NEGOTIATION SKILLS AND TECHNIQUES LAB

SUBJECT CODE- 576321 (76)

In partial fulfilment of requirement for the

Award of Degree of MBA

SUBMITTED TO SUBMITTED BY

Nidhi Thakkar

M.B.A 3rd sem.

Sec- B roll no.27

DEPARTMENT OF MANAGEMENT
BHILAI INSTITUTE OF TECHNOLOGY
(An ISO 9001:2000 Certified Institute)

Bhilai House, G.E. Road, Durg 491001(C.G.), India

Meaning and Definition of Negotiation :-
The word negotiation originated from the latin expression, negotiates,
which means to carry on business.

The process of conferring to arrive at an agreement between different

parties, each with their own interests and preferences.

A give-and-take decision making process involving interdependent parties

with different preferences.

Negotiation is an attempted trade-off between getting what you want and

getting along with people.

Negotiation is a discussion between people with the goal of reaching an

agreement on issues and separating the parties when neither party has the
power to get the desired outcome.

Negotiation is a dialogue between two or more people or parties intended

to:

o reach an understanding.
o resolve points of difference.
o gain advantage for an individual or collective.
o to craft outcomes to satisfy various interests.
According to Leigh Thompson:
An interpersonal decision making process necessary whenever we cannot achieve
our objectives single-handedly

Ex. Buying a car; buying a house; things at work

Negotiation Styles :-
There are five long-recognized styles of negotiating which characterize both
approaches to resolving disputes or making deals and the default approach taken
by each individual to negotiating. These styles can be thought of as means for
achieving negotiated outcomes as well as a categorization of individuals
negotiating.

Avoiding

Primarily concerned with avoiding intra-personal conflict

Is useful when the the stakes of a negotiated outcome are not worth the
investment of time or the potential for igniting conflict

Characterized by sidestepping, postponing, and ignoring the issue or

situation

Effective when avoidance of the situation or issue does not greatly affect the
relationship and short term task is not important to either party

Accommodating

Primarily concerned with the relationship between the parties

Easily gives the other side concessions in hopes of strengthening the

relationship, but often gives away too much too soon

Tend to neglect their own needs in favor of helping the other side get what
they want

Effective when long term relationship is important and short term task is not
important

Compromising

The style falling between accommodating and competing

 Useful when time is a concern or there is a strong relationship between the
parties

Requires concessions from both sides to find agreement

Does not focus on legitimate or fair standards for settlement and instead
utilizes Meet in the middle, or Split the difference solutions.

Collaborating

Focuses on using problem solving methods to create value and discover

mutually satisfactory agreements

Utilizes the creativity of both parties to find solutions to both sides interests

Tend to be assertive about their needs and cooperative with the other side

Effective when long term relationship is important and short term task is
important

Competing

Primarily concerned with achieving their own goals regardless of the impact
on others

Views negotiation as a win/lose rather than a problem solving activity

Often utilize manipulative tactics such as attacks, threats, and other

aggressive behavior to achieve their objectives

Effective when long term relationship is not important and short term task is
important

When preparing for your next negotiation, there are four important points of
consideration related to negotiating styles.
First, consider your own negotiating style. Do you lean towards Competing,
Accommodating, Avoiding, Compromising, or Collaborating?

Second, consider the other sides negotiating style. Are they competitive or do
they Accommodate, Avoid, Compromise, or Collaborate?

Third, consider the importance of the stakes of the negotiation to you and your
organization. How important is settling the matter at hand?

Last, consider the importance of your relationship with the other side. Are they
strangers that will remain as such after the negotiation? Are they a new client? Are
they long standing partner with strategic importance to your organization?

Having taken inventory of your style, their style, the importance of the stakes, and
the importance of the relationship. You are now better prepared to consider the
best manner in which to proceed.

If you lean towards avoidance and they lean towards competing and the
importance of the stakes is high while the importance of the relationship is low,
then you have an idea of how to proceed in the situation. In this case, you may
want to solicit the help of an agent to negotiate for you or at the very least have
thoroughly prepared to stand up for your interests in the negotiation.
Negotiation Techniques:-
Prepare, prepare, prepare.
Pay attention to details.
 Leave behind your ego.
Ramp up your listening skills.
If you dont ask, you dont get.
Anticipate compromise.
Offer and expect commitment.
Dont absorb their problems.
Stick to your principles.
Close with confirmation.

1. Prepare, prepare, prepare. Enter a negotiation without proper preparation

and youve already lost. Start with yourself. Make sure you are clear on what
you really want out of the arrangement. Research the other side to better
understand their needs as well as their strengths and weaknesses. Enlist help
from experts, such as an accountant, attorney or tech guru.

