a critical negotiation skill. Negotiation outcomes are often better when negotiators take a collaborative approach to the process, and they are better able to do this when they are able to take the perspective of the person with whom they are negotiating. Over the years, I have developed several techniques to help my students improve their collaboration and perspective‐taking skills. One of these techniques is to use collaborative terminology (BABO = both are better off) rather than more competitive language (win‐win). In this article, I describe the strategies I employ in my negotiation class to increase students’ perspective‐taking capacities and discuss how this focus enhances their ability to negotiate collaboratively.     

Perceptions of Time and Their Impact on Negotiations in the Arabic-Speaking Islamic World

This article examines how perceptions of time affect Arabic-speaking Islamic negotiators and how their attitudes about time, and their corresponding behaviors, may differ from those of their Western counterparts. We begin by identifying cultural differences in the conceptualization of time and then comment on the role of time in negotiations, discussing how time influences bargaining, trust, and negotiation tactics. In the section on tactics, we discuss stall-and-delay tactics, the use of the past as an objective standard, and limits on negotiating the future. Our purpose is to encourage negotiators from the West to be knowledgeable about the way they, as well as negotiators from Arabic-speaking Islamic cultures, conceive of and use time in negotiations. We believe that understanding that the very concept of time is often quite different in these two cultures is an important step in facilitating negotiations that cross these cultural boundaries.     

A Network Perspective on Negotiation: What Is New and Why It Matters

The resources that individual negotiators need to solve their problems are not available in a single, concentrated form, and they are certainly not available only within an isolated dyad itself. Instead, the necessary resources are widely dispersed among many actors within networks of business relationships. The best deal is unlikely to be fixed or predetermined, but is rather the outcome of long and time‐consuming negotiations that will then affect further negotiations. In this article, I describe a network perspective on negotiation that considers the relevance and impact of three phenomena that I call (1) vast connectivity, (2) multiple constitutions, and (3) ongoing consent. I further illustrate the applicability of these three factors using examples of real‐life negotiations.     

The Curse of the Smartphone: Electronic Multitasking in Negotiations

In this study, we have explored the use of mobile phones during negotiations. Specifically, we examined the effects that multitasking — reading messages on a mobile phone while negotiating face to face — had on the outcome achieved in a negotiation, as well as on perceptions of professionalism, trustworthiness, and satisfaction. Using an experimental design in a face‐to‐face dyadic negotiation, we found that multitasking negotiators achieved lower payoffs and were perceived as less professional and less trustworthy by their partners.     

Hypothetical Questions as Strategic Devices in Negotiation

In this article, we analyze the use of hypothetical questions in integrative negotiation. We argue that hypothetical questions are useful devices for advancing implicit proposals and can also provide strategic argumentative support for the acceptance of a particular solution. To explain why negotiators prefer to use hypothetical questions when putting forward implicit proposals and to demonstrate how these questions fulfill negotiators' argumentative purposes, our study uses the pragma‐dialectical concept of strategic maneuvering and applies it to the analysis of a number of real‐life negotiations. We conclude by demonstrating that hypothetical questions can be effective devices for strategic maneuvering and that negotiators can employ these kinds of questions to resolve some of the rhetorical predicaments imposed by the negotiator's dilemma as well as to gain a competitive edge over their counterparts.     

Precedents in Negotiated Decisions: Korea–Australia Free Trade Agreement Negotiations

Initial random acts can be replicated and evolve into precedents, but precedents can also be built with strategic intent. Regardless of their origin, strategically applying a particular precedent or effectively refuting the relevance of a precedent can help a negotiator control decisions and achieve interdependent goals. The purposeful use of precedents has received little attention in the negotiation literature, even though using precedents can be a powerful negotiating tactic. In this study, we examine how past decisions became precedents that helped establish the Korea–Australia Free Trade Agreement of 2014 (KAFTA). We further consider how precedents established through KAFTA later influenced trade negotiations with Canada, China, India, and Japan. Following an extensive literature review and field research, we developed a two‐dimensional matrix (precedent ownership and negotiator goals) to help guide negotiators both offensively (what I want from you) and defensively (what I don't want to give you). We conclude by proposing research to enhance our understanding of temporal issues in negotiation. No previous study within the negotiation literature has examined precedents empirically.     

