e-Negotiations

Networking and Cross-Cultural Business Transactions

Nicholas Harkiolakis, Daphne Halkias

• Publisher: Routledge
• Year: 2016
• ISBN:
  9781317143765
• Edition: 1
• Topic: Negocios y empresa
• Subtopic: Comercio electrónico

Practical negotiating skills, including those needed for cross-cultural negotiations have long been taught in classrooms, along with some of the theory that underpins them. Most of this has been based on the notion that negotiation will be interpersonal and face-to-face. In recent years, though, globalization, the telecommunications boom and the ever increasing need for today's professionals to conduct cross-cultural business transactions has led to a new way of negotiating, bargaining, and resolving disputes. In e-Negotiations, Nicholas Harkiolakis and his co-authors highlight the challenge that awaits the young professionals who are today training in business schools. Future dispute resolutions and bargaining will take place between faceless disputants involved in a new kind of social process. Any adolescent with a mobile phone and Internet access knows that most of today's social transactions take place via a hand held or other electronic device. In a world of video conferences, chat rooms, Skype, Facebook, and MySpace, critical financial, business and political decisions are made through interaction between two-dimensional characters on screens. Here, the authors compare and contrast e-negotiation as it currently is with traditional face-to-face negotiation. Case studies illustrate how cross-cultural negotiations can be managed through modern channels of social influence and information-sharing and shed light on the critical social, cognitive and behavioral role of the negotiator in resolving on-line, cross-cultural, conflicts and disputes, and generally in bargaining and negotiation. This book, with its practical exercises, will be of immense help to students and professionals needing to 'practice' with the new negotiating media.

1
Introduction

The prevalence and incidence of business negotiations among people from different countries and cultures has multiplied 20-fold over the last 20 years—according to international trade watchers, even greater increases are expected in the future as emerging economies become key players in world markets. The latest international business analysis reports state that over 50 per cent of an international manager’s time is spent negotiating. A typical senior manager in the United States (US) business scene devotes at least a quarter of his/her working day negotiating.

Negotiation processes involve the trade of gains and losses between negotiators’ positions. Some of them are planed while others can catch them by surprise. Questions arise, such as: “What are my priorities?,” “How far can I go?,” “Why does the other side follow a certain strategy?,” “Would I be the same if I was them?,” “Are they honest and truthful?,” “How do they understand commitment?,” “Should I start the bidding first?,” “Should I be aggressive?,” “Should we spend more time getting to know each other?,” “Should I walk away?,” “Should I make more concessions?” The answers we come up with to these questions will shape our strategy and ultimately lead to the success or failure of negotiations. Strategy and behavior become expressions of each other and establishing one can predict the other.

Traditionally, negotiation processes are considered as a blend of various disciplines ranging from game theory, psychology, political science, communications, law, to sociology, and anthropology. Coming into the field of e-negotiations, what we mostly find is how information technology affects negotiations in the form of communication and negotiation decision support systems. The area has not seen any significant research beyond the communications and technology aspects of it.

In e-negotiations micro-level behavior is most prevalent. Since in most cases there is one person behind the screen or telephone that engages in negotiation, their values directly affect their decisions and the way they interpret messages, handle exceptions, and communicate with others. Cultural values are expected in these situations to influence behavior in ways that cannot be anticipated or predicted by the participants involved in the process.

A major advantage of e-negotiations is the ability to record every detail of the communication process including intentions, outcomes, and information exchanged. This can provide a better understanding of the negotiation process and behavior and allow analysis and evaluation of strategies that would be impossible in face-to-face negotiations. On the other hand, the resulting time lag from the asynchronous communication exchange has been shown to make negotiators pay more attention to the substantive content of messages, and has lessened the emotional stress brought about by conflicting positions. Overall it made it easier to overcome socioeconomic differences.

Another important aspect of e-negotiations is the reduction of communication cues. According to the situation or the adopted strategy, this can act as an advantage or disadvantage. Inability to observe body language, facial expressions, and tone of voice may assist in focusing on the issue at hand, but it can also lead to misinterpretation, frustration, and mistrust. Negative emotions seem to be more influential in online negotiations than in face-to-face situations; but at the same time the faceless world of online communications appears to allow freedom of expression that would otherwise be hindered offline. Research seems to indicate that as individuals become more familiar with the Internet and they use it in their daily communication, they tend to apply the same values as they do with other communication mediums. After all, a world is a “world” whether real or virtual since we function on past experiences that we carry from the physical world.

