2. Chapter 9
Negotiation
“You often get not what you deserve, but what you negotiate.”
~ John Marrioti

3. Chapter Objectives
Determine what you want in a negotiation and make a plan to facilitate your ability to achieve it.
Determine what you’re willing to accept if you don’t get all that you want in a negotiation.
Understand what the other party’s wants and needs are in a negotiation.
Involve the other person in a collaborative and interest-based negotiation.

4. Chapter Objectives (continued)
Know when to walk away from a negotiation if a resolution does not appear possible.
Utilize framing, scripting, and other negotiation tactics to increase your effectiveness as a negotiator.
Identify unethical negotiation behaviors and determine the motivation for engaging in such behavior and strategies for dealing with it.
Increase your comfort with special situations in negotiation, such as multiparty, third party, and global negotiations.

5. Why is Negotiation Important?
Negotiation is a process in which two or more people or groups share their concerns and interests to reach an agreement of mutual benefit.
Factors driving the need for negotiation skills:
Scarcity of resources
Increased use of teams in the workplace
Global diversity
Litigious tendency of our modern society

6. Benefits of Honing Negotiation Skills
Increases your salary, profits, and marketability.
Saves time, money and grief, while ensuring needs are met.
Negotiation more likely to end in a “win-win” scenario.
Improves relationships.
Reduces the number and severity of conflicts, thereby reducing stress.

7. Integrative Bargaining Strategy
Used when a win-win situation exists.
Goal is to collaborate and generate one or more creative solutions that are acceptable to both parties.
Only works when both parties are committed to preserving the relationship that exists between them.
Requirements:
Proper skills and attitude.
Climate that supports and promotes open communication.

8. Distributive Bargaining Strategy
Used to divide a fixed amount of resources, resulting in a win-lose situation.
Negotiators typically have an adversarial or competitive posture.
Focus is on achieving immediate goals, not building or preserving relationships.
Usually only one or two fixed solutions are presented.

9. Comparing Bargaining Approaches

10. Five Stage of Negotiation
Preparation and planning
Definition of ground rules
Clarification and justification
Bargaining and problem solving
Closure and implementation

11. Preparation and planning
Clarify what you want and why
Establish a BATNA
Develop a frame
Create a strategy

12. Definition of ground rules
Set an agenda
Agree on objective criteria
Agree on what to do if an agreement is not reached
Discuss what is acceptable or not, e.g., yelling

13. Clarification and justification
Clarify your interests
Use a frame to make your case persuasive
Use questions to understand other’s interests
Share relevant information that supports your case

14. Bargaining and problem solving
Focus on problems, not people
Focus on interests, not positions
Look forward, not backward
Create options for mutual gain; adapt win-win attitude
Select from options using principles, or objective criteria

15. Closure and implementation
Verbally summarize what both parties agreed to
Review key points to ensure understanding
Draft agreement in writing
Have both parties sign the agreement

16. Strategies for Negotiating Effectively
Scripting
Develop an interest-based strategy/approach prior to a face-to-face negotiation
Identify potential options/plans that can be proposed
Topics to consider:
Opponent’s probable strategy
Your strategy
How to begin the negotiation
Core issues and problem to be solved

17. Strategies for Negotiating Effectively (continued)
Framing
Provides a perspective that helps others understand our position
Highlights the points you want to make and provides a filter for the other party
Focuses attention on the priorities you want to emphasize
Establishes a “big picture” context

18. Strategies for Negotiating Effectively (continued)
Managing
Practice negotiating
Manage your emotions
Agree to disagree
Use agendas, questions, and summarizing techniques

19. Additional Tips for Effective Negotiating
Determine the importance of the outcome for you
Look forward, not backward
Separate people from problems
Adopt a win–win attitude
Know your best alternative to a negotiated agreement (BATNA)
Go into the negotiation with objective criteria
Respond, don’t react
Use a third party

20. Integrity and Ethics in Negotiation
Reasons for unethical behavior:
Expected norms
Pressure from management or others
Suggestions that help you deal with such behavior:
Ask direct questions to reveal the truth or missing information.
Inform the other party about the tactic being used.
Request a different party with whom to continue negotiations.
End the negotiations immediately.

21. Third-Party Negotiations
Used in serious negotiations, or when objective assistance is needed
Allows each party to “vent” in a non-threatening environment
Parties can benefit from third party’s expertise and experience
Helps the negotiating parties organize their thoughts and develop options that may be acceptable to both parties
Mediator
Arbitrator
Conciliator
Consultant

22. Mulitparty and Virtual Negotiations
Multiparty negotiations are those where more than two parties are working together to achieve a collective objective.
Complex.
Difficult to manage.
Virtual negotiations are carried out via phone, fax, , synchronous chat, and teleconferencing.
Managing and keeping the conversation on track is more difficult.

23. Top 10 Rules for Virtual Negotiations

24. Global Negotiations Clarify what you want and why Develop your BATNA
Base your strategy and implementation on what you know about the practices and customs of your global negotiating partner
Research culture, practices, and business
Use the eight elements of international protocol
Global negotiations are negotiations between domestic and foreign firms.

25. Summary
Learning how to negotiate can benefit you in your personal as well as your business life.
The type of negotiating strategy you use is determined by the situation.
Interactive bargaining is used if a win-win outcome is possible.
Distributive bargaining is used if a fixed amount of resources must be divided, resulting in a win-lose outcome.
When negotiating, the more prepared you are, the greater the chances that you will get what you deserve and bargain for.