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Archive for the ‘Chapter 8: Ethics’ Category

What are ethics?

Ethics are broadly applied social standards for what is right or wrong in a particular situation, or a process for setting those standards.

Ethics grow out of particular philosophies, which purport to:

  1. Define the nature of the world in which we live in
  2. Prescribe rules for living together

Four standards for evaluating strategies and tactics in business negotiation:

  1. End result ethics – Choose a course of action on the basis of results I expect to achieve
  2. Duty ethics – Choose a course of action on the basis of my duty to uphold appropriate rules and principles
  3. Social contract – Choose a course of action on the basis of the norms, values, and strategy of my organization or community
  4. Personalistic ethics – Choose a course of action on the basis of my personal convictions

Ethically ambiguous negotiation tactics:

  1. Traditional competitive bargaining
  2. Emotional manipulation
  3. Misrepresentation
  4. Misrepresentation to opponent’s networks
  5. Inappropriate information gathering
  6. Bluffing

Tactics 1 and 2 are generally viewed as appropriate and are likely to be used. However, the other four categories are generally seen as inappropriate and unethical in negotiation.

Deception by Omission versus Commision

A negotiator using this tactic deceives the other party about what she wants on the common-value issue and then (grudgingly) agrees to accept the other party’s preferences, which in reality matches her own.

Researchers discovered that negotiators used 2 forms of deception in misrepresenting the common-value issue:

  1. Misrepresentation by omission – failing to disclose information that would benefit the other
  2. Misrepresentation by commission – actually lying about the common-value issue

Why Use Deceptive Tactics?

1. The Power Motive

  • To increase the negotiator’s power in the bargaining environment
  • Because negotiation is often primarily an exchange of facts, arguments, and logic between two wholly rational information-processing entities, whoever has better information, or uses it more persuasively, stands to “win” the negotiation
  • Individuals are more willing to use deceptive tactics when the other party is perceived to be uninformed or unknowledgeable about the situation under negotiation, particularly when the stakes are high.

2. Other Motives

  • Individualistic vs Cooperative orientations
  • Individualistic – those looking to maximize their own outcome, regardless of the consequences for the other – more likely to use misrepresentation as a strategy.
  • Cultural Differences à Motivational differences
  • Individuals in a more individualistic culture (like the U.S.) are more likely to use deception for personal gain than those in a more collectivist culture (Israel).
  • Personal motivational orientation – Cooperative vs Competitive

Consequences of Unethical Conduct

Based on 3 aspects of the situation:

1. Effectiveness

  • If using the tactic allows a negotiator to attain rewarding outcomes that would be unavailable if he had behaved ethically, and if the unethical conduct is not punished by others, the frequency of unethical conduct is likely to increase because the negotiator believes he can get away with it

2. Reaction of others

  • Arises from judgments and evaluations by the person who was the “target” of the tactic
  • Depending on whether these parties recognize the tactic and whether they evaluate it as proper or improper to use, the negotiator may receive a great deal of feedback.
  • People who discover that they have been deceived or exploited are typically angry and unlikely to trust the unethical negotiator again, may seek revenge from the negotiator in future dealings, and may also generalize this experience to negotiations with others.

3. Reactions of self

  • Under some conditions – such as when the other party has truly suffered – a negotiator may feel some discomfort, stress, guilt or remorse
  • On one hand, while the use of these tactics may have strong consequences for the negotiator’s reputation and trustworthiness, parties seldom appear to take these outcomes into consideration in the short term
  • On the other hand, particularly if the tactic had worked, the negotiator may be able to rationalize and justify the use of the tactic
  • Some explanations and justifications are as follows:
  1. The tactic was unavoidable
  2. The tactic was harmless
  3. The tactic will help to avoid negative consequences
  4. The tactic will produce good consequences, or the tactic is altruistically motivated
  5. “They had it coming” or “They deserve it” or “I’m just getting my due”
  6. “They were going to do it anyway, so I will do it first”
  7. “He started it”
  8. The tactic is fair or appropriate to the situation
  • These explanations and justifications help people to rationalize the behavior to themselves as well as allow the negotiator to convince others that the conduct that would ordinarily be wrong in a given situation is acceptable

So, How Can Negotiators Deal With The Other Party’s Use of Deception?

1. Ask Probing Questions

  • Research shows that most buyers fail to ask questions, and that asking questions can reveal a great deal of information, some of which the negotiator intentionally leave undisclosed
  • While asking questions can help a negotiator determine whether another negotiator is being deceptive, such cross-examination may actually increase the seller’s tendency to be deceptive in areas where questions are not being asked

2. Force the Other Party to Lie or Back Off

  • Pose a question that forces him or her to tell a direct lie or else abandon or qualify the assertion
  • This kind of question may make the other party nervous about liability for fraudulent negotiator behavior

3. “Call” the Tactic

  • Indicate to the other side that you know he is bluffing or lying
  • Do so tactfully but firmly, and indicate your displeasure

4. Discuss What You See and Offer to Help the Other Party Change to More Honest Behaviors

  • Tries to assure the other party that telling the truth is, in the long term, more likely to get him what he wants, than any form of bluffing or deception will

5. Respond in Kind

  • If the other party bluffs, you bluff more. If she misrepresents, you misrepresent.
  • Not recommended, but if she recognizes that you are lying too, she may also realize that the tactic is unlikely to work

6. Ignore the Tactic

All in all, ethics in negotiator is a blurred topic. There is a fine line between good ethical behavior and unethical behavior. Although some behaviors are clearly unethical, others depend on the culture, personal motivation and reaction of the negotiators.

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