Реферат: How to negotiate effectively

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<span Arial Black",«sans-serif»; mso-ansi-language:EN-US">HOW TO NEGOTIATE EFFECTIVELY

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1.What is negotiation

Negotiation is an essential part of theevery-day business life. It can take place at any time and in any place.Negotiation is a kind of meeting, but contrary to the latter it may be held insome unexpected and uncomfortable place such as the street or on the stairs.

There are several definitions of negotiation.It is said to be “the process for resolving conflict between two or moreparties whereby both or all modify their demands to achieve a mutuallyacceptable compromise”. Thus, it is “the process of changing both parties’views of their ideal outcome into an attainable outcome”.

The need of negotiation arises when we are notfully in control of events. Negotiations take place to handle mutualdifferences or conflict of:

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interests    (wages, hours, work conditions, prices:seller vs buyer)

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rights                     (different interpretationsof an agreement)

The aim of a negotiation is to come to anagreement which is acceptable to both sides, and to preserve the overallrelationships. While specific issues are to be negotiated, common interest areyet still to be maintained. Negotiations do not mean “war”. Negotiators canstill be friends and partners.

2.The negotiation continuum

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Overlap

The situations of negotiation can be showndiagrammatically in terms of ideals and limits.

<img src="/cache/referats/9852/image001.gif" v:shapes="_x0000_s2071"><img src="/cache/referats/9852/image002.gif" v:shapes="_x0000_s2068">                                            Ideal                             Limit

<img src="/cache/referats/9852/image003.gif" v:shapes="_x0000_s2062"><img src="/cache/referats/9852/image003.gif" v:shapes="_x0000_s2056"><img src="/cache/referats/9852/image004.gif" v:shapes="_x0000_s2050">                            HIM       

                                                                           Bargaining area

<img src="/cache/referats/9852/image005.gif" v:shapes="_x0000_s2053 _x0000_s2059 _x0000_s2065 _x0000_s2073 _x0000_s2075">


                                                                             Limit                                     Ideal         YOU

The limit may be the limit of negotiator’sauthority, such as a minimum (e.g. price) acceptable. If there is overlap it ispossible to settle. The final position within the bargaining area, wheresettlement takes place, depends on the negotiators’ relative strength andskill.

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No overlap

The aim of the negotiator is to achieve aresult, i.e. to find a solution, within the bargaining area. However, it ispossible that both parties set limits which do not provide overlap. In thiscase the negotiators have to move their limits, otherwise the negotiation willbe broken down.

                               Ideal                                Limit

<img src="/cache/referats/9852/image006.gif" v:shapes="_x0000_s2051 _x0000_s2057 _x0000_s2060">


                        HIM                                                      No deal

<img src="/cache/referats/9852/image007.gif" v:shapes="_x0000_s2054 _x0000_s2063 _x0000_s2066">


                                                                                                                                                           YOU

                                                                                                 Limit                                       Ideal

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Too much overlap

The opposite case is also possible. When one is careless and settlesfor less than he could. In this case the limit of the opposite side should befound and the ideal should be revised.

                                     Ideal                              Limit

<img src="/cache/referats/9852/image008.gif" v:shapes="_x0000_s2076"><img src="/cache/referats/9852/image004.gif" v:shapes="_x0000_s2069"><img src="/cache/referats/9852/image008.gif" v:shapes="_x0000_s2074">                           HIM

<img src="/cache/referats/9852/image009.gif" v:shapes="_x0000_s2081"><img src="/cache/referats/9852/image008.gif" v:shapes="_x0000_s2080"><img src="/cache/referats/9852/image010.gif" v:shapes="_x0000_s2079"><img src="/cache/referats/9852/image010.gif" v:shapes="_x0000_s2078"><img src="/cache/referats/9852/image008.gif" v:shapes="_x0000_s2077"><img src="/cache/referats/9852/image011.gif" v:shapes="_x0000_s2072">                                                                                                              YOU

                                                  Limit             Ideal           Revised Ideal

3. The approach

There are four main stages of negotiation:

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Preparingobjectives, information, strategy

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Discussing(argue) and signalling willingness to move

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Propose andbargain

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Close and agree

While preparing to the negotiation it is important not only to preparesupporting arguments but also to define objectives. Objectives should berealistic and attainable and have certain priorities. It is also necessary toinvestigate the opponent’s plans and priorities, which can be rather difficult.

