NEGOTIATION

Preparing for a successful negotiation

Depending on the scale of the disagreement,
some preparation may be appropriate for
conducting a successful negotiation.
For small disagreements, excessive
preparation can be counter-productive
because it takes time that is better used
elsewhere. It can also be seen as
manipulative because, just as it strengthens
your position, it can weaken the other
person's.

 However, if you need to resolve a

major disagreement, then make sure
you prepare thoroughly. Think
through the following points before
you start negotiating:

A procedure for negotiation

Prepare by studying the background
information.
Present the case by each side.
Signal the position taken.
Propose specific propositions for
consideration from all points of view.
Package a draft agreement.
Bargain for possible concessions.
Close discussion and bargaining.
Agree to the deal.

 Goals: what do you want to get out of the

negotiation? What do you think the other
person wants?
Trades: What do you and the other person
have that you can trade? What do you each
have that the other wants? What are you each
comfortable giving away?
Alternatives: if you don't reach agreement
with the other person, what alternatives do you
have? Are these good or bad? How much does
it matter if you do not reach agreement? Does
failure to reach an agreement cut you out of
future opportunities? And what alternatives
might the other person have?

 Relationships: what is the history of the

relationship? Could or should this history impact
the negotiation? Will there be any hidden issues
that may influence the negotiation? How will you
handle these?
Expected outcomes: what outcome will people
be expecting from this negotiation? What has the
outcome been in the past, and what precedents
have been set?
The consequences: what are the consequences
for you of winning or losing this negotiation? What
are the consequences for the other person?

 Power: who has what power in the

relationship? Who controls
resources? Who stands to lose the
most if agreement isn't reached?
What power does the other person
have to deliver what you hope for?
Possible solutions: based on all of
the considerations, what possible
compromises might there be?

Causes of Failure

Lack of system
No Clear objectives
Unrealistic position
Complaints in place of proposals
Emotional involvement
Indecision position
Rigidity

Questions
Please complete the self assessment
test.

You manage a small engineering plant and one of

your large customers owes you for three deliveries.
You feel you are getting the run-around from their
accounts department and another delivery of parts
is due next week. Do you:
a) Probably not too effective- you also have the cost
of storage.
b) Nothing has changed.
c) People who use the articles will then put
pressure on accounts for you.

A small supplier of valves has delivered a batch

which has failed your quality control tests and you
put them in your own workshop for corrective
machining. Do you:
a) Probably the best outcome, if they agree.
b) Legally you are on sticky ground, unless it is
written in the contract.
c) -Leaves you with the extra costs.
d) Not a good idea.

The supplier demands payment in full. He argues

that your machining costs are excessive and that
allegedly rejected work should be returned for their
inspection and replacement. Do you:
a) prolongs the argument.
b) Fine if they are not a sole supplier.
c) They may try to fob you off with sub-standard
work again.

You are in the midst of a very tough labour negotiation and

you believe that the union does not fully appreciate the
seriousness of your commercial plight. The local TV
reporter asks if you have a comment on the union press
conference where the official spokesperson declared that
you are trying to bluff them with your poverty but in
reality you would pay the 12 rise or take a strike. Do
you:
a) Always the best option.
b) You may be asked to back up your comments.
c) Poor response you're not trained then.
d) This may become policy that you always have to check
with the team.

The union has demanded that long-service holidays

are awarded to employees with 30 years service or
more. Your personnel department tells you that this
will affect 5 employees out of 3,000 over the next
three years. Do you:
a) Ill give you that if you give me this.
b) This just puts it off.
c) Add peanuts, get little things in return.