Conflict Resolution,

negotiation
Lecture 3
25% of a manager’s time is
spent responding to
workplace conflict
Learning OutcomeS

1. Conflict
2. Negotiation
 What is conflict?

● Conflict is a situation between at least two interdependent

parties that is characterized by perceived differences and
that the parties evaluate as negative. This often results in
negative emotional states and behaviors intended to prevail

● Conflict is an inevitable and all-pervasive element in our

society and in the world.
CAUSES OF CONFLICT
 Causes of conflict
● Perceptual differences: “Many men, many minds”
● Different goals: Each goal needs money,time, effort
● Value differences: due to philosophical, ideological, moral
concern, etc.
● Status differences: power concern
● Role pressures: overlapping/unclear assignment
● Personality differences: different styles of interacting
Consequences of conflict
Types of Conflict
Conflict can be classified into 2 main categories:

Functional Conflict – arises from within the objectives of the group.

Differences in opinions and values, can have a positive effect on the team
effectiveness.

Dysfunctional Conflict – has negative effects on groups performance.

Conflicts occur in three main areas:

Task – work content and goals
Relationship – relationships between individuals
Process – how the work is to be carried out.
Conflict resolution

Kilmann and Thomas

Conflict Model (1975)
Competing
Competing is effective:
● When quick decisive action is needed
● When unpopular action must be taken
on important issues
● When the issue is vital and the right
course is clear
● To protect against people who take
advantage of non competitive
behavior
Accommodating
Accommodating is effective:
● When you are wrong, learning is
important, or demonstrating
reasonableness is critical
● When creating goodwill is
paramount
● When harmony is important
Avoiding
Avoiding is effective:
● When the issue is relatively trivial
● When you know you can’t be
satisfied
● When the costs of conflict outweigh
the benefits of resolution
● To allow time to “cool off”
● When others can resolve the issue
more effectively
Collaborating
Collaborating is effective:
● When it’s important that both sides be
integrated
● When you want to learn and fully
understand others’ views
● To merge different perspectives and
insights
● To work though hard feelings that have
interfered with interpersonal
relationships
Compromising
Compromising is effective:
● When goals are less important than
avoiding the disruption caused by more
assertive conflict resolution styles
● When people have equal power and
commitment to mutually exclusive goals
● To quickly reach a solution
● When it’s important to reach a win-win for
all involved
 Strategy Outcome Response

Competing Win-Lose Do as I say

Avoiding Lose-Lose Not interested

Compromising Win some/ Give and take

Lose some
Accommodating Lose-Win Anything you
want

Collaborating Win/Win DO IT TOGETHER!

Negotiation
Negotiation
A process in which two or more parties exchange
goods or services and attempt to agree on the
exchange rate for them.
• Everyone negotiates on a daily basis (Samina &
Vinta, 2010, p. 26)
•Negotiation is a skill, not a profession
•Vital personally and for organisations
•Negotiating ability is learned through experience
and training (Rai 2013).
Negotiation

1. More than one party is involved

2. There is a conflict of needs and desires between two
or more parties
3. The parties negotiate by choice
4. Successful negotiation involves the management of
tangible (e.g the price or the terms of agreement)
and also the resolution of intangibles.
Phases to a Negotiation

1.Preparation
2.The actual negotiation or
bargaining
3.Closure and commitment
Two general approaches

1. Distributive negotiation: negotiation that seeks

to divide up a fixed amount of resources; win-lose
situation
1. Integrative negotiation: negotiation that seek
one or more settlements that can create a
win-win situation
Value Creation

1. Differences in interests
2. Differences in judgments about the future
3. Differences in risk tolerance
4. Differences in time preference
distributive bargaining (1)

● The goals of one party are

usually in fundamental and
direct conflict with the goals
of the other party.
● Resources are fixed and
limited
● Both parties want to maximize
their share
 distributive bargaining (2)
● Buyer’s preferred price : target point
● The price beyond which buyer will not go: resistance point (the most he
will pay as a buyer/ the smallest amount as a seller)
● The initial price set by the seller : asking price / target point
Buyer might decide to counter seller’s asking price with his initial offer - the
first number he will quote to the seller
How does the buyer decide on
his initial offeR?
 distributive bargaining (2)
● Buyer’s preferred price : target point
● The price beyond which buyer will not go: resistance point (the most he
will pay as a buyer/ the smallest amount as a seller)
● The initial price set by the seller : asking price / target point
Buyer might decide to counter seller’s asking price with his initial offer - the
first number he will quote to the seller
BEST ALTERNATIVE TO A NEGOTIATED AGREEMENT (BATNA)

A best alternative to a negotiated

agreement (BATNA) is a course of action
that a party engaged in negotiations has
determined should be taken if talks fail and
no agreement can be reached.
Factors affect the process

1. Cost of delay
2. Valuation of an issue
 Tactical tasks
(1) assess the other party’s target, resistance point,
and cost of terminating negotiations;
(2) manage the other party’s impression of the
negotiator’s target, resistance point, and cost of
terminating negotiations,
(3) modify the other party’s perception of his or her
own target, resistance point, and cost of terminating
negotiations
(4) manipulate the actual costs of delaying or
terminating negotiations.
Integrative negotiation

● one or more of the possible settlements can

create a win–win solution.
● “two to tango”—both parties must be
engaged for it to work.
● Builds long-term relationships.
Considerations Integrative Bargaining Distributive Bargaining

Likely result of continued Win-win High Win-Lose Low

relationship between parties

Goal Collaborate and generate multiple Winner takes all (scarcity

options or solutions; expand the mentality); distribute a fixed pie
pie

Bargaining climate Open communication, creative, Determination to win, willingness to

willing to change walk away, less open, ends justify
the means

Amount of time needed More Less

Time horizon Current and future Immediate only

Expanding the pie
Interests: the underlying
concerns, needs, desires, or
fears that motivate a negotiator

WHY - why they want what they

want
The method

● Separate the PEOPLE from the Problem

● Focus on INTERESTS
● Invent OPTIONS for Mutual Gain
Language point
 We don’t get what we
want in this life, we get
what we negotiate