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Negotiations chap005 perception, cognition, and emotion

Perception, Cognition,
and Emotion


Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.


Perception, Cognition, and
Emotion in Negotiation
The basic building blocks of all social encounters are:
• Perception
• Cognition

– Framing
– Cognitive biases
• Emotion


Perception is:
• The process by which individuals connect to their
• A “sense-making” process


The Process of Perception

The process of ascribing meaning to messages and events is strongly influenced
by the perceiver’s current state of mind, role, and comprehension of earlier
People interpret their environment in order to respond appropriately
The complexity of environments makes it impossible to process all of the
People develop “shortcuts” to process information and these “shortcuts” can
create perceptual errors


Perceptual Distortion
• Four major perceptual errors:
– Stereotyping
– Halo effects
– Selective perception
– Projection


Stereotyping and Halo Effects
• Stereotyping:
– Is a very common distortion
– Occurs when an individual assigns attributes to another

solely on the basis of the other’s membership in a particular
social or demographic category

• Halo effects:
– Are similar to stereotypes
– Occur when an individual generalizes about a variety of
attributes based on the knowledge of one attribute of an


Selective Perception
and Projection
• Selective perception:
– Perpetuates stereotypes or halo effects
– The perceiver singles out information that supports a prior
belief but filters out contrary information

• Projection:
– Arises out of a need to protect one’s own self-concept
– People assign to others the characteristics or feelings that
they possess themselves


• Frames:
– Represent the subjective mechanism through which people
evaluate and make sense out of situations
– Lead people to pursue or avoid subsequent actions
– Focus, shape and organize the world around us
– Make sense of complex realities
– Define a person, event or process
– Impart meaning and significance


Types of Frames
• Substantive
• Outcome
• Aspiration
• Process
• Identity
• Characterization
• Loss-Gain


How Frames Work in Negotiation
• Negotiators can use more than one frame
• Mismatches in frames between parties are sources of
• Parties negotiate differently depending on the frame
• Specific frames may be likely to be used with certain
types of issues
• Particular types of frames may lead to particular types of
• Parties are likely to assume a particular frame because of
various factors


Interests, Rights, and Power
Parties in conflict use one of three frames:

• Interests: people talk about their “positions” but often
what is at stake is their underlying interests
• Rights: people may be concerned about who is
“right” – that is, who has legitimacy, who is correct,
and what is fair
• Power: people may wish to resolve a conflict on the
basis of who is stronger


The Frame of an Issue Changes as
the Negotiation Evolves
• Negotiators tend to argue for stock issues or concerns
that are raised every time the parties negotiate
• Each party attempts to make the best possible case for
his or her preferred position or perspective
• Frames may define major shifts and transitions in a
complex overall negotiation
• Multiple agenda items operate to shape issue


Some Advice about Problem
Framing for Negotiators
• Frames shape what the parties define as the key issues
and how they talk about them
• Both parties have frames
• Frames are controllable, at least to some degree
• Conversations change and transform frames in ways
negotiators may not be able to predict but may be
able to control
• Certain frames are more likely than others to lead to
certain types of processes and outcomes


Cognitive Biases in Negotiation
• Negotiators have a tendency to make systematic errors when
they process information. These errors, collectively labeled
cognitive biases, tend to impede negotiator performance.


Cognitive Biases

Irrational escalation of
Mythical fixed-pie
Anchoring and
Issue framing and risk
Availability of

• The winner’s curse
• Overconfidence
• The law of small
• Self-serving biases
• Endowment effect
• Ignoring others’
• Reactive devaluation


Irrational Escalation of Commitment
and Mythical Fixed-Pie Beliefs
• Irrational escalation of commitment
– Negotiators maintain commitment to a course of action
even when that commitment constitutes irrational behavior

• Mythical fixed-pie beliefs
– Negotiators assume that all negotiations (not just some)
involve a fixed pie


Anchoring and Adjustment
and Issue Framing and Risk
• Anchoring and adjustment
– The effect of the standard (anchor) against which
subsequent adjustments (gains or losses) are measured
– The anchor might be based on faulty or incomplete
information, thus be misleading

• Issue framing and risk
– Frames can lead people to seek, avoid, or be neutral about
risk in decision making and negotiation


Availability of Information
and the Winner’s Curse
• Availability of information
– Operates when information that is presented in vivid or
attention-getting ways becomes easy to recall.
– Becomes central and critical in evaluating events and

• The winner’s curse
– The tendency to settle quickly on an item and then
subsequently feel discomfort about a win that comes too


and the Law of Small Numbers
• Overconfidence
– The tendency of negotiators to believe that their ability to
be correct or accurate is greater than is actually true

• The law of small numbers
– The tendency of people to draw conclusions from small
sample sizes
– The smaller sample, the greater the possibility that past
lessons will be erroneously used to infer what will happen
in the future


Self-Serving Biases
and Endowment Effect
• Self-serving biases

– People often explain another person’s behavior by making
attributions, either to the person or to the situation
– There is a tendency to:
• Overestimate the role of personal or internal factors
• Underestimate the role of situational or external factors

• Endowment effect

– The tendency to overvalue something you own or believe
you possess


Ignoring Others’ Cognitions
and Reactive Devaluation
• Ignoring others’ cognitions
– Negotiators don’t bother to ask about the other party’s
perceptions and thoughts
– This leaves them to work with incomplete information, and
thus produces faulty results

• Reactive devaluation
– The process of devaluing the other party’s concessions
simply because the other party made them


Managing Misperceptions and
Cognitive Biases in Negotiation
The best advice that negotiators can follow is:

• Be aware of the negative aspects of these biases
• Discuss them in a structured manner within the team
and with counterparts


Mood, Emotion, and Negotiation
• The distinction between mood and emotion is based on three

– Specificity
– Intensity
– Duration


Mood, Emotion, and Negotiation
• Negotiations create both positive and negative
• Positive emotions generally have positive
consequences for negotiations
– They are more likely to lead the parties toward more
integrative processes
– They create a positive attitude toward the other side
– They promote persistence


Mood, Emotion, and Negotiation
• Aspects of the negotiation process can lead to
positive emotions
– Positive feelings result from fair procedures during
– Positive feelings result from favorable social comparison

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