Negotiation: individual differences AND self-viEWS Susan Mohammed The Pennsylvania State University APS, 2016

Small differences in salary may become large gaps over time “Assuming that MBAs graduate at age 30 and work until they are 65 and that they receive only a 3% raise per year, the value of a gender gap in starting salary of $10,000 amounts to a gender gap in earnings of more than $600,000 over the course of a career. Assuming 5% annual interest on those additional earnings, that gender gap in earnings becomes a wealth gap of $1.5 million.” Bowles, Babcock, & McGinn, 2005

Women Don’t Ask: Negotiation and the Gender Divide “I talk to people in Personnel, and they say, “Well, this is the high end of the salary range, and this is all we can do.” And I just accepted that. And then after my son was born, my costs were so high for child care and other things that I went to the personal responsible for administration and said, “I have to have a substantial increase.” And I got it. And I realized after that that I could have really negotiated for much more. I could have negotiated for fewer hours; I could have negotiated for a signing bonus; there were lots of things I could have negotiated for, but I didn’t. Because I accepted, “Oh, I want to tie in with the range. I should feel lucky to have this job.” Linda Babcock and Sara Laschever, 2003, p. 48

helpful news Bowles, Babcock, & McGinn (2005) Gender differences in negotiation depend on the situation, which is malleable Gender differences in negotiation are substantially reduced when: There is decreased ambiguity in the economic structure of a negotiation Price comparison information Knowledge of what the market will pay for skills and time Women act on others’ behalf

research on individual differences and negotiation: more Hopeful news Meta-analysis of 75 studies on individual differences and negotiation (Sharma, Bottom, & Elfenbein, 2013) Compared to cognitive ability and personality traits, the most powerful predictors of negotiation performance were: Expectations and beliefs More open to change than core personality

Feelings of appropriateness What expectations and beliefs matter for negotiation performance? (Sharma, Bottom, & Elfenbein, 2013) Feelings of appropriateness How appropriate is it to engage in negotiation and use negotiation tactics? Mindset: Belief that negotiation ability is fixed versus Belief that negotiation ability is malleable and can be learned

A leader development approach to negotiation (Day & Dragoni, 2015) Negotiation self-views affecting willingness to seek out negotiations and set lower/higher aspirations Identity To what extent do you see yourself as a negotiator? Motivation Like to? Feel obligated to? Feel that the benefits will outweigh the costs?

A leader development approach to negotiation (Day & Dragoni, 2015) Negotiation self-views affecting willingness to seek out negotiations and set lower/higher aspirations Self-awareness Deep understanding of strengths and weaknesses, preferences, and how impact others in negotiation Self-efficacy Confidence that one can succeed was the single best predictor of negotiation performance in meta-analysis (Sharma, Bottom, & Elfenbein, 2013)

Modifying expectations and beliefs to improve negotiation performance Experience/Practice With feedback (preferably multiple rating sources) With reflexivity Training programs Build self-efficacy More likely to feel that negotiation is appropriate and can be improved Mentorship