Online Negotiation

Online Negotiation

Studies have compared the establishment and maintenance of business relationships based on forms of communication.  Relationships founded solely on written communication ten to founder.  Those which include written and telephone communication were sustainable, but the best relationships are those which go beyond other forms of communication to involve face-to-face meetings.


In face-to-face communication, one party can easily discern from facial expressions and shifts in body positioning the reaction of the other party to a stated position or even a misinterpretation.  Immediate steps can be taken to remedy any misunderstanding or provide further explanation or support for a negotiation position.  When communication takes place in written form, these remedies may not be available.


Advantages of Online Negotiation

Experience indicates that electronic communication can separate issues from personalities.  There is some evidence that groups using electronic communication tools may be more productive at brainstorming.  Online communication can free the buyer and supplier from location dependency and perhaps even the requirement to find a common time for conductucing the negotiations.


Drawbacks to Online Negotiation

It is fare easier to say no in writing than face to face.  The psychological separation that goes with the lack of personal contact makes the termination of the relationship much easier.  This can be a distinct advantage, because it curtails problems that may be associated with negotiating with people who know and like, including reluctance to disgrace for fear of damaging the relationship.


Online negotiators are likely to feel a need to be more persuasive efforts, more convincing. However, we must take care to avoid excessive stridency in our persuasive efforts, or our labors can easily turn counter productive.  Because of a lack of other cues, our use of language takes on particular importance, and we carefully consider the impact of each word.  How might connotations or interpretations differ?  Often, the same word can be taken in a number of different ways, and the limitations of online communications as currently realized make it difficult to evaluate the perception of the receiver. 


Buddress, Raedels, and Smith propose the following hypotheses:


The more important the issue is, the more likely it is that it will be negotiated face to face.

The more politically sensitive the issue is, the more likely it is that it will be negotiated face to face.

If either negotiator will be personally affected by the outcome, that person may want to conduct the negotiation in person.

If the topic involves issues of firm sensitivity, such as trade secrets or core competencies, the negotiation is more likely to take place face to face.

Buyer-supplier relationships will be perceived as more distant, the more online communication and negotiation are used.

Less formal planning will occur before online negotiation than for those conducted face to face.