InterNeg: 1997-1998

InterNeg: A Web Site for and about Negotiation

An overview and work plan for 1997-1998

Gregory E. Kersten and Sunil J. Noronha
Centre for Computer Assisted Management
Carleton University

International negotiations have been studied from many perspectives including psychology, sociology, political science, economics, applied mathematics, engineering, computer science and artificial intelligence (Ikle and Leites 1962; Gulliver 1979; Pruit 1981; Raiffa 1982; Adler 1983; Fisher and Ury 1983; Cohen 1991; Kremenuk 1991; Young 1991; Fraser 1992; Kersten 1995). These perspectives have also been incorporated in negotiation teaching. Simulation is an often used vehicle to study and teach negotiation (Adler and Graham 1989; Bazerman and Neale 1991; Winham 1991; Darling and Mumpower 1992; Graham, Mintu et al. 1994).

Negotiation simulations are usually conducted in laboratories, in unicultural environments. To obtain results pertinent to international and cross-cultural negotiation, experiments have been conducted in several countries in a manner that allows comparison of results (see, e.g., (Adler and Graham 1989; Roth, Prasnikar et al. 1991; Graham, Mintu et al. 1994; Carnevale 1995). These experiments often involve bargaining records enriched with questionnaires and reports from large samples and many countries (Bond 1987; Hofstede 1989) but rarely involve negotiations between people from different cultures. There has been little comparative research, especially research involving inter-cultural negotiations. There has been no research that has considered the use of computers and other sophisticated communication media in negotiation, in terms of their relative effectiveness across users from different cultural backgrounds, as well as the effect of different cultural group decision making styles upon the design of electronic aids to negotiation.

The objective of the InterNeg project is to fill this void and develop an environment that supports remote negotiations over simple or complex problems, including real-life situations. This will be achieved through the development of a site on the World Wide Web that comprises electronic bargaining facilities, analytical tools, quantitative and qualitative models, summaries, abstracts, annotated bibliographies, research results, surveys, expertise, etc. InterNeg will allow negotiations in multiple locations by many people at the same time and with no additional cost to negotiators. By its very nature InterNeg has the potential to become accessible to all people and provide them enabling tools and information to interact more directly and to bring negotiations to lower level in hierarchies.

The InterNeg site, and a prototype of one of its Web-based negotiation systems, INSPIRE, have been operational since July 1996. Until December 1996, over 300 people from India, Canada, Finland, Portugal, U.S., Hong Kong, and Korea have negotiated through InterNeg. Because it is Web-based, inter-cultural negotiations are carried out as easily as intra-cultural negotiations. The negotiations include offer exchanges together with messages and communiqu's. Participants can conduct negotiations anonymously, not knowing their counterpart's country. There are facilities that help the user to evaluate the goodness of an offer, to review the history of a negotiation, and to determine if an agreement can be improved in a way that satisfies both sides. InterNeg provides systems and information that can be used at any place that has an Internet connection.

This proposal requests funds which, together with existing funding, will allow us to complete the project by July 1998. By that time we will create a set of tools to obtain and analyse the records of over a thousand negotiations involving people from a large number of countries to assess the existing theories and concepts in cross-cultural negotiation, construct culture-specific negotiation models, and determine the implications of computer and communication technologies on negotiations and interpersonal communication within and between cultures.

InterNeg is a computer-based environment that builds upon two emerging technologies: net-centric computing and negotiation support systems (NSS). Together, these technologies are integrated into a suite of resources that facilitate negotiation, training and research.

Recent developments in the computer and communication technologies have contributed to two trends that are critical to this research project:

The principal feature of the World Wide Web is that it allows people from different locations and time zones to communicate and to use computer-based resources. Initially, the focus was on communication and remote access to databases. With the popularization of the Web there is an increasing use of remote services that used to be available only from the local computer. This includes the ability to perform operations on remote computers by using their programs and complete systems.

