BUSINESS NEGOTIATION

By : MUSTAFA HASAN AL-MAKSOOSIWarsaw university of technology Faculty of management

Contents What is negotiation Stages of Negotiation The model of negotiation Negotiation Styles and Outcomes General Approaches The Negotiation Process Gender and culture Differences in

Negotiations Managed Conflict The Conflict Process

Negotiation is a dialogue between two or more people or parties intended to reach a beneficial outcome over one or more issues where a conflict exists with respect to at least one of these issues. This beneficial outcome can be for all of the parties involved, or just for one or

Stages of Negotiation Preparation Discussion Clarification of goals Negotiate towards a Win-Win outcome Agreement Implementation of a course of actionSix-Step Model Step 1: Analyzing the Negotiation Situation Step 2: Planning for the Upcoming Negotiations Step 3: Organizing Step 4: Gaining and Maintaining Control Step 5: Closing the Negotiations Step 6: Continuous Improvements

Tow General Approaches

Distributive Bargaining▪ Negotiation that seeks to divide up a fixed

amount of resources; a win-lose situation Integrative Bargaining

▪ Negotiation that seeks one or more settlements that can create a win-win solution

United Auto Workers officials (left)and Ford Motor Company officialsshake hands during news conferencefor the start of national negotiationsin July 2011. Both UAW andFord say that they are committedto integrative bargaining in findingmutually acceptable solutionsto create a win-win settlement thatwill help boost their competitivenesswith other automakers in theUnited States and abroad.

The Negotiation ProcessBATNA

The Best Alternative To a Negotiated Agreement

The lowest acceptable value (outcome) to an individual for a negotiated agreement

Gender Differences in NegotiationsWomen negotiate no differently from men, although men

apparently negotiate slightly better outcomes.Men and women with similar power bases use the same

negotiating styles.Women’s attitudes toward negotiation and their success

as negotiators are less favorable than men’s. Cultural Differences in Negotiations

Multiple cross-cultural studies on negotiation styles, for instance:○ American negotiators are more likely than Japanese

bargainers to make a first offer○ North Americans use facts to persuade; Arabs use emotion;

and Russians use asserted ideals○ Brazilians say “no” more often than Americans or Japanese

Example: Fuji Heavy IndustryIn this photo, Japanese labor unionleader Hidekazu Kitagawa (right)presents the group’s annual wageand benefits demands to Ikuo Mori,president of Fuji Heavy Industries,Ltd., the manufacturer of Subaruautomobiles. Studies on how negotiatingstyles vary across nationalcultures reveal that the generallyconflict-avoidant Japanese negotiatorstend to communicate indirectlyand use a more polite conversationalstyle. Their style of interactionis less aggressive than otherCultures.

Managed Conflict Conflict : A process that begins when one party perceives that

another party has negatively affected, or is about to negatively affect, something that the first party cares about.

Encompasses a wide range of conflicts that people experience in organizations◦ Incompatibility of goals◦ Differences over interpretations of facts◦ Disagreements based on behavioral expectations

Argues that instead of encouraging ‘’Good’’ or discouraging ‘’Bad’’ conflict its more important to resolve naturally occurring conflicts productively.

The Conflict Process

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