Negotiation Support Systems in Budget Negotiations: An Experimental Analysis

Abstract

This paper reports the results of an experiment investigating the differences between budget negotiations conducted on an electronic negotiation support system (NSS) and those conducted face-to-face. The negotiation setting consisted of a supervisor and a subordinate negotiating a performance budget for the subordinate. Results revealed that when supervisor performance expectations were incongruent with subordinate capability, face-to-face negotiations hit impasse at a significantly higher rate than NSS negotiations. These results held regardless of the amount of concession needed to reach consensus, and they support the contention that single-issue distributive negotiations, such as budget negotiations, can benefit from the use of an NSS. In a secondary analysis of subordinate performance after the budget negotiation, we found that NSS subordinates perceived more task conflict, which positively influenced postnegotiation performance, whereas face-to-face subordinates perceived less relational conflict, which worked through satisfaction to positively influence postnegotiation performance. This result adds to the literature by clarifying the roles that communication mode plays in a negotiation and a negotiation's aftermath.