The Negotiations Process Verbal and NonVerbal Communications During
The Negotiations Process
Verbal and Non-Verbal Communications During Negotiation True or False Questions: 1. (T/F) ____ It is important in negotiations to avoid actions or questions which provoke anxiety. 2. (T/F) ____ You should use humor to diffuse tension when a conflict gets heated. 3. (T/F) ____ You should always keep your emotions under control when trying to deal with tense situations. 4. (T/F) ____ It is important to take notes when people talk to you. 5. (T/F) ____ It is not appropriate to leave a conflict in a “huff” and slam the door behind you.
To “Negotiate” Whether at a bargaining table with labor and management; a law office with plaintiffs and respondents; Camp David with international combatants; a hostage situation; or a mediation between an employee and supervisor, the definition is the same. • To “Negotiate” is to arrange or settle by conferring or discussing; or to use information and/or power to affect human behavior in an environment filled with multiple issues and tensions.
Another definition of Negotiation. . . • A strategic endeavor directed toward the specific ends of reaching agreements and satisfying negotiators’ needs. – Strategies are the pre-formulated game plans, objectives, and approaches that guide negotiators in reaching their goals; – Tactics are the specific ways bargainers implement these strategies. – From Strategy of Conflict by Schelling
Characteristics of Negotiations *From Essentials of Negotiations by Lewicki, Saunders • • • Two or more parties are involved. There exists a perceived conflict of interest between those parties. Parties chose to negotiate because they believe they can influence each other to get a better deal than what they would otherwise get if action was unilateral. For time being, parties prefer to work together for resolution rather than fight or seek other non-negotiated remedies. Parties expect to experience “give and take” during their negotiations as each side compromises positions. Parties expect that negotiations will allow them to manage both the “tangibles” and the “intangibles” contained in their issues.
Motivations for • Instrumental: – PRACTICAL value – Negotiation to achieve tangible or quantitative outcomes (i. e. , Wages; profits; productivity; benefits; etc. ) – Easy to measure Negotiation • Expressive: – ATTENTION value – Negotiation to achieve intangible or qualitative outcomes (i. e. , More respect; easier work; recognition; more input; etc. ) – More difficult to measure
Conflicts in Negotiations *From Essentials of Negotiations • Intrapersonal or Intrapsyhic conflict – Conflict within the individual • Interpersonal conflict – Conflict among and between individuals • Intragroup conflict – Conflict within a group • Intergroup conflict – Conflict among and between groups
Barriers to Successful Negotiations • Parties may not be open about their desired outcomes. • Parties may not be clear in their own minds about what they actually want to accomplish with their proposals. • Parties may not reveal all of the truth regarding their positions to each other. • Parties may not be willing to believe all that they hear from each other. • Parties may not have the right negotiators. • Parties may not be ready to settle.
Traditional Negotiation Relationship • Assumptions – For me to win, you must lose: therefore, we must compete – To help you is a sign of my weakness and it will hurt me: therefore, little real communication – My power comes from opposing, criticizing and beating you: therefore, parties are more rigid
Traditional Negotiation Relationship • Outcomes – One-sided victories (Win-Lose) – Split-the-difference compromise – Escalation into conflict – Costs high to both parties – Neither party fully achieves goals – May lead to decay and decline of both parties
What is the Aim of Negotiations?
