Communication and Negotiation Skills in Business Development - NMD

This report analyzes the communication and negotiation skills within the context of NMD, an integrated power plant equipment manufacturer facing challenges in a competitive business environment. It identifies key problems such as inconsistent management, technology obsolescence, and ineffective procurement policies. The report explores NMD's expectations regarding pricing from suppliers and discusses the potential focus on integrative bargaining to achieve favorable deals. Various tactics for both integrative and distributive bargaining are examined, highlighting strategies that NMD and its vendors could employ. Furthermore, the report addresses obstacles in negotiation between conflicting parties and proposes resolving strategies to facilitate successful agreements. The ultimate goal is to provide insights into effective negotiation practices that can enhance NMD's business outcomes. This document is available on Desklib, a platform offering a wealth of study resources for students.

COMMUNICATION AND
NEGOTIATION SKILLS

Table of Contents
INTRODUCTION...........................................................................................................................3
PART A...........................................................................................................................................3
1. Main problem and NMD expectation towards pricing............................................................3
2. Focus of NMD on integrative bargaining................................................................................5
3. Tactics that each of the supplier would follow for the goal accomplishment.........................7
PART- B..........................................................................................................................................9
Obstacles of negotiation between 2 conflicting parties and resolving strategies........................9
CONCLUSION..............................................................................................................................12
REFERENCES................................................................................................................................1

INTRODUCTION
Negotiation is one of the major aspect and component with regard to the business of
companies. Negotiation and effective communication with regard to making influence towards
the parties will lead to have a direct association with the business success (Săvescu, 2019). This
is because with the aspect of negotiation the company would able to grab the deal at minimised
prices and add value with profit towards its accounts. Bargaining and negotiation would be made
by both the supplier and the company but making an agreement of acceptance either from the
buyer or the seller side is important because it would lead to enable undue advantage to it. This
report will discuss the major challenges that are faced by the NMD solution along with a
discussion of integrative and distributive bargaining. This report will also discuss the various
tactics that could either be adopted by the NMD solution or the vendors for the deal. Likewise,
various obstacles in relation with negotiation along with their solution would also cover in this
report.
PART A
1. Main problem and NMD expectation towards pricing
NMD was an integrated power plant equipment manufacturer and one of the largest engineering
and manufacturing companies of its kind in India, engaged in designing. NMD has been
significantly facing issues in business grounds currently, where there are various issues further
found to be critically essential:
The main problems faced by NMD, can be analyse as follows:
 NMD faced various problems in establishing corporate working consistency within
management, as with specific working competitive environment there has been various
issues. It has been found that technology obsolete has led to dearth in orders and loss in
manufacturing and working assembling aspects variedly. The products manufactured, and
worked on among competent scenarios enable us to gain focus on reduced supply chain
management goals variedly. This also signifies that technology adoption to new goals
have to be further prioritized, where integration of specific technology and further
taking up new specific working targets further opens up scope for company. The
procurement policies of materials have been lacking effective standards where orders
placing has not been significantly proper. This further addresses focus on fact that

NMD policies has been further declining, which has reduced business booking
competitively and also lacked working specifics significantly. Supply chain management
of company has been further lacking efficacy targets for completing orders in time, which
further also impacted business transactions.
 The another specific problem, faced by NMD has been found that company lacked
trained and experienced working employees within departments which further also
impacted specific keen working efficacy. NMD specifics analysis of various issues,
where departments have been facing losses within revenue standards which further
reduces operational growth factors varied. The outdated technology and deformities in
manufacture marketable products, has further found to be highly essential where this
further has impacted company productiveness within longer run. The management has
been improper in handling issues within corporate working specifics which further
reduced competitive business growth significantly, on wider grounds
 In addition of this there are various other changes and obstacles that is faced by the NMD
solution include the occurrence of changes in technology. As NMD solution is a follower
of old technology which would occur as challenge with respect to the company.
 Likewise, occurrence of changes in the business environment in terms of external
environment that would lead to raise the prices of the raw material would emerge as a
major challenge for the company (Cherunilam, 2021). This would be counted as a major
challenge with regard to finance because along with rising of cost of supply the
company’s procurement policies and supply chain would have been affected. Likewise, it
would also lead to have a direct impact towards the financial structure of the company.
 The NMD solution also faces a major challenge of transformer. This is because with the
receipt of a big order of Electro Static Precipitator, the company lacks the major
component i.e. transformer. Although it has decided to make procurement of the
transformer but with the lack of availability of funds and the changing business situation
has raised the challenge among the company regarding the arrangement of the
transformer. With the occurrence of this challenge the company face the problem of
severe business loss in case of non-meeting up of the order.
 The company also face the challenge in regard to its procurement policy which lies
certain conditions that procurement wold be performed through tender system, order to

