Business Communication Course Unit 8

Negotiations

Intro

Have you ever bargained for something? Describe your experience. Was it successful?

How would you define negotiations?

1. A brief definition

A negotiation is:

• a back-and-forth communication where 2 or more parties bargain for a desired outcome

1. A brief definition

The parties involved in negotiation have interests that may be:

• common• opposed

• What communication skills are necessary for successful negotiations?

2. Negotiation essentials

For successful negotiations, remember the following advanced communication skills:

• a positive attitude– beliefs can affect outcomes– => believe that you deserve what you want to get

Follow-up

Do you usually think positively or negatively? What could the implications be for business transactions?

2. Negotiation essentials

For successful negotiations, remember the following advanced communication skills:

– state your desires and concerns clearly

– listen carefully to the other party’s desires and concerns

2. Negotiation essentials

For successful negotiations, remember the following advanced communication skills:

• knowledge of the negotiation process– know how to break down an issue into separate parts

– negotiate or bargain for who gets each part

– know how to address common interests for mutual gains

Follow-up

Give examples of some possible mutual gains in a negotiation.

2. Negotiation essentials

For successful negotiations, remember the following advanced communication skills:

• an understanding of human behaviour – know what motivates you and the other party– be aware of what matters to you and to the other party– know how to apply all relevant communication skills

(see the previous and subsequent units in this course)

2. Negotiation essentials

For successful negotiations, remember the following advanced communication skills:

• using creativity – solve problems creatively– find innovative solutions

Follow-up

Are there any downsides to being creative and innovative in business transactions / negotiations? Why? Why not? Give some examples.

2. Negotiation essentials

For successful negotiations, remember the following advanced communication skills:

• knowledge of the negotiation subject

– inform yourself about the subject of negotiation

– do some research into the options prior to negotiation

3. Fairness standards

Consider the following three fairness standards that should guide any negotiation:

• the standard of equity

– people are rewarded based on merit and effort invested

3. Fairness standards

Consider the following three fairness standards that should guide any negotiation:

• the standard of equality

– each person gets an equal share, regardless of their contribution

3. Fairness standards

Consider the following three fairness standards that should guide any negotiation:

• the standard of need

– the person with the greatest need gets the largest percentage

Follow-up

Discuss the advantages and disadvantages of the three fairness standards in negotiations:

– equity– equality– need-based

4. Negotiator types

You may be one of the two negotiator types below, based on your personality, experience, fairness standards and cultural background:

• the soft negotiator < the nurturing cultural dimension– easier to negotiate with– frequently loses– may be forced to the extremes of acquiescence

4. Negotiator types

You may be one of the two negotiator types below, based on your personality, experience, fairness standards and cultural background:

• the hard negotiator < the achieving cultural dimension– goes to great lengths to win– frequently wins– may bully the other party into a losing outcome

Follow-up

Which of the two negotiator types (soft / hard) would suit you best? Why?

Could either of the two cause you problems? What kind?

5. Negotiation factors

There are four basic factors that impact negotiation:

• the outcome– the goal you want to achieve– the items / issues for which you are negotiating – compromise may be essential (i.e. give up one half of the

items you need in order to get the other half)

Follow-up

How far could you compromise in a negotiation? What factors would you take into account?

5. Negotiation factors

There are four basic factors that impact negotiation:

• the relationship– may be as important as the outcome– your relationship with the other party is an integral part of the

negotiation process

5. Negotiation factors

There are four basic factors that impact negotiation:

• the time– time constraints heavily impact negotiation– time pressures may lead to less desirable outcomes

5. Negotiation factors

There are four basic factors that impact negotiation:

• the transaction costs– money, time, energy, wear and tear, stress etc.– know when to stop bargaining and settle the negotiation

6. Bargaining: positional v principled

As a negotiator, you may assume:

• a positional bargaining stance, in which you– take sides– form camps– fail to build rapport– begin to fight over your position– may go to extremes– automatically have a debate– cannot use your influence tactics to build a bridge

6. Bargaining: positional v principled

As a negotiator, you may assume:

• a principled bargaining stance, in which you– look for what you have in common with the other party– negotiate on merits– separate the people from the problem– focus on interests rather than positions– come up with a variety of options before making a decision– use objective standards to evaluate results

6. Bargaining: positional v principled

By assuming a principled bargaining stance, you must consider the three criteria below:

• ‘Does it produce a wise agreement?’– the solution makes sense– the solution is the best one possible out of a variety of options– all the options have been explored by participants

6. Bargaining: positional v principled

By assuming a principled bargaining stance, you must consider the three criteria below:

• ‘Is it efficient?’– the issues of transaction costs

6. Bargaining: positional v principled

By assuming a principled bargaining stance, you must consider the three criteria below:

• ‘Does it improve the relationship?’– separating the people from the problem– allowing participants to avoid personality conflicts– focusing on all the participants’ needs, interests and concerns

Follow-up

Which of the two stances (positional / principled) would you most probably assume as a negotiator? What kinds of problems might you expect, based on your choice? Explain.

7. Negotiation outcomes

Anticipate how a negotiation will end, before deciding how to start it. Your choice of tactics and strategies will determine the outcome:

• win / win– an optimum occasion– both the issues and the relationships matter equally– may be time-consuming

7. Negotiation outcomes

Anticipate how a negotiation will end, before deciding how to start it. Your choice of tactics and strategies will determine the outcome:

• win / lose– the issues matter more than the relationship– time is needed to wear down the other side– synonymous to getting the best deal

7. Negotiation outcomes

Anticipate how a negotiation will end, before deciding how to start it. Your choice of tactics and strategies will determine the outcome:

• lose / win– long-term bonds are more important than momentary issues

7. Negotiation outcomes

Anticipate how a negotiation will end, before deciding how to start it. Your choice of tactics and strategies will determine the outcome:

• lose / lose– sometimes, the best solution– the issues are less important to both parties– transaction costs are the most important

Follow-up

“Only free men can negotiate. Prisoners cannot enter into contracts.”

Nelson Mandela

• You must be fully prepared to lose a great deal in order to make a great deal.

• Information is a negotiator's greatest weapon.

Victor Kiam