Lecture 1 & 2 Basic Principles in Negotiation

BBG2303BBG2303Basic Principles in Basic Principles in

NegotiationNegotiation

By:By:

Wan Azlinda Wan MohamedWan Azlinda Wan Mohamed

What is Negotiation? What is Negotiation?

• Negotiation a field of knowledge that focuses on gaining the favor of people from whom we want things. -Herb Cohen

Negotiating definedNegotiating defined

• A special form of communication.

• Communication is the basic process, the flow of information between people that informs, instructs, and more.

• Persuasive communications

• Process of bargaining

We negotiate when …….We negotiate when …….

• Whenever we want to influence another person through exchange of ideas, or some material value.

• Negotiation is the process we use to satisfy our needs when some else controls what we want.

• Every wish we would like to fulfill, every need we compelled to satisfy, are potential situations for negotiation.

• Bargaining, haggling, mediating, or bartering

We negotiate when …….We negotiate when …….

• Negotiation between companies, groups or individuals normally occurs because one has something the other person wants and is willing to bargain to get it

Examples of negotiationExamples of negotiation

• Most of us are constantly negotiating. Example:

• When people meet to draw up contracts;• Buy or sell anything;• Resolve differences;• Make mutual decisions;• Agree to work plans;• Deciding to have lunch.

Examples of negotiationExamples of negotiation

• Where we will spend our first Hari Raya at with our family

• Buy a car

• Try to get into a class that is full

• Buy a piece of land

Basic PrinciplesBasic Principles

• Negotiation is a voluntary activity in the sense that either party can break away from or refuse to enter into discussion at any time

• A negotiation usually starts because at least one of the parties wants to change the status quo and believes that a mutually satisfactory agreement is possible

Basic PrinciplesBasic Principles

• Entering negotiation implies acceptance by both parties that agreement between them is required (desirable) before a decision is will be implemented. If the decision can be decided unilaterally by one of the parties, they may be no point in committing one self in the negotiating process.

Basic PrinciplesBasic Principles

• Timing is a critical factor in negotiation. It plays an important role in influencing the overall climate and directly affects the ultimate outcome of the decision.

• A successful outcome in negotiation is not always winning at any course or even ‘winning’, but getting what both sides want

Basic PrinciplesBasic Principles

• The progress of all types of negotiation, even when it is conducted through parties, is strongly influenced by the personal values, skills, perceptions, attitudes and emotions at the bargaining table.

Characteristics of a negotiation Characteristics of a negotiation situationsituation

• There are two or more parties – that is, two or more individuals, groups, or organizations.

• There is a conflict of interest between two or more parties – that is, what one wants is not necessarily what the other wants- and the parties must search for a way to resolve the conflict.

Characteristics of a negotiation Characteristics of a negotiation situationsituation

• The parties negotiate because they think they can use some form of influence to get a better deal that way than simply taking what the other side will voluntarily give them or let them have. Negotiation is largely a voluntary process. It is strategy pursued by choice; seldom are we required to negotiate

Characteristics of a negotiation Characteristics of a negotiation situationsituation

• The parties, at least for the moment, prefer to search for agreement rather than to fight openly. Negotiation occurs when there is no system- no fixed or established set of rules or procedures for resolving the conflict.

• When we negotiate, we expect give and take. We expect that both parties will modify or give in some what on their opening statements, request, or demands. Creative negotiations may not require compromise; instead the parties may invent a solution that meet the objectives of all side

Characteristics of a negotiation Characteristics of a negotiation situationsituation

• Successful negotiation involves the management of intangibles (psychological motivations that may directly or indirectly influence the parties during a negotiation. e.g the need to “look good” to the people you represent, core beliefs and values) as well as resolving the tangibles (e.g price or the terms of conditions)

ImplicationsImplications

• Negotiation does not have to be a verbal tug of war to be successful.