lowest quoted price bidder will be accepted and negotiation will be done with that bidder
only who will offer lowest price. With these provisions the company face the issue of
limitation with respect to the acceptance of services of the vendors.
NMD expectation from the suppliers:
The NMD expect that the price change would remain constant and they would get the
order at the same price which was paid previously. As with the occurrence of changes in the
business environment it was observed that the prices of the electric equipment and other raw
material was raised. This would lead to an occurrence of resistance among the DMD that they
would not be able to make the order as they had previously quoted. With this the company
expect that as the price of special oil which was supplied by USA remain same so the prices
changes towards the supply of raw material would be of no meaning. This means that the
supplier would not need to raise the prices. Thus, it would be right to state that the main
expectation of NMD with regard to its suppliers is to get the raw material and supply order at its
dream price i.e. 392 million with reference to the whole order that was quoted previously. This₹
means price changes are being expected by the NMD in terms of making a reduction of price3s
along with acceptance of offer and contract as per the quoted price or dream price which was
charged in the previous time.
2. Focus of NMD on integrative bargaining
While making an analysis of the situation and scenario of CPO and NMD it would be right
to state that it is most likely to have focus on integrative bargaining. Although in the available
option it has two ways including the integrative bargaining and distributive bargaining but as it
wants that that the Syskatech would lower the price and enable the supply of raw material at the
exact same price that was charged before and in past. As it was observed during the analysis that
both the suppliers are using the same manufacturing process and undergone through same
changes so it would be right to state that lowering of price and enabling the service and delivery
of raw material at the lower and integrative price would be highly expected by the NBD from the
supplier so that it can make arrangement of the raw material at the same rate along with catching
the deal.
An adoption of the integrative bargaining would be kept in priority because with the
adoption of this bargaining not only the need of company in terms of getting the best deal

regarding the electric equipment will be fulfilled but it will also lead to the attainment of best
quotation and price. With the enabling of integrative bargaining the order would be able to get
execute and accomplished at the same rate as it was quoted as before. This would lead to benefit
the company in terms of lower prices along with order accomplishment. This will also enable the
NBD to crack the deal with the vendor at the same rate as it was performed in past. This means
with this option the company would be safeguard from the time fluctuations.
In addition of this it is also to be noted that in order to grab and accomplish the distributive or
integrative bargaining, various tactics need to be exercised by the Aabid so that the deal would
be crack with the best bargaining strategy with the vendors.
Tactics in association with the integrative bargaining:
There could be various tactics that Aabid would adopt with regard to the grabbing of deal
with integrative bargaining. This would be start with the making of realization that the both the
company and the vendor have same goal that they need to earn the profit through the
performance of operation. Thus if Syskatech will certainly lower down the prices then the order
of electric equipment will be given to it. Likewise, Aabid would also make realize the Syskatech
that it is not being forced to lower down the prices but it just need to make delivery of the order
at the past rate. This will not lead to make the occurrence of any loss to the Syskatech because it
will get the deal. Aabid will also make clarify that as there are various vendors in the market who
may offer the supply of equipment at the same rate then then what would be the meaning of their
long term relationship. This means that by using the emotional and brainstorming tactics, Aabid
would work in the direction of changing of mind of Syskatech and grab the integrative
bargaining. In the same way with the adoption of the tactics of cooperation under which by
making a compromise of certain profit by Aabid in terms of raising of prices and insisting the
Syskatech to lower down the prices from the quoted price, the agreement would be able to
performed in an easy manner. Making influence towards the other parties would also lead to
make an agreement that would be covered under the integrative bargaining (Joullié and Spillane,
2021). This will lead to the situation under which none of the party would suffer from big loss
with an association towards the deal.
Tactics exercise in order to achieve distributive bargaining:
As distributive bargaining would involve the benefit of one party over the other which
would be possible and occur only in the response of one party (Friedman, 2017). This means that

