PART II Labor Relations Overview

Chapter 5 Negotiation Models, Strategies, and Tactics

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Chapter Outline
Negotiating Sessions: At the Table Critical Elements in a Negotiation: Information, Time, Power Ethics in Negotiations Bargaining Strategies Distributive Bargaining Integrative Bargaining Interest-Based Bargaining Reaching Agreement
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Figure 5.1 - A Model for Negotiating Sessions

Source: Courtesy of Lou Manchise, former director of mediation services, Federal Mediation and Conciliation Service, A Helpful Model for Negotiations, unpublished manuscript (2008). Used by permission.

Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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Figure 5.1 - A Model for Negotiating Sessions

Source: Courtesy of Lou Manchise, former director of mediation services, Federal Mediation and Conciliation Service, A Helpful Model for Negotiations, unpublished manuscript (2008). Used by permission.

Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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Figure 5.1 - A Model for Negotiating Sessions

Source: Courtesy of Lou Manchise, former director of mediation services, Federal Mediation and Conciliation Service, A Helpful Model for Negotiations, unpublished manuscript (2008). Used by permission.

Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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Figure 5.1 - A Model for Negotiating Sessions

Source: Courtesy of Lou Manchise, former director of mediation services, Federal Mediation and Conciliation Service, A Helpful Model for Negotiations, unpublished manuscript (2008). Used by permission.

Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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Figure 5.1 - A Model for Negotiating Sessions

Source: Courtesy of Lou Manchise, former director of mediation services, Federal Mediation and Conciliation Service, A Helpful Model for Negotiations, unpublished manuscript (2008). Used by permission.

Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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Figure 5.1 - A Model for Negotiating Sessions

Source: Courtesy of Lou Manchise, former director of mediation services, Federal Mediation and Conciliation Service, A Helpful Model for Negotiations, unpublished manuscript (2008). Used by permission.

Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall

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Table 5.1 - Ethical and Unethical Bargaining Tactics

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Bargaining Strategies
Collective bargaining generally involves one of two strategic approaches:
Distributive Integrative

When considering which approach might be best for a given collective bargaining situation:
A negotiator should review information, timing, and power Specific issues to be negotiated The people involved General context of the negotiations
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Distributive Bargaining
A negotiation method described as a winlose situation, in which resources are viewed as fixed and limited, and each side wants to maximize its share Can best be explained by five key elements:
Target point Resistance point Initial offer Settlement range Settlement point
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Distributive Bargaining
Three key starting values
Desired outcome Bottom line Opening offer
Negotiators make opening offers, with one of three types of anchors
Facts Extreme offer Precedent

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Figure 5.2 - Distributive Bargaining Negotiation Model: First-Year Base Wage Increase (percentage)

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Negotiation Norms
Relational norms Fairness norms Reciprocity Good faith bargaining

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Figure 5.5 - How Norms May Affect Counteroffers

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Framing Positions
Presenting an issue to the other side in a negotiation in a way that is convincing and causes the other side to see the proposal in a different light

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Table 5.2 - Four Types of Frames (Applied to Grievance Settlement)

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Use of Framing Questions

Ask why Ask why not Ask what if Ask for advice

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Integrative Bargaining
Both sides seek ways to integrate the interests of both sides into mutually agreeable options

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Integrative Bargaining
The integrative negotiator generally strives to achieve two goals:
To create as much value as possible for both sides To claim as much value as possible for their own interests

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Table 5.3 - Common Differences between Distributive and Integrative Bargaining Techniques

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Principled Negotiations
Emphasize positions versus interests Separate people from issues Focus on objective criteria Develop mutual gains options

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Table 5.4 - The Positions versus Interests of Union and Management

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Figure 5.6 - Steps in the Interest-Based Bargaining Negotiating Process

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Advantages of IBB
Improved communications Uncovers additional ideas and thus superior solutions to problems Uncovers new options Explain the critical why behind an interest or proposal

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Disadvantages of the IBB

Time consuming Negotiators may have difficulty transferring a proposed creative option into a practical, concrete solution The standards suggested by IBB negotiators are often not precise, and are subjective, thus not easily agreed to by both parties

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The Categorization Method

An integrative negotiation method that includes:
Exchanging information Developing a common list of issues Agreeing on compatible issues Exchanging equal value issues Resolving remaining issues using distributive bargaining
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Figure 5.7 - The Five Steps of the Categorization Method of Integrative or Win-Win Bargaining

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Reaching Agreement - Point of Crisis

Negotiators reach a decision If agreement cannot be reached, this may be the point of crisis

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The Closing Stage

Knowing that an agreement has been reached, the people involved become psychologically committed to the agreement

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