Negotiations

Lecture 9,10                             -                            approaches to negotiation                           12.12.11

approaches to negotiations

• synergistic
  • opponent problem as part of own
  • generating mutually beneficial options
  • preparation by defining interest
  • building relationship – separating people from issue

either cooperate (win-win) or compete (win-lose)

subject ist share, Gore Vidal make the pie grow, Barnard Baruch

“coopertition

Three different approaches

1. traditional
2. principled
3. synergistic
   * opponent problem as own
   * generating mutually beneficial options
   * building relationships

Negotiations and collective bargaining

• move towards problem- centred negotiation
• mutual gain bargaining

Collective bargaining

approach: periodic vs. continuous process

• difficult human activity – emotions of people, logic, economic interest
• relationship of mutual interdependence
• understanding limits of confrontation and accommodation – positional bargaining

Negotation – process

• process of balancing of opposing pressure of two parties
• process of compromise

→ Negotiation Deadlocked → define limit

L-I-M Analysis Like (lie) – Intend – must

Collective bargaining process

“Destination image of German speaking tourists perceive about Kazakhstan”  

Lecture 7,8             -                   What is negotiable?                                                      11.12.11

What is negotiable?

• what is not negotiable
• “anything that was negotiated is negotiable”
• strategy of cooperation
• face to face process at the table
• persuasive tactic, with right mindset

Fundamental questions of negotiation

Preparations

1. what do you want?
2. Why should they negotiate with you?

Golden Rule of negotiation – the 'power' of authority

People will not negotiate with you unless you can HELP or HURT them – financially/ psychologically/ socially/ materially/ physically

3. What are your alternatives?
   Analysis of all pros and cons → What are the alternatives?
   Develop a BATNA (best alternative to negotiated agreement)

high Relationship box Best strategies (partnership/ Joint Venture)

relationships (e.g. marriage) compromise

low Tactic Coordination Best strategies/ compromise

low status high

Four qualities of top negotiators

1. asking questions
2. testing, understanding and summarizing
3. giving internal information – to elicit additional information without giving information about your position
4. explaining before disagreeing

1. most people suffer from common human limitation. We see world through the lens of our own interest (partisan perception)
2. Even most accommodating person brings a somewhat competitive attitude

Ability to Control Information

Managing what you already know

Managing what you do not know is greatest challenge in negotiations (assumption)

Effective negotiation is 10% and 90% attitude

Lecture 5,6                        -                                     Negotiations continued                              10.12.11

(to get oranges) Positions vs. true interest (art of discovering)

find mutual interest, do not hold to one stuck position

When stuck! Dead lock... move from position to interest

→ Move away from position by discovering true interest of both

critical piece of information → only peal needed to bake cake “Need of orange for cake” is a wrong assumption! Negotiate only on facts!

→ Move from position to interest

Oranges represent only 1 variable, later 4 and 7 variables

Know the other party's need ...Why do they need the oranges? Find out true position, core goal

Negotiation – What it is

• much more than two people haggling about price (not about the best deal)
• a first form of communication with other party
• use of diverse methods to communicate ideas to achieve favourable buy
• a sum of all the way to convey:
  • information about what we want?
  • What we expected from other party?
  • How we discover about other party's want, desire and expectation

Negotiation is to find a constructive compromise

Means compromise and creativity … a process to learn to accept best available compromise

1. not a science – no absolute wrong or right in negotiations
2. not a situation in which winning is everything
3. not an inflexible event → dynamic process

Succeeding in negotiations – Seven Goals:

1. profit from negotiations → definition of profit?
2. Learn about people on other side – question to find out something valuable
3. find where the bottom line is? Min, max. no deal – between extremes negotiable
4. understand constraints surrounding the transaction
5. study the other side -essential information
6. assess your own people – those who help in transaction
7. find out what is fair and reasonable – different perceptions, opinions

Negotiation – an art

1. Art of discovery
2. Art of building relationships
3. art of communication

Bargaining represents just a facet of negotiations

NEG (not) + ease or leisure (OTIUM)

more recent definition (AD 1425) 'Negotium' – defined as 'dealing with people'

→ all dealings and matters between people

Six ways of saying no in sanskrit

1. do not say anything, no response, no reaction
2. we prospone, we see later Karlmittamer
3. looking on the ground Budedarsulauw
4. check with finance department (answer will never come) Animurtimaken
5. make eyebrows up “Did I something wrong?” Vrikuti (eyebrown)

Nibbling – do not tell everything (all that is wanted) in beginning, better one by one on time

Lecture 3,4               -                       Continued Introduction                                               9.12.11

magic word in negotiations “what if” → effective option

Making Ultimatum Work

• frosting on the cake
• soft and palatable
• never leave other side without alternative
• a receipe that cannot be tampered with back up final position some legacy

„ a common ground to meet needs and expectations“

rigid: Information, Time (pressure, deadline), power

every thing else can change

How to influence other party? → depends on one's ability

Real Estate: Location most important

Best information → a lot of power

Negotiation is a process, not an event

Divollo Austrian

The art of discovery

• seek not available information in advantage (early stage of negotiations)
• begin by making assumptions about opposites party's objectives, his reactions to your demands
• world around us – tested expectations – order and regularity in negotiations, no tested assumption before hand
  → test assumption about opposite party's objectives/ intentions    

Lecture 1,2         -         introduction to Negotiations and conflict resolution 8.12.11

• cultural uniformity before, now challenge to be highly creative and innovative
• best teacher: the world and what is happening in it

role play 35%

end term 40%

class participation 10%

quiz 15% (after 15^th lesson)

learn negotiating style

What qualities are needed for negotiation?

1. Patience
2. art of discovery – what does your opponent want, know/ read'em well, mind of party
3. mind set with which one enters the negotiation
4. what are the needs? Buyers and Sellers → no assumptions but facts

“In business you don't get what you deserve you get what you negotiate”

Three key questions:

1. Am I comfortable in this particular situation?
2. Will negotiating meet my needs?
3. Is the expenditure of energy and time worth benefit what I can receive?

→ creating a sense of mastery over situation

“You create/ generate competition” → more money will buy → How to get people to bid for your money?

Five defects with the product - old floor model techniques

1. multiple blemi discount - little blemish
2. internal trauma discount - not visible

Introduction & Objective(s):

We live in an age of negotiating. Volumes of advice tell managers how to prepare and conduct negotiations. To negotiate well, you do not need to he tricky, Negotiation is not rocket science. It is a field of knowledge that enables you to get the best deal. Skilled negotiators see more than just opening offers, counter offers and closing moves when they look at what happens at negotiation table. They see psychological and strategic currents below the surface. Knowledge of these factors, other key variables and process dynamics help negotiators to structure their proposals and corresponding strategy and predict what the other party will do next. The course aims to provide fine art of negotiations, impart key learning on its critical features and prepare you to make accurate moves with confidence. It provides a framework fire effective action and develops advanced level skills to be a win‐win negotiator.