BUSM4722 - Topic 8 - Ethics

Negotiations & Influence Negotiation Power and Influence Dr Steven Clarke A SAMPLING OF ETHICAL QUANDARIES You want to sell a stereo A friend tells you if he were interested in buying, he would pay $500 When a buyer comes, you say you already had an offer for $500 The buyer buys it for $550 Is it ethical to say what you said? You want to buy a business owned by a competitor who shows no interest in selling it to you You hired a consultant to dig up problems of the business and use that information to get the competitor to sell Is this ethical? To convince the union leaders to withdraw the demand to raise the number of paid holidays, you Tell them the company can’t afford it Make up financial statements that the company can’t afford it Offer the leaders a free trip to Florida The shoes are not returnable But you insist on returning them and make a scene and yell at the store clerk when he refuses After some discussion, the manager agrees to give your money back Is this ethical? Would Definition Broadly – what is right or wrong in a particular situation, or a process for setting those standards • Ethics grow out of particular philosophies, to o Define the nature of the world that we live in o Prescribe rules for living together Approaches to Ethical Reasoning (1) (2) (3) (2) EndResult Ethics Duty Ethics Social contract Ethics Personalis tic Ethics Approaches to Ethical Reasoning End-result ethics • • • One must consider all likely consequences Actions are right if they promote happiness Promotion of happiness is the aim Approaches to Ethical Reasoning Duty Ethics • Human conduct should be guided by primary moral principles • Individuals should stand on principles and restrain themselves by rules Approaches to Ethical Reasoning Social construct Ethics • People must function in a social, community context to survive • Communities determine rules • What is best for the common good determines the ultimate standard Approaches to Ethical Reasoning Personalistic Ethics • Conscience within each person calls them to fulfill their humanness and decide between right and wrong • Personal decision rules are the ultimate standards Ethics vs Prudence vs Practicality vs Legality Ethics - appropriate by moral conduct Prudence - wise, based on effectiveness Practical - what the negotiator can make happen Legal - what the law defines as acceptable Ethically Ambiguous Tactics Category Example Traditional competitive bargaining Emotional manipulation Misrepresentation Not disclosing your walkaway; making an inflated opening offer Misrepresentation to opponent’s networks Inappropriate information gathering Faking anger, fear, disappointment; faking elation, satisfaction Distorting information or negotiation events in describing them to others Corrupting your opponent’s reputation with his or her peers Bribery, infiltration, spying, etc A Simple Model of Deception in Negotiation Inventions and Motives for Using Deceptive Tactics Influence Situation Identification of Range of Influence Tactics Use Deceptiv e Tactics Yes Selection and Use of Deceptive Tactic(s) No Explanations and Justifications Consequences: Impact of Tactic: Does it Work? Self-evaluation Feedback and Reaction From other Negotiator, Constituency, and Audiences Motives to use Deceptive Tactics The Power Motive: • To increase the negotiator’s power in the bargaining environment • Information is a powerful source Information is assumed to be accurate and truthful Other motives: • Motivational orientation (cooperative, competitive, or individualistic) • Cultural differences (individualistic culture vs collectivist culture) • Negotiators’ perceptions of the other’s expected motivation Motives to use Deceptive Tactics The Power Motive: • To increase the negotiator’s power in the bargaining environment • Information is a powerful source Information is assumed to be accurate and truthful Other motives: • Motivational orientation (cooperative, competitive, or individualistic) • Cultural differences (individualistic culture vs collectivist culture) • Negotiators’ perceptions of the other’s expected motivation Consequences of Unethical Conduct Effectiveness: • Rewards and punishments from using a tactic or not using it affect the chance to use similar strategies in similar circumstances in the future Reactions of Others: • Feel angry, foolish • May seek revenge Reactions of Self • Discomfort, stress, guilt, or remorse Explanations and Justifications The tactic was harmless They were going to it anyway, so I will it first The tactic will produce good consequences The tactic will help to avoid negative consequences The tactic was unavoidable They had it coming The deserve it I’m getting my due He started it The tactic is fair or appropriate to the situation Dealing with the Other Party’s Use of Deception Ask probing questions • Can reveal a great deal of information, some are left undisclosed • Reduce the number of deceptive comments Dealing with the Other Party’s Use of Deception Phrase questions in Different Ways • Negotiators don’t tell outright lies They dodge, duck, bob, and weave around the truth, assuming their statements will be misconstrued “How is the heating system?” “When was the last time the heating system was inspected, and what was the Dealing with the Other Party’s Use of Deception Force the Other Party to Lie or Back Off • If you suspect the person is lying, pose a question that forces him or her to tell a direct lie • Ask questions that call for a yes or no answer •  they become nervous or conflicted Dealing with the Other Party’s Use of Deception Test the Other Party • Ask questions to which you already know the answer • Learn about their trustworthiness • Take good notes during the negotiation Dealing with the Other Party’s Use of Deception “Call” the Tactic • Indicate that you know he is bluffing or lying • Do so tactfully but firmly, and indicate your displeasure Ignore the Tactic • If the deception concerns a relatively minor aspect of the negotiation, ignore it • Let it pass, avoid embarrassing the other Dealing with the Other Party’s Use of Deception Discuss what you see and offer to Help the Other Party Shift to More Honest Behaviors • This is a variation on calling the tactic, but it 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 Respond in kind • If they bluff, bluff more • If they misrepresent, misrepresent  ... Ethical Reasoning (1) (2) (3) (2) EndResult Ethics Duty Ethics Social contract Ethics Personalis tic Ethics Approaches to Ethical Reasoning End-result ethics • • • One must consider all likely... Prudence vs Practicality vs Legality Ethics - appropriate by moral conduct Prudence - wise, based on effectiveness Practical - what the negotiator can make happen Legal - what the law defines as acceptable... Personalistic Ethics • Conscience within each person calls them to fulfill their humanness and decide between right and wrong • Personal decision rules are the ultimate standards Ethics vs Prudence