Role of negotiations in construction.

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ILLINOIS INSTITUTE OF TECHNOLODY

Table of content:                                                                                       page #

  1. Role of negotiations in construction …………………………………2
  1. Negotiation theories and principles ………………………………….2
  1. Improving negotiation process ………………………………………4
  1. Computer based improvements for negotiation process …………….4
  1. Conclusions…………………………………………………………..6                                                                                                
  1. References……………………………………………………………7

Role of negotiations in construction

          Negotiation is a form of the decision-making process where two or more parties jointly search a space of possible solutions with the goal of reaching a consensus.

In the construction industry, collaboration is an essential key for the success of projects. Since different participants from different organizations try to work together in projects, competitive stresses exist in their relationships and as a result, disputes or conflicts may inevitably occur; negotiation is preferred by project participants for the settlement of claims. Negotiation plays an important role in resolving claims, preventing disputes, and keeping a harmonious relationship between project participants. However, claims negotiations are commonly inefficient due to the diversity of intellectual background, many variables involved, complex interactions, and inadequate negotiation knowledge of project participants. Most project managers consider negotiation as the most time- and energy-consuming activity in claims management.

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Negotiation theories and principles

         To address the complex technical and human issues in negotiation, several important negotiation theories and principles have been developed, which mainly include game theory, economic theory, behavior theory, and negotiation theory.

Game theory seeks to get at the essentials of decision making and the associated strategies in situations where two or more parties are interdependent, and where, therefore, the outcome of their conflict and competition must be the product of their joint requirements and the interaction of their separate choices (Bacharach and Lawler 1981).

Classical game theory approaches are essentially ...

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