2. Pay attention to timing. Timing is important in any negotiation. Sure, you

must know what to ask for. But be sensitive to when you ask for it. There are
times to press ahead, and times to wait. When you are looking your best is the
time to press for what you want. But beware of pushing too hard and poisoning
any long-term relationship.

3. Leave behind your ego. The best negotiators either dont care or
dont show they care about who gets credit for a successful deal. Their talent is
in making the other side feel like the final agreement was alltheir idea.
4. Ramp up your listening skills. The best negotiators are often quiet listeners
who patiently let others have the floor while they make their case. They never
interrupt. Encourage the other side to talk first. That helps set up one of
negotiations oldest maxims: Whoever mentions numbers first, loses. While
thats not always true, its generally better to sit tight and let the other side go
 first. Even if they dont mention numbers, it gives you a chance to ask what
they are thinking.

5. If you dont ask, you dont get. Another tenet of negotiating is Go high,
or go home. As part of your preparation, define your highest justifiable price.
As long as you can argue convincingly, dont be afraid to aim high. But no
ultimatums, please. Take-it-or-leave-it offers are usually out of place.

6. Anticipate compromise. You should expect to make concessions and plan

what they might be. Of course, the other side is thinking the same, so never
take their first offer. Even if its better than youd hoped for, practice your best
look of disappointment and politely decline. You never know what else you
can get.

7. Offer and expect commitment. The glue that keeps deals from unraveling
is an unshakable commitment to deliver. You should offer this comfort level to
others. Likewise, avoid deals where the other side does not demonstrate
commitment.

8. Dont absorb their problems. In most negotiations, you will hear all of the
other sides problems and reasons they cant give you what you want. They
want their problems to become yours, but dont let them. Instead, deal with
each as they come up and try to solve them. If their budget is too low, for
example, maybe there are other places that money could come from.

9. Stick to your principles. As an individual and a business owner, you likely

have a set of guiding principles values that you just wont compromise. If
you find negotiations crossing those boundaries, it might be a deal you can live
without.
10. Close with confirmation. At the close of any meeting even if no final
deal is struck recap the points covered and any areas of agreement. Make
sure everyone confirms. Follow-up with appropriate letters or emails. Do not
leave behind loose ends.

Negotiation process:-

The first and most crucial step is Preparation and Planning.

 REMEMEBER: failing to prepare is preparing to fail! Before you attend the
interview you need to work out precisely what you want to achieve, what your
objectives are for the interview perhaps you could create a checklist of your
preferred needs such as salary package or working hours.

To help with such preferences this is when youre BATNA best alternative to a
negotiated agreement comes in to play. Its all about compromise, you cant just
demand the employer satisfies all of your needs and requests; you need to propose
an offer that is also within their BATNA so both can feel content.

You need to then define your Ground Rules

so both parties can exchange and discuss initial proposals, this helps to shape the
role you may be offered in the company..

The next step isClarification and Justification.

Remember, there are potentially hundreds of applicants fighting for this job so
what makes you different? Justify WHY YOU? Prove to them why they NEED to
employ you. Explain your skills and mention relevant work experience or contacts
that demonstrate why YOU are the best person for this role.

Next on the checklist is., Bargaining and Problem Solving.

This step is the give and take. If you are offered a lower salary than you expected,
but it is a job which has future prospects and you know you will enjoy working
there, then negotiation is the key. If you accept the job you can always ask for a
salary review in the upcoming year and prove to them why you have earned the
right to a higher wage.
And finally, Closure and Implementation. In other words the formalizing of the
agreement. Once you have accepted the job offer ensure the essential negotiations
agreed are written in a formal contract.

Dos And Dont of Negotiation :-

DOS :-
Remember- negotiation is the act of process of bargaining to reach a
mutually acceptable agreement or objective.
Aim high.
Understand the power balance.
Negotiate with people who are able to negotiate with you
Ask lots of questions
Be patient- time can be power
Empathize
Keep communicationg to advance relationships and negotiation objectives
Avoid controntation
Disagree from the devils advocate position.(use questioning)
Give, some of the time
Know when to leave well alone.( the use of silence)
Talk company stategy
Take notes
Expect the unexpected
Rehearse your case (always)
Maximize the value of you concessions minimize the value of the buyrs
Respect confidence given in negotiation
End negotiations positively/think win win
DONT :-
Give concessions without receiving concessions back
Create precedents without considering the long term.
Negotiate on areas over which you have no control or influence
Trade single points/get picked off
Rush or panic
Deadlock
Stop thinking/make assumptions
Be complacent
Keep chasing lost causes
Talk co. objectives
Compromise your ultimate objectives
Relax your guard
Under estimate others
Let the buyer think theres more
Be afraid to walk away