The marketplace has the tendency of punishing those whose word cannot be trusted in the process of negotiations. Therefore, business negotiations require trustworthiness and good faith from both sides of the parties involved in the process of negotiating. The impact of negotiating in bad faith can cost the business more than one can expect and it can take many years to overcome. This is as a result of the reputational damage caused by the negotiator that sometimes can be irreparable. This paper seeks to determine whether managers negotiate ethically in the contemporary businesses. The point of focus includes: The fundamental elements of negotiations, negotiation process, the importance of ethical negotiations, understanding different cultures and individual differences in the negotiation process, resolving the differences or issues that can result in negotiating in bad faith or unethically.
The Fundamental Elements of Negotiations
Negotiations are determined by three main elements; for instance, interests, rights, and power. Lewicki, Suanders, and Barry (2011, p. 2) define interests as needs or desires that people care about. Every negotiation must be preceded by desires or interests that every party wants to achieve or like to be given priority. However, it is the desires that also lead to the unethical negotiation when the interests underlie the parties position when they come in the negotiations. When one party advances its interest than the other most likely there would be unethical negotiations. When negotiations turn to arguments there is no solution that the parties involved are most likely to reach at. Therefore, reconciling such interests especially when every party has come in the negotiation with the optimism that it must advance its interests may not be easy. Most managers in the contemporary businesses advance their interests at the expense of the customers. The outcome of such unethical behavior results in far worse effects than one could comprehend. Lewicki et al. (2011) explain an example of instances where interests advance the need for negotiation and the probable impact. According to the authors, managing directors of sales and production engage in a negotiation that results in an argument because they are unable to reach an agreement. The sales manager prefers to produce more products because he thinks that more products will mean different or variety of models for customers; thus, increasing the sales. On the other hand, the production manager thinks that they should produce fewer products because more products will increase the production cost for the company. If the two managers do not come to an agreement on what quantity they should produce it becomes a problem not only to the management but to the entire organization. In this case, each party needs his interest to be considered and no one is willing to conceal accommodating the interests of the other person or party.
When two or more parties are negotiating it becomes difficult for them to determine which party is right especially where there are opposing views like the above case. In extreme situations where people have negotiated and there is no positive outcome, the case may be taken to courts which act as an independent standard to set the level background for the parties to agree on. However, this may only apply to situations where the rights can be formalized by the courts. In cases like the internal negotiations within the organization, it becomes very difficult to determine the rights because every side wants to be considered right by the other side. Therefore, in such cases, the rights become unclear to determine because they are not only different but also contradictory. Lewicki et al. (2011, p. 3) highlight that in such a case where there is no party that is right it is important to turn to a third party that may be considered neutral to help resolve the differences.
In every negotiation, every side of the parties wants to be considered powerful and the most powerful will carry the day as the final decision will rest on him. This is where most of the prejudices are experienced. When every party in the negotiation wants to feel more powerful than the other, it is most likely that disagreements may emerge between them. However, in cases where one already possesses more power than the other, it becomes difficult for the party with less power to negotiate freely. However, the party that feels less power will be prejudiced as its interests may not be considered. A good case scenario is a business organization where the manager is involved in negotiation with an employee or a supervisor; the two may not agree because one party is already powerful and will involve unethical negotiation techniques (Lewicki et at., 2011). Some of the unethical behaviors that managers may depict during negotiation include untrustworthy and lack of empathy. Managers like to take control of situations to express their power. However, when this power is used to infringe others then it is unethical. Power conflict in negotiations has also been created by the societal stereotypical beliefs that men are more powerful than women. Paddock and Kray (2011) argue that differences in expectations of men and women are influenced by status and power. As a result, in a negotiation where there is a woman a manager may not give more attention to what the woman says not because she is not intelligent enough but because she is a woman. Most of the managers who perceive work as purely male proposition engage in unethical negotiation behaviors that may result in prejudice to the other party that involves female (Karnes, 2009, p. 189).
