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Influence

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					CHAPTER 10

 INFLUENCE
    AND
NEGOTIATION
       Learning Objectives
• After studying this chapter, you should be
  able to explain:
  – What persuasion is and its role in the
    influence process
  – Six primary approaches to influence
  – Negotiations
  – International applications and concerns
                 Persuasion
• Persuasion and influence are not identical.
• Persuasion is the effort to change people’s
  beliefs or attitudes.
  – A change in a private attitude or belief resulting from
    a receipt of a message
• Influence is convincing people to actually do
  something
  – An action that leads to a change in behavior
• Persuasion is a deeper form of change than
  influence.
              Persuasion
• Cognitive response model of
  persuasion: A model that views the most
  direct cause of persuasion as the self-talk
  of the target audience, not the persuasion
  method itself or its deliverer.
               Persuasion
• Reasons why people may respond to a
  persuasive message:
  – Many people would like to build a more
    accurate view of the world and how it works.
  – People would like to be consistent with their
    own values (the consistency principle) in
    order to avoid cognitive dissonance.
  – People also care about what others think.
                 Influence
• Influence or Social influence:
  Encouraging a change in behavior that
  was caused by real or imagined external
  pressure.
• Three behavior outcomes deriving from a
  successful influence attempt:
  – Conformity
  – Compliance
  – Obedience
                 Influence
• Conformity: Changing one’s behavior to match
  the perceived requirements of others.
• Compliance: The act of changing one’s
  behavior in response to a direct request, and the
  request may come from someone who is not in
  authority over you.
• Obedience: Changing one’s behavior in
  response to a directive from an authority figure.
                 Influence
• Six universal principles of influence
  – Social proof: A principle of influence that
    states people are more likely to want to do
    something if they believe that many others are
    doing the same thing or buying the same
    product.
  – Authority: A principle of influence that states
    people are more likely to say yes to a request
    or purchase a product if an authority says it is
    good to do so.
                 Influence
• Six universal principles of influence (cont.)
  – Liking: A principle of influence that holds that
    people are more likely to be influenced by
    those whom they like or with whom they have
    similarities.
  – Consistency: A principle of influence that
    indicates how people are influenced by
    showing how their previous statements or
    stated values fit with a recommendation or
    request.
                 Influence
• Six universal principles of influence (cont.)
  – Reciprocation: A principle of influence that
    states people are more likely to say yes to a
    request when the requester has done
    something for that person in the past.
  – Scarcity: A principle of influence that argues
    that people are more likely to buy a product or
    want to do something that they perceive as
    scarce, unique, or dwindling in availability.
                 Influence
• Social proof
  – People like to follow the crowd.
  – It is helpful to appeal to what the larger group
    is doing.
  – Using an opinion leader (or two) is quite
    important.
  – People faced with strong group consensus
    sometimes go along even though they think
    the others may be incorrect.
                 Influence
• Social proof (cont.)
  – Social validation is important in cultures with
    high group cohesiveness (East Asia).
  – To encourage a behavior, show that many
    others are doing that same thing, particularly
    people who are similar to those you are trying
    to influence.
  – To discourage a behavior, do not say that
    many others are doing the action you want to
    discourage.
                 Influence
• Authority
  – The authority principle is helpful to some
    extent because we do not have time to
    evaluate every decision we make.
  – Studies by Stanley Milgram.
  – People are more influenced by those who
    display their credentials and awards as a
    signal of their authority.
                 Influence
• Liking
  – People seek opinions from and are thus
    influenced by those who they like, are similar
    to, or feel connected with in some way.
  – Similarity increases liking.
  – Differences decrease liking and thus
    influence.
  – Managers can use similarities to build
    relations with external and internal customers.
                   Influence
• Liking (cont.)
  – Praise can establish liking while criticism can
    have the opposite effect.
  – Able managers can use praise to repair an
    already damaged relationship.
  – There are cultures where negative comments
    may be even more damaging than in others.
  – Focusing on others’ needs instead of talking
    about what you want can establish liking.
                  Influence
• Consistency
  – Once individuals go on record in favor of an
    idea or product, they typically prefer to stick to
    that position.
  – Thus, seemingly insignificant commitments
    can lead to large behavior changes.
  – Decision makers have a tendency to escalate
    their commitments to decisions that are not