The loss of visual cues online is of primary importance since it evenly balances characteristics of the offline world like attractiveness, gender, color, and ethnicity. Individuals disadvantaged by geographical location, confinement, threats, mobility, and sight or hearing impairment can now use the Internet to access information and negotiate on equal terms. The virtual environment nevertheless brings its own unique hierarchies and “social” structures. The privileged ones can have fast access with state-of-the-art hardware and software, while the less privileged will be on the other side of the “digital divide.” Typing speed and fluency with English can also be a divider in that the fast typists and native speakers can easily keep up in chat rooms and intense communication exchanges.

To convey feelings and emotions online in an attempt to avoid misinterpretation and get our point across, a form of language in terms of symbols and norms have come into use through general acceptance: symbols like ‘smileys’ can be used to magnify and express feelings of text-based information, while switching from lower case to upper case can be used to emphasize text—an act similar to shouting in the physical world. Time, data, and location tracking along with direct request and translation services can further assist in clarifying the content that is being communicated.

1.1 The Negotiations Framework

A framework suggested in this book will take the negotiator through a spiral of activities that repeat themselves in every cycle while not necessarily preserving their duration each time. These (Figure 1.1) include the stages of Intelligence, Perception, Strategy, and Communication, which eventually lead to Deal or No Deal.

It is expected that while initially more time will be spent in intelligence and perception and less in strategy and communication, this will reverse the closer we get to the final outcome. In the beginning, we need to spend more time learning about the issues at hand and understanding our “opponent”, while as the process matures and we get more feedback, our understanding grows and the “opponent’s” positions and needs become more obvious. The opposite is true for the strategy and communication phases since the need to move from exploratory positions and offers to a more precise and detailed final position grows in time. At later stages, communication becomes more intense. So while the cycle remains more or less the same in terms of sequence of its phases, the time spent in each phase changes drastically and is directly influenced by the personality, state of mind, and experience of each negotiator.

Figure 1.1 Negotiations Spiral Framework

Negotiation strategies have been identified in the literature ranging from distributing, avoiding, accommodating, integrating, compromising, collaborating, and exploiting, to competing, among others. Naturally, negotiators do not necessarily belong in exact stereotypes, but the general rule is that if the spiral does not progress in the intended fashion then there is something seriously wrong in the negotiation. Competitive negotiators tend to spend more time in the last phases of positioning and communication while cooperative ones spend more time in understanding the opponent and position accordingly.

In our view, though, the suggested spiral will more than cover the process while allowing the individual to employ their own personal style by acting on the time length of each phase. The communication mediums that will be the focus of this book, in reference to the suggested framework, include teleconferencing, videoconferencing, and web-based communication.

It should be taken as a certainty for the future ahead of us that e-negotiations and the technology supporting them will create new and unique advantages and disadvantages. The absence of traditional social cues and their substitution with new forms could lead to more objective evaluations, while also diffusing identity perceptions and lessening self-awareness. The situation will be worse in cross-cultural communications due to lack of nonverbal signs and the effort required for building trust. On the other hand, communicating through the Internet defies logistic boundaries of time, place, and hierarchy, and allows focused considerations of task content and performance.

1.2 The Negotiator

Regarding technology, negotiators, like most people, can be seen as belonging to separate “technology adoption life-cycle” groups, such as:

• innovators and early adopters—including the technology enthusiasts, those that lead and influence new developments and changes;

• mainstream followers—including those that adopt established technology and trends;

• late bloomers—including those that resist change but are forced to adapt in order to survive.

E-negotiations have seen the rise of specific skills that weren’t traditionally so influential in negotiations. Since the work of a negotiator is essentially based on language, good typing skills and fluency in writing are extremely important online. Increased bandwidth and fast Internet access can also be an advantage in real-time synchronous communication (chatting, videoconferencing, and so on).

The rise of the Internet posed greater problems to traditional players in negotiation, like governments and public authorities. Coming to grips with technological change is not as straightforward as one would expect for such players primarily due to organizational and professional inertia in dealing with such issues. The amount of information exchanged online is difficult to comprehend and digest especially for older generations of negotiators and diplomats. Suddenly, these groups are faced with a wider audience that is much more involved and influential. Their counterparts can appear with many faces and voices and it becomes difficult even to those familiar with technology to put order to what their senses deliver to their brains.

Traditional negotiators are also challenged in both the information content they were privileged to withhold and the expertise they projected. Nowadays, information flows openly on the Internet and almost anyone can access and consume it, eventually presenting themselves as experts. The involvement of many players can dilute the image of traditional players as field experts. Foreign advisers are expected to be the first victims of the new era. One look at the website of the CIA or those of other government institutions can easily give anyone a good view of world issues and their importance to US policy. One can liken the world of negotiators to a protest where, instead of a leading person having the loudspeaker, there are many with loudspeakers delivering their individual messages.

