3/17/2023

Business skills
Sanela Ravlić, PhD, Lecturer
sravlic@bak.hr

Complaints, conflicts,
negotiations

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Complaints
Opportunity, a signal of the need for improvement

◦ Reveals a concern or question that the customer has

◦ The customer should be encouraged to express them
◦ Silent objections CANNOT be corrected

A sale in which objections are raised by the customer is much more

likely to succeed !!

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Complaints – types
NEED - I don't need your product; I am happy with what I have
PRICE (most common complaint)Too expensive; We have a better offer; We are
looking for something cheaper; We can't afford it
PRODUCT / SERVICE - I don’t like color, design, style; It is of poor quality; Poor
performance
SOURCE - I've never heard of you before; You are too young a company; You
have bad publicity
TIME - I need to think about it more; I can't decide now; I need to check with
my partner

Respond to customer complaints

 Be positive about the objection
 Listen carefully and do not interrupt the customer while making a complaint
 Expect objections and be prepared for them
 Prevent the customer
 Understanding the customer’s complaint and empathizing with their concerns

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Respond to complaint – customer is not right

 We directly deny his claims if they are extremely

unfounded (false)
 Caution! - use carefully so as not to cause even
greater damage
 We indirectly deny if we want to subtly tell the
customer that he is wrong

Respond to complaint – customer is right

 Boomerang - turn the problem to your advantage

 Compensation - when the disadvantages are compensated
by other advantages
 Asking questions - by asking him questions, the customer
answers his own complaint
 Overcoming the complaint - if the complaint is trivial

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• Putting Customers on Hold for too Long. ...

• Using Negative Language. ...
• Transferring Callers Again and Again. ...
• Asking Customers to Repeat. ...
• Agents Offer No Empathy. ...
• Directing Customers to the Website. ...
• Rude Behavior and Bad Attitudes.

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Conflict is a situation in which two parties (persons or groups) want

to achieve a goal that they perceive that one side can achieve, but
not both (Rijavec, M., 2002)
Conflict
Conflict is an everyday phenomenon that we encounter in our environment and in
ourselves.
There is probably no person who has not gotten into a conflict (business or personal) at
least once in their life.

Depending on the communication skills, the person will successfully resolve the conflict
or will resort to one of the methods of non-resolution.

Types of conflicts
 conflicts within the individual
 conflicts between individuals
 conflicts between groups
 conflicts between organizations

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Conflict
Double attraction conflict - when we are between two equally attractive goals, so we
can't decide which goal to stick to

Double rejection conflict - when we are between two equally repulsive (negative)
goals, so we can't decide which of them to accept when we have to. If one has to
decide between treating a disease slowly and for a long time, or surgically, quickly,
both ways are painful

The conflict of simultaneous attraction and repulsion - when we are facing one goal,
but that goal is both attractive and repulsive (psychologists sometimes call it an
"ambivalent" goal). For example, a student is faced with the decision to enroll in a
doctorate, which on the one hand strongly attracts him, but at the same time he is
aware that the study will take a long time, be expensive, etc., and these negative sides
reject him. (Petz, 2003, 279)

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Strategies for not resolving a conflict

 Doing nothing is not a bad strategy, but it often leads to conflict escalation
 Pretending to resolve a conflict - empty phrases are an indicator of it, giving the impression that you are
doing something about the conflict, but you are actually avoiding it (the problem is being considered; we will
try to investigate the situation; we will consider the possibility
 Hiding information - the assumption is that if something is not known, there can be no conflict; however, this
only delays the conflict and leads to the fact that when a conflict occurs, it can be much stronger
 Giving orders - using our power, we order people not to be in conflict, but a counter-effect is achieved, the
conflict becomes more intense and destructive
 Leaving it to someone else to resolve them - the worst of these strategies because there is no personal
involvement, and the one who should have resolved the conflict will give the impression of weakness

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Conflict resolution strategies

Indirect techniques should be used before directly trying to solve the problem

Indirect techniques:
 Reducing contacts between the parties in the conflict
 Appealing to common goals
 Transferring responsibility for conflict resolution to a higher level
 Thinking about reorganization

Direct techniques:
 Avoidance - physical or mental withdrawal from the conflict; both sides pretend that the conflict
does not exist and hope that it will disappear on its own)
 Giving in - adjustment to the interests of another person)
 Imposition - use of power and more aggressive approach for personal gain)
 Compromise (both sides give in, use of middle ground)
 Cooperation (win-win solution)

Rijavec, Miljković, 2002.

