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Arts of negotiation, presentationtechniques
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AON 1
Neuman - Szabó – TanácsBME Filozófia és Tudománytörténet Tanszék2016/17. ősz
AON 1
What is a negotiation?When to negotiate? When not to?Enter and exit pointsSuccess criteria
WHAT IS A NEGOTIATION?• We negotiate in different situations in different
circumstances with diverse goals and with differentpartners about very different topics
• Selling-buying something• What to see in the movies?• Discussion of a business cooperation• Divorce• Law-court trial (?)• Piece negotiation• Oral exam• .....
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WHAT IS COMMON IN THESE EXAMPLES?
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• The goal is always to reach an agreement.• The positians change dynamically.
• Exception: Law court trial. Why?
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DEFINITION
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• Negotiation: Unregulated and flexible process aiming atreaching an agreement between two or more parties.
▫ Who are the parties the previous examples? Whatpossible agreements can you think of? What doesflexibility mean in these cases?
• Arts of negotiation (AON) aim at finding general correlationstypical to most negotiations. The tools of AON helps usexamine different types of negotiation explore governingrules and helps us be more successful negotiators.
▫ Why is the law-court trial different?
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The law-court trial is not a businessnegotiation!
• Third party (the court) gets involvedbecause the parties could not agree
• Goal: not an agreement bit rather toconvince the third party!
THE (BUSINESS) NEGOTIATION• Two or more participants (persons,
groups, organizations).
• Goal: finding a compromise
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A fight: NOT a NEGOTIATION!
• Get rid of tension, attackt the other,emotional.
• Goal: pursueing our interest at all cost,beat the other party, bullying, make theother party ridiculous, etc..
THE NEGOTIATION• Confront interests, raching win-win,
maintaining or establishing goodrelationship
• GOAL: realitic mutually beneficialagreement
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A rational debate is NOT a NEGOTIATION!
• Finding the truth throughargumentation. Proofs andrefutations.
• Goal: find a conclusion that allparties may agree with.
THE NEGOTIATION• Serving interests, flexible route to
find an agreement .
• GOAl: agreement
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HOW DOES AON HELP US?• William Ury (Harvard University,):
▫ https://www.ted.com/talks/william_ury?language=en#t-75630
• An old man dies somewhere in the middle eastleaving 17 camels to his sons:▫ Half of the camels will go to the oldest▫ One third – the middle boy inherits▫ 1/9 of the camels should go to the youngest
• Unfortunately 17 is a prime. Cannot be divided eitherby 2,3 or 9.
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How does arts of negotiation help? (2)
• The boys decide to consult an old wise woman:▫ She has one camel that she can lend the boys.
▫ The total number of camels will be 18▫ 18/2=9 – for the oldest▫ 18/3=6 – for the middle▫ 18/9=2 – for the smallest
• 9+6+2=17 -> they need 17 camels• They return the camel to the lady.
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WHY DO WE NEGOTIATE?
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• It takes effort and energy to negotiate.• Negotiations always have some risk.
▫ We must have good reason to enter a negotiation.
• We enter a negotiation if: we are not fully satisfied withour present situation (broadly construed), and we envisionan agreement that will improve it.
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WHEN IS IT WORTH TO NEGOTIATE?• If the expected agreement promises more value than our
status quo or other solutions reached with different means.= ENTRANCE CRITERIA.
• The negotiation is successful if it guarantees more morevalue than our status quo or other solutions reachedwith different means
• = SUCCESS CRITERIA.
• The negotiation is not successful if it establishes anagreement with less value than our status quo or othersolutions reached with different means.
You are wrong if you are notopen to negotiation with thehope of guaranteeing a morevaluable situation than thestatus quo!
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WHAT DOES SUCCESS MEAN IN A NEGOTIATION?
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• The outcome of a negotiation is successful for us if we reachedthe most favorable solution given the circumstances.
▫ The assessment may contain subjective elements, too.
• Success therefore cannot be measured 100 % objectively.
▫ Examples:
� We believe that we purchased something for the lowestpossible price because we have not learnt about thelatest price cuts – we happily agree.
� We managed to have our salary increased to a level 10%higher than the average.
