Print SV chapter 1 overview of negotiation

BUSINESS NEGOTIATION

Mr. CHÂU THẾ HỮU – MBA
International Business Administration Department
0907 414 021



CHAPTER 1

OVERVIEW OF NEGOTIATION


In this chapter
1.

Overview on Negotiation

2.

Types of negotiation

3.

Principled negotiation


1. Overview of Negotiation
 Definitions
 Features
 Negotiation in international business

1.1. Definitions
 Negotiate (v) to try to reach an agreement by formal discussion
(Oxford Advanced Learners)

 Negotiation is a basic means of getting what you want from others. It is
back-and-forth communication designed to reach an agreement when you and
the other side have some interests that are shared and others that are
opposed.
(Roger Fisher & William Ury)


Prerequisites of negotiation
A conversation is considered as “negotiation” when there are:

 Interdependence between parties
 Beneficial conflicts
 Power equivalence
 Target which is agreement


1.2. Features
 Maximize Common benefits and minimize conflicting private ones.
 Negotiation aims at Agreement, not Winning position.
 Negotiation is affected by status and power of both parties.
 Negotiation: an art and science!!!


1.3. Negotiation in international business

 Definition: Negotiation relating to business transactions between parties with
different nationalities.

 International business negotiation is affected by:
 Economics laws
 Politic and democratic relations
 Fluctuation in the world market and economy
 Legal framework
 Cultures


2. Types of negotiation
 Based on forms
 Based on strategy


2.1. Forms of Negotiation
 Face-to-face
 Negotiation via phone
 Negotiation via mails / faxes
 Negotiation via e-commerce applications (emails, social media...)
 Advantages and Disadvantages


2.2. From a strategic view
Strategy vs Tactics?
Negotiation strategies

 Competitive strategy / Win-Lose
 Cooperative strategy / Win-Win

 Lose - Lose
 Compromising strategy
 Positioning strategy: Hard vs Soft
 Principled strategy


3. Principled Negotiation
 The problem
 The method
 Commonly asked questions


3.1. The problem


Arguing over positions…
 Produces unwise agreements
 Is inefficient
 Endangers an ongoing relationship



Other cases
 When there are many parties?  even worse
 Being nice?  no answer


3.2. The method
 Separate the People from the Problem
 Focus on Interests, not Positions

 Invent Options for Mutual Gain
 Insist on Using Objective Criteria


3.2.1 Separate the People from the Problem
 Negotiators are people first.
 Every negotiator has 2 kinds of interests: In the substance and in the
relationship.

 Separate the relationship from the substance; deal directly with the people
problem.

 Prevention works best.


Separate the RELATIONSHIP from the substance; deal
directly with the PEOPLE problem.
Perception

 Put yourself in their shoes.
 Don’t deduce their intentions from your fears.
 Don’t blame them for your problem.
 Discuss each other’s perceptions.
 Look for opportunities to act inconsistently with their perceptions.
 Give them a stake in the outcome by making sure they participate in the process
 Face-saving: Make your proposal consistent with their values.


Separate the RELATIONSHIP from the substance; deal
directly with the PEOPLE problem.

Emotion

 Recognize and understand emotions, theirs and yours.
 Make emotions explicit and acknowledge them as legitimate.
 Allow the other side to let off steam.
 Don’t react to emotional outbursts.
 Use symbolic gestures.


Separate the RELATIONSHIP from the substance; deal
directly with the PEOPLE problem.
Communication
- Problems:

 Negotiators may not be talking to each other.
 They may not be hearing you.
 Misunderstanding
- Solutions:

 Listen actively and acknowledge what is being said.
 Speak to be understood.
 Speak about yourself, not about them.
 Speak for a purpose.


Prevention works best
 Build a working relationship
 Face the problem, not the people

Let me say this as clearly as I can: the United States is not at war with
Islam and will never be.


3.2.2. Focus on INTERESTS, not Positions
 For a wise solution reconcile interests, not positions
 How to identify interests?
 Talking about interests


For a wise solution reconcile interests, not positions
 Interests define the problem
 Behind opposed positions lie shared and compatible interests, as well as
conflicting ones.