BUS 420
NEGOTIATION PROCESS
Ethics in Negotiation
Instructor: Prof. Azize ERGENELİ
Prepared By:
Orçun DİNÇTOPAL 20211888
M. Murat ÇİFTÇİ 20311879
Utku GÜĞERÇİN 20312067
Eray ERSOY 20312001
March-2007
Negotiation is a pervasive features of business life. Success in business typically requires successful negotiations. In a competitive and morally imperfect world, business people are often faced with serious ethical challenges. Herboting suspicious abut the ethics of others, many feel justified in engaging in less-than-ideal conduct to protect their own interests. The most sophisticated moral arguments are unlikely to counteract this behaviour. We believe that this morally defensive behaviour responsible, in large part, for much undesirable deception in negotiation. Drawing on recent work in the literature of negotiations, we present some practical guidance on how negotiators might build trust, establish common interests, and secure credibility for their statements thereby promoting honesty.
“We must make the world honest before we can honestly say to our children that honesty is the best policy” George Bernard SHAW
What do we mean by ethics?
Ethics are broadly applied social standards for what is right and wrong in a particular situation, or a process for setting those standards. And ethics grow out of a particular philosophies which; define the nature of the world in which we live and prescribe rules for living together.
Why do people choose unethical behaviour?
The first answer that normally occurs to us is that people are corrupt, degenerate, or immoral. In fact these answers are to simplistics; moreover, they do not help us understand and control our own behaviour, or successfully influence and predict the behaviour of others in a bargaining environment.
Here were three primary factors motivational factors which lead negotiators to consider using unethical tactics: the pursuit of profit, the desire to beat an opponent in a competitive environment, and the need to insure or restore some standard of justice that has been violated.
Three major categories of ethical conduct were used to describe the broad range of questionable negotiating strategies and tactics: means/ends, truth-telling, and relativism.
The more e is committed to abide by certain rules and procedures, the more one believes that following the rules will eventually lead to the desired ends. The second group of tactics, relativistic vs. absolute, forces us to deal with questions of whether there are truly absolute rules and principles of right and wrong, or whether questions of ethics must be answered by each individual in his own personalized, subjective view of the world. Many authors have suggested that bluffing, misrepresentation or factual distortion is sometimes necessary in order to effectively negotiate; such behaviour, however, may well be seen by others as unethical and inappropriate.
We believe that the negotiation process raises a host of ethical issues, more so than most other interpersonal transactions. Much of what has been written on negotiating behaviour has been strongly normative abut ethics, and prescribed “dos and don’ts”. We do not believe that this approach facilitates the understanding of how negotiators actually decide to act unethically. We believe this process can best be understood by a simple decision-making model.
We proposed that a negotiator who chooses to use an unethical tactic usually decides to do so in order to increase his negotiating power. Power is gained by manipulating the perceived base of accurate information (lying), getting better information about n opponent’s plan, or undermining an opponent’s ability to achieve his objectives. Using these tactics leads to two kinds of consequences; first, actual attainment or non-attainment of these goals he was seeking; and second, evaluation and criticism of the tactics by the negotiator himself, by his opponent and by observers. Negotiators usually feel compelled to justify their actions –i.e., they know they have done something “wrong” and need to establish a “good reason”
We suggested that the decision to use ethical or unethical tactics may be influenced in varying degrees by differences in individual backgrounds, personality, rewards or punishments associated with ethical or unethical actions, and the social and cultural norms that dictate what is appropriate or inappropriate in a given environment. We have made a number of assumptions about ways to judge and evaluate human conduct in the realm of ethics. We have intentionally avoided taking a strong normative stance, and have not tried to emphasize our own biases about what kinds of conduct are ethical or unethical. Instead, we have proposed several conclusions that can be drawn from research, experience and common sense:
1- Individuals will often disagree as to what kinds of negotiating tactics are “ethical” or “unethical”, and in which situations it is appropriate or inappropriate to use them.
2- The decision to use an unethical tactic can be probably best be understood as a quasirational decision making process in which a variety of personality and situational variables are likely to affect that decision.
