Perception, Cognition, and Emotion in Negotiation
Perception, Cognition and Emotion in Negotiation
Expected Learning Outcomes
By the end of this session, you should be able to:
Clearly define the terms perceptions, cognitions, and emotions.
Explain the role of perceptions, cognitions, and emotions in negotiation.
Discuss how perceptual distortion can lead to biases in negotiation and impaired judgment.
Explain what is meant by framing and discuss the role of framing in negotiation.
Introduction
Perception, cognition, and emotion are the basic building blocks of all social encounters, including negotiation. Our social actions are guided by how we perceive, analyze, and feel about the other party, the situation, and our own interests and positions. A working knowledge of how humans perceive the world around them, process information, and experience emotions is important to understanding why people behave the way they do during negotiations.
Negotiations as Social Encounters
Negotiations are a specific type of social encounter informed by:
Perception and perceptual distortions
Cognition (e.g., framing, cognitive bias)
Emotion
Why Study These Phenomena?
These psychological tendencies exist and may influence our decision-making.
They may put us at a disadvantage by causing us to make bad decisions.
They may be the source of bad decisions by our counterpart.
They may reduce the likelihood of finding common ground.
We must know how to recognize and overcome them in our own behavior and the behavior of others.
Understanding Perception
Perception
Perception is the ability to recognize, interpret, and respond to information. It is crucial to understanding our environment and responding to it, sometimes transforming it.
Perception defined: the process or result of becoming aware of objects, relationships, and events by means of the senses, which includes such activities as recognizing, observing, and discriminating. These activities enable organisms to organize and interpret the stimuli received into meaningful knowledge and to act in a coordinated manner.
Perception Is…
…a sense-making process through which a person understands and assigns meaning to messages and events in a complex environment so that he can respond appropriately.
…influenced by experience and current state of mind.
…important for negotiators because sound decision-making relies on the ability to properly interpret environmental stimuli.
The Perceptual Process
The perceptual process involves:
Stimulus
Attention
Recognition
Translation
Behavior
Cognitive Shortcuts
The social environment is generally complex, and we cannot absorb everything.
Selective perception means tuning in to some stimuli while tuning out others.
Negotiators rely on perceptual shortcuts, mental models, or heuristics, but this may come at the expense of accuracy.
This raises the subject of perceptual distortion.
Perceptual Distortion
Refers to biases and errors in perception which influence the way we communicate and make decisions.
Four major examples:
Stereotyping
Halo effects
Selective perception
Projection
Examples of Perceptual Distortion
Stereotyping: Occurs when one individual assigns attributes to another solely on the basis of the other’s membership in a particular social or demographic category (e.g., about young people, specific ethnic groups, police, students).
Halo/horn effects: Similar to stereotypes, occur when people generalize about a variety of attributes based on the knowledge of one attribute of an individual (e.g., tendency to think that friendly people are honest).
Selective perception: The perceiver singles out certain information that supports or reinforces a prior belief and filters out information that does not conform to that belief. This perpetuates stereotypes or halo effects.
Projection: When people assign to others the characteristics or feelings that they possess themselves. It usually arises out of a need to protect one’s own self-concept, to see oneself as consistent and good.
Frames
Frames…
… refer to the way in which an individual perceives or defines a situation.
All social situations are subject to interpretation.
Two or more people involved in a situation will generally define it differently because of background, professional training, or past experience.
Definition of Frame
A frame is a broad definition of the situation that extends beyond decision-making risk to incorporate a variety of personal and situational factors that can affect how a person defines the current problem or key concerns at stake.
A frame is a perspective or point of view that people use when they gather information and solve problems.
One of the principal concerns of negotiation is to guide the parties to a common perception of the issues – a common frame of reference.
Definition Continued
Frames are a reaction to present circumstances based on a set of assumptions and beliefs derived from the past.
Framing is not only a passive response to circumstances – it is often advocated as an active strategy in negotiations.
Fisher et al. advise to “Frame each issue as a joint search for objective criteria.”
They also suggest that the framing of a negotiation can influence process and outcomes: “Framing a negotiation as a contest of will over positions aggravates the entangling process.”
O’Brien advises that “If you find yourself boxed into a corner, you have made a mistake or things are tense then use humour to make light of the situation and retract or reframe your position.”
