IMPLICATIONS FOR TRAINING PEOPLE
As contributors to the body of scientific empirical research on negotiation and conflict resolution, we admit with some embarrassment that much more thought goes into examining the nature of bias and error at the bargaining table than to solutions as to how to eliminate or reduce it.
Perhaps this reflects the fundamental tension between basic and applied research. However, we are not content to naively suggest that mere awareness of bias is sufficient to deal with it. Thus, we have undertaken a line of empirical investigation that asks how negotiators learn and apply principles at the bargaining table; we review the highlights here. Our conclusion about learning to reduce cognitive bias and error at the bargaining table is based on three principles: feedback, analogical reasoning, and behavioral skills.The Importance of Feedback
Most people do not get timely or accurate feedback about their performance. Thus, they continue to make the same mistakes time and again. To return to the fixed-pie perception, we enter the negotiation assuming that the other party’s gain comes at our expense and vice versa. Even if this assumption is false (as it often is), chances are good that we do not realize it and enter our next negotiation with the same fixed-pie assumption. Even if people receive feedback, it is often incomplete or misconstrued, whether by the sender or the recipient. This, of course, is completely consistent with the egocentric biases we discussed earlier.
As a way of combating bias, Thompson and De Harpport (1994) examined the effects of three feedback situations: process feedback, outcome feedback, and no feedback. Negotiators who received no feedback knew nothing about the other party or the underlying structure of the negotiation. They were given a blank sheet of paper and asked to write some comments about the nature of their experience in the negotiation they had just completed.
Negotiators who received outcome feedback were told the value of the overall package to the other party in the completed negotiation. This feedback provided important information about the underlying structure of the negotiation. Finally, negotiators who received process feedback were given complete information about their opponent’s preferences for each issue negotiated. As an example, for a company representative who negotiated an employment contract, process feedback imparted information about how the employee subjectively valued the various issues discussed (salary, vacation, annual raise, and so on).Negotiators who received process feedback were most likely to abandon the pervasive fixed-pie assumption in subsequent negotiations, and to recognize trade-offs that were mutually beneficial for both parties. Suppose two negotiators have just received process feedback after negotiating a job contract. Assume these same parties are to negotiate again about a completely different set of issues, say, regarding a house rental. Having received process feedback, they are likely to assume correctly that not every gain for the other party constitutes an equal loss for themselves. Furthermore, they recognize that mutually beneficial exchanges can be made: if the landlord is to concede on an issue important to the tenant (say, monthly rent), then in exchange the tenant can concede on an issue important to the landlord (lease length). In this way, negotiators who receive process feedback reach agreements that are satisfactory to both parties. By contrast, negotiators who receive only outcome feedback are not as successful in recognizing this integrative potential, and those who receive no feedback are the least successful of all.
Analogical Reasoning
One of the most effective means by which people solve problems is analogical reasoning (Gick and Holyoak, 1983). Analogy is the process of mapping the solution for one problem into a solution for another problem. This involves noticing that a solution to a problem from the past is relevant, and then mapping the elements from that solution to the target problem.
For example, a student learning about the structure of the atom enhances her understanding by drawing on her prior knowledge of the structure of the solar system.In many instances, experienced negotiators have occasion to reason by analogy from a previous negotiation experience but often fail to do so. This problem of failing to capitalize on opportunities to learn by analogy is not limited to negotiators; in general, people’s ability to take full advantage of prior experience is highly limited (Loewenstein, Thompson, and Gentner, 1999). Having solved one problem does not always help in solving an analogous problem if the two come from different contexts. We do not always access prior knowledge, given an analogous situation.
In a study of learning by analogy (Gick and Holyoak, 1983), students were given a problem about how to use radiation to destroy a patient’s tumor, given that the stream of rays at full strength will destroy the healthy tissue en route to the tumor. The solution is to converge on the tumor with low-strength radiation from multiple directions. Having been given this problem and learned the solution, people are then given an analogous one: a general needs to capture a fortress but finds he cannot use his entire army to make a frontal attack. One solution is to divide the army and converge on the fortress from many directions. Even when the tumor problem and the fortress problem are presented in the same session, only about 41 percent of students spontaneously applied the convergence solution to the radiation problem. Though they retained the knowledge about the first solution, they failed to access it. Yet, when simply told to “think about the earlier [tumor] problem,” a full 85 percent of students applied the convergence solution to the new problem. Simply reminding people of an analogous problem helps them map the solution onto the new problem.
The good news for negotiators is that analogy training can substantially improve negotiation performance.
