An organizational model for transitional negotiations: concepts, design and applications

Abstract

Negotiations generally tend to focus efforts on attaining optimality in single-problem contexts that are ad hoc, disparate and temporary in nature. Once negotiators reach agreement, the process usually attains closure and the long-term impact of the outcome is rarely considered. In organizational settings, decisions involving quid pro quos are, however, made on a continuous basis. Since organizational environments are constantly in flux, negotiated solutions that appeared successful on a given problem at first might no longer work out to be effective in the long run. We postulate that organizations evolve from one state to another and negotiations play an important part in these transitions. From this perspective, decision-making in organizations or between them can be modeled using sequential Markov chains that converge on homeostasis. This leads to a prescriptive approach for transitional negotiations that allow for assessment of the long-term impact of decisions and suggest acceptance of possible short-term losses in favor of the better payoffs that are to come. We provide a hydraulic dam example to illustrate the transitional aspect of decision-making over time. Based on earlier successful GDSS, we also suggest a software architecture that would allow the proposed theoretical model to be implemented as an organization negotiation support system with practical benefits.