Hard Bargaining in the Classroom: Realistic Simulated Negotiations and Student Values

Empirical research into the negotiation practices of lawyers shows that “hard bargaining,” including at least some unethical conduct, is an inescapable fact of a lawyer's life. To prepare students for legal practice, negotiation instructors must expose them to hard bargaining in the classroom. In doing so, however, instructors should be sensitive to the moral and ethical values of their students, so that the classroom experience does not unduly pressure students to compromise their values. The simulation is the primary tool of negotiation instruction. By selecting and manipulating simulations, a negotiation instructor can expose students to a wide range of negotiating behaviors, from distributive negotiations marked by the use of power tactics to value‐creating negotiations in which participants must consider many interests and collaborative strategies predominate. With that flexibility, however, comes the potential for classroom exercises to pressure students, in ways both subtle and overt, to adopt behaviors that feel uncomfortable. In this article, I examine the use of simulations to teach different types of negotiating behavior, including hard bargaining. Referring to a number of widely available simulations, I suggest ways to focus student attention on three dimensions of negotiation behavior — the issues over which the parties are bargaining, the objectives the parties seek, and the tactics the parties use to achieve their objectives — in order to push students to reflect on their own negotiation behaviors and to prepare for the tactics of others. I assess the potential for simulations to pressure students to compromise their values, and I conclude with my own thoughts on the goals of a negotiation course.     

The Meaning of Intuition for the Negotiation Process and Outcome

Intuition is a useful tool for negotiators, as negotiations are often highly complex endeavors in which people make holistic judgments with incomplete information and no time for deliberation. Therefore, one might expect that intuition greatly influences negotiations and their outcomes and that negotiators would use intuition to their advantage. However, there is almost no systematic research into the meaning of intuition for negotiation. In this conceptual paper, drawing on five interviews of experienced negotiators, we apply general research on intuition to the specific case of negotiation and find that negotiators use intuition specifically for attribution and social interaction. We distinguish different intuition attitudes; identify preparation, time, and negotiation stages as relevant drivers for the use of intuition in negotiation; clarify the distinction between intuition and routine; and shine new light on the concept of domain-specific knowledge.     

Panacea or Snake Oil? Interest‐Based Bargaining in the U.S. Airline and Rail Industries

This study of interest‐based bargaining (IBB) examined past usage, current preferences, and future intentions to use this approach in U.S. airline and railroad labor negotiations. Based on a survey of eighty‐four union and management chief negotiators, we found that the personal attributes of the chief negotiator (orientation toward relationships, personal conflict handling style, and competency in IBB approaches) were strong predictors of the past use of IBB. However, personal affinities and styles became irrelevant as experience with IBB accumulated. The negotiator's preferences for IBB in general were strongly correlated to his or her awareness of other carriers' and unions' experiences with IBB, as well as to his or her own direct experience. The negotiator's intention to use IBB in the future was also related to the quality of the contract personally obtained through IBB practices. The study also revealed the unpopularity of IBB among labor negotiators relative to their management counterparts.     

When Negotiations Become Routine: Not Reinventing the Wheel While Thinking Outside the Box

In this article, we seek to apply the insights of recent research on routine to the context of repeated negotiations. To demonstrate the link between both concepts, we introduce an analytical framework in which we identify different negotiation situations in which routine can develop. We distinguish two dimensions of the negotiation process: a problem-solving dimension and a communication dimension. Our framework for analyzing the role of routine in negotiation is built around these two dimensions. We define those skills that we argue in repeated negotiations can help negotiators manage particular kinds of negotiations depending on the level and type of routinization that type of negotiation involves. Moreover, we demonstrate that our framework is inherently dynamic, which we illustrate with simplified business examples.     

The Walk in the Woods: A Step‐by‐Step Method for Facilitating Interest‐Based Negotiation and Conflict Resolution

In this article, we describe a method we have used successfully in both academic and professional settings to rapidly introduce novice negotiators to the principles and practice of interest‐based negotiation: “the walk in the woods.” The walk incorporates much of the principles of interest‐based negotiation: fostering self‐awareness, cultivating curiosity, and understanding the importance of world view. The walk's effectiveness is illustrated in this article using the case of the merger of two large, complex health‐care organizations.     

