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INTRODUCTIONArmenda Daye, Procurement Analyst, Acquisition Career Manager, DOI
Overview of the new Interest-Based Negotiations course
Personal Background Information
2007 & 2008 Contracting Competency SurveysContracting personnel need improvement in negotiating skills
2-Day interactive IBN course developed to encourage employees to negotiate in a fearless manner
IBN Course Schedule and Registration2010 ScheduleWednesday, March 24Thursday, March 25Tuesday, April 20Wednesday, April 21Wednesday, May 12Thursday, May 13Wednesday, August 11Thursday, August 12
RegistrationFederal Acquisition Institute Training Application Systemhttps://www.atrrs.army.mil/channels/faitas
Difference between my Position-Based Negotiation course with DoD and the new Interest-based Negotiation Concept-40 hour course-Emphasis on WINNING-Two Groups 50% students represented contractor, 50% Government-Worked on math-laden proposal for 4 days and conducted the negotiation on 5th day-Negotiations were Emotional (apprehension, anger, tears)
Three ObjectivesDistinguish between position-based and interest-based negotiationIdentify the interest-based negotiation processExplain the elements of an interest-based approach to negotiating
Discussion of:Definition of NegotiationTypes of Negotiation MethodsThe Interest-based Negotiation Process
What is Negotiation?Back-and-forth communication to reach an agreementA means of getting what you want from othersAn attempt to resolve differences
Why Do We Negotiate?Because we want or need:Something others have Someone to do something
When Do We First Learn to Negotiate?
What Do We Negotiate Over in Government Acquisition?
Price
Delivery
Quality
Two Types Of NegotiationPosition Based (The What)Interest Based (The Why)
Position-Based NegotiationFocuses on pre-determined solutionsAttacks the opposing parties positionsProduces unsatisfactory agreements
Interest-Based Negotiation (IBN)Focuses on all parties:Individual needsOrganizational needs
Five Elements of IBNSeparate the people from the problemFocus on interests, not positionsCreate options for mutual gainDefine objective criteriaDevelop your BATNA
1. Separate the People from the ProblemPeople and problems get entangled by:EmotionsCommunicationsPerceptions
2. Focus On InterestsPositionsInvolve a Predetermined solutionRequire justification (defense)End discussionsInterestsExamine Why a solution is preferredRequire explanation (reason)Start discussions
3. Options for Mutual GainRecognize there can be > 1 optionExpand the pie thru Brainstorming
4. Objective Criteria (Mutually Acceptable Yardsticks)
Others in the industry doThe last time this happened weThe standard contract says
What is customaryPrecedentLaw
5. BATNABest Alternative to a Negotiated Agreement (Walk Away Position)Consider what you will do if an agreement is NOT reachedIs Activated when Alternatives are OUTSIDE the negotiationMust be real and concrete
Options vs. BATNAOptionsInside the negotiationCreated with counterpartPotential solution(s)/ brainstormingBOTH you and counterpart receive benefitBATNAOutside the negotiationCreated aloneFall back position if negotiation failsONLY impacts you/your organization
The IBN Process
WifeI want a vacation in Las VegasHusbandI want a vacation at the beachVacation Problem
Vacation SolutionWifeI want a vacation in Las VegasHusbandI want a vacation at the beach
Understand your position and theirsRecognize your interests and theirsExplore options for mutual gainUse objective criteriaIdentify your BATNA and theirsIBN CONCEPTS SUMMARY
Government Example of IBN Process: Negotiation with Program OfficeProgram Office wants a sole-source contract
1. UNDERSTAND YOUR POSITION AND THEIRS
Your Position: Legally Sufficient Contract
Their Position: Assured Quality Contractor
2. RECOGNIZE YOUR INTERESTS AND THEIRS
Your Interests:Competition, Best Value
Their Interests:Timely, Quality Service
3. EXPLORE OPTIONS FOR MUTUAL GAINUse of a Government-Wide Acquisition Contract (GWAC)
Use of an existing DOI Contract
Use of Sole Source Contract w/proper justification (FAR Part 6)
4. USE OBJECTIVE CRITERIA (for Negotiation with Contractor)
Rates in GWAC Contract(s) or existing DOI Contract(s)
Consumer Price Index
DCMA Forward Pricing Rates
5. IDENTIFY YOUR BATNA
Target Price in Pre-Negotiation Memorandum
Amount of the funded requisition
Ceiling Price in Pre-Negotiation w/concessions on delivery and/or quality
QUESTIONS
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