The Web permeates research and education. Its services include access to techniques and tools which are used in research (e.g., statistical packages, mathematical programming software), access to data and information for processing and analysis, and generation of massive amounts of data. In education, the ability to access and run remote programs and databases allows its users to extend classroom and laboratory boundaries across geographical and time zones. It allows instructors and students to retrieve and use resources from remote sites. However, to our knowledge, the Web is not used in studying and teaching negotiations. Extensive search of Web resources showed that there is a very small number of sites devoted to negotiation. A list of these sites is available at:

and its associated Web pages. Moreover, these sites use the Web merely to inform about research projects, courses, seminars, etc., and provide some very basic information about their activities. None of them uses the Web for research or training activities that are accessible to students, researchers and practitioners.

Negotiation support systems (NSS) are computer-based software tools typically used for training and research in a laboratory environment (Kersten 1985; Jelassi and Jones 1988; Alemi, Fos et al. 1990; Fraser 1992; Andriole 1993; Fang, Hipel et al. 1993; Bui 1994; Holsapple, Lai et al. 1994; Rangaswamy and Shell 1994; Balakrishnan and Eliashberg 1995). In teaching and training NSS are used to:

While there is a large and growing number of NSSs, they are rarely used in actual negotiation (Nyhart and Samarasan 1990; Teich, Wallenius et al. 1994; Kersten 1997). Zartman (1993) argues that decision analysis based on multi-attribute theory, simulation modelling, statistical analysis, and cognitive mapping have shown their usefulness. The two NSSs which are part of the InterNeg project use decision theory and support construction of a utility function. However, we also plan to show the usefulness of other technologies, including knowledge-based systems, hypertext and display facilities.

The InterNeg project began in 1996 with the development of a simple Web-based negotiation support system. The system, called INSPIRE, has been tested and modified since the Summer of 1996. In December the system became fully operational. InterNeg offers also other services. It is the home site of two journals, International Negotiation and Group Decision and Negotiation where basic information, table of content, abstracts, and calls for papers are maintained. Handouts, information on how INSPIRE can be used in different university courses, and examples of student assignments are available as well as several articles, an extensive bibliography and information about programs and organizations.

The InterNeg site is a source and repository of negotiation-related resources and its home page is at

The site is organized into five departments in addition to general information about the site, its history, users and developers. An overview of the site is presented in Fig. 1.

INSPIRE is the first system designed to conduct negotiations on the Web. It is an NSS based on analytical models rooted in decision and negotiation analysis (Kersten 1985; Kersten and Szapiro 1986; Lax and Sebenius 1986; Sebenius 1992; Rangaswamy and Shell 1994). The system's home page is at

INSPIRE comprises three main facilities, corresponding to the three main stages of a negotiation (preparation, offer-exchange and post-settlement):

In addition to the above three major functions there is a range of smaller support features. Also, during the offer exchange the user may re-evaluate issues and options and modify his/her utility function.

INSPIRE is our main research tool for studying decision making and negotiation across cultures and in networked environments. It is also used to study the impact of decision analysis on the negotiation process, the role of support in negotiation and the role of explanatory and display facilities on users' perception and decision making. The system can be used with only one negotiation case which consists of four issues; the case is simple and culture-neutral. By default, issues are assumed to have "discrete options", i.e., only a finite number of explicitly listed options are considered to be meaningful as outcomes of the issue. Users have to negotiate over all issues at the same time, that is, sequential negotiations are not allowed. To allow users with different backgrounds and computing knowledge an effective use of the system, handouts, examples and explanations are provided.

User friendly features, simplicity of the instructions, and inherent flexibility make INSPIRE an attractive tool for teaching. It has been used in management seminars, and in regular university courses, such as English as a Second Language, purchasing management, international business, information systems, decision support systems, and management science at Carleton University, Indian Institute of Management in Bangalore, Abo Academy University, Helsinki School of Economics, and McMaster University. With the establishment of the InterNeg site and the latest version of INSPIRE (Version 2.2) the number of participating institutions is expected to grow quickly.

