Recently, I wrote about a new study on fairness in monkeys. (another-study-on-fairness ) “Fairness” seems to be a popular topic as my colleague Linda Bulmash in her One Minute Negotiation Tips published by the Los Angeles County Bar, (Volume VI, Number 2, February 2013) (Busmash) takes up the topic of “Defining Fairness in A Negotiation”. In her article, she notes that “fairness” can be defined in several different ways. It is a “loaded” term, to say the least.
As explained in greater detail by Nancy A. Welsh in her article “Perceptions of Fairness in Negotiation”, 87 Marquette Law Review 753 (2004), “fairness” has both a distributive definition and a procedural definition. (Fairness) “Distributive fairness focuses on the criteria that lead people to feel that they have received their fair share of available benefits-i.e., that the outcome of a negotiation or other decision making process is fair.” (Id. at 754.). Not surprisingly, its definition is very subjective but can be distilled into
“….four basic, competing principles or rules- equality, need, generosity, and equity. The equality principle provides that everyone in a group should share its benefits equally. According to the need principle, “those who need more of a benefit should get more than those who need it less.” The generosity principle decrees that one person’s outcome should not exceed the outcomes achieved by others. Finally, the equity principle ties the distribution of benefits to people’s relative contribution. Those who have contributed more should receive more than those who have contributed less.” ( Id.)
Ms. Bulmash notes that Harvard Business School Professor Max Bazerman has found an additional principle: maintaining the status quo. To resolve a conflict, an organization will resist radical change and instead agree to make a change in the same way or manner as it did in the past- even though it was never “fair” to begin with!
Returning to Ms. Welsh’s article, she notes that as overlays to distributive fairness are the variables of self-interest, social relationships and the interaction between cultural norms and situational needs. ( Id. at 755.) The first two- self-interest and social relationships- are very much intertwined. If there is no relationship between the negotiating parties and/or each never expects to negotiate with the other again, each party will have her self-interest uppermost in deciding which of the four principles (need, generosity, equality or equity) should dictate her actions. If the negotiating parties have a negative relationship, each “…will aim to gain more than the other negotiator, even if this requires undertaking a risky strategy.” (Id.)
If, though, the parties have a positive relationship, it suddenly becomes important to each of them that a “fair” outcome is reached:
”Further, positive social relationships influence negotiators’ selection of the particular fair allocation principle that will anchor their negotiations. If a negotiator is dividing a resource with someone else and expects future, positive interactions with that person, the negotiator tends to use the equality principle to define distributive fairness.” (Id. at 756.)
As one can easily surmise, “fair” outcomes are affected by our own self-interest or our “egocentric bias”. Our perception of fairness is affected by the role we play in the negotiation, or as Ms. Welsh phrases it, “[e]quitable distribution…is in the eyes of the self-interested beholder.” (Id. at 758.).
Cultural norms are viewed along a collectivism-individualism continuum. If a culture is collective, it places stronger emphasis on the group as a whole. If the culture is individualistic, it places stronger emphasis on the individual’s personal goals and interests. (Id. at 756-7.)
“Procedural” fairness is just as important. Research has shown that “…people’s perceptions of outcome fairness are influenced by how they felt they were treated during a dispute resolution ….process.” (Id. at 759.) How the party was treated during the negotiations is all important. Was she given sufficient opportunity to speak? Was she given a meaningful opportunity to tell her story? Was the other negotiator (or mediator) open-minded, giving due consideration to what the party was stating? Was she given assurances by either the other party or the mediator that she had been heard and understood? Was she treated in a fair, even handed manner? Was the mediator truly “neutral”? And, finally, but most importantly, was she treated with dignity and respect? If so, that party will have a greater tendency to view the outcome as substantively “fair” AND will be more likely to comply with its terms, even if those terms are not as favorable as she had wanted or even produced some unhappiness! (Id. at 761-762, 763-4.)
In sum, not only is “… the messenger … very much a part of the message…” but so is perception. “Fairness” is, indeed, in the eyes of the beholder!
… Just something to think about!