The negotiation process


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The negotiation process

  1. 1. THE NATURE OF NEGOTIATION <ul><li>Rubin.J.Z. & Brown B.R (1975) </li></ul><ul><li>“ The process whereby two or more parties decides what each will give and take in an exchange between them .” </li></ul>
  2. 2. <ul><li>Distributive / Adversarial </li></ul><ul><li>Win – Loose </li></ul><ul><li>Hostile / Competitive </li></ul><ul><li>Based on secrecy and self interest </li></ul><ul><li>The objective is to increase advantages in price or cost </li></ul><ul><li>Low levels of trust </li></ul><ul><li>Unhealthy extremes of aggressive cohersition blocking and ultimatums </li></ul><ul><li>A no deal impasse </li></ul>NEGOTIATION APPROACHES
  3. 3. NEGOTIATION APPROACHES <ul><ul><li>Integrative /collaborative </li></ul></ul><ul><ul><li>Win – Win </li></ul></ul><ul><ul><li>Friendly – collaborative </li></ul></ul><ul><ul><li>Based on openness and shared interest. </li></ul></ul><ul><ul><li>The objective is to ascertain common goals </li></ul></ul><ul><ul><li>High levels of trust </li></ul></ul><ul><ul><li>We are in this together </li></ul></ul><ul><ul><li>We will resolve our problems and work for our shared interests </li></ul></ul>
  4. 4. NEGOTIATING BEHAVIOUR <ul><li>Proposing behaviour (I think we should) </li></ul><ul><li>Reasoned negative behaviour (This wont work because) </li></ul><ul><li>Seeking Information behaviour (Asking for information) </li></ul><ul><li>Giving information behaviour (Response is possible / likely) </li></ul><ul><li>Development behaviour (Building on supporting ideas) </li></ul><ul><li>Clarifying behaviour (This is what we agreed) </li></ul><ul><li>Emotional negative behaviour (Defence against attack) </li></ul>
  5. 5. TIME <ul><li>Have patience </li></ul><ul><li>If there are benefits to resolving the negotiation quickly, sell the other party on the value a quick settlement will have for him </li></ul><ul><li>Realise deadlines can be moved, changed or eliminated </li></ul><ul><li>Try to find out the other party’s deadline </li></ul><ul><li>Take your time </li></ul>
  6. 6. NEGOTIATION GOALS <ul><ul><li>Substance goals. </li></ul></ul><ul><ul><ul><li>Outcomes that relate to content issues. </li></ul></ul></ul><ul><ul><li>Relationship goals . </li></ul></ul><ul><ul><ul><li>Outcomes that relate to how well people involved in the negotiations and any constituencies they represent are able to work with one another once the process is concluded. </li></ul></ul></ul>
  7. 7. THE NEGOTIATION PROCESS <ul><li>Prenegotiation </li></ul><ul><li>The actual negotiation </li></ul><ul><li>Post negotiation </li></ul>
  8. 9. PRENEGOTIATION <ul><li>Who is to negotiate? </li></ul><ul><li>Individual approach </li></ul><ul><li>Team approach </li></ul><ul><li>Spokesperson, recorder, experts . </li></ul><ul><li>The venue </li></ul><ul><li>Buyers should expect vendor [Lyson] </li></ul><ul><li>Home ground </li></ul><ul><li>Easy access to files </li></ul><ul><li>Expert advice facilitated </li></ul>
  9. 10. PRENEGOTIATION <ul><li>Intelligence gathering </li></ul><ul><li>ascertaining respective strengths & weaknesses. </li></ul><ul><li>Relative data assembly (cost, sales, production etc) </li></ul><ul><li>preparing presentable data (charts, graphs etc) </li></ul><ul><li>Negotiation objectives </li></ul><ul><li>Specific </li></ul><ul><li>Clarification </li></ul><ul><li>Strategy and tactics </li></ul><ul><li>Overall plan </li></ul><ul><li>Right attitude </li></ul>
  10. 11. THE ACTUAL NEGOTIATOIN Stages & Techniques <ul><li>Stage one: </li></ul><ul><li>Introduction </li></ul><ul><li>Agreement of agenda </li></ul><ul><li>Rules and procedures </li></ul><ul><li>Stage two: </li></ul><ul><li>Negotiation range </li></ul><ul><li>(adversarial/collaborative) </li></ul><ul><li>Stage three: </li></ul><ul><li>Agreement of common goals. </li></ul>
  11. 12. THE ACTUAL NEGOTIATOIN Stages & Techniques <ul><li>Stage four: </li></ul><ul><li>Problem identification </li></ul><ul><li>Solutions being put forward </li></ul><ul><li>Removal of barriers </li></ul><ul><li>Determination for concessions </li></ul><ul><li>Reviewing and reconsideration </li></ul><ul><li>Deadlock </li></ul><ul><li>Stage five: </li></ul><ul><li>Same as first part of ‘post negotiation’ </li></ul>
  12. 13. POST NEGOTIATION <ul><li>Statement of agreement </li></ul><ul><li>signed and commented </li></ul><ul><li>Selling to constituents of both parties </li></ul><ul><li>Implementation of agreement </li></ul><ul><li>Procedures established </li></ul><ul><li>To monitor the implementation </li></ul><ul><li>to deal with arising problems </li></ul><ul><li>Negotiation Post-mortems </li></ul><ul><li>Satisfaction extent and improvement opportunities </li></ul><ul><li>Cost reduction possibilities </li></ul><ul><li>Usefulness of efficient methods </li></ul>
  14. 15. <ul><li>“ these replies are typical, the meaning of ethics is hard to pin down and the views many people have about ethics are shaky how can you equate ethics with your feelings, being ethical is clearly not a matter of following ones own feelings and in fact feelings frequently deviate from what is ethical”. </li></ul><ul><li>Professor Raymond </li></ul><ul><li>Harvard Business School </li></ul>
  15. 16. What is Ethics? <ul><li>Is the branch of Philosophy that defines what is good for the individual and for society and establishes the nature of obligations or duties that people owe themselves and one another. </li></ul><ul><li>Aristotle </li></ul>
  16. 17. Why Ethics in Negotiations? its all about … <ul><li>Trust </li></ul><ul><li>Relationship </li></ul><ul><li>Fair </li></ul><ul><li>Honest and Openness </li></ul><ul><li>Reflection </li></ul>
  17. 18. Unethical Issues In Negotiations Includes……. <ul><li>Lying </li></ul><ul><li>Bribes </li></ul><ul><li>Kickbacks </li></ul><ul><li>Corruption </li></ul><ul><li>Threats </li></ul>
  18. 19. HOW TO IMPLEMENT ETHICS <ul><li>Ethical Codes </li></ul>
  19. 20. <ul><li>“ The very exercise of developing a code is in itself worthwhile; it forces a large number of think through in a fresh way about their mission and the important obligations they as a group and as individuals have with respect to society as a whole.” </li></ul><ul><li>Jane Gibbs </li></ul><ul><li>Chartered Institute of Purchasing and Supply </li></ul>
  20. 21. ARE THEY…….
  21. 22. QUESTIONS
  22. 24. <ul><li> </li></ul><ul><li> </li></ul><ul><li> ../negotiation.html </li></ul><ul><li> topic.asp?docid=1909&cate... </li></ul>