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Conflict resolution – communication challenges

 Bullies (threatening, coercing, demanding and attacking)

 Restrained (they like to avoid conflict situations, and usually turn to their superiors for a decision)

 Approvers (always give positive answers and say "yes", so it is difficult to determine which "yes"
really means and which "yes" means "maybe")

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Conflict resolution – communication challenges

Positive sides of a conflict

 Improves the quality of decisions that is being made

 Encourages creativity and innovation

 Increases interest and curiosity in the group

 Becomes a means of reducing tension

 Allows for better adaptation to change.

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Conflict resolution – communication challenges

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Negotiation

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Negotiation

 The decision-making process through which buyers and sellers resolve conflict
areas and / or reach agreements

 The ultimate goal: reducing or resolving conflicts

 The basis of negotiations is the voluntary exchange of "useful" for "useful"

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When to negotiate
Negotiations require more intensive preparations and planning, and are mostly related to the
sale of products or services of very high value

However, almost everything becomes the subject of negotiations, for example:

 Usual sales
 Price lists
 Discounts
 Customer complaints (different techniques)
 Sales with negotiation
 Terms and deadlines
 Guarantees
 Credit conditions
 Method of resolving complaints
 Level of after-sales service
 Prices and discounts for certain quantities
 Disposal of unsold and obsolete goods

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Skilled negotiatior

● In the past the ability to negotiate was considered innate or instinctive, and today we know
that it is a technique that can be learned
● A good negotiator is not just a person who can make a good contract nor a person who can
make a contract quickly; a good negotiator is a person whose agreements lead to the
successful implementation of the agreement
● The goal is to create a win-win situation - a good outcome and benefits both parties; because
of him no one feels that she has made an unfavorable contract

Chriss Voss - https://www.youtube.com/watch?v=MjhDkNmtjy0

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Negotiation as power
 Create other options to be less dependent on the job in question
 Discover what is important to the other party
 Tell the other side what they might lose
 Find allies
 Involve people in the decision-making process who can contribute to the desired outcome

OBJECTIVES
It is necessary to define:
 Target position - what the company wants and hopes to achieve
 Minimum position - the least the company is willing to accept
 Opening (initial position) - initial proposal that is higher than the target position
MINI MAX STRATEGY
What is the minimum I can accept?
Which is the maximum I can ask for without gving anything?
What is the maximum of what I can give up?
What is the minimum I can offer without being ridiculed?

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Negotiation team
 Members must be good negotiators
 The more diverse the team members, the more areas they can “cover” with knowledge
 The team leader controls their work and defines their roles

Possible problems of teamwork:

 disagreement and differing opinions
 To go into ereas beyond their expertise
 Division and insufficient preparation

It is necessary to define the roles (who is in charge of which area, who responds to the offers and of
another negotiating team, who gives offers) and consider the styles in which the team resolves
negotiations

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Negotiation team

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Negotiation
 NEGOTIATION is a decision-making process through which both parties reach an agreement
(buyers and sellers)
 Different areas of negotiation require different competencies of the negotiating team (terms
and conditions of delivery, guarantees of work, funding ....),
 Surround yourself with different people in the team, but be sure to clearly define their roles
and tasks
 It is important to understand your own work, tasks and interests of the organization, but also to
understand the style of communication and business on the other side
 Define the minimum and desired framework for negotiations
 Use the appropriate negotiation technique, depending on the characteristics of the other party
and the nature of the communication
 Concessions are likely, but know in advance your limits and realistic limitations
 Strive to create a "win-win" situation
 Decent and professional level of business communication and etiquette
 It is important to know the culture of communication (especially in international negotiations)

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Negotiation - steps

Begins with a friendly conversation (important in international negotiations); meeting

teams (remember names); Negotiations begin with the aim of establishing a "win-win"
environment, calm and kindness is important - the atmosphere; avoiding verbal and
nonverbal gestures that are not desirable

