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  1. NEGOTIATION 2. Definition ‘A process of securing an agreement between parties with different needs and goals, but each having something to offer to the other, and…
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  • 2. Definition ‘A process of securing an agreement between parties with different needs and goals, but each having something to offer to the other, and each benefitting from establishing an agreement, though the balance of power can be dependent upon whether one party’s needs are significantly greater than the other’ or ‘A process that occurs when two or more parties decide how to allocate scarce resources’
  • 3. Types of Negotiation :  Distributive Negotiation Win – Lose  Integrative Negotiation Win-Win
  • 4. Distributive Negotiation :  Negotiation that seeks to divide up a fixed resources; a win-lose situation.  Get as much as pie possible.  Opposing nature between the parties.  Information sharing is low.  Creates short term relationship.
  • 5. Integrative Negotiation :  Negotiation that seeks one or more settlements that can create a win-win solution.  Expand the pie as much as possible so that each parties can be satisfied.  Congruent nature between parties.  Information sharing is high.  Creates long term relationship.
  • 6. Negotiation Process Preparation and Planning Definition of Ground rules Clarification and Justification Bargaining and Problem Solving Closure and Implementation
  • 7. Preparation and Planning :  Assessing relative strength of two parties.  Set negotiating objectives – ask, ‘What are real issues?’ ‘Which parties should be involved?’.  It saves you from surprise and unexpected when other party introduces unexpected facts and figures.  Plan the best way to argue your case.  Assess your and other parties bargaining power.
  • 8. Definition of Ground Rules :  Defining with the other party the ground rules and procedures to follow.  Who will do the negotiating?  Where will it take place? Any time constraints, if any, apply?  To what issues will negotiation be limited?  Will follow a specific procedure if an impasse is reached?
  • 9. Clarification and Justification :  Explain, Amplify, Clarify, Bolster and Justify the demands.  Its an opportunity for knowing the issues of each other.  Why these issues are important.  How you arrived at your initial demands.  Provide the other party with any documentation to support your position.
  • 10. Bargaining and Problem Solving:  Actual give and take in trying to hash out an agreement.  Both the parties undoubtedly need to make concessions.  The way to influence deal .  Making concessions.  Breaking an impasse.  Towards a settlement.
  • 11. Closure and Implementation:  Check, recheck.  Legal Aspects.  Give reasonable assurance.  Formalizing the agreement you have worked out.  Developing procedures necessary for implementing and monitoring it.
  • 12. Individual Differences in negotiation Effectiveness.  Personality Traits in Negotiation.  Moods/Emotions in Negotiation.  Culture in Negotiations.  Gender Difference in Negotiations.
  • 13. Third Party Negotiations:  Mediator : is a neutral third party who facilitates a negotiated solution by using reasoning and persuasion, suggesting alternatives.  Arbitrator : is a third party who have the authority to dictate an agreement.  Conciliator : is a trusted third party who provides an informal communication link between negotiator and the opponent.
  • 14. Negotiation Tactics:  Negotiation decoy – later negotiate with other party.  Extreme offers – Non-verbal bewilderment /surprise.  Cherry-picking – “This is what other companies are offering., so you will need to at least match those.”
  • 15.  Mandated authority – “Oh! That will not be acceptable to the Chairman.”  “Take it or leave it”  The negotiation nibble - Last moment, “Transportation and insurance is included, isn’t it?? “If you are willing to pay the extra 3% we will include these two items.”
  • 16.  Negotiation deadline  Moral appeal – ‘It will help the workers / society.  All I have is only 60 % - to bargain.  Lubrication – smooth talk, flattery and so on.  Golf Club, dinner meeting etc.
  • 17. Thank you !!!
  • 18. Reference:  Organizational Behavior 15th Edition, 2013 Stephen P Robbins. Timothy A Judge. Neharika Vohra.  
  • 19.
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