Low Power,First Offers,and Reservation Prices: Weak Negotiators are Self-anchored by Their Own Alternatives

Although most scholars recommend making the first offer in negotiations, recent research and practitioners' experience have uncovered a second-mover advantage in certain situations. In the current article, we explore this first- versus second-mover dynamic by investigating the circumstances under which negotiators would make less favorable first offers than they would receive were they to move second, focusing on the effects of negotiation power in the form of alternatives. Additionally, we examine the effects of low power on reservation prices and whether these effects could be mitigated using an anchor-debiasing technique. In Study 1, we manipulated negotiators' power in the form of the best alternative to the negotiated agreement and examined its effect on first offers and reservation prices. Our results showed that low-power negotiators would receive more favorable first offers than they would have made themselves when facing either low- or medium-power counterparts. Also, our results suggest that low-power negotiators had less favorable reservation prices than their medium- and high- power counterparts. In Study 2, we investigated whether this effect would persist in the face of anchor-debiasing techniques. Our results showed that while anchor-debiasing techniques did improve their first offers, low-power negotiators would still benefit from making the counteroffer rather than moving first. Our findings uncover the disadvantageous effects of low power on first-offer magnitude while offering practical advice to negotiators.     

East Asians’ Social Heterogeneity: Differences in Norms among Chinese,Japanese, and Korean Negotiators

East Asian cultures are widely held to be fairly homogeneous in that they highly value harmonious social relationships. We propose, however, that the focus (dyadic versus group) and the nature (emotional versus instrumental) of social relations vary among the Chinese, Japanese, and Korean cultures in ways that have important implications for the negotiation tactics typically employed by managers from these three cultures. Our data are from a web survey administered to three hundred eighty‐eight managers from China, Japan, and South Korea. In this article, we discuss how the differences in the focus and the nature of business relationships in China, Japan, and Korea are manifested in the different norms for negotiation tactics endorsed by managers from these three countries.     

Diplomatic Interactions and Negotiations

This article examines the role of state actors, organization agencies, and individual agents in diplomatic interactions and negotiations. States as diplomatic actors, organizations as diplomatic agencies, and individuals as diplomatic agents enter into complex and interdependent relationships. Proposing a three‐level analysis of interstate interactions and diplomatic negotiations, I argue that no diplomatic negotiation happens without interactions between parties at the state, organizational, and individual levels. The agency–structure paradigm provides a conceptual framework for understanding behavioral and structural properties of international interactions and their influence on diplomatic negotiations. Diplomatic negotiation employs specific forms of interaction, using a distinct language, protocol norms, symbols, ceremonies, and rituals. The state's “self” (as a social conception of its identity, values, and interests) affects the process of diplomatic negotiation. By managing, organizing, and improving international interactions at the actor, agency, and agent levels, negotiating parties can advance the process and effectiveness of diplomatic negotiation.     

Cognitive Maelstroms,Nested Negotiation Networks,and Cascading Decision Effects: Modeling and Teaching Negotiation Complexity with Systemic Multiconstituency Exercises

Negotiation practitioners today struggle to manage complex political, economic, and cultural disputes that often involve an array of intertwined issues, parties, process choices, and consequences – both intended and unintended. To prepare next‐generation negotiators for these multifaceted challenges, negotiation instructors must keep pace with the rapidly evolving complexity of today's world. In this article, we introduce systemic multiconstituency exercises (SMCEs), a new educational tool for capturing this emerging reality and helping to close the experiential learning gap between the simulated and the non‐simulated environment. We discuss our pedagogical rationale for developing The Transition, a seventy‐two‐party SMCE inspired by the complex conflicts in Afghanistan and Central Asia and then describe our experiences conducting multiple iterations of this simulation at Harvard University. We argue that SMCEs, in which stakeholders are embedded in clusters of overlapping networks, differ from conventional multiparty exercises because of their immersive character, emergent properties, and dynamic architecture. This design allows for the creation of crucial negotiation complexity challenges within a simulated exercise context, most importantly what we call “cognitive maelstroms,” nested negotiation networks, and cascading decision effects. Because of these features, SMCEs are uniquely suited for training participants in the art of network thinking in complex negotiations. Properly designed and executed, systemic multiconstituency exercises are next‐generation teaching, training, and research platforms that carefully integrate negotiation, leadership, and decision‐making challenges.