    working out and should be terminated.
                 Influence
• Reciprocation
  – People are more willing to comply with
    requests from those who have provided
    something to them first.
  – Gifts can increase the number of donations.
  – Balanced reciprocity: Securing a promise of
    a near-immediate return for a favor done or a
    gift given; thought to be particularly important
    in China and in ethnic Chinese communities
    around the world.
                 Influence
• Scarcity
  – People find objects and opportunities more
    attractive to the degree that they are scarce.
  – Reactance: When we are told that we cannot
    have or do something, then we want it more.
  – Scarcity does not just influence consumers
    but also can be influential inside firms as well.
            Negotiations
• Negotiating: A process in which at least
  two partners with different needs and
  viewpoints try to reach agreement on
  matters of mutual interest.
                 Negotiations
• Cognitive shortcuts and negotiation
  – Even in the careful, studied process of a long
    negotiation, decisions can be affected by:
     •   Availability
     •   Loss aversion
     •   Consistency
     •   Other heuristics
              Negotiations
• Balance of power
  – In any negotiation, one side may have more
    leverage.
  – It is not always clear which firm has the power
    in a relationship.
  – Negotiating skill is especially critical because
    it can help maximize what you receive from
    the negotiations.
              Negotiations
• Types of negotiations
  – Distributive (or fixed-pie) negotiations: This
    type assumes a fixed set of resources to
    bargain over, although this assumption may
    not be accurate and should be challenged by
    the other side.
  – Integrative (or expanding-pie) negotiations:
    This type looks aggressively for win-win
    solutions that also enlarge the resources that
    both sides might capture in negotiations.
    The Negotiation Process
• Common biases that appear at the start of
  a negotiation:
  – Unrealistic expectations
  – Anchors
  – Escalation of commitment
     The negotiation Process
• Unrealistic Expectations
  – Unrealistic expectations include those that are
    too high or too low
  – An under-confident negotiator who starts out
    by undervaluing his/her position and
    bargaining power will make unnecessary
    concessions or choose a low starting point
    (anchor), consequently affecting the
    outcomes of negotiation.
     The Negotiation Process
• Anchoring
  – A cognitive bias that describes the common
    human tendency to rely too heavily, or,
    anchor on one piece of information when
    making decision.
  – During negotiation process, individuals may
    anchor on specific topic or value such as a
    starting price, and then discussion may
    proceed around that value.
    The Negotiation Process
• The Best Alternative to a Negotiated Agreement
  (BATNA)
  – Decisions should not be evaluated in isolation, but
    must be assessed in the context of other reasonable
    alternatives at hand.
  – It is not very helpful to say that certain decision is bad
    and that you disagreed with it without proposing what
    you would have recommended instead.
  – Negotiators must be fully aware of their alternatives.
  – It is better to quit a lengthy negotiation than to accept
    a deal at a loss just to show something for the effort
    (escalation of commitment).
    The Negotiation Process
• The importance of information
  – Having well-organized and relevant
    information is crucial to effective negotiations.
  – It is important to collect as much information
    as possible because most negotiators will not
    offer the information up front.
   The Negotiation Process
• The importance of information - Common
  biases:
  – Most people make decisions based on vivid
    experiences and events – Unfortunately,
    memory is often selective and subject to the
    availability heuristic.
  – Individuals are often as impressed by the
    theatricality of a presentation as its
    substance.
    The Negotiation Process
• A reservation price is the firm’s absolute
  bottom price that is acceptable.
• Target price is the value that you would like to
  have.
• Impasse: When a manager and his or her
  negotiating partner cannot reach an agreement.
• Ultimatum: Requiring someone or a group to do
  specific thing in a specific way in order for
  negotiations to continue.
    The Negotiation Process
• Framing
  – Negotiators can react differently to identical
    proposals when the framing changes.
  – Loss framing and the scarcity principle.
• Fairness and trust
  – Most people are very sensitive to fairness
    issues.
  – The ultimatum game.
    The Negotiation Process
• Positive emotion
  – Anger, pride, overconfidence, and over-
    competitiveness can work against you.
  – Negotiators who are in positive moods are
    more likely to achieve integrative
    agreements.
    The Negotiation Process
• Culture in negotiations
  – A negotiation becomes cross-cultural when
    the parties involved belong to different
    cultures and therefore do not share the same
    values and behaviors.
  – Effective cross-cultural negotiations contain
    all the complexity of domestic negotiations
    with the added dimension of cultural diversity.

				
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posted:9/27/2012
language:English
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