The objectives should be classified basically as follows:

Like                Ideal butleast important

Intend            Achievable, arange of possibilities

Must               The real limit

                                    Ideal                                                  Limit

<img src="/cache/referats/9852/image010.gif" v:shapes="_x0000_s2070"><img src="/cache/referats/9852/image012.gif" v:shapes="_x0000_s2064"><img src="/cache/referats/9852/image013.gif" v:shapes="_x0000_s2052">                                                                                                AREA OF NO DEAL

                                     Like

<img src="/cache/referats/9852/image014.gif" v:shapes="_x0000_s2061">                                                  

<img src="/cache/referats/9852/image015.gif" v:shapes="_x0000_s2058">                                                  Intend

<img src="/cache/referats/9852/image001.gif" v:shapes="_x0000_s2067"><img src="/cache/referats/9852/image016.gif" v:shapes="_x0000_s2055">                                                                                    Must

The general strategy for negotiation is to have a negotiating team ofthree people, who will also be involved in the preparation.

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Leader                  The person who will do thetalking and conduct the negotiations

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Summariser        The person who will ask questions andsummarise for control

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Observer              The person not involved in theactual negotiations, whose role is

to watch, listenand record

80 % of the negotiating time is spent arguing. If it equals 100 % thenegotiation will break down. There are two kinds of arguing:

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Reasonable andconstructive             Debates,discussions

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Unreasonable anddestructive                       Emotionalquarrels

The opponent may try to divert you by escaping into destructivebehaviour. In this case, your behaviour should be not to interrupt, but tolisten and control your feelings. Even if the battle is won, the war can belost.

A negotiator should be constructive in arguments and try to getinformation by asking open questions or even leading questions. One thingshould be tackled at a time and the opponent should be made justify his caseitem by item.

It is important to be non-committal and to state only ideals at first.Later, the information about the negotiator’s position can be given, and lateralternative proposals can be made. Sometimes it is necessary to challenge theopponent, so that he demonstrates his strengths.

Negotiation means movement. It may be that both parties move on oneissue. It may be that each moves on different issue. The motive forces aretwofold:

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Sanctions            The penalty of not agreeing

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Incentives                        The benefits ofagreeing. 

In both cases, the parties seek to protect their self-interests. Theywill show willingness to move by sending signals.

To signal is not to show weakness. But if both parties wait for theother to signal, the result will be deadlock.

The opponent’s signals will show his willingness to move. So one shouldlisten, recognise his signals and interpret them, looking for the qualifiedwords which are evidence of willingness to move.

Another very important point of negotiations is proposing andbargaining. Proposals should be realistic in order not to cause argument anddeadlock. The language of the proposal signals one’s firmness. Weak languagesuch as “we hope…, we like…, we prefer…” should be avoided. Instead, a phrase“we propose…” is appropriate.

The final step in a negotiation is closing and agreeing. There are twoaspects to it:

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When to close

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How to close

The first is the most difficult moment to recognise. There is a balancebetween:

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Closing too early                        More concessions fromthe opponent could have been

       squeezed

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Closing too late              The opponents squeezed excessiveconcessions.

The aim of closing is to get the opposition tostop bargaining and to make an agreement. The final thing to do is to writedown the agreement and agree what is written down. It is necessary to do thisbefore leaving the negotiating table.

 

4. Characteristicsof an effective negotiator

What characteristics should one have to be an effective negotiator. Thefirst and the most important characteristics, from the standpoint of manyexecutives and managers of large corporations, is preparation and planning skills.

The other very important characteristics are:

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Knowledge ofsubject matter being negotiated

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Ability to thinkclearly and rapidly under pressure and uncertainty

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Ability toexpress thoughts verbally

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Listening skills

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Judgement andgeneral intelligence

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Integrity

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Ability topersuade others

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Patience

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Decisiveness

5. Conclusion

In spite of the existence of negotiating theories,it is frequently difficult to apply theoretical and conceptual knowledge in apractical situation. In order to be a good negotiator, one should havenegotiation skills as well as a theoretical knowledge. But without a practicalexperience it is hard to negotiate effectively.

Interpersonal skills are very important in the negotiation, but whatcan help a negotiating party while thinking what to do is not an elaboratedtheory, but rather is it a simple analysis and intuition.

Bibliography

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Raiffa, Howard. 1982. The art and science ofnegotiation. Harvard University Press. Pages 119-133.

2.<span Times New Roman""> 

Murcott, Owen. 1991. IBS Management Training. Hanzehogeschool.Groningen.
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