In one study, managers who received analogy training were nearly three times as likely to recognize and apply the appropriate principle in future negotiations (Loewenstein, Thompson, and Gentner, 1999). As a result, negotiators who had analogy training outperformed those who did not. For example, in negotiating a deal for a Broadway production, negotiation dyads with analogy training gained an average of $21,000 over their untrained counterparts, who made suboptimal agreements and left large amounts of money on the bargaining table—wasted, as far as both parties were concerned.In another study of negotiator training, four other learning principles were compared to learning by analogy (Nadler, Thompson, and Van Boven, 2003): (1) learning by observation (watching other negotiators), (2) textbook learning (reading about negotiation principles), (3) learning by feedback (process feedback, as described in the previous section), and (4) learning by experience only (no explicit training). The greatest improvement in negotiator performance was seen with negotiators who had analogy training or observation training. Performance also improved, albeit to a lesser extent, when negotiators learned through feedback. Those exposed to textbook learning or to learning by experience alone showed no measurable improvement in performance. Thus, the picture emerging from this research is that training programs teaching negotiators how to make relevant comparisons between prior and current negotiation experiences is an extremely effective method for improving outcomes.
Behavioral Skills
To be effective at conflict resolution, people need to have strategies that work. Further, the strategies need to be general enough to apply to varying situations. Yet they cannot be so general as to be useless. In this subsection, we identify and discuss five key strategies in the bargaining literature that withstand the difficult test of empirical investigation. (See also Bazerman and Neale, 1992.)
Build Trust and Share Information.
In long-term relationships, people learn to build trust as a way of responding to uncertainty. Even though we lack a close relationship with someone, we might expect to have future interactions: a car dealer who makes a sale might expect the customer to refer friends or engage in repeat business; a job candidate negotiating terms with an interviewer expects to interact with the same person after beginning the job; two managers from different divisions working together toward an organizational goal know they will inevitably have future contact. In all of these situations, opportunity for deceit exists because of informational uncertainty or asymmetry. One way of dealing with this uncertainty is to build trust through sharing information of the sort that clearly indicates an interest in mutual well-being. Sharing such information helps ensure that the parties can continue to develop good working relations for the future.Ask Questions. Building trust is not always possible. Sometimes negotiations are a one-shot deal, where the parties are aware they will never see one another again. Even where future interaction is possible, building trust is still difficult. If trust is absent or unclear, one of the most important strategies to pursue is to ask questions—specifically, to gather information about the opponent’s preferences to ascertain which issues the opponent values most, which option is most preferred on each specific issue, and whether the opponent’s expectations regarding the future differ from your own. Ideally, the issue most valued by your opponent is different from yours, in which case both parties can get what is most wanted by giving up something considered less valuable. But it is difficult to achieve trade-offs without asking about the opponent’s priorities.
Provide Information. If the opponent is reluctant to answer any questions, there is an alternative strategy available: share some information first. Offering information is usually an effective strategy because it invariably triggers the reciprocity principle.
We often feel obligated to return in kind what others have offered or given to us. Reciprocity is a powerful behavioral tendency observable in all human societies. People feel upset and distressed if they receive a favor— or a slight—from another person but are prevented from returning it.Negotiators who extend information about their own interests or priorities are likely to receive some information in return. Although they may not want to reveal their reservation price (the minimum for which they will settle) or their best alternative option, they can still offer information about the relative importance of the issues as they see them. The goal is to exchange just enough information so that the final agreement is maximally beneficial for both parties and divides all resources available without leaving anything left over on the bargaining table.
Make Multiple Offers Simultaneously. Sometimes, negotiators are disappointed to find that their attempts to obtain and seek information are not effective. There is an alternative strategy: make one offer, and wait to hear the opponent’s response. Little can be learned, though, about the opponent’s interests and preferences simply from a single offer that is rejected. A more productive strategy is to make multiple offers. This involves presenting the other party with two (or more) proposals of equal value to oneself. The other party is asked to indicate which of the proposals he prefers. This can reveal valuable information about which issues are important to him. Thus, the negotiator plays detective by drawing conclusions based on the opponent’s response to the multiple offers (Medvec and Galinsky, 2004).
Search for Postsettlement Settlements. Sometimes, parties may decide to renegotiate after a mutually agreeable settlement has been reached. It may seem counterintuitive or counterproductive to resume negotiations after a deal has been struck. But the strategy of postsettlement settlements is remarkably effective in improving the quality of negotiated agreements. Negotiators using this strategy agree to explore other options, mindful that the goal is to find another agreement that both prefer to the current one—with the understanding that they are bound by the initial agreement if another is not found. The postsettlement settlement strategy allows both parties to reveal their preferences without fear of exploitation, because they can safely revert to their previous agreement (Bazerman, Russ, and Yakura, 1987).