Personal and Situational Factors affecting a Negotiation

Cite this article as:"Personal and Situational Factors affecting a Negotiation," in The Business Professor, updated October 2, 2017, last accessed July 13, 2020,


What personal and situational factors are commonly understood to affect negotiation?

Negotiations are far more complicated than just a bundle of facts that negotiators are trying to organize. While facts are the background of negotiation, the following situational factors are readily understood to affect the negotiation process:

• Context – The situation or conditions under which the situation arises. What are the facts of the situation? Who are the parties to the situation? What is the nature of the interaction or relationship between the parties. Are there teams or coalitions among the parties?

• Objectives or Interests – The objectives and interests of the parties are often subjective and will drive the negotiation process.

• Perception or Cognition – How an individual perceives the facts of the situation. Cognition is the mental process used to process these facts will shape a parties willingness to negotiate. An individual’s perception of the facts of a situation and the negotiation process will affect the ability to effectively process the facts or information. Cognition entails logic, emotion, and heuristics (biases). These elements affect a party’s understanding of what is a successful negotiation.

• Creativity – A negotiator’s willingness and ability to search for and develop alternative resolutions to situations involving differing perceived interests or objectives will affect the breadth of the negotiation.

• Strategy & Tactics – Each parties’ strategic plan for arriving at a particular outcome (or within a range of outcomes) and the tactics or measures employed to effectuate that plan will affect the negotiation process.

• Communication – The ability or effectiveness of parties to a negotiation to communicate their interests, objectives, and acceptable resolutions of situation will affect the negotiation process. In a way, effective negotiation practice is a communication exercise. Parties use communication techniques to derive and understanding of the other party and her interests. Communication is also the primary method of achieving concessions the bring a negotiation within a zone of potential agreement (ZOPA).

• Trust – Trust between individuals affects the willingness and depth of personal interaction. In this way, trust moderates the interaction between individuals when their interests and objectives differ.

• Relationships – The nature or extent of the relationship between individuals will contribute to the context, communication, and trust that define a negotiation.

• Ethics – Ethics influence and individual’s values, perceptions of situations, and the communication and strategic tactics employed in a negotiation.

• Culture – Aspects of cognition, communication, trust, and ethics are all implicated when individuals from different cultures interact.

• Medium of Communication – The medium through which parties communicate can affect numerous aspects of the negotiation. Notably, it affects the communication process and the cognitive processing of the information exchanged. This can, in turn, affect the strategy that the parties employ.

• Intermediaries – The presence of facilitators or decision makers will have an effect on the negotiator’s objectives, perceptions, strategy, communication, and trust in a situation.

• Process – A party’s willingness to negotiate and their actions in the negotiation process are affected by the negotiation process and the actual outcome obtained.

Each of these aspects of negotiation are important for effective negotiator to understand and is discussed individually throughout this material. This material draws heavily from negotiation research in the areas of management, psychology, law, economics, and other disciplines.

• Discussion: Can you think of any other characteristics or factors of a negotiator or situation that would affect the negotiation process or outcome?

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