Chapter 14: Conflict and Negotiation
Conflict: a process that begins when one party perceives that another party has negatively affected or is
about to negatively affect something that the first party cares about. Conflict encompasses a wide range of
issues including the following: incompatibility of goals, differences in interpretations of facts,
disagreements over behavioral expectations
Functional Conflict: Positive, enhances group performance by encouraging innovation.
Dysfunctional Conflict: Negative, leads to destructive outcomes.
Traditional View(1930s-40s): All conflict was assumed to be bad and to be avoided. Conflict was
viewed negatively and was discussed with such terms as “violent, destructive, and irrational.” Conflict
was a dysfunctional outcome resulting from poor communication, a lack of trust between people, & the
failure of managers and leaders to be responsive to the needs and aspirations of their employees.
Interactionist View(1950s-60s): Encouraged conflict. Based on the belief that a harmonious group was
prone to becoming static, apathetic, and unresponsive to needs for change and innovation. While a
minimal level of conflict could be beneficial, not all conflicts are good.
Resolution-Focused View(Contemporary): While there are some very specific cases in which conflict
can be beneficial, workplace conflicts are not productive & tend to produce stress. Researchers have
started to focus more on managing the whole context in which conflicts occur, both before & after the
behavioral stage of conflict occurs. In cross-cultural conflicts, impediments to agreements center on
emotional attachments and social identities.
Negotiation: the process in which two or more parties exchange goods or services and attempt to agree
upon the exchange rate for them.
Distributive Bargaining: a win-lose scenario where one party’s gain is another’s loss. Research
consistently shows one of the best things you can do is make the first offer and make it an aggressive one.
Another distributive bargaining tactic is revealing a deadline. Distributive bargaining leaves one party a
loser (ex. car sales).
Integrative Bargaining: assumes one or more of the possible settlements can create a win-win solution.
Both parties must be engaged for it to work. Integrative bargaining, in general, is preferable to distributive
bargaining (ex. labor-management relations).
UAW Demands: 36% pay increase, pensions, job security, and a 32-hour work week with 40-hour pay.
Resistant to major changes. UAW workers did not receive all demands but secured a 25% pay increase
and concessions for future training and retraining for high-tech roles in GM’s upcoming battery
production facilities.
Gender Differences in Negotiations: Men and women do not negotiate differently. A popular stereotype
is that women are more cooperative, pleasant, & relationship-oriented in negotiations than are men. The
evidence doesn’t support this belief. Because women are expected to be “nice” and men “tough,” research
shows women are penalized when they initiate negotiations. Evidence also suggests women’s own
attitudes and behaviors hurt them in negotiations. Managerial women demonstrate less confidence than
men in anticipation of negotiating and are less satisfied with their performance afterward. Women are also
less likely than men to see an ambiguous situation as an opportunity for negotiation.
Third-Party Negotiations: when individuals or group representatives reach a stalemate and are unable to
resolve their differences through direct negotiations, they may turn to a third-party. Mediator: A neutral
third-party who facilitates a negotiated solution by using reasoning, persuasion, and suggesting
alternatives. Arbitrator: A third-party to a negotiation who has the autonomy to dictate an agreement.
Conciliator: A trusted third-party who provides an informal communication link between the negotiator
and the opponent.
BATNA(Best Alternative to a Negotiated Agreement): refers to the best alternative that a party has if
no agreement is reached in negotiations. Understanding BATNA helps parties assess the worst deal they
are willing to accept before walking away. In salary and fringe benefit negotiations between
management (Party A) and labor (Party B), each side must know their BATNA-the worst deal they are
willing to accept before walking away from the table. This helps both sides recognize when to settle or
push for more. The idea of BATNA is similar to buying or selling a car-knowing the minimum price
you're willing to accept before walking away from the negotiation.