Chapter 8 Conflict and Negotiation Cobra Cars Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Conflict Conflict is a process that begins when one party perceives that another party has negatively affected or will negatively affect something the first party cares about Of course conflicts vary in size and shape Minor disagreements on the layout of reports or document templates Disagreements on ownership of a particular responsibility or problem Inter-company conflict over a scarce market share Wars are conflict over political power and resources on a cultural, social or national level Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

What are some sources of conflict? Conflict can be caused by just about anything, but can be grouped generally into 3 categories: Structural as related to jobs Diversity of goals, reliance on participation and ambiguity across departments can cause interdepartmental conflict Personal Variables. Individuals have different value systems and personality characteristics resulting in conflict over facts or objects Communication As we saw in Chapter 6, its any wonder that as human beings we can actually get any thought across from one to another without causing conflict Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Evaluating Conflict Intentions – a conflict can be caused by one party’s interpretation of another party’s intention Conflict can be positive or negative. Positive conflict supports group performance and is used for the general evaluation of decisions at the workplace Conflict can also be positive in that it reduces group-think. Interestingly, in hiring decisions, executives will often hire like personalities to themselves, thinking to reduce conflict, but also maybe reducing the richness of their decision making Negative conflict usually is interpersonal and does nothing to further the action for a project. It reduces group cohesiveness and slows decision making Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Managing Team Conflict As we have seen conflict over the tasks or the project enrich the decision making around the tasks and projects We can reduce intragroup conflict by: Sharing more info so the facts can be debated Developing multiple alternatives Sharing commonly agreed on goals Injecting humour into the discussion Maintaining a balanced power structure Resolving issues without forcing consensus Exercise p 321, “Not Your Dream Team”. Answer questions 1, 2, 3 Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Negotiation Negotiation – a course of resolution for a conflict. It is a process in which two parties who offer goods and services try to agree upon the exchange rate between them Within negotiations, individuals have Issues, Positions and Interests: Issues are items placed on the bargaining table for discussion (The NHL needs to control its costs to survive long-term) Positions are the individual’s stand on the issue (Cost certainty must be present for the NHL to survive). Positions are the WHAT you want. Interests are the underlying concerns that are affected by the negotiation resolution. Interests are the WHY you want. (If cost certainty is not attained, the NHL may collapse in a few years) Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Types of Bargaining Distributive Bargaining – operates under a zero-sum condition (any gain one side makes comes at the expense of the other) Each party treats the other as an opponent and as a result, when one party loses, there is animosity Integrative Bargaining – operates under the assumption that there exists one or more settlements that can result a win-win solution Makes working together in the future easier, allowing both sides to have victory Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Tactics for Distributive Negotiations Softball – developing good relations with the other side asking lots of questions, showing interest and desire to learn Create and use deadlines and use persuasion Hardball – use of intimidation, anger, guilt, stress, personal attacks and abuse A bogey is when the other side is convinced that an unimportant item is a huge item, such that giving it away seems like a big deal Nibble is the process of going after every last concession once a deal has been substantially made Chicken, similar to playing chicken with cars, is the process of setting up a huge demand and putting a big consequence in place if it is not met Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Tactics for Integrative Bargaining Log Rolling – giving up on an issue if the other side gives up on their issue Bridging – When the bottom lines of each side are too far apart to make a potential settlement, bridging is the use of a creative innovation to bridge the gap Packaging – aggregating many different objects of negotiation to move the negotiations forward Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Positions for Negotiation See Exhibit 8-7 Target Point – what you would like to achieve in the negotiation Resistance Point/Bottom Line – the lowest outcome that is acceptable, beyond which it is better to let negotiations fail Best Alternative To a Negotiated Agreement (BATNA) Your BATNA is your next best alternative if your negotiations fail In the case of the NHL, their next best alternative might be a number of fall back positions (from laying off staff to hiring replacement players) Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Positions for Negotiation Settlement Range – the range of possibilities that is between the bottom lines (BL) of both sides What do you think are the Target, Bottom Line and BATNA for the NHL? For the NHLPA? Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Why do we shoot for a win-win? Why do we shoot for a win-win solution? Clearly a lose-win scenario does not work for us Clearly a lose-lose solution does not work for anyone A win-lose scenario does not work for the other side A win-win scenario is the only scenario that leaves both sides with success Provides both sides with a victory Both sides save face Most importantly: Both sides remain interested in the deal after it is complete, because it makes sense for them Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

3rd Party Negotiations When negotiations reach a stalemate, a 3rd party can help find a solution Conciliation – using a trusted 3rd party who provides an informal communication link between the two sides Often help by researching, interpreting and persuading Mediation – using a neutral 3rd party who facilitates negotiating a solution by using reasoning and persuasion, suggesting alternatives, etc Are more aggressive than conciliators Arbitration – using a 3rd party with the authority to dictate an agreement Always results in a decision Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP

Final Thoughts on Negotiation Negotiations require an understanding of culture Some cultures are conflict oriented and gain recognition through it Some cultures see negotiations as a breakdown and want it fixed immediately Gender affects the negotiation processes Women use dialog to achieve understanding Men use dialog to persuade Negotiation also involves much ettiquette Playing hardball can be seen as aggressive Asking for the other parties bottom line right at the start shows lack of understanding Chapter 9 Organizational Behaviour Dave Ludwick, P.Eng, MBA, PMP