Aim of Negotiation • To reach a desired and durable result by including the interests of both parties • To reach agreement efficiently and fairly using talents of all participants to solve problems • To develop a shared sense of satisfaction from working together successfully
A Good Negotiating Outcome 1. Better Than Alternatives Away From The Table. 2. Satisfies Interests Me: Well Satisfied Both: Your problem is my problem You: Acceptable 3. The Best Among Many Options Don’t leave joint gains on the table. 4. I Do Not Feel Taken – A Legitimate Outcome. 5. Efficient Process – Requires Good Communication 6. Realistic Commitments - Likely to Comply, Easy to Implement 7. Leaves Us With A Good Working Relationship
Negotiation Methods: Power, Rights, and Interest. Based
Negotiating Methods The outcome of any agreement will reflect the extent and manner in which the parties deal with the basic methods of negotiation. • Power • Rights • Interests
Negotiating Method - Power
Negotiation Method - Power The ability to direct the outcome of negotiations. • Difficult to determine who is more powerful without a destructive power contest • Perception of other party’s power often incorrect • Other party may respond irrationally
Negotiating Methods - Rights
Negotiation Method - Rights The entitlement to a negotiating outcome. • Rarely clear answer • Two rights sometimes contradictory • Advocating rights is frequently costly and time consuming • Rights assertion frequently requires intervention by a third party
Negotiating Methods Interests
Negotiation Method - Interests What is needed for a acceptable negotiating outcome. • Interests usually underlie positions • Concern needs, desires, concerns, fears, values, or matters that a party really cares about • Seeks to preserve relationships
Negotiating Methods Power Rights Interests
Conflict Resolution Methods Power/Rights/Interests/Transaction Costs Power Rights Interests Resources Required: always high: time, money, stress generally costly: time, money, stress time, talent Satisfaction with Outcome: one-sided: the winner mixed: not satisfied, to highly satisfied both interests must be satisfied or no agreement Compliance: as long as power is applied until a better opportunity presents itself very durable because interests are met Quality of Relationship: always runs risk of “one upmanship” mutual respect, valued partner,
Positional and Interest. Based Negotiations Understanding these negotiating concepts and recognizing when to use them.
Positional Negotiations Positional negotiations is a process that starts with the solution. Parties propose solutions to each other and tender offers and counter-offers with the objective of reaching a solution acceptable to all parties.
Positional Negotiations Attitudes • • Resolution options are limited We are adversaries There is only one right solution – Mine Be aggressive to win Any concession is a sign of weakness Negotiate to win all you can A win for you is a lose for me
Positional Negotiations Goals NEGOTIATE TO WIN! WIN ALL YOU CAN! FOCUS ON THE PRESENT!
Positional Negotiations Works Best • One – Time Problem • Parties have Equal Skills • Comfortable with Tactics • Desire the “Right” Decision
Shortcomings in Positional Negotiating • It tends to lock negotiators into positions they have taken • Ego becomes involved the more a party is compelled to defend a position • It diminishes the importance and value of personal relationships • It encourages reliance on power to force acceptance of a position • It discourages communication of interests, values, and needs that are essential to the search for creative solutions
Interest-Based Negotiations Interest-based negotiations starts with a needs analysis. Parties develop an understanding of their individual needs and seek to educate the other party about these needs and learn the needs of the other party with the objective of engaging in joint problem solving to meet all parties needs.
Interest Defined Interests are specific needs, conditions, or results that a party must meet for successful negotiations. Interests may be procedural, psychological, substantive, or external.
THE INTEREST ICEBERG Remedy Requested Relationships Culture Hurts/wounds Behaviors Pride Practices History LSylvester Bias
Interests PSYCHOLOGICAL • Trust PROCEDURAL • Fairness SUBSTANTIVE • Outcome EXTERNAL • Others
Interest-Based Negotiations Attitudes • • Resolution options are not limited We are problem solvers Relationships are important Creative solutions are possible There are probably several satisfactory solutions We may have shared interests Our goal is win/win
Interest-Based Negotiation Goals IDENTIFY YOUR INTERESTS! ADVOCATE FOR YOUR NEEDS! PRESERVE THE RELATIONSHIP!
Interest-Based Negotiations Solve the Problem(s) • Focus on issues, not personalities • Focus on interests, not positions • Invent options that meet both side’s most important concerns • Look to standards for what should happen. Keep in mind the standard of mutual caretaking; relationships that always go one way become very difficult • Talk about how to keep communications open as you go forward
Interest-Based Bargaining Works Best • Relationship are Important • Communications are Good • Trust is Developed • Multiple Problems
Comparison Interest-Based and Positional Negotiations Interest-Based Identify Issues Clarify Facts Find Interests Develop Options Consider Standards Rate Options/Standards Reach Consensus Positional Identify Issues Clarify Facts Develop Positions Advocate Positions Reduce Your Demands Consider Counteroffers Reach Agreement
Positional vs Interest Based Negotiating Elements In Positional Negotiating In Interest Based Negotiating Open high or low Use objective standards Trade concessions toward midpoint-compromise Choose from many options rather than splitting the difference Disguise true feelings – wear a Speak openly and clearly, mask describing your interests Discredit case and claims made by the other party Accept case made by the other party as one possible solution Use tactics to keep the other party off balance Make sure the other negotiator feels comfortable,
Creating a Stable Negotiating Environment • Engage in discovery and mutual education • Create advocacy • Listen, seek to understand • Enhance enforcement • Enhance implementation
Solve the Problem • Focus on issues, not personalities • Focus on interests, not positions • Invent options that meet both side’s most important concerns • Look to standards for what should happen. Keep in mind the standard of mutual caretaking; relationships that always go one way become very difficult • Talk about how to keep communications open as you go forward
QUESTIONS FOR EXPLORING INTERESTS • What problem are we trying to solve? • Are there other problems? • What do you want to have happen? • What concerns do you have? • What is the best case scenario for you? • What do you want to accomplish? • What would have to happen for you to feel satisfied? • What will it take for you to work together? • Is there anything else important to you?