3- In deciding to use an unethical tactic, a negotiator is likely to be most heavily influenced by what he believes the consequences will be for his choice: will it help him accomplish his objectives, and what kind of feed back is he likely to receive from others?
4- Negotiators who have used unethical tactics in the past, or might be considering their use in the future, should strongly consider three possible consequences of using unethical tactics:
a) Will they really help achieve objectives?
b) How will they affect the quality of the relationship with this opponent in the future?
c) How will they affect their reputation?
Negotiators frequently overlook the fact that while unethical or expedient tactics may get them what they want in the short run, these same tactics typically lead to long-term problems and to diminished effectiveness.
Rules of the game
An assumption: every negotiation situation involves questions of ethics. What are the understood “rules of the game?”
Ø What is fair?
Ø What is just?
Ø What is legal?
Ø What is appropriate and acceptable?
Ø What is expected?
Is ethical behaviour ….
Ø What is practical?
Ø What is expedient?
Ø What is efficient?
Ø What serves one’s interests or a client’s interests?
Ø What is necessary to win?
Like the poker player, a negotiator hopes that his opponent will overestimate the value of his hand. Like the poker player, in a variety of ways he must facilitate his opponent’s inaccurate assessment. The critical difference between those who are successful negotiators and those who are not lies in this capacity both to mislead and not to be misled.
Four major approaches to ethical reasoning
1. End-result ethics (results lens)
The rightness of an action is determined by evaluating its consequences. Here the question is: “what will be the result?”
2. Duty ethics ( reputation lens)
The rightness of an action is determined by one’s obligation to adhere to consistent principles, laws and social standards that define what is right and wrong. Here the question is: “what will others think?”
3. Social contract ethics ( relationship lens)
The rightness of an action is based o the customs and norms of a particular society or community. The question here is: “how will this impact others?”
4. Personalistic ethics (rights lens)
The rightness of the action is based on one’s own conscience and moral standards the question here is: “what should I do?”
So when in an ethical quandary we answer the following questions;
Ø What will be the result?
Ø What will others think?
Ø How will this impact others?
Ø What should I do?
THE IMPORTANCE OF NEGOTIATION ETHICHS
Commonly held assumptions reflect negatively on the ethics of the negotiation tactics of car salespeople, lawyers, horse traders, and other people who have a reputation of trying to influence folks into reaching agreements by misrepresenting facts. This kind of stereotyping has attached itself to people from different countries, ethic groups, or even as reflected in the expression from the 60s ‘Don’t trust anyone over 30’.
Negotiation is about many things; one of its central elements is convincing others to accept the accuracy or reality of information that will influence their decision. Most negotiators know that it is, indeed, possible to influence people by lying to them. But good negotiators also realize that when other parties find out they have been on the receiving end of lies, the lying negotiator’s credibility goes down to tubes.
There is an old expression ‘If you cheat me once, shame on you. ‘If you cheat me twice, shame on me.’ People who have been taken in by dishonestly resent it; if they are able, they try to get out of deals where there’s been misrepresentation.
In general, a general negotiator must make positive misstatement to be held liable fraud. First, when the negotiator makes a partial disclosure that is; or becomes, misleading. Second, where the negotiator acts as a fiduciary. Third, when the negotiator has important information about the transaction not accessible to the other side. Fourth, where required by statue.
On the other side we can say that negotiation is not a competitive sport. In competitive sports, the object is to end up winning the game, the race, or the event. Negotiators who focus on treating other parties as opponents run the risk of ending up with reluctant counterparties to whatever agreements may be reached. Unless all the parties are fully committed to their agreement, it may well fall apart; in those circumstances the negotiation has failed.
The ethics of negotiation should be based on several understandings;
· Reluctant partners make undependable partners so treating negotiation partners with respect and honesty simply makes common sense.
· Negotiators need to recognize up front that the only reason to use negotiation to resolve a conflict, agree on a project, or conclude a sale because other parties may be able to add value an individual or a single company cannot do acting alone.
· Transparency in the negotiation process is more likely to bring about buy-in than hidden agendas or tricky maneuvers.