Despite the changes that have taken place and will continue to take place, negotiators will still need knowledge, judgment, and expertise. All that is needed nowadays is adaptation to the new realities. This is not a matter of choice. It’s a survival requirement. Prior to engaging in negotiations online, it is important to consider whether it is “tasks” or people that will be affected by decisions being taken. This is important since tasks are impersonal and can benefit from the structure and permanency of the online medium, while decisions about people need the expressive power of human beings with their verbal and nonverbal cues to fully express and represent a situation. When deciding on the communication mode to negotiate on an issue, it is important to accommodate as much as possible the needs, skills, and communication preferences of all parties and choose the most practical and most efficient option.

Negotiators in this book will be viewed as knowledge systems that are influenced and shaped by different environmental factors as they mature as individuals and professionals. Starting with the basic ingredient of each human being in the form of the DNA each one inherits, we are raised in family environments that operate in societies that are nothing more than microcosms inside nations, regions, and the world at large. Each environmental layer encloses and exerts primary influence on the ones it encloses and to a lesser degree its outside layers. In other words, as we are influenced by the world, we also influence the world at least in our vicinity. To a person this is expressed in the form of education and experience while interacting with others.

Figure 1.2 The Negotiator’s Layers of Influence

Each one of us moves in the world surrounded with these “onion” rings of influence, filtering incoming signals that people and events emit, and modulating the signals we emit. Personality and culture are the primary expressions of this filtering that we do. Negotiators need to be aware of this layering if they are to communicate the right message to the right recipient and make sense of what they receive in return.

1.3 About this Book

Two alternatives were considered when developing the book material. One would have a strong academic emphasis in the print version and supporting material for the professional and lay reader and the other would have more of a hands-on print version and reserve the academic emphasis for the book’s website (http://www.e-negotiations.info).

We decided to go with the second approach as print editions are more familiar and personal for a wider audience than their online counterparts. They are also more comfortable to carry and read and can reach general audiences of students and practitioners of various disciplines including professionals and lay readers.

The online section of the book has been developed to function as supplemental course material in addition to expanding the resources presented in the print version. In the online section students and faculty can find:

• chapter objectives;

• sample syllabus;

• case studies for the topics addressed in each section of the book;

• hands-on exercises and projects that can be done in classroom and as homework assignments;

• color book images;

• PowerPoint presentations;

• extended list of online resources for each topic;

• reference publications.

1.4 What this Book Isn’t

This book should not be seen as a promoter of e-negotiations over face-to-face negotiations.

We actually take the stand that e-negotiations are an unavoidable “evil” that is here to stay and we all need to be familiar with the new medium and become proficient in its use as negotiators, but not at the expense of face-to-face negotiations.

While the emphasis of this book is on technology’s impact on negotiation and as a medium of negotiation, there are certain aspects that will not be addressed and these include the areas of mediation and arbitration. In this respect, the book will only briefly touch on online dispute resolution (ODR) mechanisms in conflict resolution. As a consequence, security, confidentiality, and privacy issues will only be mentioned in a general context and not dealt with specifically or in-depth.

2
Technology in Brief

This chapter will follow a simplified approach to presenting the basic technology elements essential to entering the e-negotiation sphere. In today’s world we are usually exposed to simple information technology (IT) concepts from childhood. To better understand the technology solutions adopted nowadays in e-negotiations, this chapter will provide more of an intuitive description of some of the technology elements involved in e-negotiations in terms of their relevance and interdependence. Technology will be presented here in analogy to negotiations as resolutions between goals, physical resources, and money. Although this might sound a little far-fetched, it does accurately depict reality because the evolution of technology is nothing more than meeting needs and communicating actions and intentions. Thinking and behavior that propel negotiation between two parties just don’t pop up out of nowhere. There is a need somewhere that we try to satisfy by negotiating options and achieving consensus that in turn is translated into actions that lead to a product which satisfies the initial need.

In our attempt to express and communicate issues, we develop languages that address the specifics of each need. These languages are nothing more than abstractions we adopt as we move into unexplored territory to make our life easier and more productive. They pack meaning into words that, when laid down with the proper syntax, create higher level concepts that can be packed again into words of higher level meaning and the process goes on like that, satisfying our need for higher levels of abstraction. Language, and especially written language, is the most important asset for an e-negotiator and for that ...