Management of Negotiations Expectations • Reality • Standards • BATNA/WATNA
Alternative Outcomes to Reaching a Negotiated Agreement BATNA WATNA Best Alternative to a Negotiated Agreement Worst Alternative to a Negotiated Agreement
BATNA The least damaging outcome anticipated if no agreement is reach.
BATNA Advantages • Forces negotiators to realistically evaluate their negotiating strength • Prevents blind negotiations • Protects from accepting terms that are too unfavorable
WATNA The most damaging outcome to anticipate if no agreement is reached.
WATNA Advantages • Forces negotiators to realistically evaluate their options • Prevents power negotiations • Protects from rejecting terms that are in your interest to accept
Management of Negotiations Closure • Reaching Agreement • Drafting the Agreement • Signing the Agreement
Structural Complexities of Multi-Party Negotiations
A Simple Two Party Negotiation Party B Party A In any given negotiation session, many types of negotiation occur between interdependent individual groups. For simplicity’s sake, let us illustrate this point by examining a two-sided dispute. At the negotiating table are parties A & B.
Horizontal Bargaining Party B Party A
Horizontal Bargaining • • Lead negotiator Roles Behavior Techniques Procedures Interests Closure
Vertical Bargaining Constituency Bargaining Party B Party A Organizational Bargaining
Vertical Bargaining • Constituency – Team member represents a special group – Constituency can assist in clarify interests – Need to keep informed • Organizational – Team is delegated negotiating authority – Understand interests of delegating authority – Need to keep informed
Unilateral Bargaining – Vested Interest Party B Party A Unilateral vested-interest bargaining occurs when one or more members of a team covertly approach members of another team.
Unilateral Bargaining – Conciliatory Party B Party A Unilateral conciliatory bargaining occurs when one or more parties informally, and possibly privately, explore alternatives for settlements with members of another team. Those overtures are conducted with the full knowledge of the team in the hope that the information shared will lead to fruitful bargaining for all sides.
Unilateral Bargaining • Conciliatory Interest – – Authorized by the team or lead negotiator Used to clarify data or identify mutual needs Requires accountability Constructive • Vested Interest – – Unauthorized covert meeting Conducted for the benefit of the team member Destroys team synergy Destructive
Bilateral Bargaining Party B ? ! Party A Bilateral bargaining occurs between the teams and is generally conducted by a spokesperson or by authorized team members. In this type of negotiation, the history of the dispute is reviewed, issues and interests are identified, alternatives are generated and discussed and agreements are reached.