in order to exercise the distributive bargaining Aabid would adopt such tactic that it would force
and make the supplier i.e. Tyco towards the résistance point under which Tyco would not be able
to get resist with the acceptance of the offer. This would be performed with the enabling of best
offer or other motive that would lead to have an acceptance of the offer. This would include the
aspect of influence under which Aabid will influence the Tyco to accept the order at lower rate.
Another tactic but a slight more risky tactic that Aabid would adopt is negative settlement. This
means that by offering the higher prices which is being expected by the Tyco would lead to make
the reduction of prices and resistance which is showed by the Tyco towards the acceptance of
offer. This would lead to acceptance of offer at lower prices and benefits towards the company
(Sigurðardóttir, Hotait and Eichstädt, 2019). Likewise, Aabid would also adopt the practice
under which it will make the acceptance of offer by the belief that it would be the best possible
deal at the current time and among all competitors. This means that with a belief over the aspect
that they had chosen the best deal the supplier will accept the offer and as a result the company
would get the deal at most suitable prices.
Thus, with the discovery of the resistance point of other party i.e. Tyco and influencing
that resistance point would lead to the execution and achievement of the distributive bargaining.
However, on a wider scale it would be right to state that Aabid will need to adopt the tactics in
relation of integrative bargaining so that the deal would be able to execute and cracked at lower
prices that would further benefits the company in terms of enabling electric equipment at lower
and previously paid prices.
3. Tactics that each of the supplier would follow for the goal accomplishment
Integrative bargaining:
As per this bargaining practice there would be a situation of win-win. This means under
this bargaining both the supplier and the buyer would make agreement over the specified price
under which there would be a benefit of both the parties this means the situation of win-win
(Ebner, 2021). Here under this bargaining both the parties will make collaboration with each
other and make negotiation in order to accomplish the situation of win-win.
Distributive bargaining:
It is the competitive bargaining under which one party will win gain the benefits over the
loosing of another party. This means under this bargaining there will be winning of one party and

the loosing of other (Ebner and Kang, 2018). This is competitive bargaining under which one
party will surrender and loose the case and as a result of that the opposing party will win the
condition.
As there would be an occurrence of meeting between the suppliers and Aabid regarding
the discussion of pricing informally so both the suppliers including Syskatech and Tyco would
adopt most appropriate strategies and tactics as per their bargaining method so that the pricing
would be fixed and the contract would be executed. As per the situation and mode of bargaining
the tactics would be adopted. This could be understood with the tactics of mutual benefit of
consideration as in the case of integrative bargaining of Syskatech under which the price
lowering would be performed by the party in such a manner that the supplier as well as the Aabid
would be in the situation of win-win. This means that no party would face the situation of loss
and affection. This would also include the giving of consideration and occurrence of negotiation
that would lead to evolve the occurrence of best result in terms of fixation of best price and the
execution of the contract (Scully-Russ and Torraco, 2020).
Being a bargaining strategy the best tactics would be considered as the negotiation under
which a negotiation regarding the pricing of the contract would be performed (Park and et.al.,
2019). Likewise, collaboration would also be counted as one of the most important and best
tactics under which with the aspect of collaboration the parties would make each other to be
agree with each other that would further lead to the situation of best suitable price in regard to
the contract so that none of the party would suffer the situation of loss. Although under this mode
and strategy the Syskatech would need to face certain loss but at the same time it would lead to
the situation of win-win i.e. benefits for both the party in terms of lowering the price for Aabid
and grabbing of deal for Syskatech.
In the same way the party with distributive bargaining would also adopt various tactics in
regard to the bargaining. Here the tactics of not revealing the significant information about the
circumstances would work the best because with this tactic the other and the opposing party will
become ready to accept the deal. Likewise, the practice of first anchor would also plays an
important role in this because with the strong sense of opposing party and its situation and
accordingly making of bargaining would lead to have a strong impact towards the other. Time
tactics would also to be adopted by the party with respect to the distributive bargaining (Batra,
2017). In the same way Tyco would also adopt the tactic of enabling and getting every possible

detail and information about the Aabid regarding its need that why it need this deal to be crack
and what is the importance of this deal in its business. By getting every possible information the
Tyco would implement the distributive bargaining under which it can take undue advantage of
the Aabid with the taking benefit of its condition and meeting it through the delivery of essential
supply. Adoption of the tactic of confusion would also be accompanied and adopted by the Tyco
in order to accomplish its goal. As pert this tactic it will create confusion in the mind of the
Aabid and make it realize that the deal which is offered by the Tyco would be the best among all
so that it must adopt this deal rather than looking at other options. This would lead to
accomplishment of its goal along with grabbing of the deal.
As both the party want to accomplish their goals in terms of cracking the deal so with the
adoption of most suitable method and tactics the bargaining would be able to performed. Since
the integrative bargaining would involve the mutual trust of both the parties while the
distributive bargaining would involve the benefit on one over the other would not only lead to
make accomplishment of the deal but at the same time also assist the performance of good
bargaining. Also as bargaining would involve the lowering of price with respect to the deal so
with the adoption of various mode of bargaining strategy the price quotation would be easy to
lower down. Thus, with the adoption of various tactics with regard to the concerned bargaining
strategy, the goal of both the parties would be able to get accomplished.
PART- B
Obstacles of negotiation between 2 conflicting parties and resolving strategies
Negotiation is strategic discussion related to the manner in which the key issue need to be
resolved between the two parties and accepted the same. So, through negotiation both the parties
involved emphasis on avoiding the argument and finding out a common agreement to reach a
form of compromise ( Baarslag and et.al., 2017). Thus, the main motive is to find a better
solution that could helps in resolving issue face by both and contribute in meeting their
respective needs. In the above case, there has been negotiation process carried by the Chief
procurement office of leading public sector in India. The company want certain products and
services but due to changes happening in business situation, it realize that it is not possible or
suitable for the firm to make purchase of the products and services at the same price as
previously decided (Martin-Raugh and et.al., 2020). Furthermore, the case helps in