Lewicki et al argue that “. . . parties who are competitive are likely to have positive identity frames of themselves, negative characterization frames of each other, and a preference for win–lose approaches to resolving their dispute. Recognizing these tendencies empowers negotiators to reframe their views of themselves, the other, or the dispute resolution mechanism in play in order to pursue a process that will resolve the conflict more productively."
Communication and Culture in Framing
Communication: Our understanding of what we hear someone say is shaped by our own experiences and the way we see the world – our frame of reference. Effective communication relies on similar frames of reference.
Culture: Frame of reference is largely determined by culture, with different cultural experiences producing different interpretations.
Why Frames Matter
Framing is inevitable.
One may frame a problem because of deeply buried past experience, deep-seated attitudes and values, or strong emotion.
Frames may also be influenced by available information and the situation or setting in which information is presented.
Framing may be a matter of strategic choice and deliberately employed by negotiators to influence outcomes.
Understanding Framing Dynamics
Understanding framing dynamics helps negotiators consciously elevate the framing process, thereby better controlling it. Negotiators who understand how they are framing a problem may understand more completely what they are doing, what the other party is doing, and how to have more control over the negotiation process.
Frames may be malleable and, if so, can be shaped or reshaped as a function of information and communication during negotiation.
Application of Frames in Negotiation
Contrast Effect
The contrast effect may influence negotiations:
When a reasonable proposal comes in the wake of a series of unattractive proposals, it will seem by comparison more attractive.
It may manifest itself in the “good guy bad guy approach” which may or may not be combined with an approach which seeks to “soften up” the opponent by adopting an unreasonable posture in the first instance.
Undesirable property v. highly desirable but somewhat overpriced property
Sales technique – selling a more expensive thing before a cheaper one e.g. selling “long term warranty” to protect the investment after the purchase of a 100,000.00 computer.
Framing: The Fixed-Pie Perception
People usually take one of three tacks when preparing for negotiation:
Resignation to capitulating to the other side (soft bargaining)
Preparation for attack (hard bargaining)
Compromising (hard and soft – trying to reach a mid-point between opposing desires)
Reframing
During negotiation or joint problem-solving, the explicit management of frames and the framing process may lead to important shifts in both the frames themselves and in their impact on the conflict dynamics. This purposive management of frames is called reframing.
Use of frame analysis and reframing processes have the following goals:
To clarify or refresh the perception of the issues in dispute to promote more productive information exchange and listening to ideas not previously considered and to expand the framework of discussion and explore means of action or solutions not yet attempted.
To sharpen the parties' understanding of their interests and how the modes of action they have chosen serve those interests in order to examine potential processes for managing conflict more productively and to reconsider patterns of relationships among stakeholders.
To identify those subjects which the involved parties view differently, even when the basis for the divergent frames are more fully understood to identify opportunities for trade-offs based on clearly understood differences.
To identify differences which cannot be bridged in order to more fully appreciate conflict dynamics and to evaluate the potential for conflict reduction processes that do not violate these intractable differences, to determine the degree of importance attributed to these intractable differences in frames, and to seek ways to address them.
Thus, reframing, stemming from stakeholders' understanding of their own as well as others' expressed frames, may pave ways for resolving, or at least better managing, a dispute.
Reframing Example
By using the term of “we” instead of “me” and “you” or “us and “them”, you may be able to subtly get the other party to abandon their positional or adversarial posture.
Ask open-ended questions to acknowledge their role in solving a common problem.
Cognition and Cognitive Biases
Cognition
Cognition refers to all forms of knowing and awareness, such as perceiving, conceiving, remembering, reasoning, judging, imagining, and problem-solving.
…all those processes through which the negotiator engages the senses to absorb, process, retain and responds to information….how negotiators use information to make decisions about tactics and strategy—the process of cognition.
Another definition: Includes basic mental processes such as sensation, attention, and perception. Cognition also includes complex mental operations such as memory, learning, language use, problem-solving, decision-making, reasoning, and intelligence.
What is a Cognitive Bias?
A cognitive bias is a mindset that flows from the tendency for people, including negotiators, to hold onto their positions, preferences, and beliefs even in the face of contradictory information.
A cognitive bias is a systematic error in thinking that affects the decisions and judgments that people make. Some of these biases are related to memory, while others might be related to problems with attention.
