Understanding Commercial Negotiation

This assignment delves into the complexities of commercial negotiation. It defines key elements like seller, buyer, and goods/services involved. The analysis focuses on conflict resolution within projects using positional and principled negotiation methods. Furthermore, it examines five prominent negotiation theories: structural, strategic, behavioral, processual, and integrative. The assignment concludes by emphasizing the significance of stakeholder management in effective commercial negotiation.

Commercial Project Negotiation Task
3: Presentation And Written
Assessment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Various aspects of commercial negotiation............................................................................1
Arguments using several factors which are applied in conflicting.........................................1
Project negotiation ways.........................................................................................................2
Methods of managing conflict................................................................................................2
Ways for engaging stakeholder..............................................................................................3
Commercial negotiation theories and concepts......................................................................3
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
In the commercial project when dispute comes into consideration within working
environment then negotiation procedure taken into account for resolution. The present study
reflects on several aspects and theories which are relating to the negotiation process of dispute
solving. Apart from this, various methods included in the project for negotiation, dispute
management and engaging stakeholders using relevant theories. Beside this, the commercial
negotiation concept and theories are also explained in the present project.
MAIN BODY
Various aspects of commercial negotiation
Negotiation is one kind of discussion among two parties for reaching up to the beneficial
outcome. Further, it has various branches among them one is negotiation which comes within
workplace due to a particular aspect which is price. On the basis of pricing factor of any product
or services the issue of commercial negotiation arise among two parties. It has mainly three
aspects which are mentioned below:
Seller: It is one party involved in the commercial negotiation who sales goods and services up to
the customers. It performs activities in the market for reducing level of competition and
attracting people. If seller provides low quality of the product and service then this issue arisen
among two parties.
Buyer: Another aspect is buyer who purchase goods from the seller but when conditions are
completed then issue came (Ehrman, 2013). Apart from this, if buyer not make payment of
products on time or as per the conditions then also create issue of commercial negotiation.
Product or service: The base due to which commercial negotiation arisen between buyer and
seller is product or service. If the seller not deliver high quality of goods to the buyer or not
charges fair and reasonable prices then conflict take place.
Arguments using several factors which are applied in conflicting
At the time arising disputes among two or parties then for making solution various
elements undertaken. Those types of the aspects which applied in the conflicting are stated
below:
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Logic: It is one of the significant factor which helps to resolve the issue of dispute in project.
When logics and rules are implemented then overall negotiation procedure and conflicting
affected in favourable direction (McCarthy and Hay, 2015).
Persuasion: When one party persuade to another conflicting in order to proper communication
then process of negotiation become smooth. Therefore, conflicts will be resolved easily as well
as appropriately from the project. Further, it is one of the highly applied factor in the conflicting.
Project negotiation ways
For making solution of the negotiation in the projects there are some methods included
and taken into consideration by the parties. Further, some ways which act as the negotiation
theories are mentioned below:
Positional negotiation:
As per this method each party included in negotiation is with the unjustified reasons as
well as issues and at the extreme position. Under this, people belief on the ultimate solution
rather than proper justifications. Due to this, one party is in the win situation and another is in
lose condition. Further, this is less used way due to time consuming for negotiation (Herberling
and Templin, 2016.).
Principled negotiation:
This theory of project negotiation considered when conflicted parties are creative and
come up with proper justifications. Further, principled negotiation seeks towards the condition of
win where any party not face lose. It includes generally four aspects like people, interest, options
and criteria.
Methods of managing conflict
In the working environment of project completion conflict takes place generally which
are managed using several ways. Further, methods which support to project manager for
resolving issue of conflict are stated below:
Accommodating: Under this, the employees and team members follow all the rules and
regulations which are framed for them. As they consider all the frameworks and laws then issue
of arising conflict will be managed up to the greater extent.
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Avoiding: As per this method, group of people either ignore or delay issue arisen within the
workplace. Due to this, they hope that there is not any kind of conflict and solved properly
(Gatzlaff and Liu, 2013).