INSPIRE provides an extremely efficient method for collecting data for research purposes. Each user is asked by the system for permission to record all communication. Once the permission is granted the system records all users' individual actions and their communication. In addition, the users are asked to fill out two questionnaires (pre- and post-negotiation). The most current summary of data about the users is available at:

In an attempt to maintain a uniform and unbiased user population the INSPIRE users have no access to other InterNeg services during negotiation. That is, users can find these services as anyone can find a Web site, but we do not provide a link from INSPIRE to other InterNeg pages and services. Only after completion or termination of the negotiation do INSPIRE users get information about InterNeg and its other services.

The InterNeg Support System (INSS) is a generalization of the INSPIRE system that will be operational at the beginning of 1997. INSS will allow its users to select a negotiation case (four are available now) or to construct their own case, the use of different negotiation protocols, continuous issues with salient initial values, and user-defined issues. Its negotiation protocols include sequential and parallel negotiations, the use of free text messages to complement and to replace offers, joint formulation and revision of the negotiated problem, partial ranking of alternatives, system-supported mediation on request, different modes of visualization of the negotiation's dynamics, utility, and offers, and support for the analysis of opponent's preferences. INSS users have access to all services provided by InterNeg.

INSS, contrary to the INSPIRE system, will have links to numerous negotiation resources, including hints, interpretations, and results of studies. The INSS users will have links to all information provided at the InterNeg site as well as links to other sites. They will also be able to use other systems, both supported and unsupported by InterNeg. One of those systems is knowledge-based and it will provide context-dependent explanations, analyses and help. It will also assess users' performance.

The InterNeg Facility for Explanatory Reasoning (INFER) is one of our main projects for 1997. This system will address the requests of many INSPIRE users who asked for on-line evaluation and suggestions. INFER is a knowledge-based system with several knowledge bases available. INFER will be coupled with both INSPIRE and INSS. Users of the INSPIRE system will be able to ask--after their negotiation has been terminated--for an assessment of their activities, comments and suggestions. INFER will provide simple evaluation and direct interested users to more comprehensive information available on the InterNeg site and elsewhere.

INFER will be closely coupled with INSS. The INSS users will be able to request context dependent explanation and advise. INFER will provide on request analysis of the offers, concessions and the negotiation dynamics. The construction of the appropriate knowledge-base will commence in the Spring of 1997. Another knowledge base will provide users with an assessment of their opponents and their cultural background based upon existing concepts of cross-cultural negotiation as well as our own results from the INSPIRE study. Conceptually, INFER is an advisor who at any point in negotiation may be asked for an opinion. Initially, we will limit the domain of expertise to a few well and narrowly defined domains.

The current focus of the InterNeg project is on both research and education. Our research objectives will be met when the two NSSs and other InterNeg services become widely used. To achieve this InterNeg will provide more information about conducting negotiations, analyses of negotiation dynamics, interpretation of positions and concessions, negotiation protocols and cultural differences. We will also cooperate with instructors who teach negotiation related courses. One effect of such cooperation is the case on technological negotiation developed by Dr. M. Mohan from the Indian Institute of Management. This case was tested with the INSPIRE system but it will be available in INSS.

(Hafner 1993) in his summary of the benefits and drawbacks of the analytical methods lists as the first limitation the fact that ìthese methods and tools are likely to increase inequalities among the statesî. The availability and the ease of use of the InterNeg and its services show that analytical tools can be used effectively in developing countries and by first year university students. We plan to promote the InterNeg services in the area of sustainable development, particularly in developing countries.

