Such as, ‘multiple parties, great uncertainty, threats of litigation, heightened emotions, and seeming irrationality’, not to speak of parties ‘playing hardball, behaving unethically, or negotiating in their own self-interest’.

For instance, a chapter titled ‘negotiating rationally in an irrational world’ suggests the use of System 2 thinking, which is ‘reasoned thought, and is slower, conscious, effortful, explicit, and logical’. In contrast, System 1 thinking (as proposed by researchers Keith Stanovich and R.F. West) “corresponds to intuition, is typically fast, automatic, effortless, implicit, and emotional.”

While it’s not news that people are irrational and sometimes make mistakes, as Daniel Kahneman and Amos Tversky found, “what is news is that many of the mistakes people make are systematic and predictable.”

These regular errors are four, find Malhotra and Bazerman. First, the fixed-pie bias, which can affect even the most seasoned negotiators, ‘causing them to focus exclusively on capturing value for themselves and to ignore approaches that could create value.’

The second is the vividness bias, which shows as ‘too much attention to vivid features’ of the offer.

Next comes non-rational escalation of commitment, bizarrely to ‘a failing course of action’. It is often difficult for negotiators to admit that their initial strategy was ill conceived or that they have made a mistake, the authors note.

And the fourth pitfall is ‘susceptibility to framing’, when we may differently treat risks involving perceived gains and losses. Valuable takeaways.

D. Murali

http://BookPeek.blogspot.com

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