Chapter 4

Managing Conflict and

the Art of Negotiation
Project Life Cycle Stages and Conflict

Formation Buildup Main Program Phase-out

Setup & Goal Setting Planning & Resources Execution & Integration Completion & Closure

Conflicts arise from Conflicts happen when Delays in the schedule Conflicts happen when
unclear objectives, managers disagree on and problems with people feel rushed or
authority ambiguity, plans, ways to do how parts fit together stressed. They might not
and resource work, or who gets can cause conflicts. agree because they do
commitment struggles resources. These are It's very important to things differently or want
during project setup. common in teamwork. balance time, money, the same things. Problems
and what needs to be can also start when work
done. is passed from one person
 Conflict peaks in buildup & main program
Conflict Intensity by Life stages where planning and execution
Cycle Stage demands rise.
Conflict Intensity Across Project Life Cycle Stages
90

80

70

60

50

40

30

20

10

0
Formation Buildup Main Program Phase-out
 Setting At the start of a project, the technical goals
Clear are not clear. This can cause confusion and
Objectives disagreements about what the project
should do and what needs to be finished.

Securing Getting clear promises from top bosses and

Resource team leaders about resources can be hard. But
Commitmen it is very important to do this to stop problems
Project t like resource fights and delays in work.
Formation
Priority
Stage Conflicts Setting
Deciding which project is most important
early helps show its value and makes it
easier to share resources fairly.

Authority When it is not clear who can make choices

and about technical work, time plans, or money, it
Decision can cause fights. It is very important to know
Rights who does what and who makes which decisions.
Project Buildup Stage Conflict

Schedule Pressures Technical Disagreements Resource Commitments

& Roles
During the buildup stage, Conflicts happen when Project managers ask
teams create plans and project managers and functional managers for
try to finish their work on experts have different help with resources. But
time. Sometimes, they ideas. Experts usually functional managers have
have too many tasks and know more about their many tasks to do.
not enough time or tools. Sometimes, it is not clear
area. This can cause
This can cause problems who is in charge. This can
arguments about the
cause problems and
and arguments about best way to do project
disagreements between
when to do tasks and who work.
project and functional
gets to use the tools.
managers.
Main Program Phase Conflict

Schedule Delays and Technical Interface Resource Trade-offs and

Dependencies Conflicts Constraints
When one task is late, it As projects get bigger, In projects, you often need to
slows down all the tasks that there are more parts that balance three things: time,
depend on it. This can make money, and what needs to be
need to work together.
the whole project finish late. done. This means sometimes
This can cause problems if
To fix this, teams might need you have to make choices
the parts don’t fit well. about what is most important.
more people or help, but
Teams must fix these Project managers decide how
that is not always possible.
problems so all parts work to use resources like money
This can cause problems and
smoothly as one system. and people carefully. They try
disagreements between
hard to keep the project on
teams and groups working
track, on budget, and still do
on the project.
a good job.
Project Phase Out Conflict

Time Pressure and Resource Issues Personality Conflicts and Closing

As the project deadline gets closer, work gets Difficulties
Stress and worry about finishing the project

busier and more stressful. cause people to get on each other's nerves.

Arguments can happen about how to share

If earlier parts of the project were late, it
project resources and who moves to new jobs
makes the ending phase even tighter.
next.
Team members often work extra hours or in
Tensions rise between teams finishing this
shifts to finish on time.
project and those starting new ones.
• There are also fights over limited people
• Good talking and compromises help reduce
and tools needed to complete the project. problems and close the project well.
Comprehending Negotiation within Project
Management
Negotiation means talking and agreeing on how to
share or solve problems.

In projects, people inside the team talk to find good

solutions because they have the same goals.

These talks are different from outside fights because

team members want to help each other.

The goal is to find answers that help everyone and

make the project succeed.
• Good negotiation needs open talks and trust so
everyone works well together.
 Partnering means working as equals, not just as
buyer and seller. It is about sharing goals and
trusting each other.

This helps people communicate better, avoid

Partnering in conflicts, share knowledge, split risks, and finish
Project projects faster by solving problems together.
Management
Everyone must promise to work well, build teams,
agree on a plan, decide how to solve problems, and
get support from leaders.

• To succeed, people need to stop thinking as rivals,

be honest, keep trust, follow laws, and respect
different ways of working.
 A project charter is a short paper everyone in charge
signs. It says what the project is, what jobs need to be
done, when they should be finished, how much money
can be used, and what help is needed. This helps
everyone know their duties and what will happen.
Project
The charter stops mix-ups by making sure all agree on
Chartering
the plan and their jobs. If problems come up, the charter
helps fix them quickly because everyone agreed to the
rules.

