Perception, Cognition & Emotion

What are the perceptual Biases

Frames

Cognitive Biases

Emotions

• What is perception• Whatever happens between occurrence of a

stimulus and our behavioral reaction to it• Many processes in between….

Stimulus Attention Recognition Translation Behavior

Perception

• Perceptual Biases

• Stereotypes • Generalize from one individual many individuals of a

group– Due to time pressure, cognitive stress, mood

• Halo• Generalize from one attribute many attributes

– Due to lack of experience with person, celebrity status, moral qualities of attributes

• Perceptual Biases (cont’d)

• Selective perception (aka confirmation bias)

• Reliance on evidence that is consistent with beliefs than over that is inconsistent– Perpetuates stereotypes, halos etc

• Projection (aka false consensus effect)

• Assume other is similar to you in interpreting & responding to situation

• Framing– Individual interpretations of negotiation

situation• E.g., objective of negotiation, expectations for

outcomes, information used to argue case, procedures, criteria for evaluating outcome

– Some types of frames are similar to concepts of strategy, goals, interests, rights, power…..!• E.g., substantive, outcome, aspiration, process…

• Types of frames (similar to other concepts)

– Substantive vs. Process • to have a particular way of thinking of what the

conflict is about vs. how to resolve the conflict

– Outcome vs Aspiration• Achieve a certain outcome vs. satisfy needs or

interests

– Rights• Correct, legitimate, fair

– Power• coercion, economic pressure, legitimate

authority, expertise

– Give an example…

• Types of frames (cont’d)– Identity• Definition of oneself

– E.g., group membership, place of birth etc.

– Characterization• Definition of the other party

– Prior experience w/other party, reputation, image projected early in negotiation

– Loss-gain• Risk vs. reward

– E.g., Loss of $$ vs. gain in value of item

• How frames work… (note similarity to how interests operate)

–More than one frame @ one time–Mismatches of frame conflict– frames differences in negotiation– Type of Issues Frames– Frames agreements– Differences in values, personalities,

background etc differences in frames

• How frames operate within the course of a negotiation• What gets discussed: stock issues• Build a strong case for own position, refute other

party’s argument• Diagnosis/Formula/Detail• Discuss multiple secondary items transform

negotiation (develop issues)• Reframing: attack arguments, making case,

management of multiple issues

• Cognitive Biases• Escalation of commitment

• Fixed-pie beliefs

• Anchoring & Adjustment

• Loss vs. Gain frame

• Availability (vividness)

• Winner’s curse (counterfactuals)

• Cognitive Biases• Overconfidence

• Law of Small numbers (extrapolating from experience)• E.g., “Hot hand”

• Self-serving Biases: • fae, a-o, false consensus (b23)

• Endowment Effect

• Ignoring other party’s cognitions

• Reactive devaluation• minimize concessions made by disliked other

• Managing misperceptions & cognitive biases• Awareness is not sufficient, • E.g., discussing how to set offers etc. does not reduce

anchoring and adjustment effects

– Reframe when frames are mismatched• Define & evaluate problem, discuss in structured

way • Arunachalam & Dilla 1995

• Emotions in Negotiation• Negotiation processes & outcomes

Positive & Negative Emotions• Positive Emotions Positive Outcomes

– Integrative processes– Positive attitude toward other side– Promote persistence

• Negotiation processes Positive Emotions– Fair procedures– Favorable social comparisons

• Negative Emotions Negative Outcomes– Definition of situation as competitive/distributive– Escalation of conflict– Retaliation

• Negotiation processes & outcomes Positive & Negative Emotions (cont’d)

• Negative Emotions Negative Outcomes– Definition of situation as competitive/distributive– Escalation of conflict– Retaliation

• Negotiation Processes Negotiation Emotions– Competitive mind-set– From Impasse– Beginning of a negotiation

• Positive emotions negative outcomes• Scrutiny of counter arguments is less• Susceptibility to deceptive tactics• Positive emotions positive expectations. If

those are are not met via integrative agreements, other party is treated more harshly

• Negative emotions positive outcomes• Information value – motivation to resolve situation

or leave it• Words used to trigger negative emotion to convey

seriousness of purpose– .g., anger is a double edged sword….

• Using emotion as a negotiation tactic– Positive emotional tone • agreements incorporating future business

relationship• Induce compliance w/ ultimatum offers

– Adjust strategy based on emotion of other party• Angerlower demands• Smaller concessions when anger threatens

outcomes of negotiation• Worry/disappointment lower demands• Guilt/regret higher demands• EI Emotional tuning of messages to other

party’s emotions