Chapter 8
Conflict and Negotiation
Cobra Cars
Organizational Behaviour
Dave Ludwick, P.Eng, MBA, PMP
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
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
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
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
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
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
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
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
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
Positions for Negotiation
• Settlement Range – the range of possibilities that is
between the bottom lines (BL) of both sides
$
BL2
+ve SR
BL1
BL1
BL2
-ve SR
BL2
BL1
+ve SR means
a deal can be
made
Since SR = 0,
exactly one deal
can be made
-ve SR means
no deal can be
made
• 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
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
rd
3
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
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