• Successful negotiation involves the ability to

1. determine through observation and analysis the best means of persuasion and

2. put the persuasion approach into practice at the appropriate time.

ImplicationsImplications• Not all situations warrant ‘negotiating treatment’. It

may not be possible or desirable to enter negotiations when:

1. You are not in a position to bargain.2. You have the power or authority to impose your

views.3. You do not have time to prepare effectively,4. Negotiating may damage your long-term

objectives.5. You are too weak or inexperienced to deal with the

other party.6. You are facing what you know is an unanswerable

demand.

ImplicationsImplications

• Because timing is important in negotiation, you need to recognize where you are in the negotiating process, and plan your actions (journey) accordingly.

When you shouldn’t negotiateWhen you shouldn’t negotiate

• When you could lose everything• When you’re sold out• When demands are unethical• When you don’t care• When you don’t have time• When trust has been broken• When waiting would improve your position• When you are not prepared

Common Negotiating MistakesCommon Negotiating Mistakes

• Based on John Illish (1992) personal experience as a negotiator

1. Entering negotiations with a preset mental mindset.

2. Not knowing who has final negotiating authority.

3. Not knowing precisely what power they possess and how to use it effectively

4. Entering a negotiation with only a general goal to be obtained upon the final outcome of negotiation.

5. Failing to advance positions and arguments of substance.

Common Negotiating MistakesCommon Negotiating Mistakes

• Based on John Illish (1992) personal experience as a negotiator

6. Losing control over seemingly unimportant factors such as timing and ordering of issues.

7. Failing to let the side make the first offer.8. Ignoring time and location as a negotiating

weapon.9. Giving up when negotiation seems to reached

a deadlock.10. Not knowing the right time to close.

• Negotiation which ‘go wrong’ often do for a similar reasons. These reasons called ‘syndromes’

• The ‘one track’ syndrome

• The ‘win-lose’ syndrome

• The ‘random walk’ syndrome

• The ‘conflict avoidance’ syndrome

• The ‘time capsule’ syndrome

The ‘one track’ syndromeThe ‘one track’ syndrome

• Negotiators have already decided what the facts of the case are and the required solution before negotiating begins.

• Convinced that the other party will accept their solution.

• ‘ A train running along one mental track, with no option for turning left or right to avoid obstacles and pitfalls that are certain to occur along the way during every negotiation consequences’.

Main SymptomMain Symptom

• One of the negotiators begins the negotiation by stating that there are number of key points to be covered and arranges them in apparently logical order. These points are then worked through in a mechanical fashion, at a relatively high speed, covering a lot of points, none in any great depth, regardless of the other party.

• Frequent interruptions to prevent the other party from talking at length on /irrelevant’ matters.

• Clear signs of frustration and/or non-acceptance on the part of he other party.

Potential RemediesPotential Remedies

• View agendas as frameworks, which are useful as guides or checklists, but which need not be rigidly adhered to at all times.

• Ask the other party to suggest items on the agenda and formulate a joint working plan for the discussions.

• Treat information as hypothesis rather than fact.• Use interim summaries and restatements and

revies at the end of each topic/meeting to check understanding points raised by other party.

• Listen actively and look out for non-verbal cues of agreements, disagreement, frustration, etc as well as the verbal content.

The ‘win-lose syndrome’The ‘win-lose syndrome’

• The negotiators view, or come to view, the discussions as a contest or a debate which they are determined to win.

Main SymptomMain Symptom

• Refusal to accept the validity of the other’s view, claims and arguments.

• A large number of critical statements, personal attacks and emotional outburst.

• A lot of closed questions and leading statements to gain compliance with preconceived ideas (eg, “You must accept that…., or /You do not seem able to understand that…”)

Potential RemediesPotential Remedies

• Ask more open questions to elicit the other party’s views.

• Be prepared to listen to the other party.• Avoid getting into defense-attack spirals.• Resists the urge to reject or undermine every

argument of other party, even when you agree.• Look for common ground.• Lists points of agreement and disagreement.• Ask yourself: what are my real interests in this

dispute? How important is the long-term relationship with the other party? How can I make the other party concede without losing face?