The InterNeg project is centered around two methodologies, corresponding to its two broad goals:

Negotiations are already conducted through Internet. Prototyping, rapid development techniques, and multimedia together with the increased bandwidth of telecommunication enable quick development and deployment followed by wide spread use of computer-based systems. These technologies also allow for media-rich interfaces and powerful analytical engines for information processing. Thus, users obtain access to a large number of powerful systems which are easy to use. The ease of access and use is reinforced with the Web browsers which introduce a simple and common interface to different systems. In effect we will soon witness systems which facilitate negotiations or even conduct negotiations on behalf of the user.

Within the first methodology we will use rapid protoptyping, code reuse and maintainability as the most important design criteria in building large software environments like InterNeg. Our implementation uses object oriented techniques to achieve these goals. The use of object classes allows for the system's customization and expansion with new models of preference structures, new specialized types of issues, user actions, and other constructs (all of which are implemented as objects) from the domain of negotiation.

The Web frontend (pages) is stateless. Negotiations, on the other hand, last beyond the lifetime of any single program that is part of InterNeg. The state of a negotiation has to be saved and restored between programs. The easiest way to view this problem is to restate it in terms of persistent objects, employ object database management and provide support for ACID transactions. Graphic display of negotiation dynamics is also done through object oriented implementation. Other graphical input and output will be done with Java applets.

We collect data to determine if and to what extent culture affects how people make decisions and negotiate through electronic media. We are also interested in the impact of specific media on negotiations and human behavior.

It has been argued that rational models are not and cannot be used in negotiation (Stein 1988; Hafner 1993) and a good compromise does not have to be an optimal or efficient solution. Our users have no difficulty to employ such models, however, they may do it not only to reveal their preferences and values but also to justify them and control their changes. While we have no sufficient data to generalize several observations, we noted that some INSPIRE negotiators used the utility construction mechanism to avoid concession making. That is, they ranked packages (offers) in such a way that ìon paperî the compromise they achieved was as good as their first offer. Some other users modified their preferences several times during the course of negotiation so that they progressively coincided with the preferences of their opponents.

InterNeg has an internal messaging facility. This allows for sending anonymous messages and conducting anonymous negotiations. We find it interesting that to date no user revealed her/his true identity. One area of study is to seek differences in the negotiations when people know their opponents' culture as opposed to when they don't know it (Tan, Watson et al. 1995).

Most scholars from divergent disciplinary perspectives concur on the importance of context to analyze the preferences, decisions, and outcomes of negotiation (Bell 1988; Larson 1988; Stein 1988; Cohen 1991). A very interesting and probably complex question is what constitutes a context in even simple negotiation conducted remotely and with electronic means and analytical tools. Our preliminary results indicate that users who are familiar with the Web send more messages and are more satisfied with the negotiation process and outcome than those who have only started using it. Those who analyze negotiation dynamics with graphs feel that they have more control over the process. We obviously need to obtain more data but one hypothesis that may be formulated is that a new culture emerges which is across the geographical boundaries: the "culture of the Web users".

As far as we know, the InterNeg project is the first of its kind and breaks new ground in the area of negotiation research and negotiation support systems. The services available from the InterNeg site, including INSPIRE, INSS, and INEF allow us to conduct an extensive and unique study on inter- and intra-cultural negotiation involving thousands of subjects from different countries, organizations and with different backgrounds. These services will also allow thousands of people to learn about negotiation techniques and tools, to use computer and communication technologies for problem analysis and solution, persuasion and argumentation, assessment of situations through free-text, formal quantitative and graphical representations.

Our preliminary results show that the proposed services embodied in the emerging technologies can be used in conducting real-life negotiations. We do not claim that intergovernmental negotiations or those which involve tens of millions of dollars will be conducted over the Web. However, networked society and the globalization of interactions increases contacts between remote organizations and thus brings forth the necessity to negotiate. Such negotiations may be supported with systems like INSS. They may not involve a large team of professional negotiators and tens of millions of dollars but they may be critical to the well being of a small organization or a project's success in a developing country.

The InterNeg project work plan, its main activities and deliverables are given in the figure below.

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