NEGOTIATION

Mukul Gupta(Faculty of Management)

Trainer PD & English Communication Skills(Khandewal College of Management Science & Technology)

concept

Negotiation starts with a discussion.

concept

A usual activity of ordinary life.

concept

Negotiation includes a combination of compromise, collaboration, and possibly some pressure on vital issues.

concept

Negotiation process is commonly used for resolving differences, allocating resources, and taking other decisions.

concept

The term negotiations and the term bargaining are generally used interchangeably, but has different meaning in business

terminology.

concept

Bargaining is: -

WIN LOSE

concept

Negotiation is:-

WINWIN

characteristics

Two or More Parties

characteristics

Conflicts between Needs and Desires

characteristics

Negotiation contributes in better results.

characteristics

Surplus Equalizing Process

characteristics

Parties seeks for an Agreement with Mutual Adjustment

NATURE

A Continuous Process

NATURE

A Persuasive Activity

NATURE

A Psychological Approach Oriented process

NATURE

Soft skill that a manger need

NATURE

Process that contributes in Economic Balance

TYPES OF NEGOTIATION

INTEGRATIVENEGOTIATION

DISTRIBUTIVENEGOTIATION

INTEGRATIVE NEGOTIATION

The Concept of Integrative negotiation is based on the concept of

SYNERGY.

INTEGRATIVE NEGOTIATION

Parties cooperate to achieve maximize benefits by integrating their

interests.

INTEGRATIVE NEGOTIATION

Both parties involved in negotiation process jointly look at the problem, try to search for alternatives and try

to evaluate them and reach a mutually acceptable decision or solution.

INTEGRATIVE NEGOTIATION

WINWIN

DISTRIBUTIVE NEGOTIATION

It may be called as Bargaining.

DISTRIBUTIVE NEGOTIATION

Based on the concept that the gain made by one person is loss incurred by the

other person.

DISTRIBUTIVE NEGOTIATION

WIN LOSE

Comparison

planning for negotiation

Planning in its simplest form is thinking in advance to respond to W factor accordingly…

planning for negotiation

Preparation

Relationship Building

Information Gathering

Prediction

Pre-Negotiation

planning for negotiation

Looking for the Possibility

Bidding

Closing the Deal

Negotiation

planning for negotiation

Implementing the Agreement

Follow-up

Post-Negotiation

STRATEGIES for negotiation

The overall plan to achieve one’s goals in Negotiation.

How is it differ from Tactics & Planning?

Approaches to Strategies

BilateralUnilateral

Strategic Modelof Negotiation

This model is known as “Dual Concern Model”

Strategic Modelof Negotiation

How much concern do I have in achieving my desired outcomes at stake in the negotiation?

Strategic Modelof Negotiation

How much concern do I have for the current and future quality of the relationship with the other party?

Strategic Modelof Negotiation

GAINR

ELAT

ION

Active-engagementStrategies

GAINR

ELAT

ION

Collaboration Accommodation

Competition

NON-engagementStrategies

GAINR

ELAT

ION

Avoidance

Strategies & Tacticsof Distributive Negotiation

Why understanding of distributive negotiation is important?

Multiple SituationCounter Moves

Skill level required

Strategies & Tacticsof Distributive Negotiation

Situations of Distributive Negotiations are-

Goals of one party are in fundamental & direct conflict to another party

Strategies & Tacticsof Distributive Negotiation

Situations of Distributive Negotiations are-

Resources are fixed and limited

Strategies & Tacticsof Distributive Negotiation

Situations of Distributive Negotiations are-

Maximizing one’s own share of resources is the goal for both the parties.

Strategies & Tacticsof Distributive Negotiation

Situations includes-

Starting Point (Initial Offer)Target Points

Resistance Points (Walkaway)Alternative Outcome

Strategies & Tacticsof Distributive Negotiation

Situations includes-

Starting Point (Initial Offer)Target Points

Resistance Points (Walkaway)Alternative Outcome

Strategies & Tacticsof Distributive Negotiation

Role of alternatives to a negotiated agreement-

Alternatives gives the negotiator power to walk away from the negotiation.

