Business Negotiations

Sen. Lecturer: Ms. Tharuka Jayathilake

 • What is the Process of
Negotiation
• The types of Negotiations
• Barriers to Negotiate
• Forming a good
negotiation

Learning
Objectives
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 Negotiation Process

The negotiation
process utilizes five
specific steps to
resolve conflict or
help numerous
parties reach a
decision effectively.

BUSINESS NEGOTIATIONS JULY-DEC 2023 3

 Negotiation Process
1. Preparation
2. Open discussion
3. Clarification of goals
4. Bargaining /
Negotiation
5. Agreement
6. Implementation of
the plan

BUSINESS NEGOTIATIONS JULY-DEC 2023 4

• Effective preparation helps you gather the
necessary information prior to negotiation
• can improve the quality of your negotiations.
• Besides discussing plans for the actual negotiation
with other parties during this phase, it's beneficial
to conduct internal preparation prior to the
negotiations.
• Performing research, meeting with stakeholders or
decision-makers within an organization and
developing contingency plans can provide you with
more options when you meet with the other parties
to hold a negotiation.

1. Preparation
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• Sharing information between parties at
the start of a negotiation
• can help you create a more positive
outcome for all sides
• provides each party with an
opportunity to discuss their stance at
the start of the negotiation
• This helps all parties negotiate from a
shared understanding of the key points
related to the negotiation.

2. Open Discussion
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• Sharing key goals may produce more
effective negotiation between parties.
• Sharing goals allows you to understand
what your negotiating partners desire
and helps them understand your goals.
• This may help you find areas of
common interest and identify lower
priority areas for both sides where you
may make compromises to agree on
terms.

3. Clarification of Goals
BUSINESS NEGOTIATIONS JULY-DEC 2023 7
• The negotiation process often
comprises several rounds of
discussions, offers and counteroffers.
• During this phase, it can be beneficial
to make an initial offer that matches
your ideal result or one that’s
potentially more beneficial for the
company.
• This allows you to make concessions
to other parties while remaining close
to your ideal outcome.

4. Negotiation
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• If your negotiations are successful, you come
to an agreement.
• Agreements following negotiations represent a
compromise with one or more parties making
concessions to reach a deal that’s fair to all
involved.
• In most business negotiations, this is with the
signing of a contract that formalizes any terms
of the agreement to ensure all parties
understand their expectations from the
agreement.

5. Agreement
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• After reaching an agreement, each party
involved in the negotiation takes on the
responsibility of implementing their
portion of the agreement.
• important to understand what your
company's responsibilities are in relation
to the contract.
• If the agreement you’ve negotiated
includes contingencies, it may provide
multiple implementation

6. Implementation of a plan
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 1. Practice active
listening
2. Communicate clearly
3. Remain open to
collaboration
4. Stay calm throughout
5. Let the facts guide
you

Tips for
Negotiating
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Types of Negotiating
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BUSINESS NEGOTIATIONS JULY-DEC 2023 13
• Multi-party negotiation is a complex,
iterative process involving the exchange
of views, ideas and perspectives among
several parties that might include
organizations, groups, regions, countries
or individuals within larger entities.
• Complexity may appear chaotic,
especially in the absence of structure and
leadership.

https://study.com/academy/lesson/multiparty-n
egotiation-definition-challenges-examples.html

Multiparty Negotiation
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• This type of negotiation process takes
place between the two teams.
• Ex.: Negotiation strategies between the
teams of two companies that are looking
to merge are called team negotiations.
• While putting together a negotiation
team, a company looks for members with
excellent negotiation skills and highly-
developed strategic thinking capacities.

Team Negotiation
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• An approach to bargaining whereby the parties involved
partake in negotiations based on what they want from a
particular position.
• In positional bargaining, the parties are engaged in a
concept of distributive bargaining, and the situation is
win-lose by default.
• Unlike ordinary forms of bargaining, which seek to
create value for either party or both parties, positional
bargaining is more about claiming an objective.
• That is why each party may approach the other as an
enemy or competitor instead of a value generation https://study.com/academy/lesson/what-is-positional-bargaining-definition-exam
es.html
partner.

Positional Negotiation
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1. Ego
2. Taking Negotiations As Personal Battles And Focusing Too Much On Winning
3. Maintaining A Know-It-All Attitude And Failing To Ask Genuine Questions
4. Being Hostile And Thinking Negatively During The Negotiation Process
5. Inability To Grasp The Problems And Positions Of The Other Party In The Negotiation
Process
6. Entering A Negotiation Unprepared And Uninformed F And Having No Credible Answers For
The Questions Asked
7. Being Short-Tempered, Sarcastic, Lacking Listening Skills, And Criticizing Too Much

Barriers To Good Negotiation

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 1. Look At Negotiation As A Puzzle To Be Solved Rather Than A Battle To Be Won
2. Listen With Attention And Be Empathetic
3. Ensure That The Negotiation Is A Win-Win Situation Or It Creates Frustration
4. Instead Of Focusing On Compromising, Gear Your Efforts To Achieve Your Interest
5. Work On Your People Skills And Communication Skills
6. Practice Your Negotiation Skills And Strategies With Friends And Family
7. Learn To Accept Mistakes And Improve On Them
8. Know Your Genuine Value And Learn To Say No Whenever Required
9. Treat Negotiation As A Presentation. Improve Your Body Language So That It Will Give You A Winning
Edge
10. Be Smart And Strategic. It Is Said That Let Them Win The First Negotiation, And They Will Usually Be
Happy Enough To Let You Win Two To Three More
11. Define Your Personal Strengths And Use Them Positively To Impress And Convince

How To Develop Good Negotiation Skills

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Thank You!