1. “You often get not what you deserve, but what you negotiate.”
Chapter 9
Negotiation
“You often get not what you deserve, but what you negotiate.”
~ John Marrioti
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

2. 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.
Know when to walk away from a negotiation if a resolution doesn’t appear possible.
Utilise framing, scripting and other negotiation tactics to increase your effectiveness as a negotiator.
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

3. Why is Negotiation Important?
Factors driving the need for negotiation skills:
Negotiation is a process in which two or more people or groups share their concerns and interests to reach an agreement of mutual benefit.
Scarcity of resources
Increased use of teams in the workplace
Global diversity
Litigious tendency of our modern society
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

4. Benefits of Honing Negotiation Skills
Ability to maintain better control in business and personal situations.
Much better way to reach a solution than either a lawsuit or arbitration.
Negotiation more likely to end in a “win–win” scenario.
Both parties are involved from the outset.
Helps both parties achieve a workable resolution, and helps to preserve and improve their relationship, reputations and sense of professional achievement.
Reduces stress and frustration.
Often reduces the number of future potential conflicts.
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

5. 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
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

6. 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.
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

7. Comparing Bargaining Approaches
Figure 9.1
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

8. Five Stages of Negotiation
1. Preparation and planning
Clarify what you want and why
Establish a BATNA
Develop a frame
Create a strategy
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

9. Five Stages of Negotiation (cont)
2. 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
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

10. Five Stages of Negotiation (cont)
3. Clarification and justification
Clarify your interests
Use a frame to make your case persuasive
Use questions to understand others’ interests
Share relevant information that supports your case
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

11. Five Stages of Negotiation (cont)
4. Bargaining and problem solving
Focus on problems, not people
Focus on interests, not positions
Look forward, not backward
Create options for mutual gain; adopt a win–win attitude
Select from options using principles, or objective criteria
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

12. Five Stages of Negotiation (cont)
5. Closure and implementation
Verbally summarise what both parties agreed to
Review key points to ensure understanding
Draft agreement in writing
Have both parties sign the agreement
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

13. 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
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

14. Strategies for Negotiating Effectively (cont)
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 emphasise
Establishes a “big picture” context
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

15. Strategies for Negotiating Effectively (cont)
Managing
Practice negotiating
Manage your emotions
Agree to disagree
Use agendas, questions and summarising techniques
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

16. Principles of Successful Negotiation
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)
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

17. Principles of Successful Negotiation (cont)
Focus on interests, not fixed positions
Go into the negotiation with objective criteria
Respond, don’t react
Use a third party
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

18. 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 organise their thoughts and develop options that may be acceptable to both parties
Mediator
Arbitrator
Conciliator
Consultant
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

19. 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.
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak

20. 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 chance that you will get what you deserve and bargain for.
Copyright  2006 McGraw-Hill Australia Pty Ltd PPTs t/a Interpersonal Skills in Organisations
Slides by Caroline Juszczak