understanding that the company have opportunity to get products from two vendors that are
having similar policies and are responsible for providing similar quantity of products and
services to the firm.
Therefore as per the case CPO is responsible for making the purchase of electric
equipment by negotiating with both the vendors in order to get best deal that have better quality
at minimum price. So that company can enjoy more benefits through getting supply from
specific vendor in limited time frame. In negotiation between the two conflicting parties there are
certain obstacles that might face by CPO of NMD solution (Kopelman, 2020). Such as the
company have specific procurement policies that it need to follow while making purchase of
products and services to contribute smooth operation of business in external environment.
Likewise, in the policy it is clearly mentioned that the procurement of material must be on the
basis of tender system only to know which party is providing at particular price, quantity and
quality.
As NMD solution has its specific procurement policy consisting of various rules and
steps in relation with the purchase of raw material and other equipment at a predetermined
prices. This will lead to the occurrence of obstacle with regard to negation with the conflicting
parties. This is because with the change in business situation grabbing of order at the same rate
would not be possible and make the negotiation to be difficult (Steele and Beasor, 2017). At the
same time making of high payment would lead to have an impact towards the procurement
policy of the company. This will lead to raise obstacle along with making it difficult to pursue
with an order. Likewise, as the company is a follower of tender system under which a tender will
be allotted to a single party for the supply of equipment and if that tender would be fix at higher
prices than it would lead to raise difficulty for the company in terms of occurrence of loss in long
run. This would also impact the company and raise obstacles with respect to making pursuing of
the order. This could be evidenced with the tender of NMD solution under which tender will be
entitled to only those party which bid the lowest price. With this situation there would be an
occurrence of conflicts among the supplier and raise obstacle for the company in terms of non-
performance of order. This would further be accompanies with the aspect of obstacles because of
the occurrence of conflicts among the vendors in terms of accepting order at lower prices.
This would be further ascertained that with the occurrence of price clashes between the
vendors the supply of not only the company would be suffer but at the same time the clashes in

terms of negotiation and integrative and distributive bargaining would also occur in terms of
non-determination of adequate pricing. This will also be assisted with the affection towards the
NMD solution in terms of its relationship with its suppliers.
Likewise, with the aspect of user of outdated technology that combine with the high
manufacturing pricing would also lead to raise obstacles with regard to the negotiation among
the suppliers. Since the cost of manufacturing of the NMD is high and in order to pursue with the
aspect of low cost it want that the contract of supply will be accepted at lower prices which will
lead to raise confliction among the vendors with regard to the pricing. Also with the aspect of
low influence towards technology would lead to raise the obstacles and issues in the course of
negotiation with the vendors because it would limit the options and raise the costing.
Thus, procurement policies, tender system and low technology influence along with high
manufacturing costing would be the main three obstacles that would resist the occurrence of
contract of supply between the vendors.
In the same way it is to be noted that with the adoption of certain strategies these obstacles
would be easy to get overcome and removed. These steps and strategies would include an
inculcation of flexibility policy in the procurement structure and an introduction of digitalization
policy for bidding. This means that with the aspect of digital technology the choice of bidding
would be raise and the company would be able to make best bargaining with its vendors in terms
of adoption of integrative bargaining (Demange, 2019). Likewise, with the aspect of making
flexibility the price quotation and vendor’s possession would be able to get fluctuate. This means
through enabling flexibility in terms of making certain raising of prices, not only the integrative
bargaining but the distributive bargaining with the conflicting vendors would also able to get
restored (He and Yang, 2018). As with the aspect of digitalization and online bidding the
company would be able to make wider choice in respect to supplier which would further lead to
assist the company in cracking the deal at most suitable prices. In addition of this an adoption of
the strategy of consolidation of supplier list, making a clear explanation of expectations with
regard to the supplier would also lead to assist the best strategy and solution in order to resolve
the issue of procurement and other related obstacles.

CONCLUSION
From the above report it would be concluded that performance of negotiation and bargaining
is an important aspect with respect to the business and companies. With the availing of
bargaining the companies would be able to get best deal in terms of low prices and cost in
relation with the manufacturing and supply. In the same way it is also understood that with the
aspect of integrative bargaining both the supplier and the buyer would get benefitted. However,
in case of distributive bargaining only one party will win and benefit over the other. In the same
way it is also summarized from the above report that while adopting a specific strategy regarding
bargaining, the company as well as supplier need to adopt various tactics to crack the sales deal.