Negotiation Fundamentals for Project Managers

© ESI International PMC:CW3:EN:000 ver. 2.0

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Negotiation Fundamentals for Project Managers


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Objectives

By the end of this module, you will be able to—Define negotiation in the context of project managementIdentify and evaluate stakeholder relationships on your ownproject(s) to determine the need to negotiateAnalyze relationships with project stakeholders to determineimplications for negotiationIdentify the major areas and phases within project managementwhen negotiations occurAnalyze the project constraints as they relate to negotiation

Module 1: Negotiation Fundamentals for Project Managers

© ESI International PMC:CW3:EN:000 ver. 2.0 5


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Definition of Negotiation

Latin“neg” = not“otium” = leisure

Negotiation is hard work!So, why negotiate?Negotiation is an attempt to solve adisagreement or misunderstanding—tocome to agreement.It occurs many times and at manylevels of a project.


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Negotiation and Project ManagementConsiderations

Power = Amoral; has neither good nor badinitiative where stakeholders discussionsare concerned—is simply movementPolitics = Use of power to accomplishdesignated objectives


6 PMC:CW3:EN:000 ver. 2.0 © ESI International


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Negotiation and Project Management

Project Environment StakeholdersProject Life CycleProject Constraints


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Exercise 1-1

Identifying and Negotiating with Stakeholders

Tool: Identifying and Negotiating with Stakeholders




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Strategies for Negotiating with Different Typesof Stakeholders

AlliesAdversariesChallengers"Yes" people


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Negotiation and the Project Life Cycle

Tool: Negotiating Through the Project Life CycleHandout: Negotiation and the Project Life Cycle Sample Response




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Negotiating the Project Constraints

Which constraint do you typicallynegotiate first on your projects?


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Negotiating the Project Constraints: ACollaborative Approach

At the beginning of the Exploration stage, suggest the following process:A. Requirements and Scope: Clear and comprehensiveB. Schedule

1. Estimate individual task duration2. Set task start dates3. Agree on dependencies to set critical path4. Calculate final deliverable date

C. Budget/Cost Estimates1. Type of contract2. Cost estimates by major deliverable or just overall?




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Two Approaches to Negotiating Scope


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Key Messages

Negotiation is an attempt to resolve a disagreement, dispute, ormisunderstanding.Project managers need to understand organizational power andpolitics as well as relationships with stakeholders while negotiating.Negotiation occurs throughout the project life cycle.Negotiation in the project [management] context requires anunderstanding of how to manage the family of project constraints.The order in which the project constraints are negotiated willdepend on the situation, organization, industry, and culture;however, identifying requirements and scope first will often lead togreater success.




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Next Steps: Action Plan

How can you apply what you learned in this module to your workenvironment?

Turn to the Action Plan tab and find the worksheet for this module.Using the questions provided on the following slide, develop a list ofactions you will complete when you return to work.For each action (what), identify—

Who needs to be involvedWhen you anticipate completing the action


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Next Steps: Action Plan (continued)

Take a few minutes to think about what you have learned duringclass and review the questions below.

What challenges do you encounter when negotiating the projectconstraints (time, cost, scope, resources, quality, risk) on yourprojects?Considering the discussion of negotiating scope, what is thedifference, in your own words, between the two approaches? Whennegotiating scope, what has your experience been?How can effective negotiation skills enhance your ability tonegotiate in a project environment?What have you learned about stakeholders that could help you bemore effective on your projects?



Negotiation Fundamentals for Project Managers

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