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1. Conflict resolution

2. Added-value negotiating

Section Topics

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Why are negotiation and conflict management skills so important to the role of the internal auditor?

Answers:• Help build relationships and trust.• Understand and handle adversarial

communication.• Effectively deliver reports and

recommendations.

Discussion Question

Part 4, Section E, Introduction

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Nature of Conflict

Conflict is a disagreement between parties about interests, ideas, opinions, beliefs, values, and behaviors.

Individuals

Groups (within/between)

Systemically within or among

organizations

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• Value differences

• Unethical behavior

• Poor communication

• Change efforts

• Different goals and objectives

• Resource allocation

• Lack of information

• Environmental stressors

• Group incompatibility

• Cultural background differences

• Questionable motives

• Incorrect assumptions

• Leadership and management approaches

• Status differences

• Lack of trust

• Reward systems

• Short-sighted problem solving

Conflict Triggers

Part 4, Section E, Topic 1

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Individual Resolution Strategies

Competing—focusing on winning

Accommodating—giving in, even if not convinced

Avoiding—ignoring the conflict

Compromising—giving in to gain some resolution

Collaborating— working together for a win/win

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Manager Styles: Resolution Strategies

Withdrawing—avoiding or ignoring conflict

Smoothing—finding common ground; may involve giving in

Forcing—dominating and forcing a win/lose situation

Compromising—reaching a compromise for both sides

Collaborating—looking for a win/win solution together

Part 4, Section E, Topic 1

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I. You and a partner have gathered all of the data for an auditing report, which is due in one week. You disagree on the report format due to personal report writing preferences.

II. You would like to continue work with a vendor but are in conflict over what you can pay and what they will deliver for that amount.

Discussion Question

Answers:I. If either format will communicate the important points, you

might accommodate or compromise to get the report done on time.

II. Since you want to keep the vendor, you might collaborate by looking for a win/win solution that will meet your needs and support the vendor quality you have come to expect.

Which resolution strategy might you use in each circumstance below? Choose from competing, accommodating, avoiding, compromising, or collaborating.

Part 4, Section E, Topic 1

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• Separate the people from the problem.• Focus on interests, not positions.• Generate a variety of possibilities.• Base results on objective standards and

mutual interests.

Principled Negotiation

Outcomes are not based on the positions of parties but on mutual interests and fair standards.

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• Select appropriate time and place.

• Identify your goal.

• Set a discussion agenda.

• Focus on facts and real issues.

• See the other party’s point of view.

• Separate people from the problem.

• Discuss in a respectful manner.

• Use good communication skills.

• Remain calm.

• Find common ground.

• Consider winning and losing consequences.

• Use a facilitator or mediator if necessary.

• Develop alternatives.

• Come to agreement.

Resolution Considerations

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Added-value Negotiating

Win/Win

Added-value negotiating is a cooperative approach, based on shared interests and objectives. Parties present exchanges of value and multiple deals, which requires a good deal of advance study and preparation. The ultimate goal is a win/win agreement.

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Negotiating Steps

Clarify interests.

Identify value options.

Create several offers.

Select the best offer.

Perfect the deal.

Part 4, Section E, Topic 2

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What are some of the special considerations in global deal making?

Discussion Question

Answers: Cultural background differences, negotiation practice differences, time and distance differences, cross-border legal issues, possible need for cultural mediators and informants

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Reinforcing Activity 4-5Part 4, Section E, Topics 1 and 2

Negotiating

Part 4, Section E, Topics 1 and 2

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Questions?

End of Section E

Part 4, Section E