UNIT 6 THE MEETING

Objectives and strategies for

negotiation meetings
The general approach to negotiations has
undergone a change in modern times,
similar to the changes that have occurred
in approaches to supplier relations.
There is now greater emphasis
on long-term relations, which
in negotiations suggests a need
for cooperative ‘win- win’
strategies:.
Both sides can gain by
arriving at the best
possible agreement
This contrasts with earlier
ideas (sometimes referred
to in terms of a ‘zero-sum
game’) that a win for one
party must mean a defeat
for the other.
However, negotiators
will not always seek a
collaborative strategy.
In fact the choice of
strategy is sometimes
regarded as a balance
between two different
considerations:
1. The importance of the
negotiation’s immediate
outcome,
2. The importance of the
long-term relationship.
These considerations
can be mapped onto a
two-by-two grid.
This model indicates that
where we regard the long-term
relationship as important our
approach to the negotiation
will be collaborative or
accommodative.
In other words, we will
seek an integrative
negotiation.
On the other hand, where we are
interested in a good result from this
particular negotiation, and not
specially interested in the long-term
relational effect, our Approach
maybe more competitive: we will
adopt a distributive approach.
The buyer’s priorities leading up to the
negotiation are to
1. assemble relevant information,
2. to establish his objectives for the
negotiation, and
3. to plan the strategies and tactics he
will adopt in order to achieve them.
It is helpful to determine two parameters
in respect of each objective:
1. the best that the buyer can
reasonably hope for, and
2. the worst that he is prepared to
accept.
Consciously or unconsciously
the supplier will be defining
similar parameters. Where the
two acceptable ranges overlap
there is scope for negotiation.
Assuming that we do decide
to negotiate, we need to
consider the possibility that
we fail to reach an
agreement with the
supplier.
To prepare for this, we
must consider in
advance what options
will then be available to
us.
BATNA stands for the ‘best alternative to a
negotiated agreement’.
Buyers should always consider their best
alternative before going into a negotiation.
This enables them to be more assertive during
the negotiation, because if they are not
achieving objectives they have the safety net
of a ‘Plan B’.
 Stages in a negotiation meeting

Various authorities have

analysed the negotiation
meeting as a process
consisting of distinct stages.
Some authors go further than this by
distinguishing the stages in an
integrative negotiation meeting from
those in a distributive negotiation
meeting: see diagram.
Notice that in an integrative
negotiation the emphasis is on
finding joint solutions. 
INTEGRATIVE DISTRIBUTIVE

IDENTIFY AND DEFINE THE SELECT AN OPENING OFFER

PROBLEM
UNDERSTAND THE PROBLEM SELECTING AND OPENING
OFFER
GENERATE ALTERNATIVE GAINING AND YIELDING
SOLUTIONS CONSESSIONS
EVALUATE AND SELECT FINAL OFFER
ALTERNATIVES
AGREEEMENT AGREEMENT
The literature on negotiation covers a
number of ploys designed to
condition the opposite party in such a
way that they are more amenable to
accepting our position.
This often happens in the initial
stages of the negotiation
 The following examples are taken from
Gavin Kennedy’s book The Perfect
Negotiation.
•‘Domination’ behaviour. For example,
we insist on preconditions before
negotiating, or we insist that certain
items are non-negotiable, or we
attempt to fix the agenda unilaterally.
•Shaping behaviour. For example,
using the ‘tough guy/soft guy’
approach we show personal
willingness to accommodate the
other party’s point of view, but we
make it clear that others in our
organisation may take a sterner view.
 Managing the meeting
The personnel who may be involved
in a negotiation meeting are as
follows.
•The negotiators, appearing for our
team – this could include support
personnel, such as our legal
representative, our accountants etc.
•The opposition
negotiators,
appearing for the
other team
•Indirect actors, on the
sidelines (people who
influence our negotiators, and
people who influence their
negotiators, e.g. senior
managers)
•Interested observers –
shareholders,
competitors, the
media etc
The personnel on both sides will have
been selected for:
their knowledge of the issues,
their skills as negotiators,
their past record of success in
negotiations of the kind
contemplated etc.
In relation to the personnel
appearing for the other
side, our preparation
should have covered the
following points.
•Their likely objectives
•Their reputation,
•Negotiating style and likely
tactics
•Their BATNA
•The level of their authority
The actions of both sets of
personnel will be influenced by
various context issues.
 
•The history of the relationship
between the two parties
•The kind of
relationship desired
for the future
•Expectations as to
whether negotiations
are likely to recur in
future
•The deadlines
surrounding the
negotiation process
•The ‘rules of the game’,
including common and
generally accepted practices
that govern negotiations in a
particular cultural setting
If one party to the negotiation has
greater power than the other there is
an opportunity for coercion.
This may occur in situations of
distributive negotiation, but is not
characteristic of integrative
negotiation.
In an integrative negotiation the more
powerful party is interested in the long-
term advantages that may accrue from an
outcome satisfactory to both sides.
He will realise that the exercise of
coercion, while potentially giving him an
immediate ‘win’, may hinder his long-
term objectives by alienating the opposite
party.
 HARD NEGOTIATION TACTICS
• Extreme demands followed up by small, slow
concessions. Perhaps the most common of all hard-
bargaining tactics, this one protects dealmakers from
making concessions too quickly. However, it can keep
parties from making a deal and unnecessarily drag out
business negotiations. To head off this tactic, have a
clear sense of your own goals, best alternative to a
negotiated agreement (BATNA), and bottom line – and
don’t be rattled by an aggressive opponent.
•Commitment tactics. Your opponent may
say that his hands are tied or that he has
only limited discretion to negotiate with
you. Do what you can to find out if these
commitment tactics are genuine. You
may find that you need to negotiate with
someone who has greater authority to
do business with you.
•Take-it-or-leave-it negotiation
strategy. Offers should rarely be
nonnegotiable. To defuse this hard-
bargaining tactic, try ignoring it and
focus on the content of the offer
instead, then make a counter-offer
that meets both parties’ needs.
•Inviting unreciprocated offers. When
you make an offer, you may find that
your counterpart asks you to make a
concession before making a
counteroffer herself. Don’t bid against
yourself by reducing your demands;
instead, indicate that you are waiting
for a counteroffer.
•Trying to make you flinch. Sometimes
you may find that your opponent keeps
making greater and greater demands,
waiting for you to reach your breaking
point and concede. Name the hard-
bargaining tactic and clarify that you will
only engage in a reciprocal exchange of
offers.
•Personal insults and feather ruffling.
Personal attacks can feed on your
insecurities and make you vulnerable.
Take a break if you feel yourself getting
flustered, and let the other party know
that you won’t tolerate insults and other
cheap ploys.
•Bluffing, puffing, and lying.
Exaggerating and misrepresenting
facts can throw you off guard. Be
skeptical about claims that seem
too good to be true and
investigate them closely.
•Threats and warnings. Want to
know how to deal with threats? The
first step is recognizing threats and
oblique warnings as the hard-
bargaining tactics they are. Ignoring a
threat and naming a threat can be
two effective strategies for defusing
them.
•Belittling your alternatives.
The other party might try to
make you cave in by belittling
your BATNA. Don’t let her
shake your resolve.
Good cop, bad cop. When facing off
with a two-negotiator team, you may
find that one person is reasonable
and the other is tough. Realize that
they are working together and don’t
be taken in by such hard-bargaining
tactics.