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Nothing but NegotiationNothing but Negotiation
Graham Botwright Roger Greenfield
Strategic Negotiation
© 2007, The Gap Partnership, All Rights Reserved
Negotiation is where...Negotiation is where...Negotiation is where...Negotiation is where...
Two parties resolve differences to reach agreement
© 2007, The Gap Partnership, All Rights Reserved© 2007, The Gap Partnership, All Rights Reserved
Commercial negotiation is where...
Commercial negotiation is where...
The buyer wants to buy
and the seller wants to sell
and the basis of the business
needs agreeing
© 2007, The Gap Partnership, All Rights Reserved
Sell
Persuade
Rationalise
Argument
Convince
Justify
Qualify
Explain
Enthuse
Ask
Negotiate
Question
State
Listen
Think
Wait
Control
Position
Consider & Weigh
Tell© 2007, The Gap Partnership, All Rights Reserved
The values of society
The values of society
The behaviours of negotiatorsThe behaviours of negotiators
CaringCaring
ConsiderateConsiderate
Co operativeCo operative
ConformingConforming
DependableDependable
FairFair
Generous Generous
Honest Honest
OpenOpen
RationalRational
ReliableReliable
TruthfulTruthful
UnselfishUnselfish
WillingWilling
ArrogantArrogant
ClosedClosed
DishonestDishonest
EmotionalEmotional
InconsiderateInconsiderate
IndifferentIndifferent
IrrationalIrrational
MeanMean
RejectingRejecting
SelfishSelfish
UnfairUnfair
UnreasonableUnreasonable
UnreliableUnreliable
UntruthfulUntruthful© 2007, The Gap Partnership, All Rights Reserved
‘Any man who tries to be good all the time is bound to come to ruin among the great
number who are not good. Hence a prince who wants to keep his authority must learn
how not to be good, and use that knowledge, or refrain from using it, as
necessity requires.’Niccolo Machiavelli. 1469-1527Niccolo Machiavelli. 1469-1527
© 2007, The Gap Partnership, All Rights Reserved
The balance of powerThe balance of power The level of dependency - BATNAs The power of the brand History / precedents Market conditions & competitor activity The nature of the product or service Each party’s time pressures Each party’s circumstances Personal relationships
© 2007, The Gap Partnership, All Rights Reserved
Negotiation Power LawsNegotiation Power Laws
• The Law of Reciprocity
• The Law of Scarcity
• The Law of Authority
• The Law of Legitimacy
• The Law of Relativity
• The Law of Difference
© 2007, The Gap Partnership, All Rights Reserved
Information is power
Questioning and Listening
GAINS POWER LOSES POWER
Talking and Arguing
© 2007, The Gap Partnership, All Rights Reserved
Are you ‘in charge’?Are you ‘in charge’?
1. Do others view you as someone who turns up late?2. Do others view you as disorganised?3. Do others see your lack of planning?4. Do others see you as talkative?5. Do others view you as passive?6. Do others view you as aggressive?7. Do others view you as wanting to be liked?8. Do others see you missing deadlines?9. Do others see you as apologetic and excusing?10. Do others see you as emotional?
0: Strongly disagree 0: Strongly disagree 1: No strong view 1: No strong view 2: Strongly agree 2: Strongly agree
© 2007, The Gap Partnership, All Rights Reserved
121
3
6
9
11
10
8
7 5
4
2
SupplierBartering
Haggling /Bidding
Hard Bargaining
DealingConcession Trading
Win Win
PartnershipJoint Problem Solving
RelationshipBuilding
Negotiation contextNegotiation context• Price is the most important variable
• It can be tough and arrogant
• There is little dependency on each other
• There is no long term contract
• The deal is win/lose or competitive
• Price is less important than finding creative solutions to add value
• There is a warm relationship
• Both parties are more dependent
• Trust is important
• Both parties benefit from the deal
• Price is still important
• Now there are other variables or ‘levers’ discussed in the deal
• Both parties need to share information
• Negotiations are about getting things in return for concessions
© 2007, The Gap Partnership, All Rights Reserved
TrustTrust
‘The act of sharing information,
demonstrating flexibility,
using the law of reciprocity’
© 2007, The Gap Partnership, All Rights Reserved
CLIMATE
Positive/affirmative language
Park Issuesrather than
reject
Provide options-How
ManageInformation
sharingBuild on their
ideas
Co-operative
Competitive
Secretive -no information
sharing
Reject issues
Gestures, Inappropriate
NVC
Inflexible
No , Can’tWon’t !
© 2007, The Gap Partnership, All Rights Reserved
Cost
Inreturn Cost
Inreturn
InReturn
+
Cost
+
USUSTHEMTHEM
© 2007, The Gap Partnership, All Rights Reserved
Power and Relationships • People rarely exploit their power fully
• Power is obtained from many sources
• Power can be exploited competitively, collaboratively or creatively
• A ‘relationship’ is not a ‘soft’ and ‘fair’ approach
• A relationship takes years to develop and seconds to shatter
© 2007, The Gap Partnership, All Rights Reserved
8 Things to consider8 Things to consider
• Negotiators do not sell or rely on logic• Negotiators offer satisfaction to the other party• Negotiators are not their feelings• Negotiators assess and exercise power • Negotiators are in charge• Negotiators adapt behaviour to circumstances• Negotiators are able to build trust• Negotiators seek out low-cost / high-value trades
© 2007, The Gap Partnership, All Rights Reserved
Nothing but NegotiationNothing but Negotiation
‘‘You only have power over people You only have power over people so long as you don’t take so long as you don’t take everything away from them. everything away from them. When you’ve robbed a man of When you’ve robbed a man of everything, he’s no longer in your everything, he’s no longer in your power – he’s free againpower – he’s free again’’
A. SolzhenitsynA. Solzhenitsyn
© 2007, The Gap Partnership, All Rights Reserved