The ‘random walk’ syndromeThe ‘random walk’ syndrome

• This is when negotiation frequently jumps from one topic to another before coming to an agreed conclusion, or when the negotiators periodically return to the same topic without adding anything to discussions.

Main symptomsMain symptoms

• There is no summary of the issues agreed or discussed at the end of a meeting.

• When one of the negotiators attempts to summarize, the other party objects that s/he never agreed to these points.

Potential remediesPotential remedies

• Think through likely problem areas before the discussion.

• Delay closure on a topic until full agreed solution is arrived at.

• Use more probes to obtain detailed information about the problem area under discussion.

• Use more summarizing and paraphrasing to ensure that the other party understands your point of view.

Potential remediesPotential remedies

• Be more tolerant of silence, allowing some thinking time or forcing the other party to talk.

• Spend more time on defining what the problem is.

• Have more adjournments to review the discussion and consider the way forward.

• Devote greater attention to the agenda setting before the discussion of issues begins.

The ‘conflict avoidance’ syndromeThe ‘conflict avoidance’ syndrome

• In this situation, the party do not talk about the issues underlying their conflicts or are merely paying lip-service to them.

Main symptomsMain symptoms

• No agenda setting

• Asking open questions with no follow through.

• Rapid switches to more ‘comfortable’ topics.

• Unconditional concession making

• Proposals are made as a ‘gift’.

Potential RemediesPotential Remedies

• If the conflict is genuinely not serious, no remedial actions are needed.

• If the conflict is serious, attempt to influence the motivation of parties.

• A recognition that giving in will not necessarily produce good solution.

• Use of information gathering skills to identify and agree areas where agreement could be reached, and specific ways to achieve it.

• Where necessary, use of threats and promise to obtain commitment to achieving a joint solution.

The ‘time capsule’ syndromeThe ‘time capsule’ syndrome

• This is when the negotiators do not consider the circumstances or context in which the negotiation is taking place, either in terms of the pressures on themselves or the other party, or the history of the relationship.

• They treat the situation in isolation and are surprised if the other person does not see the negotiation in the same light as themselves or introduces elements from the past encounters especially if they were considered to be (lost) battles.

Main SymptonsMain Symptons

• One negotiator treats the encounter with great deal more gravity than others, and get frustrated when the other party does not see things in similar serious light.

• One party is more highly charged emotional state.

• One party raises an issue that the other person thinks has nothing to do with the current issue.

Potential RemediesPotential Remedies

• At the beginning of each negotiation session, be clear about where the relationship stands.

• Consider the other party’s priorities and pressures before and during negotiations.

• Continuously check understanding of the other ‘s point of view.

• Try to find solution about which both parties can feel positive.

Key points for avoiding common Key points for avoiding common mistakesmistakes

• Do not interrupt other party. Talk less and listen actively.

• Ask open ended questions to build understanding.

• Use paraphrasing, humour and positive comment.

• Use adjournments to keep control over your team and discussions.

• See yourself a clear, specific and realistics gal before entering a meeting.

• Summarize regularly.

Key points for avoiding common Key points for avoiding common mistakesmistakes

• List the points of explaination, interpretation, and understanding.

• Avoid weak language, such as ‘We hope’, ‘We like’, ‘We prefer’.

• Don’t always criticize the other party. Look for common ground.

• Avoid irritators. Value loaded words like ‘unfair’ or ‘unreasonable’ tends to provoke a defensive or aggressive response.

Key points for avoiding common Key points for avoiding common mistakesmistakes

• Avoid diluting your own arguments by giving too many reasons for your proposal. It is better to have one or two good reason for all your claims than to have ten weak reasons for each claim.

• Avoid emotional outbursts, blaming, personal attacks or sarcasm.

Thank YouThank You