SCM201

what is the bargaining zone?

• The bargaining zone is the area where each side's bargaining range overlaps and where agreement is possible

• In collective bargaining, both labor and management realize that their counterparts will not completely agree on their ideas for a perfect settlement

• It is imperative to view bargaining as a whole, because a concession on one issue may knock a settlement on another issue out of the bargaining zone.

• B and C are correct

A commitment statement should have a

•  low degree of finality.

•  high degree of specificity

•  an indefinite statement of consequences

•  a high degree of emotionality

•  None of the above should be included in a commitment statement

A public commitment statement means that the wider the audience, the less likely the commitment will be changed ?

• True

• False

Definition of highball ?

• The highball tactic is one of the oldest hardball moves in the book

•  If you haven't done your research, or aren't aware of what is happening, you may fall for it

• Your counterpart will open with an extremely high or low offer, which they hope will force you to reconsider your resistance points and goal

• All of above

A negative bargaining zone indicates that

• parties are worse off by not reaching agreement than reaching agreement

• there is no positive overlap between the parties' reservation points

• parties should keep negotiating to find a positive bargaining zone

•  the counterparty's first offer was not accepted

Negotiation _____ refers to the overall approach used to reach a mutually beneficial agreement with a supplier that holds different points of view from the buyer

• tactics

• positioning

• strategy

• conflict

 What is the purpose of bargaining?

• Judgments of responsibility and fairness are attributable to the ways in which people process information, such as selective encoding and memory, differential retrieval, the informational disparity

• Collective bargaining is the process in which working people, through their unions, negotiate contracts with their employers to determine their terms of employment, including pay, benefits, hours, leave, job health and safety policies, ways to balance work and family, and more

• States that benefits should be proportional to needs

• Negotiators' reservation points overlap

What is a Zone Of Possible Agreement (ZOPA)?

• A zone of possible agreement (ZOPA) is a bargaining range in an area where two or more negotiating parties may find common ground

• The amount of overlap between negotiating parties' reservation points; a measure of the value that a negotiated agreement offers to both parties compared to the value of not reaching a settlement

• There is no positive overlap between the parties' reservation points, therefore, parties should pursue other alternatives rather than spending fruitless hours trying to reach an agreement

• The positive difference between the settlement outcome and the negotiator's reservation point; the total surplus of both parties adds up to the size of the ZOPA or bargaining surplus; illustrates the mixed motive nature of negotiation; negotiators are motivated to both cooperate and compete with the other party

The reason why the Good cop, Bad cop strategy works in negotiation?

• strengthen trust, create pressure to make decisions faster

• Reduce financial pressure

• cooperative relationship between the two sides

Using tactics “ good cop, bad coop” aims to put too much pressure on partners to reach the agreement we want

•  true

• false