• All leaders and team heads say yes to the charter.

This makes sure everyone works together, and any
big changes need okay from all, not just one person.
Managing Scope Change in Projects
Causes of Scope Change Errors and Technological Uncertainty
Scope changes happen for three main At the start, project plans might not be
reasons: mistakes in the first plans, new perfect because we don’t have all the
ideas from clients or team members, and facts or some tech is new. This means we
outside rules like laws or policies. may need to change things, like fixing the
base or using new tools.

Client Learning and Evolving Needs External Mandates and Regulations

Clients often find new needs during the project. Laws, rules, or company policies can make
For example, software may need extra project goals change. These changes can come
features, or equipment might need better as a surprise. We must be ready to talk and
specs. plan again to fit the new needs.
Priority Levels and Rules in Projects

Important projects get full support and needed resources. If there

is a conflict, we do the tasks that are due the soonest first.

Less important projects are nice to do but only if there is extra

time and money. They can wait if there are problems.

Sometimes, urgent projects come up because of new laws or

important client needs. These must be done right away.

Urgent projects can change plans and make it hard to share

resources. Managers have to change schedules and decide what
to do first.
• Good talking and planning are needed to handle changes and
keep things moving when priorities change.
Negotiation Techniques in Practice

BATNA (Best Alternative to a Negotiated Agreement)

BATNA is your fallback plan if negotiations fail. Knowing your
BATNA gives you leverage and confidence. For example, a
supplier negotiating a contract may have another buyer lined
up, strengthening their position.
ZOPA (Zone of Possible Agreement)
ZOPA defines the overlap where both parties' minimum and maximum
acceptable terms meet. Understanding ZOPA helps negotiators find
common ground quickly. For instance, a project budget between $1M
and $1.2M creates a ZOPA for agreement.

Interest-Based Negotiation
This technique focuses on underlying interests instead of positions,
encouraging collaboration. An example is two departments negotiating
resource allocation by jointly exploring shared goals rather than
competing demands.
Tools and Techniques for Negotiation
Negotiation Checklists Negotiation Software

Structured checklists Specialized software

ensure all critical helps track offers,
negotiation points and counteroffers, and
objectives are covered agreements,
to avoid oversights. improving
organization and
Role-Playing Exercises transparency.
Communication
Frameworks
Simulated negotiation Tools like active
scenarios build skills, listening and interest-
confidence, and based negotiation
prepare teams for real- frameworks facilitate
life negotiation clearer understanding
challenges.
and solutions.
Measuring Negotiation Success
Agreement Durability Over Time Participant Satisfaction Levels Cost Savings Achieved Through Negotiation

Percentage of Effective Agreements (%) Satisfaction Rating (%) Cost Savings (%)

100
90 12 15 10 9
14 11
80
70
60
50 85
40
30
78
20
10
0
Immediately After 1 Year Later
Year 1 Year 2 Year 3 Year 4 Year 5 Negotiation

Long-lasting agreements High satisfaction among Negotiations that successfully

reduce rework and disputes, negotiation parties correlates reduce costs contribute
ensuring smoother project with better cooperation and directly to project budget
progress and stronger ongoing positive relationships adherence and improved
partnerships. in projects. financial outcomes.
 Power Negotiations often involve parties with
Imbalances unequal power, leading to dominance by
stronger parties. Address this by
establishing clear ground rules and
seeking third-party mediation if needed.

Common Challenges Cultural Different cultural backgrounds affect

in Negotiation Differences communication styles, negotiation tactics,
and expectations. Understanding and
respecting these differences reduces
misunderstandings and fosters trust.

Communica Miscommunication due to language,

tion jargon, or emotional biases can derail
Barriers
negotiations. Active listening, clear
language, and confirming understanding
help overcome these barriers.
Integrating Negotiation into Project Management

Negotiation in Planning Conflict Resolution Through Negotiation

Negotiation is crucial during project planning to Throughout project execution, negotiation helps
align stakeholder expectations, define clear resolve disputes between team members, vendors,
objectives, and agree on scope, schedule, and and clients by finding mutually acceptable
resources, preventing conflicts later. solutions, maintaining project momentum.

Change Management and Negotiation Building Long-Term Partnerships

Negotiation plays a key role when handling Integrating negotiation fosters trust and
scope changes or resource reallocations, cooperation among stakeholders, creating
ensuring all parties agree on adjustments lasting partnerships that support current and
without jeopardizing project success. future project collaborations.