Реферат: How to negotiate effectively

1. What is negotiation

Negotiation is an essentialpart of the every-day business life. It can take place at any time and in anyplace. Negotiation is a kind of meeting, but contrary to the latter it may beheld in some unexpected and uncomfortable place such as the street or on thestairs.

There are severaldefinitions of negotiation. It is said to be “the process for resolvingconflict between two or more parties whereby both or all modify their demandsto achieve a mutually acceptable compromise”. Thus, it is “the process of changingboth parties’ views of their ideal outcome into an attainable outcome”.

The need of negotiationarises when we are not fully in control of events. Negotiations take place tohandle mutual differences or conflict of:

interests(wages, hours, workconditions, prices: seller vs buyer)

rights(differentinterpretations of an agreement)

The aim of a negotiation isto come to an agreement which is acceptable to both sides, and to preserve theoverall relationships. While specific issues are to be negotiated, commoninterest are yet still to be maintained. Negotiations do not mean “war”.Negotiators can still be friends and partners.

2. The negotiation continuum


The situations ofnegotiation can be shown diagrammatically in terms of ideals and limits.

/>/>                                           Ideal                             Limit

/>/>/>                            HIM       

                                                                           Bargaining area


                                                                              Limit                                     Ideal         YOU

The limit may be the limitof negotiator’s authority, such as a minimum (e.g. price) acceptable. If thereis overlap it is possible to settle. The final position within the bargainingarea, where settlement takes place, depends on the negotiators’ relativestrength and skill.

No overlap

The aim of the negotiator isto achieve a result, i.e. to find a solution, within the bargaining area. However,it is possible that both parties set limits which do not provide overlap. Inthis case the negotiators have to move their limits, otherwise the negotiationwill be broken down.

                              Ideal                                Limit


                       HIM                                                       No deal



                                                                                                 Limit                                       Ideal

Too much overlap

The opposite case is alsopossible. When one is careless and settles for less than he could. In this casethe limit of the opposite side should be found and the ideal should be revised.

                                     Ideal                               Limit

/>/>/>                           HIM

/>/>/>/>/>/>                                                                                                              YOU

                                                  Limit             Ideal           Revised Ideal

3. The approach

There are four main stagesof negotiation:

Preparing objectives,information, strategy

Discussing (argue) andsignalling willingness to move

Propose and bargain

Close and agree

While preparing to thenegotiation it is important not only to prepare supporting arguments but alsoto define objectives. Objectives should be realistic and attainable and havecertain priorities. It is also necessary to investigate the opponent’s plansand priorities, which can be rather difficult.

The objectives should beclassified basically as follows:

LikeIdeal but leastimportant

Intend Achievable, a rangeof possibilities

Must The real limit

                                    Ideal                                                   Limit

/>/>/>                                                                                                 AREAOF NO DEAL



/>                                                  Intend

/>/>                                                                                    Must

The general strategy fornegotiation is to have a negotiating team of three people, who will also beinvolved in the preparation.

LeaderThe person who will dothe talking and conduct the negotiations

SummariserThe person whowill ask questions and summarise for control

ObserverThe person notinvolved in the actual negotiations, whose role is  to watch, listen and record

80 % of the negotiating timeis spent arguing. If it equals 100 % the negotiation will break down. There aretwo kinds of arguing:

Reasonable andconstructiveDebates, discussions

Unreasonable anddestructiveEmotional quarrels

The opponent may try todivert you by escaping into destructive behaviour. In this case, your behaviourshould be not to interrupt, but to listen and control your feelings. Even ifthe battle is won, the war can be lost.

A negotiator should beconstructive in arguments and try to get information by asking open questionsor even leading questions. One thing should be tackled at a time and theopponent should be made justify his case item by item.

It is important to benon-committal and to state only ideals at first. Later, the information aboutthe negotiator’s position can be given, and later alternative proposals can bemade. Sometimes it is necessary to challenge the opponent, so that hedemonstrates his strengths.

Negotiation means movement.It may be that both parties move on one issue. It may be that each moves ondifferent issue. The motive forces are twofold:

SanctionsThe penalty of notagreeing

IncentivesThe benefits ofagreeing. 

In both cases, the partiesseek to protect their self-interests. They will show willingness to move bysending signals.

To signal is not to showweakness. But if both parties wait for the other to signal, the result will bedeadlock.

The opponent’s signals willshow his willingness to move. So one should listen, recognise his signals andinterpret them, looking for the qualified words which are evidence ofwillingness to move.

Another very important pointof negotiations is proposing and bargaining. Proposals should be realistic inorder not to cause argument and deadlock. The language of the proposal signalsone’s firmness. Weak language such as “we hope…, we like…, we prefer…” shouldbe avoided. Instead, a phrase “we propose…” is appropriate.

The final step in anegotiation is closing and agreeing. There are two aspects to it:

When to close

How to close

The first is the mostdifficult moment to recognise. There is a balance between:

Closing too earlyMoreconcessions from the opponent could have been


Closing too lateTheopponents squeezed excessive concessions.

The aim of closing is to getthe opposition to stop bargaining and to make an agreement. The final thing todo is to write down the agreement and agree what is written down. It isnecessary to do this before leaving the negotiating table.

4. Characteristics of an effective negotiator

What characteristics shouldone have to be an effective negotiator. The first and the most importantcharacteristics, from the standpoint of many executives and managers of largecorporations, is preparation and planning skills.

The other very importantcharacteristics are:

Knowledge of subject matterbeing negotiated

Ability to think clearly andrapidly under pressure and uncertainty

Ability to express thoughtsverbally

Listening skills

Judgement and generalintelligence


Ability to persuade others



5. Conclusion

In spite of the existence ofnegotiating theories, it is frequently difficult to apply theoretical andconceptual knowledge in a practical situation. In order to be a goodnegotiator, one should have negotiation skills as well as a theoreticalknowledge. But without a practical experience it is hard to negotiateeffectively.

Interpersonal skills arevery important in the negotiation, but what can help a negotiating party whilethinking what to do is not an elaborated theory, but rather is it a simpleanalysis and intuition.


Для подготовки данной работы былииспользованы материалы с сайта www.bigmir.net/


Raiffa, Howard. 1982. Theart and science of negotiation. Harvard University Press. Pages 119-133.

Murcott, Owen. 1991. IBSManagement Training. Hanzehogeschool. Groningen.

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