A Causal Knowledge-driven Negotiation Mechanism for B2B Electronic Commerce

Abstract

With the advent of the Internet, the electronic B2B negotiation process has drawn increasing attention from both researchers and practitioners. However, the literature still shows that only structured negotiation terms (SNTs) are being explicitly considered, despite the fact that unstructured negotiation terms (UNTs) should be rendered as well. This chapter proposes a new negotiation support mechanism that can be utilized to incorporate causal relationships between SNTs and UNTs in the process of B2B negotiation, by using a cognitive map. The proposed negotiation mechanism suggests that cognitive maps could be used to represent causal relationships between SNTs and UNTs, both as knowledge representation vehicles and as inference engines. After reviewing the potential of cognitive map in B2B negotiation, we implemented a prototype, CAKES-NEGO, which we then used in illustrative examples in order to examine the validity of our proposed mechanism. The mechanism was tested using two practical scenarios: a structured, twenty-one item questionnaire was developed and applied in order to evaluate the mechanism’s validity based on the responses of eleven graduate students. In addition, statistical tests proved that the proposed negotiation mechanism could improve decision performance significantly in B2B negotiations.