Negotiation is a process where one party presents its desires to the other party and they come to an agreement which every party benefits. According to Katz, Kochan, and Colvin (2015), negotiation process should be guided by ethical principles including honesty, transparency, and good faith. The process of negotiation begins with the parties agreeing on the terms of negotiation which should be decided by both parties. A manager cannot decide to negotiate a business contract without the other party they are negotiating with agreeing with the terms and the place. As part of the negotiation process, Larson, Olofsson, and Severin (2005, p. 39) assert that managers should maintain the face of the company; this means that the interest of the company should be at the top of agenda. However, this should not inhibit understanding between the negotiators.
Negotiations require flexibility and ability to make changes whenever they are needed. As much as one may like to advance the interest of the company it is also important to allow room for some changes to accommodate the interests or desires of the other party in the negotiation. De Girolamo (2013) asserts that negotiations should not be driven by selfishness and egocentrism that blinds one from accepting changes when proposed by the other party. In some cultures like the Chinese culture, only experienced professionals are allowed to hold negotiations because they are able to make the changes when needed.
Negotiations process also involves bargaining to reach an agreement where everyone is suitable with the final decision. A good manager is guided by ethical principles including understanding and flexibility. The main aim of negotiation is to come to an agreement or common level of understanding concerning a certain issue. Negotiations that are driven by unethical behaviors turn out to be disagreements and arguments. Some of the managers in the contemporary society due to lack of experience; end up spoiling the reputation of the company because they are unable to engage ethically with other people. According to De Girolamo (2013), respect is one of the key principles in ethics that managers require especially when negotiating. Therefore, managers need to depict the highest standard of ethical behavior because they represent the face of the company. If anything goes wrong with the negotiation it is not the manager that will be most implicated but the company. There are various ways of bargaining but the two main ones include distributive and integrative. The distributive bargaining involves negotiations where one side benefits and the other lose the negotiation. This type of negotiation was used many years ago and mostly do not apply today. The integrative bargaining on the other is the negotiation where both parties agree on a common level where they can both benefit from the decision (Katz et al., 2015). Sometimes negotiations can benefit both parties and sometimes it may not. However, even when one party has to lose and the other gains ethical behavior helps to find a common level of understanding so that the party that loses does not come out of the negotiation feeling prejudiced.
Importance of Ethical Negotiations
Despite being the common practices in business today, negotiations do not meet the required standards in terms of the ethical conduct of the negotiators. The fact that ethics is not taught in school makes it difficult for people graduating from colleges and other higher learning institutions to depict good ethical behaviors in their negotiations or discussions. Skiba (2015, p. 400) argues that negotiation is a two-sided process of communication with the aim to reach an agreement where each party is comfortable with. Negotiations are not monologue that one comes to the table when he/she has already decided on what he wants. Cross (1977) further explains that negotiation is a learning process where no one knows all. Listening to the other person is also important because their opinions should also count in the negotiations (Goffman, 1967). Most managers today apply the distributive bargaining strategies with the aim of winning; thus, turning negotiations into competitions which is wrong. When people come together to negotiate they do not intend to compete even though they do not intend to lose as well. Skiba (2015) highlights some of the characteristics of ethics required in negotiations. The author explains that ethics can be demonstrated in various ways during negotiations; for instance, during the process which he calls the process ethics where negotiations are undertaken in processes including preparatory, essential, and final stages (Skiba, 2015, 401).
Skiba (2015) further mentions that people can also depict different immoral and unethical behaviors in negotiations. The most commonly identified symptoms of unethical behavior during negotiations include manipulation and lie. He defines manipulation as a group of psychological, propaganda, and organizational activities calculated and designed on affecting another person either within or outside the organization (Skiba, 2015, 401).Some of the unethical behaviors aimed at manipulating others include using gifts to bribe the other party, using spies to obtain special information that can be used to outsmart the other party in negotiation, undermining the credibility of the other party during the negotiation, and stealing documents belong to the other party to gain more advantage. All these add up to what Skiba (2015) identifies as manipulation of things to suit the interest and desires of one party at the expense of the other. Lying is also another unethical symptom that is not acceptable during negotiations even though many people prefer to use it to gain an advantage. Dishonesty during negotiation especially by a manager depicts the kind of organization that he/she comes from. As already mentioned before, managers carry the face of the organizations that they represent. Therefore, if they demonstrate dishonesty by lying it gives a wider picture of the organization. Therefore, Skiba (2015) explains that ethics is important during ne...
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