It is not advisable to use manipulative techniques: Low offers; Emotional burnout

(breakdown); Limited budget tactics; Tactics of limited powers; Time constraints; "Good
cop - bad cop"; „Our terms - take it or leave it” because they can jeopardize the trust,
goodwill and image of the company

When we make „concessions”: do not "run", analyze well all the possibilities and how
they affect the final outcome for us, ask for something in return; finally, and refuse
concession if it is not in line with our goals

Agreements: formal (legal value, easier to prove in court, in writing and signed by both
parties - the contract) and informal (the result of informal negotiations, and compliance
with agreed provisions is harder to monitor, prove and harder to sanction non-
compliance)

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Organisational culture
Corporate culture

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Organisational culture
 Organizational culture (corporate culture) is a system of values, beliefs and customs within an
organization that interact with the formal structure, producing norms of behavior (Arthur
Sharplin)
 Recently in the focus of interest of scientists.
 Research results show that
corporate culture is a "soft" component of organizational success
that is part of corporate identity

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Organisational culture

 Represents a set of norms, rules of conduct, common beliefs, attitudes and value systems and
the specific way of doing business internally (employees, management, managers) and
externally (public)
 It is the overall expression of the business philosophy of the business entity, expressed through
the mission, vision, style / way of doing business, and by which the entity can be strongly
differentiated in relation to the competition in the market

 A good corporate culture nurtures positive values and a quality work environment (e.g.
promotes the independence of workers in their work, but also nurtures teamwork, encourages
creativity, motivates employees ...)

 Corporate culture is an (un)written value-set, beliefs, behaviors and collective approach;

rooted in an organization’s goals, strategies, structure and approaches to employees.

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Organisational culture

Source: https://srwasia.com/corporate-culture (13.2.2023.)

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Organisational culture – definition and role

"Business culture is a pattern of values and learned ways of doing things that have developed
throughout history and that are manifested through the material objects and behaviors of
business stakeholders." (Brown, 1995)
"The culture of business entities is a common and traditional way of thinking shared by all
employees. New employees need to learn and accept it. ” (E. Jaques, 1952)

 A significant factor in decision making

 Determines the ability to adapt to the environment
 It is important for the coordination of work in the organization
 Effective behavior control mechanism
 It forms the opinions and feelings of employees
 Reduces conflicts in the business entity
 A set of motives

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Historical overview

1979 - article "On Studying Organizational Cultures" (Pettigrew) - introduces the concept of
culture and applies it to businesses
1985 - "Organizational Culture and Leadership" (Edgar Schein) – „father” of business culture

5 directions - according to the understanding of the organization:

 Classical school of organization - a rigid organization of business entities
 The Human Behavior school - the focus is on the behavior of people within the company
 Decision making theory - normative and descriptive branch of decision making
 System theory - looking at the organization as a whole made up of subsystems
 Contingency theory - there is no ideal structure, but each must adapt to the situation in which
the business entity finds itself

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Historical overview

1979 - article "On Studying Organizational Cultures" (Pettigrew) - introduces the concept of
culture and applies it to businesses
1985 - "Organizational Culture and Leadership" (Edgar Schein) – „father” of business culture

5 directions - according to the understanding of the organization:

 Classical school of organization - a rigid organization of business entities
 The Human Behavior school - the focus is on the behavior of people within the company
 Decision making theory - normative and descriptive branch of decision making
 System theory - looking at the organization as a whole made up of subsystems
 Contingency theory - there is no ideal structure, but each must adapt to the situation in which
the business entity finds itself

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Historical overview

1979 - article "On Studying Organizational Cultures" (Pettigrew) - introduces the concept of
culture and applies it to businesses
1985 - "Organizational Culture and Leadership" (Edgar Schein) – „father” of business culture

5 directions - according to the understanding of the organization:

 Classical school of organization - a rigid organization of business entities
 The Human Behavior school - the focus is on the behavior of people within the company
 Decision making theory - normative and descriptive branch of decision making
 System theory - looking at the organization as a whole made up of subsystems
 Contingency theory - there is no ideal structure, but each must adapt to the situation in which
the business entity finds itself