Strategies & Tacticsof Distributive Negotiation

Role of alternatives to a negotiated agreement-

Attractive Unattractive

Setting Higher Goals

Making fewer concession

Negotiators have much less bargaining power

Strategies & Tacticsof Distributive Negotiation

Fundamental Strategies-

Push for settlement near opponent’s resistance point

Strategies & Tacticsof Distributive Negotiation

Fundamental Strategies-

Get the other party changing their resistance point

Strategies & Tacticsof Distributive Negotiation

Fundamental Strategies-

Changing own resistance point

Strategies & Tacticsof Distributive Negotiation

Fundamental Strategies-

Convincing other party that the settlement is best possible.

Strategies & Tacticsof Distributive Negotiation

Keys to Fundamental Strategies-

Discovering the other party’s resistance point

Strategies & Tacticsof Distributive Negotiation

Keys to Fundamental Strategies-

Influencing the other party’s resistance point

Strategies & Tacticsof Distributive Negotiation

Tactics may be used in distributive bargaining:-

Tactics we use in distributive bargaining are called as Hard Ball Tactics.

Strategies & Tacticsof Distributive Negotiation

Tactics may be used in distributive bargaining:-

They are designed to pressure targeted parties to do things they would not other wise do.

They are tactics which work on poorly prepared negotiators

Strategies & Tacticsof Distributive Negotiation

Hard Ball Tactics of Distributive Bargaining –

Good Guy/Bad Guy Highball/Lowball Bogey Nibble Chicken Intimidation Snow Job

Strategies & Tacticsof Distributive Negotiation

Good Guy/Bad Guy

Named after police interrogation technique.

Negotiators using this tactic can become so involve with their game and act they fail to concentrate on obtaining their goals.

Strategies & Tacticsof Distributive Negotiation

Highball/Lowball

Starts with a ridiculously high opening offer that know they will never achieve.

The tactics goal is to have the other party reevaluate their opening offer and move closer to the resistance point.

The risk is the other party will think negotiating is a waste of time.

Strategies & Tacticsof Distributive Negotiation

Bogey

When a negotiator pretends an issue important and it is not.

It only works well IF they pick a issue that is important to the other side.

Strategies & Tacticsof Distributive Negotiation

Nibble

Is a tactic used to get small concession without negotiating.

The concession is too small to lose the deal over, but large enough to upset the other side.

Strategies & Tacticsof Distributive Negotiation

Chicken

Negotiators who use this tactic combine a large bluff and threaten actions.

Strategies & Tacticsof Distributive Negotiation

Intimidation

It is guilt, anger, legitimacy, fear, what ever gives you power over the other party.

Strategies & Tacticsof Distributive Negotiation

Snow Job

It is the overwhelming of information that you have trouble determining which facts are real or important.

Strategies & Tacticsof integrative Negotiation

What Integrative Bargaining includes?

Commit to the needs of all involved partiesExchange information & ideasInvent options for mutual gain

Strategies & Tacticsof Integrative Negotiation

Integrative negotiation aims at seeking mutually satisfying solutions with essence of free flow communication and mutual understanding.

Strategies & Tacticsof Integrative Negotiation

Integrative Negotiations have some key steps: -

Defining Problem Understanding

Generate alternative solutions Evaluation and Selection

Strategies & Tacticsof Integrative Negotiation

Claiming and Creating Value

Strategies & Tacticsof integrative Negotiation

Identify & Defining Problem

It should be mutually acceptable

It should be stated as goal with obstacle identification

Strategies & Tacticsof integrative Negotiation

Understanding

Concerns, needs, desires, or fears.

Process = path to settlementPrinciples: Doing what is fair, right, acceptable, and ethical

Strategies & Tacticsof integrative Negotiation

Generating Alternative Solution

Create options by redefining the problem set:

CompromiseLogroll – (Concession)Modify the pieFind a bridge solution

Strategies & Tacticsof integrative Negotiation

Generating Alternative Solution

Creating solutions via: -

Brainstorming Surveys

Strategies & Tacticsof integrative Negotiation

Evaluation & Selection

Evaluate by: Quality Objective standards Acceptability

Advance criteria agreement Justify personal preferences

mukulguptahr@gmail.com

Unit – 1 (END)

Thank Yu