External Factors Press Influential Individual Party B Party A Demonstrations Environmental Group
Collective Participation Party B Party A
Exercise Modifications • The company is Belgrade Baby Foods • The crime is potentially a felony Each table should: • 1) identify their own interests • 2) Identify the other sides interests • 3) Create options to satisfy both interests • 4) Post all on a flip chart and be prepared to report out to the other side
Influences on Negotiation
What are the cultural influences in negotiations to be aware of when dealing with representatives from: • • France Germany Italy UK
• • • Goals (contract or relationship) Attitudes towards negotiation process (win-win, win-lose) Personal styles (formal vs. informal) Styles of communication (direct/indirect) Time sensitivity (high or low) Emotionalism (high or low) Agreement form (specific or general) Agreement building process (bottom up or top down) Negotiating team organization (unilateral or consensus) Risk Taking (higher or lower)
France • • • Less team oriented – negotiate individual Debate is stimulating Well prepared Parties can make decisions Strategies include logical proposals, arguments and counter proposals • Preference for discussing philosophy • Important meetings treated very formally
Germany • • Well prepared, serious, organized Tough positional stances Least affected by interpersonal issues/relations Negotiations are formal and will follow agenda Relationships should not intrude on tasks Low risk takers Conflict viewed as inadequate preparation Emotional outbursts and frequent interruptions not appreciated • Decision making takes time
British • Value bottom line and short term results • Open about opinion but indirect in its expression, emphasizing courtesy and tact and formality. • Don’t show true emotions – often reserved and understated • Risk averse and cautious, favoring security and status quo
Italy • • Personal relationships important Need to feel they can get along with counterparts Confident, shrewd and competent Initial negotiations can include lots of casual talks and positioning tactics • Takes a long time to get to point • Multiple conversations at once and interruptions common • Presentation must be organized, clear and polished with dramatic effect for audience
What is the Serbian Approach to Negotiation? • • • Goals (contract or relationship) Attitudes towards negotiation process (win-win, win-lose) Personal styles (formal vs. informal) Styles of communication (direct/indirect) Time sensitivity (high or low) Emotionalism (high or low) Agreement form (specific or general) Agreement building process (bottom up or top down) Negotiating team organization (unilateral or consensus) Risk Taking (higher or lower)
Parameters of contract • Sales and marketing training for sales force of brake manufacture • General sales training, not industry specific • Focus on concepts, leave specific knowledge to participants
Feedback on Training • Not specific to industry!! • Alienated females with inappropriate language • Task Force Assignment had no females • Too lecture oriented
MANAGEMENT OF NEGOTIATIONS Interest-Based Negotiations
Management of Negotiations Seven Factors to Consider • • Preparation Planning Administrative Communications Techniques Expectations Closure
Management of Negotiations Preparation • Identify your interests • Anticipate other party’s interest • Find objective standards • Generate possible options
Management of Negotiations Planning • Set goals for initial contact • Collect and analyze facts • Design a strategy • Negotiating Team Representation
Management of Negotiations Administrative • • Time Location Participants Room Arrangement Refreshments Support Roles External elements
Management of Negotiations Communications • Behavior • Verbal and non-verbal • Trust
Levels of Trust • Ability to Perform • Personal Conduct • Compliance with Agreements
Building Trust • • • Listen Display a concern for interests Demonstrate empathy Keep confidences Fulfill promises Be respectful
How easy is it to build trust in negotiations?
Destroying Trust in Negotiations • • • Act inattentive Ignore interests Breach a confidence Break a promise Embarrass the other party Spring a surprise
How easy is it to destroy trust in negotiations?
Rebuilding Trust • Accept responsibility for actions • Acknowledge your actions • Make restitution or repairs • Be transparent in future
Management of Negotiations Problem-Solving Techniques • Brainstorming • Consensus-Building • Action Planning
Brainstorming A technique used to generate as many original ideas as possible for solving a problem or an impasse without judging them. It is based on theory that the more people working on the problem the more ideas that will be generated.
Rules for Brainstorming • • • Define the problem Do not criticize an idea Be imaginative Build on other’s ideas Aim for quantity Record all ideas
Procedures for Brainstorming • Create a relaxed comfortable environment • Set seating arrangement • Seek full participation • Record ideas in full view of all
Consensus-Building A technique that reaches an agreement by identifying the interests of concerned parties and then builds a solution to maximize meeting those interests. The terms of the agreement do not have to be the first choice of all parties, but rather a solution that everyone can accept.
Why use Consensus-Building? • To benefit from each person’s unique knowledge, logic, and creativity. • To reach greater commitment and support of the agreement and its implementation.
Procedures for Consensus-Building • • • Generate option Discuss option Explain consensus Describe reasons for not acceptable Consider means to make acceptable Seek to build consensus
Action Planning A technique that provides structure and a framework for reaching a solution to a problem.
Action Planning • • Identify the real problem Redefine the problem Determine the causes of the problem Discuss consequences of not resolving it • Brainstorm possible solutions • Use consensus to select a solution • Record the agreement
Management of Negotiations Expectations • Reality Checking • Objective Standards • BATNA/WATNA
Reality Checking • What is my real interest in the outcome • Do I need to maintain this relationship • Are there external interests here • What are the consequences of not reaching an agreement
Objective Standards Tangible factors for comparing and evaluating options. These may include laws, court decisions, regulations, industry guides, trade practice, past performance, expert evaluations, or similar transactions.
Alternative Outcomes to Reaching a Negotiated Agreement BATNA WATNA Best Alternative to a Negotiated Agreement Worst Alternative to a Negotiated Agreement
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