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7-S – McKinsey model

 A team of professors from Harvard University and Stanford, together with the consulting company
McKinsey developed the model
 A tool for managerial analysis and action to organize and lead the company to gain an edge over
the competition. This pattern shows how the success or some other traits of an organization follow
from the configuration of 7 traits that are all interconnected, all parts of the system.
 There is no use if only two or three elements are aligned. Since all elements are interdependent,
they must all be mutually harmonized and consistent. An efficient organization needs a high degree
of internal compliance of these 7 elements. Each element must be in harmony with the others and
strengthen them (synergy)
 The McKinsey 7S model includes 7 factors that are categorized as "Hard" or "Soft" elements
"Hard" is easier to define and identify and management can directly affect them: strategic elements,
organizational charts and reporting, formal processes and IT system
"Soft" elements can be difficult to describe, and are less tangible and more influenced by culture. BUT
they are just as important as the “hard” elements if the organization wants to be successful. The
model shows the interdependencies of the elements and shows how a change in one affects all the
others.

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7-S – McKinsey model

 Strategy - set requirements for the project and the means to achieve
them
 Structure - Organizational advantage of project implementation
 Systems - Methods of job design, execution, supervision and control
 Style (Culture) - A unique way of working and interrelationships within
the company
 Staff - Selection, management and leadership of those working on the
project;
 Shared Values – belief system, corporate culture
 Skills - Managerial and technical tools available to the project manager
and project team members

The 7S model can be used in a variety of situations and can: improve company efficiency, examine the
likely effects of future changes within the company, align departments and processes during mergers or
acquisitions, determine how best to implement the proposed strategies…

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7-S – McKinsey model

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Organisational culture

 A set of values, norms and beliefs

 A set of basic assumptions and beliefs accepted by members of an organization
 It is expressed through the behavior of employees, and through the history and tradition
of the company
 The way of life and work in the company
 Represents the personality (character) of the company

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Organisational culture

Basic groups of factors influencing organizational culture

 Working Group (Commitment, Obstacles, Morality, Friendship)

 Organizational characteristics (Size, Complexity, Formalization, Autonomy)
 Managerial leadership style (Reserved, Emphasis on production volume, Considerate,
“Stick your nose in everything”);
 Administrative processes (Reward system, Communication system, Conflict/cooperation
and Risk tolerance)

Source: Sikavica, P., Organizacija, Zagreb, Školska knjiga d.d., 2011.

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Organisational culture - symbols

 Visible and invisible signs of culture

 The most important symbols are:
 Values, norms, attitudes and beliefs
 Status symbols
 Tradition, stories and history – rituals
 Jargon and language
 Physical environment

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How can we change organisational culture?

https://www.centranum.com/resources/organizational-culture/ 8.3.2022. 43

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Type of cultures

Task oriented culture - conservatism, production orientation, concern for status and
reputation, secrecy, neglect of the individual

Relationship oriented culture - respect for individuals, customer is the most important
person, team building, openness, trust, respect, delegation, decentralization, autonomy,
innovation

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Handy tipology – 4 basic types

 Entrepreneurial culture (power culture) has a strong central figure at the

center, the structural representative is the spider web
 Bureaucratic culture (role culture) is based on logic and rationality, the
pictorial representative is the Greek temple
 Team culture (task culture) focused on teamwork, project
 The culture of the individual is rare, individuals are the focal point

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Theory Z of Motivation (William Ouchi)

Japanese company
American company
• Lifetime employment
• Employment for a short period of time
• Rigorous grading and slow progress
• Very fastassessment and progress
• Universalist career
• Specialist-specific career
• Implicit control (self-control)
• Explicit control (rules and roles)
• Collective decision making
• Individual decision making
• Collective responsibility
• Individual responsibility
• Caring for human life in general
• Caring for people in the organization

"Z" company
• Long-term employment: exploiting talent
• Relatively slow grading and progress: ability, not seniority
• Moderate specialist career: broadly ranked skills acquired through job change
• Combination of explicit and implicit control: self-control guided by rules and roles
• Participation and consent in decision-making: all those affected by decisions
• Individual responsibility: everyone for their actions
• Caring for people at work and out of work

