Chapter 2 The Traditional Perspectives on Professional Buying Behaviour
2.1.5 Practitioner Focussed Models and the Broad Negotiation School
Within the broad negotiation school there is also a significant body of literature which, although focussed mainly on providing guidance to practitioners, also provides useful conceptual insight. Raiffa (1982:46) offers a model of distributive bargaining between buyer and seller in which he outlines the Zone of Agreement within which the players operate (Figure 2.1).
Although this model is presented as being simplified it clearly demonstrates the interaction between the objectives of both parties and also the zero-sum nature of this particular perspective. Zero-sum is a term, borrowed from Game Theory2, which suggests that the negotiating parties cannot through mutual cooperation increase the overall value of the collective benefits which will accrue.
Figure 2.1: The Geometry of Distributive Bargaining Source: Adapted from Raiffa (1982:46)
Within the Raiffa model it is clear that both buyer and seller want to move in opposite directions and several authors express opinions as to how practitioners can best be achieve the movement they desire. Karras(1992:36) recognises that the outcome of any negotiation is a function of the relative power between the parties and argues that the enhancement of negotiation skill is the one of most effective ways to increase the power held. Karras supports the negotiators simultaneous use of both power based adversarial techniques and also of collaborative problem solving approaches. Rojot
2 Game Theoretic approaches to negotiation are discussed in Section 2.1.3
42 (1991:47) proffers a similar perspective in which the negotiated outcome is perceived to be a function of the relative power held by the parties but also recognises that it is legitimate, on occasion, to adopt a more supportive, collaborative and understanding approach. Noticeably, however, Rojot does little to define any criteria by which to determine the appropriateness of either style. Fisher and Ury (1981:11) describe a process that they classify as 'principled negotiation' in which relationships are ideally protected by the adoption of a rational of identifying solutions that maximise the joint gains shared between the parties. This they see as the essence of the collaborative approach. Alternatively, Kennedy, Benson, and McMillan (1980:143), Fleming (1997:25) and Kennedy (1997:183) believe that maximising power is fundamental to the negotiation process and discuss the tactics and strategies aimed at enhancing the power held. While acknowledging that good working relations should be preserved, their basic approach is firmly rooted in the effective utilisation of asymmetric power.
Lytle, Brett and Shapiro (1999:32) offer a view that practitioners have three strategic alternatives that can be adopted during negotiation; these are to focus on Interests, Rights, and Power. They summarise these options diagrammatically in their model of ‘Three Basic Approaches to the Resolution of Disputes’ (Figure 2.2)
Figure 2.2: Three Basic Approaches to the Resolution of Disputes Source: Adapted from Lytle, Brett and Shapiro (1999:32)
Lytle, Brett and Shapiro recognise that all three approaches may well be utilised within a single negotiation, arguing that the ability to make tactical
43 use of these different approaches, particularly when confronting ‘rights’ and
‘power’ lines of attack, are key managerial skills.
Lax and Sebenius (1986:33) offer an insightful observation that gives context to the combined use of both adversarial and collaborative approaches, within the context of a specific commercial negotiation:
‘No matter how much creative problem solving enlarges the pie, it must still be divided; value that has been created must be claimed. And, if the pie is not enlarged, there will be less to divide; there is more value to be claimed if one has helped create it first.’
Walton and McKersie (1965:165) detail a series of complex strategies arising from the amalgamation of adversarial and collaborative bargaining. They argue that by playing the ‘Mixed Game’ it is possible to benefit from the combination of integrative bargaining to establish the maximum total sum available, accompanied by relatively hard distributive bargaining to claim the maximum share. They note, however, that despite its attractiveness there are several practical difficulties associated with the implementation of such a strategy, not least because of the difficulty in transitioning between soft and hard bargaining in the course of a single negotiation. The outline of the Walton and McKersie (1965:164) complex strategy model is replicated in Figure 2.3.
Figure 2.3: The Four Complex Bargaining Strategies Source: Adapted from Walton and McKersie (1965:164)
44 Having reviewed the broad negotiation school, both in terms of the theoretic models advanced and also through practitioner focussed literature, it becomes apparent that although insightful there are limits as to the perception of buyer-seller interactions that are provided. These limitations are discussed in the following section, together with potential options whereby wider perspectives can be gained.