The effects of bargaining orientation and communication medium on negotiations in the Bilateral Monopoly Task.

Abstract

Discussions via electronic mail are becoming commonplace to support decision-making and coordinating activities. Users of these technologies are usually dispersed either in a geographical and/or a temporal sense. Thus, unlike participants in face-to-face meetings, participants in electronic text discussions cannot speak to each other nor can they see each other. Unfortunately, few guidelines exist which identify the tasks for which electronic text and face-to-face meetings are effective. This study examines how communication via electronic text impacts the processes and outcomes of negotiation in dyads. Electronic and face-to-face discussions are characterized by the efficiency of the communication media supported by each, and by media richness, the ability of those media to convey social and emotional information. These communication media will be compared and contrasted on the ability of each to support a negotiation task which requires two participants to simultaneously solve a logical problem and resolve conflicting objectives. In a controlled laboratory experiment, pairs of subjects with either a competitive or an integrative bargaining orientation completed the Bilateral Monopoly Task in one of four communication media (text-only, text-plus-visual-access, audio-only, audio-plus-visual-access). As hypothesized, an integrative bargaining orientation and/or the relatively efficient audio mode of communication lead to a higher joint outcome. In addition, visual access (which conveys a rich array of social and emotional information) resulted in a higher joint outcome for subjects with integrative bargaining orientations, but lower joint outcomes for those with competitive orientations. The results indicate that bargaining orientation and communication medium have a marked impact on negotiation processes and outcomes. An efficient communication media is required to closely examine negotiation issues, and to reduce uncertainty about the constraints inherent to the negotiation task itself. Media richness strongly moderates the effect of bargaining orientation. A rich media enhances both the predisposition of an integrative bargainer to trust, and a competitive bargainer to dominate, the other party. Uncertainty regarding the logical structure of the task was reduced only via verbal communication, while equivocality regarding the bargaining orientation of the negotiating parties was reduced only via visual communication.