Negotiation Skills Basics
Negotiation Skills Basics
Negotiation Skills Basics
Objective
• Explain What is Negotiation
• Explain the Basic Principles of Negotiation
• Describe the Benefits of Negotiation
• Explain the Types of Negotiation Strategies
• Explain the Stages of the Negotiation Process
• Describe the Concepts of a Win-Win Negotiation
• Explain the Various Styles of Negotiation
• Explain What is BATNA
• Describe Strategies for Developing Negotiation Skills
• Explain the Types of Third Party
• Explain the PROBE Technique for Negotiating
• Describe the Negotiations in Organizations
• List the Issues in Negotiation
• List the Characteristics of a Good Negotiator
• List the Tips for Effective Negotiation
Introduction
Maxwell
Telecommunications, a
leading Telecom
Service company
recently came to
Globus to have new
SAP based database
software to be
developed for them.
Introduction
Peter carefully
reviewed and analyzed
Maxwell’s
requirements and
came up with a Project
Plan.
Introduction
Let us learn
a bo u t
‘Negotiatio
n Skills’ in
detail.
Objective
• Explain What is Negotiation
• Explain the Basic Principles of Negotiation
• Describe the Benefits of Negotiation
• Explain the Types of Negotiation Strategies
• Explain the Stages of the Negotiation Process
• Describe the Concepts of a Win-Win Negotiation
• Explain the Various Styles of Negotiation
• Explain What is BATNA
• Describe Strategies for Developing Negotiation Skills
• Explain the Types of Third Party
• Explain the PROBE Technique for Negotiating
• Describe the Negotiations in Organizations
• List the Issues in Negotiation
• List the Characteristics of a Good Negotiator
• List the Tips for Effective Negotiation
What is Negotiation?
ly s a me.
e e x act i v id u al
p le a r
e r y i n d
ff e r e nt
o pe o n d ev in d i
No t w e a c h a
e r e n t l y
w a n t s,
fore , e s di ff e ed s ,
Th e re
b e h a v
e re n t n
ff e r e n ce
in ks and h a s diff b a s ic di
th
o n s and I t is t his e to me.
situ a ti s . r i s e-to -ti
a n d aim a t g ives tim
s h m
belief n people t conflict fro
e
betwe ement and i t h e ach
disag
re o -e xist w ell as
u t u ally c ional as w se
r , t o m o fess t th e
o v e , p r t h a
More t personal important ould be
a is h
other s level, it eements s
u s in es d i sa gr
b s an d
i c t
confl d.
e
resolv
Need for Negotiation
g u m ent
d to ar
a y le a o n e or
ic ts m lt i n
co n fl y r es u p p y.
cau s e hm a un h a
is b e w h ic e li n g
This n t m ent a rti e s fe
es e p lved
and r e involved o ne i n vo
f t h v e r y ent
all o e lp s e ee m
tiation h nd of agr o m eet
, ne g o gro u n da ls
n c e o n t s a
He
k a comm greemen
to see n the disa ectives.
e bj
betwe dividual o
in
their
Objective
• Explain What is Negotiation
• Explain the Basic Principles of Negotiation
• Describe the Benefits of Negotiation
• Explain the Types of Negotiation Strategies
• Explain the Stages of the Negotiation Process
• Describe the Concepts of a Win-Win Negotiation
• Explain the Various Styles of Negotiation
• Explain What is BATNA
• Describe Strategies for Developing Negotiation Skills
• Explain the Types of Third Party
• Explain the PROBE Technique for Negotiating
• Describe the Negotiations in Organizations
• List the Issues in Negotiation
• List the Characteristics of a Good Negotiator
• List the Tips for Effective Negotiation
Basic Principles of Negotiation
There are a few common basic principles that apply to all types of negotiations
and in all situations. Some of the basic principles of negotiation are as follows:
ti a ti o n , t he The initiatio
There are a In any ne
g o n of any
lways at s h a re at negotiation
least ‘two p r ti e s
arties’ two pa m m on results due
always
involved an o m e c o to different
y least s e r in t h e o p i n i o n s an
s t , e i t h d objective
negotiation
process. intere r or in of the two p s
c t m a tt e arties whic
subje hinders the h
e n e g o ti ating outcome in
th b rings general.
