Perception, Cognition, and Emotion in Negotiation PO NC5

CHAPTER FIVE

Perception, Cognition, and Emotion in Negotiation

The basic building blocks of all social encounters are:

•           Perception

•           Cognition

–      Framing

–      Cognitive biases

•           Emotion

 

Perception

Perception is:

 

•           The process by which individuals connect to their environment.

•           A “sense-making” process                                           

 

 

The Process of Perception

Perceptual Distortion

•          Four major perceptual errors:

–    Stereotyping

–    Halo effects

–    Selective perception

–    Projection

Stereotyping and Halo Effects

•            Stereotyping:

–       Is a very common distortion

–       Occurs when an individual assigns attributes to another solely on the basis of the other’s membership in a particular social or demographic category

•            Halo effects:

–       Are similar to stereotypes

–       Occur when an individual generalizes about a variety of attributes based on the knowledge of one attribute of an individual

 

Selective Perception
and Projection

•            Selective perception:

–       Perpetuates stereotypes or halo effects

–       The perceiver singles out information that supports a prior belief but filters out contrary information

•            Projection:

–       Arises out of a need to protect one’s own self-concept

–       People assign to others the characteristics or feelings that they possess themselves

 

Framing

•            Frames:

–       Represent the subjective mechanism through which people evaluate and make sense out of situations

–       Lead people to pursue or avoid subsequent actions

–       Focus, shape and organize the world around us

–       Make sense of complex realities

–       Define a person, event or process

–       Impart meaning and significance

 

 

Types of Frames

•           Substantive

•           Outcome

•           Aspiration

•           Process

•           Identity

•           Characterization

•           Loss-Gain

How Frames Work in Negotiation

•            Negotiators can use more than one frame

•            Mismatches in frames between parties are sources of conflict

•            Parties negotiate differently depending on the frame

•            Specific frames may be likely to be used with certain types of issues

•            Particular types of frames may lead to particular types of agreements

•            Parties are likely to assume a particular frame because of various factors

 

Interests, Rights, and Power

Parties in conflict use one of three frames:

•            Interests: people talk about their “positions” but often what is at stake is their underlying interests

•            Rights:  people may be concerned about who is “right” – that is, who has legitimacy, who is correct, and what is fair

•            Power:  people may wish to resolve a conflict on the basis of who is stronger

The Frame of an Issue Changes as the Negotiation Evolves

•            Negotiators tend to argue for stock issues or concerns that are raised every time the parties negotiate

•            Each party attempts to make the best possible case for his or her preferred position or perspective

•            Frames may define major shifts and transitions in a complex overall negotiation

•            Multiple agenda items operate to shape issue development

Some Advice about Problem Framing for Negotiators

•            Frames shape what the parties define as the key issues and how they talk about them

•            Both parties have frames

•            Frames are controllable, at least to some degree

•            Conversations change and transform frames in ways negotiators may not be able to predict but may be able to control

•            Certain frames are more likely than others to lead to certain types of processes and outcomes

Cognitive Biases in Negotiation

•           Negotiators have a tendency to make systematic errors when they process information.  These errors, collectively labeled cognitive biases, tend to impede negotiator performance. 

Cognitive Biases

•                      Irrational escalation of commitment

•                      Mythical fixed-pie beliefs

•                      Anchoring and adjustment

•                      Issue framing and risk

•                      Availability of information

 

 

•            The winner’s curse

•            Overconfidence

•            The law of small numbers

•            Self-serving biases

•            Endowment effect

•            Ignoring others’ cognitions

•            Reactive devaluation

 

Irrational Escalation of Commitment and Mythical Fixed-Pie Beliefs

•            Irrational escalation of commitment

–       Negotiators maintain commitment to a course of action even when that commitment constitutes irrational behavior

•            Mythical fixed-pie beliefs

–       Negotiators assume that all negotiations (not just some) involve a fixed pie

Anchoring and Adjustment
and Issue Framing and Risk

•            Anchoring and adjustment

–       The effect of the standard (anchor) against which subsequent adjustments (gains or losses) are measured

–       The anchor might be based on faulty or incomplete information, thus be misleading

•            Issue framing and risk

–       Frames can lead people to seek, avoid, or be neutral about risk in decision making and negotiation

Availability of Information
and the Winner’s Curse

•            Availability of information

–       Operates when information that is presented in vivid or attention-getting ways becomes easy to recall.

–       Becomes central and critical in evaluating events and options

•            The winner’s curse

–       The tendency to settle quickly on an item and then subsequently feel discomfort about a win that comes too easily

Overconfidence
and the Law of Small Numbers

•            Overconfidence

–       The tendency of negotiators to believe that their ability to be correct or accurate is greater than is actually true

•            The law of small numbers

–       The tendency of people to draw conclusions from small sample sizes

–       The smaller sample, the greater the possibility that past lessons will be erroneously used to infer what will happen in the future

Self-Serving Biases
and Endowment Effect

•            Self-serving biases

–       People often explain another person’s behavior by making attributions, either to the person or to the situation

–       There is a tendency to:

•       Overestimate the role of personal or internal factors

•       Underestimate the role of situational or external factors

•            Endowment effect

–       The tendency to overvalue something you own or believe you possess

 

Ignoring Others’ Cognitions
and Reactive Devaluation

•            Ignoring others’ cognitions

–       Negotiators don’t bother to ask about the other party’s perceptions and thoughts

–       This leaves them to work with incomplete information, and thus produces faulty results

•            Reactive devaluation    

–       The process of devaluing the other party’s concessions simply because the other party made them

Managing Misperceptions and Cognitive Biases in Negotiation

The best advice that negotiators can follow is:

•            Be aware of the negative aspects of these biases

•            Discuss them in a structured manner within the team and with counterparts

Mood, Emotion, and Negotiation

•           The distinction between mood and emotion is based on three characteristics:

–      Specificity

–      Intensity

–      Duration

Mood, Emotion, and Negotiation

•            Negotiations create both positive and negative emotions

•            Positive emotions generally have positive consequences for negotiations

–       They are more likely to lead the parties toward more integrative processes

–       They create a positive attitude toward the other side

–       They promote persistence

Mood, Emotion, and Negotiation

•            Aspects of the negotiation process can lead to positive emotions

–       Positive feelings result from fair procedures during negotiation

–       Positive feelings result from favorable social comparison

Mood, Emotion, and Negotiation

•            Negative emotions generally have negative consequences for negotiations

–       They may lead parties to define the situation as competitive or distributive

–       They may undermine a negotiator’s ability to analyze the situation accurately, which adversely affects individual outcomes

–       They may lead parties to escalate the conflict

–       They may lead parties to retaliate and may thwart integrative outcomes

–       Not all negative emotion has the same effect

Mood, Emotion, and Negotiation

•            Aspects of the negotiation process can lead to negative emotions

–       Negative emotions may result from a competitive mind-set

–       Negative emotions may result from an impasse

–       Negative emotions may result from the prospect of beginning a negotiation

•            Effects of positive and negative emotion

–       Positive feelings may generate negative outcomes

–       Negative feelings may elicit beneficial outcomes

•            Emotions can be used strategically as negotiation gambits