Post on 19-Dec-2015
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Preparation for Negotiation
The Four Phases of negotiation Phase One: how to prepare
Phase Two: how to debate
Phase Three: how to propose
Phase Four: how to bargain
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Epilogue
Slide 3
Trading potatoes…
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Preparation…
Preparation does not eliminate surprises, nor does it cause both parties to stick to the agenda, or even the topic under discussion.
What is does is allow you to anticipate likely stances and demands, and to focus your attention on the potential for trade.
If you are thinking about the potential for trade you are thinking about the potential solution, and this alone increases your effectiveness as a negotiator
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What do we need to do first?
Textbook example – Royale Multinational ComponentsPlant is undergoing a four year total quality
improvementSpecial and very expensive machines are used to
produce computer chipsUptime – time available for production has fallen
below 70 %, while 80-90 % was expectedJack Duval has asked the manufacturer to visit the
plant and discuss how they can ensure a permanent improvement in the uptime performance
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Exercise
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Answers
“In God we trust; all others must use data”
“It does not really matter what it is that you are planning to negotiate about, if you do not have data you cannot do much but hope for the best
“Without data we are negotiating about impressions, feelings and assumptions, non of which provide a firm basis for effective decision making
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Uptime rates for five machines
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What are we negotiating about?
Kennedy writes:The negotiators are guided by their wants
by identifying their interests and from these interests selecting the issues that will achieve those interests, and for all issues they would need to decide their positions, or preferably a range of positions that they would like to achieve
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Royale Multinational Components
Interest arise from the data – the profitability of chip making is enhanced significantly when high uptime rates are achieved (their interest)
Royale wants to increase uptime (the issue)
The degree to which they want to increase the uptime is their position
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Interests and wants
Interests are found by asking “why” you want something to happen Why do I want this problem solved?
Why do I want the problem solved in this or that particular way?
Why is it necessary to adopt this or that position?
Fear, hopes and concerns
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Examples of interests
Raising living standard
Becoming more profitable
Reduce crime in order to feel safer
Satisfying your customers
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Interests and wants
Next question – what issues and positions will deliver our interests?Issues and positions – anything over which
you can trade. Anything a negotiator can trade is a tradable
Tradables unlocks deadlocks
Tradeables have different values for each negotiator
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Mustafa wants to buy a PC
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Tradables for Mustafa
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Royale Multinational Components
Suppose that the Royale project team concludes that the following elements would satisfy their wantsAn agreed minimum acceptable uptime of the
machines greater than the current average performance
Some form of self financing incentive scheme for the manufacturer if these minimum uptime rates were achieved
Some range of stiff penalties on the manufacturer if he fails to reach or sustain the minimum acceptable uptimes
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Negotiable tradables
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What is most important
After the tradables have been identified we must decide on their priorities – not everything contributes to the overall objective to the same extent
People have different wants and hence trade is possible
Each tradable is assigned as being ofHigh, Medium or Low importance
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Tradables prioritised
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Tradables prioritised
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What does the manufacturer want?
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Is there a basis for trade?
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Comparative valuations
Both place high value on uptime and medium on time of acceptable uptime
Not everything is equally prioritised
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Can we trade?
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Negotiable Ranges