x t t h a t
conte
o th t h e parties
b
in a
together
n.
negotiatio
Basic Principles of Negotiation
There are a few common basic principles that apply to all types of negotiations
and in all situations. Some of the basic principles of negotiation are as follows:
It is a gener
al belief, th d e v e r y party
at Each a n
parties do c oa
negotiation
o n s i d er enters int i th a
as a better a ti o n w Each an
way of tryin negoti a t t h ey d every
f t h e party
their differe
g to solve firm belie nce of
nters in
to a neg
nces. v e a c h a w i th otiation
d o ha e ot h e r a fi r m belie
a d in g th th e y f that
persu i r
fy thei initia
s h a l l maintai
to m o d n their
party l stance
rig in a l s tance. persuad and
o e
to chan the other part
ge. y
Basic Principles of Negotiation
There are a few common basic principles that apply to all types of negotiations
and in all situations. Some of the basic principles of negotiation are as follows:
e
Distributiv
n
Negotiatio
Integrati
ve
Negotia
tion
i lls t hat
u c i al sk o r:
s t c r ti at
t h e mo a t n ego
n g are e a gre
i
llow to becom e
e fo
Th l p y ou fl ex ibl
e
can h open and ical
e th
• B ways be e thize
A l m p a l s k i lls
•
l w ays e od socia
• A velop go ntuitions
e i
• D llow your
o
• F assertive
e
• B
Distributive vs. Integrative Negotiation
The given table shows the comparison between Distributive Negotiation and
Integrative Negotiation.
Distributive Negotiation Integrative Negotiation
It involves discussion of only one issue at a It involves discussion of several issues at a
time. time.
Involved parties have a ‘Win-Lose’ attitude Involved parties have a ‘Win-Win’ attitude
towards reaching the negotiation outcome. towards reaching the negotiation outcome.
Each party wants to use the negotiation to Each party wants to use the negotiation to
maximize its own share of ‘fixed pie’. ‘expand its own share of the pie’ by creating
and claiming value.
It is an approach usually used in one-time It is an approach usually used in a continuing
relationship between two people. relationship between two people.
The involved parties keep their respective The involved parties share their respective
interests hidden. interests with the other party.
Each party expresses a strong position for Each party expresses and try to come up with
each issue. as many options as possible per issue to
maximize mutual gains.
Distributive vs. Integrative Negotiation
The given table shows the comparison between Distributive Negotiation and
Integrative Negotiation.
Distributive Negotiation Integrative Negotiation
The involved parties keep information hidden. The involved parties share information with
each other and try to get to the root cause of
the ‘why’ of the existence of the issue.
The involved parties are adversaries. The involved parties are joint problem-
solvers.
The aim of such negotiation is ‘winning’. The aim of such negotiation is ‘making a wise
decision’.
The main focus of involved parties is on their The main focus of involved parties is on their
‘stance or position’. ‘goals and objectives’.
The involved parties use pressure to get what The involved parties do not use pressure but
they want. strive to get what they want through
principles.
MCQ
Click on the
radio button
to select the
correct
answer!
MCQ
Q.
GooDistributive Negotiation is also
d ! That'sknown
commonly Rightas
! ___________.
Correct Ans
wer:
Distributive
Negotiation
known as ‘P is also comm
ositional Ne on l y
gotiation’.
l ic k he re to
C
!
continue
MCQ
Q.
ThaDistributive
t's Not QuNegotiation
ite Rias
is also
commonly known gh___________.
t!
