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

2. 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

3. 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

4. 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

5. 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

6. 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

7. 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

8. 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

9. 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

10. 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

11. 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

12. 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

13. 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

14. 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