Negotiation Strategies and Planning for Successful Deals
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Added on 2019-09-30
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This article discusses negotiation strategies, planning, variables, and buyer positioning for successful deals. It emphasizes the importance of good records and provides tips for effective negotiations. The article also covers the benefits of face-to-face negotiations and the need to be tactful and diplomatic.
Negotiation Strategies and Planning for Successful Deals
Added on 2019-09-30
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TASK-1:PART-IThere are four strategies:1.Win-LoseWin-Lose in the lower left quadrant is less likely to be accepted voluntarily as it will occur when only one side perceives the outcome as positive. In such a situation, based on the principle of competition between participants Distributive Bargaining processes are more likely than integrative bargaining.2. Lose-LoseLose-Lose in the lower right quadrant. It means all the parties end up being worse off. In some lose-lose situations, all parties understand that losses are unavoidable and that theywill be evenly distributed.3.Win-WinWin-Win in the top right quadrant occurs when each side of a dispute feels that they havewon. Both the parties are likely to accept any resolutions voluntarily because both the sides benefit from such scenario. This process involves Integrative bargaining.(Purchasingnegotiationtraining.com, 2016)The classic example of this is called the Prisoner’s dilemma in which two prisoners must decide whether to confess a crime. Neither prisoners knows what the other will do.The best outcome for Prisoner A occurs if he/she confesses, while prisoner B keeps quite. In this case, the prisoner who confesses and implicates the other is rewarded by being set free, and the other (who stayed quite) receives the maximum sentence, as she/he did not cooperate with the police, yet they have enough evidence to convict (This is a win-lose outcome). The same goes for prisoner B. But if both prisoners confess (trying to take advantage of their partner), they each serve the maximum sentence (a lose-lose outcome). If neither confesses they both serve a reduced sentence (a win-win outcome although the win is not as big as the one they would have received in the win-lose scenario)(Beyondintractability.org, 2016)WIN- LOSELOSE-WIN WIN-WINLOSE-LOSE
Part-IIWin –Win behaviour gives a contrast reaction than the win loose behaviour which can be summoned as being cooperative to non-cooperativeBody language, emotions and behavior which might be exhibited can be explained with the help of an example: A-Being Non cooperativeB-Being cooperativeBehaviourMore of me means less of you.Being aggressively competitive.Prefers to dominate on othersFavors bluff.AttitudeMy interest is more important than preserving the relationship with others.You have to be cruel to get kindin the business.Looking at own interest first and leave others.BehaviourMore of me means more of youBeing assertively competitivePrefers mutual coordination.Doesn’t bluff.AttitudeGood relationship is more important than taking advantageof others weakness.A margin deal is better than no deal.Negotiators should not open their feelings and intentionsPart-IIIWhile conducting a one time negotiation we do not expect to interact with the party again in the future so we might consider taking the distributive negotiation orbargainingapproach to achieve as much gain as we can and if we consider to interact in future over long term then we need to focus, adjust and think along the lines as it might receive a value of higher benefit from the prospective buyerBy gaining an understanding of the consequences of winning or losing for both yourself and your opponent will help us plan in a better way our strategy for the negotiation. Moreover this will allow us to make more effective decisions and get ourselves prepare for possible obstacles, challenges or opportunities that could in future.Part-IVThe ‘win-win’ negotiation is often seen as most desirable outcome as it depicts that the negotiating parties have reached an agreement which cannot be improved upon through furtherdiscussion and negotiations.Some of the circumstances can be explained with the help of example:Skilled negotiators usually manage expectations prior to and during a negotiation. Some do this instinctively. In order to avoid increasing opponents’ expectations they make less concessions .Ensure that the opponent perceives the outcome as being beneficial by being modest about the gains from a deal.
When voice is given to negotiator during the counterpart in the decision process. Even when the party is in a position of power we should make sure so as to acknowledge the counterpart’s perspective and inviting him or her to express their views, to react to initial proposals and suggest alternatives.Task 2-The Bargaining ArenaPart-IIn case of a win-lose negotiation results in one side trying to exploit the weakness of the other party.Examples of win lose situation1)If the software vendor gets to know that the company desperately needs the software for implementing their project and are not aware of the alternative provided by the competitor, he may not budge below $21,000. Similarly, the project manager may try to give the vendor an amount for developing the software in-house and try to net the software for say $19,000.2)While purchasing a car customers wants to get the car at a price of say $10000 but the cardealer wants to sell the car at say $15000. After negotiation both the parties agree at a price of say $13000.3)Suppose A is buyer and B is seller then A will win if A wants to purchase one units for Rs.100 and B wants to sell one unit for Rs.150 and ultimately one unit is sold for Rs.100 hence A wins and B loses.Part-IIObjectives and outcomes which influence where final point of agreement is reached are:For setting and achieving of objectives relies on identifying range of outcomes. In mostcases you will set upper and lower ‘breakpoints’.In case of Zone of possible agreements (ZOPA) Both the supplier and the customer must set objectives for the negotiation and agree the areas of common ground where they are prepared to negotiate.Evaluating the outcomes of win –lose situation as the win-loss analysis requires interviews to take place with customers and non-customers to assess why they bought from you and in particular why they bought from your competitors. The win/loss analysis should include both quantitative (questionnaires) and qualitative information (interviews and observations).Negotiation can seem improvisational, demanding quick responses and rational decisions as not every negotiation results in agreement and success can be measured by achieving a win-win outcome but also by knowing when you should say no to an unsatisfactory deal.
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