Correct Ans
wer:
Distributive
Negotiation
known as ‘P is also comm
ositional Ne o nly
gotiation’.
l ic k he re to
C
!
continue
Objective
• Explain What is Negotiation
• Explain the Basic Principles of Negotiation
• Describe the Benefits of Negotiation
• Explain the Types of Negotiation Strategies
• Explain the Stages of the Negotiation Process
• Describe the Concepts of a Win-Win Negotiation
• Explain the Various Styles of Negotiation
• Explain What is BATNA
• Describe Strategies for Developing Negotiation Skills
• Explain the Types of Third Party
• Explain the PROBE Technique for Negotiating
• Describe the Negotiations in Organizations
• List the Issues in Negotiation
• List the Characteristics of a Good Negotiator
• List the Tips for Effective Negotiation
Stages of the Negotiation Process
The following are the stages of any negotiation process:
Meeting:
Inquiry:
Bargaining:
Closure:
Acceptance:
Stage 4:
Closure
Stage 3:
To negotiate well with the client, the first
Bargaining
thing that Peter should do is to prepare
well for the meeting. Peter could go
Stage 2: through the Project Plans of similar
Inquiry projects that Globus had handled in the
past, talk to and seek guidance from his
Stage 1: superiors and put all the data and
Meeting information that he gets related to the
project at one place.
Real Life Example
Stage 1: Meeting
Stage 5:
Acceptance
Stage 4:
Closure
Stage 3:
To negotiate well with the client, the first
Bargaining
thing that Peter should do is to prepare
Peter should also
makmeeting.
well for the e a list ofPeter
all thcould go
Stage 2: he has to clear w e queries that
throughitthe
h thProject
e clientPlans
, thingof similar
Inquiry agree to and cann s that he can
projects othat
t agGlobus
ree to whadith thandled
he clientinetthe
past, talk to and seek guidance from his c.
Also, at the meeti
Stage 1: superiorsngand
Peteput
r shall
outhe data and
ld co
client as a cool, c me across to the
Meeting onfidethat
information nt and profession to the
he gets related
al person.
project at one place.
Real Life Example
Stage 2: Inquiry
Stage 5:
Acceptance
Stage 4:
Closure
Stage 3:
Bargaining
Stage 2:
Inquiry
During the inquiry stage, Peter should
exchange information with the client and
Stage 1: discuss their concerns, scope of work,
Meeting deadlines, future enhancements etc.
Real Life Example
Stage 2: Inquiry
Stage 5:
Acceptance
Stage 4:
Closure
Stage 3:
Bargaining
Stage 4:
Closure
Stage 3:
Bargaining
Stage 2:
Inquiry
At this stage, Peter should now agree to
terms that are completely acceptable and
Stage 1: offer options and tradeoffs for things that
Meeting are unacceptable as is stated by the client.
Real Life Example
Stage 3: Bargaining
Stage 5:
Acceptance
Stage 4:
Closure
Stage 3:
Bargaining
Stage 4:
Closure
Stage 3:
Bargaining
Bargaining
Stage 2:
Inquiry
At this stage, it is important that both the
client and Peter restate their positions and
Stage 1: confirm their tradeoffs they are willing to
Meeting negotiate.
Real Life Example
Stage 4: Closure
Stage 5:
Acceptance
Stage 4:
Closure
Stage 3:
Bargaining
Bargaining
So, agreement sh
ould be achieved
deadlines, curren on the agreed
Stage 2: t scope, terms re
enhancements et garding future
Inquiry c. It should be ag
the partieAt this
s th stage, it is important reethat
d upoboth
n bythe
bo t h
at th e discussed and a
terms wouclient
ld noand grepositions
ed upon and
w bePeter restate their
drafted into a leg
Stage 1: contract bconfirm
etween the twtradeoffs
their a l an
they are willing
d bindto
ing
Meeting negotiate. o p a r ti es .
Real Life Example
Stage 5: Acceptance
Stage 5:
Acceptance
Stage 4:
Closure
Stage 3:
Bargaining
Stage 2:
Inquiry At this final stage of the negotiation
process, Peter should make sure that both
the parties agree to signoff the deal and
Stage 1:
Meeting reach an agreement on the terms of the
Project.
Negotiation Outcomes
The given image shows the various options of possible outcomes with respect
to the parties involved in a negotiation.
YOU
WIN LOSE
I Win,
WIN
We Both Win
You Lose
ME
I Lose, We Both
LOSE
Pause for
reflection
Agree on
factual Clarify your
information objectives in
the beginning
Pause for
Reflection
Pause for Reflection
Pause for
reflection Clarify your objectives in the
beginning
Pause for
Agree on factual information reflection
Pause for
reflection
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