· Other parties have feelings.
Last understanding is the Golden Rule of treating others as you would wish to be treated has the bottom line value of increasing other parties’ enthusiasm about negotiating with you as well as their enthusiasm about the ultimate agreement.
Good negotiation ethics: honesty, transparency, respect for others are all genuinely pragmatic approaches to use. A negotiator’s reputation is not unlike that of a restaurant; if you have bad meal, you are not likely to return. And a negotiator with whom others don’t want to deal is effectively out of business.
Negotiator also should understand four major approaches to ethical reasoning: end-result ethics, or the principals of act utilitarianism; rule ethics, or the principle of rule utilitarianism; social contract ethics, or the principles of community-based socially acceptable behaviour; and personalistic ethics, or the principles of determining what is right buy turning to one’s conscience. Each of these approaches may be used by negotiators to evaluate appropriate strategies and tactics.
Consequently we can say that negotiation ethics is more important for negotiator that’s why negotiator should recognize ethics carefully. Also unethical behaviours are most important to the negotiator. Because when he or she faced with unethical behaviour he or she should find the reasons for unethical behaviour.
WHEN CAN BE ETHICS IMPORTANT AND HOW?
When negotiators deal with the other parties using of deceptions, negotiation ethics become important. They behave differently like above:
Ø Intimidation
Ø Fulility portroyal
Ø Discomfort and relief
Ø Bluffing
Ø Gentle prods
Ø Minimization
Ø Contradiction
Ø Altered information
Ø A chink in the defense
Ø Self-disclosure
Ø Point of deception cues
Ø Concern
Ø Keeping the status guo
Ø Direct approach
Ø Silence
Ø Ask Probing Questions
Ø Recognize the Tactic
Ø Ignore the tactic
Ø Ask questions
Ø “Call” the tactic
Ø Respond in kind
Ø Discuss what you see and offer to help the other party change to more honest behaviors.
If we want to give an example for the ethics importance, we can look at the EU(European Union)-Turkey negotiations. In this negotiations EU seems to behave unethic. Becasue its criterians which they describe is not apply equally to all candidate countries. Criterias that are negotiated are not objective.For example a matter that says “ In future if there exists a digestion trouble, EU will stop the negotiations with Turkey” is not applied for Crotia which aply EU at the same time with Turkey.
Also we can see some tactics from Turkey government in negotiations.Our Prime minister give a declaration that “When we perform criterias in the negotiation process, if EU says we can not take you, we will evaluate other choices.” This is an example of indimitadion tactic.Is this tactic ethic or unethic? Why our prime minister give this declaration? İs this tactic is a strategy or threat? This declaration is gived by prime minister because in negotiations EU behaves unethically that’s why our prime minister use a tactic for this unethic behaviour.
There exists a lot of example for the ethics importance because in our life we generalley negotiate.When we talk with our friend, when we bargain in the shopping-center, when discussed important subjects, when the countries improve their relationships etc.. All that is exists when we negotiate ethics become important, well than why? Because arriving at clear, precise, effective, negotiated agreement depends on the willingness of parties to share accurate information about their own preferences, priorities, and interests.At the same time, because negotiators may also be interested in maximizing their self-interest,they may want to disclose as little as possible of their positions-particularly if they think they can do better bay manipulating the information they disclose to the other party.This situation may cause unthical behaviours like deception,misstatement,bluffing,falsification or selective disclosure.
Why do the negotIators need to know about the ethIcs?
Even the subjects are different, everyone negotiates. Little has been published and said about the ethics in negotiation because questions or comments about the ethics in negotiation arise for someone, when he or she negotiates, otherwise ethics will not be discussed. There are no written, certain rules about the ethics (in negotiation). But the basic solution for ethics in negotiation is too simple, it is empathy. Empathy (the ability to identify with and understand somebody else's feelings or difficulties) will make the sides of the negotiation think about what they are doing – ethical or unethical. But negotiators use empathy when they want to use, especially in the business life, mainly for profit – even it is for short term -, there are many unethical conducts in negotiations.