Collaborating: In this method, two or more members integrate their opinions for managing
disputes. When all the creative ideas collaborated in the firm then quick solution can be
generated. It is one of the best way for both party seller and buyer for taking quick action in
conflict.
Compromising: According to this, both the conflicted parties compromise with each other and
give up some aspects. Therefore, easily disputes in the project will be managed in an effectual
direction.
Ways for engaging stakeholder
 The manager of project when make sure that all the stakeholders are properly committed
at all the phases then engage them appropriately.
 Further, by ensuring that expectations and wants of stakeholders are achieved the
manager able to engage them with project.
 Another way is that, addressing upcoming issues and potential concerns of stakeholders
throughout the project life-cycle (Manage Stakeholder Engagement, 2016).
Commercial negotiation theories and concepts
There are different number of the approaches involved with the commercial negotiation
for resolving disputes of the workplace. Basic five theories are considered at the majority level
which are described below:
Structural: Under this approach, each issues and negotiations are initially defined by both the
parties. After that analysed and on the basis of that proper and valid solutions of the dispute
made between buyer and seller. Further, in this overall process of commercial negotiation gibe in
a proper structure.
Strategic: This approach considers for making solution of the specific issue and meet with the
goal of project. In this generally two theories involved which are decision and rational choice.
While resolving issue of conflict in project using strategic approach, the rational choice theory is
taken into account.
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Behavioural: The theory of behavioural in negotiation refers to the role, personality as well as
the characteristic of negotiators for deriving outcome of the conflicts. This theory of commercial
negotiation was derived from basically two approach like experimental and psychological
traditions (Petrescu, Dinescu and Popescu, 2016).
Processual: As per this theory, both the conflicted parties react on each others for resolving
issue in the project. Moreover, it is combination of the structural and strategic theory of
negotiation which leads to make effectual resolution.
Integrative: It is another theory of negotiation in which opinions of the parties involved are
included. The reason is that multiple ideas are supportive to make an effective solution for any
conflict or project problem instead of one opinion.
CONCLUSION
It can be concluded from the above analysis that with the commercial negotiation three
basic elements included which are seller, buyer and goods or services. For resolving conflict
issue from the working environment of project positional and principled these two kinds of the
negotiation methods taken into account. Apart from this, by considering some ways project
manager able to manage disputes and engage stakeholders towards the workplace. It can be
ascertained that in the commercial negotiation generally five theories involved like structural,
strategic, behavioural, processual and integrative.
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REFERENCES
Journals and Books
Ehrman, J., 2013. The British Government and Commercial Negotiations with Europe 1783-
1793. Cambridge University Press.
Gatzlaff, D. and Liu, P., 2013. List Price Information in the Negotiation of Commercial Real
Estate Transactions: Is Silence Golden?. The Journal of Real Estate Finance and
Economics. 47(4). pp. 760-786.
McCarthy, A. and Hay, S., 2015. Strategic Framework for Negotiation. In Advanced Negotiation
Technique. pp. 143-148.
Online
Herberling, M. and Templin, C., 2016. Principled versus Positional Negotiation: Avoiding
Compromising Situations. [Online]. Available through:
<https://www.instituteforsupplymanagement.org/pubs/Proceedings/confproceedingsdetail.
cfm?ItemNumber=5205&SSO=1> [Accessed on 8th September 2017].
Manage Stakeholder Engagement, 2016. [Online]. Available through:
<https://www.greycampus.com/opencampus/project-management-professional/manage-
stakeholder-engagement> [Accessed on 8th September 2017].
Petrescu, M., Dinescu, R. and Popescu, D., 2016. The Commercial Negotiation Framework.
[Pdf]. Available through:
<http://www.wseas.us/e-library/conferences/2010/TimisoaraW/EMT/EMT1-18.pdf>
[Accessed on 8th September 2017].
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