Complex Negotiations

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Multiparty Negotiations (1 of 2)
• Negotiation situations often involve more than two parties,
and involve a myriad of relationships and issues
• A multiparty negotiation is a group of three or more
individuals, each representing his or her own interests,
attempting to resolve perceived differences of interest.

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Multiparty Negotiations (2 of 2)
There are four key challenges of multiparty
negotiations:
• Dividing resources
• Coalitions
• Formulating trade-offs
• Voting and majority rule

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Multiparty Negotiations – Majority
Rule
If not used wisely, voting rules and the use of majority
rule can thwart effective negotiations:
• Majority rule fails to recognize the strength of individual
preferences.
• Consequently, majority rule does not promote integrative
tradeoffs among issues.
• Groups negotiating under unanimous rule reach more
efficient outcomes than groups operating under majority
rule.

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Multiparty Negotiations – Voting
Paradoxes
A variety of paradoxes can affect groups aggregating
the preferences of team members through voting, such
as:
• Condorcet paradox
• Impossibility theorem
• Strategic voting
• Consensus agreements

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Strategies for Successful Multiparty
Negotiations (1 of 2)
Given that multiparty negotiations present special
challenges, the following are strategies negotiators
can use to enhance their ability to expand the pie in a
multiparty context:
• Know who will be at the table
• Manage the information and systematize proposal
making
• Brainstorm options independently
• Develop and assign process roles
• Stay at the table
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Strategies for Successful Multiparty
Negotiations (2 of 2)
Strategies negotiators might use to enhance their
ability to expand and slice the pie in a multiparty
context (continued):
• Strive for equal participation
• Allow for some points of agreement, even if only on
process
• Avoid the “equal shares” bias
• Avoid the agreement bias
• Avoid sequential bargaining

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Coalitions (1 of 2)
Coalitions face three sets of challenges:
• The formation and size optimization of the coalition
• Trust formation and maintenance in coalitions
• The complex distribution of resources among members

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Coalitions – Dividing Resources
Coalitions of negotiators have several methods by
which to divide resources:
• Core Solution model
• Shapley model
• Raiffa’s Hybrid model

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Maximizing Coalitional Effectiveness
The following are behavioral strategies for effectively
navigating coalitions and maximizing their
effectiveness:
• Make your contacts early.
• Seek verbal commitments.
• Use unbiased-appearing rationale to divide the pie.

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Principal-Agent Negotiations:
Advantages
Many advantages can be realized by using agents to
represent one’s interests in a negotiation, such as:
• Expertise in the negotiation process
• Substantive knowledge
• Networks and special influence
• Emotional detachment
• Ratification
• Face saving

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Principal-Agent Negotiations:
Disadvantages
On the reverse, there are disadvantages to using agents
to represent one’s interests in a negotiation, such as:
• Shrinking ZOPA
• Incompatible incentive structure
• Loss of control
• Agreement at any cost

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Principal-Agent Negotiations (1 of 3)
The following are strategies for negotiators who want to
work effectively with agents.
• Shop around
• Know your BATNA before meeting with your agent.
• Communicate your interests to your agent without
revealing your reservation price.
• Capitalize on the agent’s expertise.
• Tap into your agent’s sources of information.
• Use agent networks.

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Principal-Agent Negotiations (2 of 3)
The following are strategies for negotiators who want to
work effectively with agents (continued).
• Discuss ratification.
• Use your agent to help you save face.
• Use your agent to buffer emotions.

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Principal-Agent Negotiations (3 of 3)
Questions That Potential Home Buyers Should Ask Real-
Estate Agents
1. Can you represent me as a buyer’s agent?

2. How will you find me homes?

3. How can you leverage my down payment, interest rate, and

monthly payment?

4. What different points will you be able to negotiate on my behalf?

5. How long have you been selling real estate full time?

6. What can I expect in terms of communication?

7. Does your contract have an “easy exit” clause in it?

8. Under what conditions will you cut your commission?

Source: Based on Ron Holdridge, Re/Max Metro Realty, Seattle, Washington.

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Constituent Relationships
• A constituent is ostensibly on the same side as the
principle negotiator, but exerts an independent influence
on the outcome through the principle negotiator.

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Constituent Relationships –
Challenges
Negotiators may face several challenges with
constituent relationships, including:
• Behind-the-table barriers
• Accountability
• Conflicts of interest

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Constituent Relationships -
Improvements
Negotiators may employ several strategies for
improving constituent relationships.
• Communicate with your constituents.
• Do not expect homogeneity of constituent views.
• Educate your constituents on your role and limitations.
• Help your constituents do horizon thinking.

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Team Negotiation
The presence of at least one team (versus a solo
negotiator) at the bargaining table increases the
incidence of integrative agreements.
Advantages of a team at the negotiation table include:
• Increased size of negotiating pie
• Increased information exchange amongst negotiating
parties
• Increased information exchange which leads to greater
judgment accuracy about parties’ interests
• Integrative agreements are promoted.
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Team Negotiation: Challenges
Several challenges face negotiating teams, such as:
• Teammate selection
• Number of people on the negotiating team
• Communication on the team
• Team cohesion
• Information processing (the common information bias)

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Team Negotiation: Improvement
Strategies
Several strategies can be used to improve team
negotiations, such as:
• Goal and strategy alignment
• Preparing together for the negotiation
• Plan scheduled breaks
• Assess accountability

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Intergroup Negotiation - Challenges
Intergroup negotiation involves a number of challenges,
including:
• Shared versus individual identity
• In-group bias
• Extremism

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Intergroup Negotiation – Optimization
(1 of 2)

Consider the following strategies for optimizing

intergroup negotiations, such as:
• Find and develop a common identity
• Characterize differences as debates, not disagreements
• Cooperative communication
• Greater contact can increase cooperation
• The GRIT model strategy

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 Intergroup Negotiation
GRIT Strategy: Gradual Reduction in Tension
1. Announce your general intentions to de-escalate conflict and your specific intention
to make an initial concession.

2. Execute your initial concession unilaterally, completely, and publicly. Provide as much
verification and documentation as possible.

3. Invite reciprocity from the other party. Expect the other party to react to these steps
with mistrust and skepticism. To overcome this, consider making another concession.

4. Match any reciprocal concessions made by the other party. Invite more.

5. Diversify the nature of your concessions.

6. Maintain your ability to retaliate if the other party escalates conflict. Any such
retaliation should be carefully calibrated to match the intensity of the other party’s
actions.

Source: Based on Barron, R. S., Kerr, N. L., & Miller, N. (1992). Group process, group
decision, group action (p. 151). Pacific Grove, CA: Brooks/Cole.

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Intergroup Negotiation – Optimization
(2 of 2)

Because mere contact does not always lead to better

intergroup relations, the following strategies are
preventative and can ward off destructive competition
between groups:
• Social and institutional support
• Acquaintance potential
• Equal status
• Shared goal
• Cross-group friendships

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