Impact of Cognitive Biases
Leigh Thompson provides an illustration of how cognitive biases can influence negotiating outcomes:
“With regard to slicing the pie, negotiators should be willing to settle for outcomes that exceed their reservation point and reject offers that are worse than their reservation point. However, people frequently settle for outcomes worse than their BATNA (the agreement bias) and often reject offers that are better than their BATNA (hubris). . . .The key question is why such irrational behavior occurs. The problem can usually be traced to either cognitive or emotional biases.”
Causes of Cognitive Bias
Cognitive biases can be caused by a number of different things, but it is these mental shortcuts, known as heuristics, that often play a major contributing role.
Heuristics are mental shortcuts that enable quicker and more efficient judgment, decision-making, and problem-solving – they are rule-of-thumb strategies used frequently and instinctively in everyday decision-making, but they may not be accurate and may be influenced by cognitive biases.
Aside from heuristics, cognitive biases may be caused by social pressures, individual motivations, emotions, and limits on the mind's ability to process information.
Impact of Cognitive Biases
Cognitive biases can obviously lead to flawed decision-making.
Negotiation is joint/collective decision-making.
Cognitive biases can therefore have a negative effect on negotiation outcomes – leaving money on the table.
Example: Inattentional Blindness
Inattentional blindness is a tendency to see, hear, or experience only that which we are focused on and be blind to other obvious factors that are not the focus of our attention. In the process, important information is overlooked, resulting in our inability to make rational and effective decisions.
During a negotiation, parties are so focused on their positions/perspectives/goals while processing multiple issues and complex information that inattentional blindness could affect even the most expert negotiators.
Decision-makers and negotiators systematically ignore valuable information that is readily available.
Example: Confirmation Bias
Confirmation bias is a type of selective perception that emphasizes ideas able to confirm personal beliefs, while despising everything that contradicts them. It's the tendency to search for and interpret information in a way that confirms our preconceptions and often goes hand-in-hand with inattentional blindness.
When confronted with complex information, people tend to focus on information that is favorable to them and interpret neutral information in a manner favorable to them.
The more time invested in gathering and interpreting supporting information, the stronger the cognitive bias.
Effective negotiation requires that confirmation bias be neutralized by acknowledging that we do not see the complete picture and by looking at the counterpart’s perspective.
How Should Negotiators Deal with Cognitive Bias?
Negotiators must recognize the possibility of these cognitive biases within themselves so as to take the necessary steps to address them.
Then, take the appropriate step in relation to the particular bias that may be at work.
It is also important to recognize the biases at work in your counterpart(s) – you may find it convenient to use it against them, or you may need to get them to reframe in order to arrive at a better outcome.
Emotion
What are emotions?
How do they affect negotiations?
How can we capitalize on the positive effects of emotions and mitigate the negative effects?
Emotion Defined
Emotion is a complex reaction pattern, involving experiential, behavioral, and physiological elements, by which an individual attempts to deal with a personally significant matter or event. For example, threat evokes fear; disapproval evokes shame, approval evokes pride or happiness.
…a complex state of feeling that results in physical and psychological changes that influence thought and behavior.
Mood states are more diffuse, less intense, and more enduring than emotion states, which tend to be more intense and directed at more specific targets.
Impact of Emotion on Negotiation
Negotiations create both positive and negative emotions.
Positive emotions (e.g., happiness) can result from:
…liking the other party
…feeling good about the development of the negotiation process and the progress that the parties are making
…liking the results that the negotiations have produced
Impact of Emotion on Negotiation
Negative emotions (e.g., anger, frustration, anxiety, fear…) can emerge from:
…dislike (hate, revulsion, distrust) of the other party
…feeling bad about the development of the negotiation process and the progress being made
…disliking the results
Negative emotions may spawn negative and unhelpful behaviors (e.g., aggression, withdrawal, defensive and unhelpful behaviors like withholding information).
Summary
Psychology plays a very important role in negotiations.
Understanding that role helps us to be better negotiators.
In this section, we focus on the key roles played by the interrelated perception, cognition, and emotions.
We analyze these concepts because negotiation is not a black box – better understanding of its component parts allows us to better understand ourselves and our counterpart and to plan and act better in negotiable situations and take a leadership role thus bring about outcomes that are better for ourselves, our counterparts, and society.