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When to change company culture

 If the company has expressed values that no longer fit into the
environment

 If the industry (activity) is rapidly evolving

 If the company is mediocre or worse in its branch

 If the company is smaller and growing fast

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Rumors in organisation

 Informal information transmission network

 „hear-say„
 It is not under the control of the management

 Employees consider it a more reliable and credible source of information

 It serves the personal interests of the people involved
 As many as 75% of employees find out about news through rumors, and 75% of that information
is accurate
 Important part of communication networks because through it managers can sense morals,
important issues and anxiety in organizations, but the impact of rumors should be limited to
reduce the negative consequences

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Zaključno o
Organizations need to:



komunikacij
Develop computer databases with essential information that employees can easily search, intranet …
Create a culture that supports and rewards knowledge sharing
 i u that will enable employees who have acquired valuable expertise and knowledge
Develop mechanisms
to share it with others
organizaciji
 Perfect communication in the organization is an (un)achievable goal, it is important to use
communication techniques and tools for the benefit of the organization and continuously adapt, learn
and improve.
 Awareness of the importance of communication is the basis for change and its first step. Research
shows that there is a positive relationship between productivity and communication, so the effort
spent on improving communication should be understood as an investment in the future of the
organization and its success.

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Etiquette rules of good manners

Prejudices of good behavior

 Every behavior is innate, it is not acquired.

 Human behavior is caused by internal factors such as motives, attitudes and

feelings.

 Once formed, behavior remains forever.

 Behavior has no significant impact on success at work and in life.

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Etiquette rules of good manners

Prejudices of good behavior

 Every behavior is innate, it is not acquired - False - Total human behavior is formed
throughout life.

 Human behavior is caused by internal factors such as motives, attitudes and

feelings - Internal factors affect behavior, but it is defined by the influence of both
internal and external factors.

 Once formed, behavior remains forever

 Behavior has no significant impact on success at work and in life

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Etiquette rules of good manners

Prejudices of good behavior

 Every behavior is innate, it is not acquired - False - Total human behavior is formed
throughout life.

 Human behavior is caused by internal factors such as motives, attitudes and feelings -
Internal factors affect behavior, but it is defined by the influence of both internal and external
factors.

 Once formed, behavior remains forever - The period of adaptation and learning lasts a
lifetime. The question is not whether we can, but whether we want to change and learn.

 Behavior has no significant impact on success at work and in life - In interpersonal

relationships, nothing is more important than behavior. Relationships with others are an
interaction by which we influence the behavior of others.
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Standards of good business conduct

Basic rule: to take into account the opinions and feelings of others and to show by our behavior that we
possess good human values based on respect for others

Basic standards:
 Look & Manners - avoid selfish behavior, tolerate the needs of others
 Honesty - be honest and fair
Respect - Respect the opinion of others and observe yourself through their eyes
 Personality - show the strength of your personality and your personality
 Style and tact - do not rush („first jump and than say hop")
 Sometimes it is wise to remain silent ("If you keep silent, you remain a philosopher")

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Business behaviour/conduct
Addressing:
 "Sir", "Madam", "colleague" + surname and title (even if you know the person, you are addressing it with
respect)

Closeness at work:
 do not cross the line of privacy in communication
 not expressing sympathy (touching, hugging, tapping on shoulders ...)
 don't stare
 not to bore colleagues or make inappropriate comments

Welcoming guests:
 Greet them in the lobby or in the middle of the office
 Handshake - the guest is the first to extend a hand; make eye contact during handshake, state the title
and position if presenting the person to others
 Do not pour alcohol in the office

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Following protocols

Business card
It is given at the beginning of the conversation at the first meeting
It is delivered only after the presentation and is always given in hand
If sent with flowers or a gift, it is placed in an envelope

Conversation
The person who initiated the meeting begins
If there is a time limit, this should be politely emphasized
It is important to remember that we represent our company and the business of the
company

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Written communication
 They need to be specifically addressed
 Adapt your writing style to the topic and the person you are writing to
 Letter should not be too long
 Check the level of confidentiality of written content
 Pay attention to spelling and terminology
 Use a formal style to communicate with people you don’t know

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