Project Management

Negotiation Process - Basic Skills

last edited by: Peter Wootton on Apr 22, 2024 6:19 AM login/register to edit this page
Keywords: Knowledge and Skills

Contents
1 Need of Negotiation
2 Distributive Negotiation
3 Integrative Negotiation
4 Skills
5 Stages of the negotiation process
6 Negotiation Outcomes
7 Critical Concepts of Win-Win Negotiation
8 Various Styles of Negotiation
9 What is BATNA
10 Strategies for Developing Negotiation Skills

What is negotiation?


Need of Negotiation

No two people are exactly the same. Therefore, each and every individual thinks and behaves differently in different situations and has different needs, wants, beliefs and aims. It is the basic difference between people that gives rise to disagreement and conflict from time-to-time.

Moreover, to mutually co-exist with each other at personal, professional and business level, it is important that these conflicts and disagreements be resolved.

this is because conflicts can lead to argument and resentment, which may result in one or all of the involved parties feeling unhappy.

Hence, the negotiation helps everyone involved to seek a common ground of agreement between the disagreements and also met their individual goals.


Basic Principles of Negotiation It is a general belief that parties do consider negotiations a better way of trying to solve differences.

Each and every party enters into a negotiation with a firm belief:

  • That they do have a chance of persuading the other party to modify their original stance.
  • That they shall maintain their initial stance and persuade the other party to change.

Every negotiation process involves compromise or change of opinion of one of both parties in order to reach an acceptable final agreement.

It is important in every negotiation that adequate time is at hand in order to debate the various viewpoints of both parties and reach an agreement.

The negotiation process is always a process of direct and verbal communication which involves interaction between parties.

Each part has some influence or power, whether it is real or assumed, over the other's ability to act and think.


The art of negotiation

Negotiation is an art; you can get better and better with it. If you feel that you don’t have an innate talent for negotiations, don’t be disappointed because these skills can be honed and developed with the proper training and practice. People who always say good things may feel that they are good negotiators, but that is not always the case. Negotiation is all about understanding what you want and what the other person wants, and then coming up with a win-win scenario.

Negotiation happens everywhere; it’s omnipresent. You may have to negotiate over anything, right from the deadlines of a project to which person will do what chores at home. In the real world, it is sometimes difficult to ascertain whether your negotiation is good or bad. You may think that you are a good negotiator, but in reality, it may be just the opposite. Even before you negotiate, you will have to know what can be negotiated and what cannot be negotiated.


Benefits of negotiation

  • Good negotiations help you gain better control in business as well as personal situations.
  • They help you identify and understand you own as well as the other parties’ interests, as well as the differences between them.
  • It helps to reach a ‘Win-Win’ Solution, which is mutually beneficial to all the parties involved in a negotiation.
Good negotiations also help to improve interpersonal relationships.

They help to develop and maintain an overall harmonious and thriving interpersonal environment.

It is one of the easiest and quickest ways to solve conflicts and disagreements.

  • Negotiations help reduce stress and frustration among two conflicting individuals.
  • Negotiations help to reach an agreement in cases where a dead-end may be reached if a consensus is not established between two differing needs, wants or opinions.

Types of Negotiation Strategies

  • Distributive Negotiation
  • Integrative Negotiation

Distributive Negotiation

‘Distributive Negotiation’ is also known as ‘Positional’ or ‘Competitive’ or ‘Fixed Pie’ or ‘Win-Lose’ Negotiation. It is a type or style of negotiation in which the parties compete for the distribution of a fixed amount of value. The involved parties in a ‘distributive negotiation’ have a ‘win-lose’ attitude towards reaching the goal and is based on an attempt to divide up a fixed pie or amount of resources for oneself. ‘Distributive Negotiation’ involves holding on to a fixed idea, or position, of what you want and arguing for it and it alone, regardless of any underlying interests.

The main focus in such a type of negotiation strategy is on achieving immediate goals, with little or no regard for building future relationships. Generally, no new creative solution is reached in such negotiations as the parties spend the least possible time and energy in resolving the conflict. The outcome of the negotiation is reached by the presentation of fixed solutions and a decision or choice is made quickly.


Integrative Negotiation

‘Integrative Negotiation’ is also known as ‘Interest-based’ or ‘Cooperative’ or ‘Win-Win’ or ‘Non-zero Sum’ Negotiation. It is a type or style of negotiation in which the parties cooperate to achieve a satisfactory result for both. The involved parties in an ‘integrative negotiation’ have a ‘win-win’ attitude towards reaching the goal and attempt to strive not just for their own outcomes, but for favourable outcomes for both sides. ‘Integrative Negotiation’ involves reaching an agreement keeping into consideration both the parties’ interests which includes the needs, desires, concerns, and fears important to each side.

The main focus in such a type of negotiation strategy is on developing mutually beneficial agreements based on the interests of the disputants. Generally, new creative solutions are reached in such negotiations as the parties spend maximum possible time and energy in resolving the conflict. The outcome of the negotiation is reached by collaboration between the parties to find a “win-win" solution to their dispute.


Skills

The following are the most crucial skills that can help you to become a great negotiator:

  • Be open and flexible
  • Always be ethical
  • Always empathize
  • Develop good social skills
  • Follow your intuitions
  • Be assertive

One of the best practices that you can follow for an effective and successful negotiation is to always have a ‘face-to-face’ negotiation. Try your best and avoid negotiating over the phone or email. Negotiating in person helps you to understand the other person better by watching out for his body language, facial expressions, vocal intonation, and other cues that can help you negotiate better by getting an insight into what the other person is thinking.


Stages of the negotiation process

  • Meeting:

The first stage of the negotiation process is the negotiation meeting. The meeting can be in an informal or formal setting. When there are two parties meeting, the venue, date and time are decided first. The meeting begins with introductions.

  • Exploration:

The second stage of the negotiation process is the stage of Exploration. During the exploration stage, both parties exchange information and discuss their concerns, explore all possible scenarios mentally. The main objective of this stage is to ascertain the strengths and weaknesses, needs, wants, desires and issues.

  • Terms Nogotiation:

The third stage of the negotiation process is Terms Negotiation. During this stage, both parties make offers and tradeoffs. At this stage, both the parties consider all the possible options available to find a middle path between their differences.

  • Closure:

This stage occurs after both parties have looked at all the options closely. During the closure stage, both parties restate their positions and confirm their tradeoffs if they are willing to negotiate.

  • Acceptance:

The final stage of the negotiation process is acceptance. During the acceptance stage, both parties would either decide to suspend negotiations or they may reach an agreement.


Negotiation Outcomes


Critical Concepts of Win-Win Negotiation


Various Styles of Negotiation


What is BATNA


Strategies for Developing Negotiation Skills


I consider it important to use the time before, during and after trading. Time management in the negotiation process can more easily lead to the desired results.


last edited by: Peter Wootton on Apr 22, 2024 6:19 AM login/register to edit this page


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