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WHEN SHOULD WE SAY NO TO NEGOTIATION 1?Examples1.:• If you are not interested in an agreement, you may lose and gain
nothing- e.g.: someone wants to buy your limited edition bicycle that you haveno intention to sell, especially because the offered price is way belowthe value you find reasonable, moreover, you will not be able to go towork without your bike.
• If the status quo is optimal.– e.g.: we are happy with the agreement we reached with thefirewood supplier.
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• If the other parties expectations are illegal, unjust,morally unacceptable.- e.g.: blackmail, fraud, corruption
WHEN SHOULD WE SAY NO TO NEGOTIATION 2?examples 2:• If you have reached your capacity limit, do not negotiate! Increase
your price, instead!– e.g.: you have multiple requests for holding trainings. This is asituation when you can ask for more money and limit yourundertakings.
• If the negotiation is too risky. Try to find another solution in tis case!- e.g.: rewriting a midterm can also be considered a kind ofnegotiation. But: if you run the risk of lowering your existing grade,than you take a huge risk.
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• If we are certain that the other party is not flexible.– e.g.: you do not start bargaining in a supermarket,since the assistant is not in the position to decreasethe price.
WHEN TO SAY NO TO NEGOTIATION? When to postpone:
• If you are under time constraint: time constraint increases the risk ofmaking mistakes, agreeing contrary to your interests.-e.g.: you have to find a flat as soon as possible. You don’t have time toevaluate the market, see the prices, selections, etc.
• If you are not prepared for the negotiation: the possibilities, theimportant questions, the best answers you will find out only after thenegotiation!- e.g.: an employee „attacks” his boss for wage increase in the elevator
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WHEN TO SAY NO TO NEGOTIATION? When to postpone 2?• Ha a várakozás erősíti a pozíciódat.
-példa: ha a karácsonyfa vásárlással kivárjuk az utolsó pillanatot, amikoraz eladók akciósan kínálják a megmaradt fákat. Piaczárás előtt fél órávalnagyobb esély van lealkudni a termékek árából, mert az árusnak akkor márnem a nagy haszon, hanem a készleten való túladás a célja.
• Ha a másik/többi résztvevő téves hitben van: szakítsd meg a tárgyalást, haannak jeleit látod, hogy a másik/többi résztvevő téves hit szerinttevékenykedik.-példa: azzal a felhatalmazással mentél tárgyalni, hogy egy beruházásütemtervéről megegyezz a partnerrel, de ő azt hiszi hogy a munkaerőbéréről fogtok alkudozni.
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EXIT CRITERIA• If we reached a compromise• If the compromise would lead you to a worse situation than your
status quo.• If the negotiation would lead you over your capacity limits.• If it is clearly impossible to reach an agreement.• If you need a new negotiation round.• If it becomes clear that the person you are meeting is not the one
who is in charge of the given deal.
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CASE STUDYIt would have been a better choice tonegotiate
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• There are occasions when werefuse to enter a negotiation andfeel sorry about it afterwards.
• Usually we can still go back tothe negotiating table.
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However, sometimes we lose the opportunity to negotiate.
INTERIOR DESIGNER FURNITURE COMPANY
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Client
vs.
Negotiation would have been theright choice(1)• A furniture company (F) recommended an Interior Designer Agency
(I) to a client. The project was the interior design and furnishing anew office buliding
• In exchange, F asked I to use his furnitures in his proposal.
• I contacted the client.
• the client changed his mind and organized a tender for choosingthe interior designer. The interior designer will be asked to do thefurnishing, as well.
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Negotiation would have been theright choice(2)• I wanted to win this bid, therefore, he offer a price way below the
market average. If he wins the project, he will lose money, unlesshe can overprice the furniture. This was exactly, I had in mind. ttszázalékát.
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Negotiation would have been theright choice (3)• I won the bid.• I prepared the design.• The client changed his mind once again, and decided to have a tender for
the furnishing, as well.• It has been decided that I has to organize an open tender in order to
choose the right furniture company for the office building.• I had to learn that F has absolutely no chance to win this tender,
because…
▫ his offer was not the cheapest▫ he ranked only no 3 in the quality ranking.▫ In the value for money assessment F was not among the 3 best.
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Negotiation would have been theright choice (4)
• Summarizing: I was not able to argue for chosing F.
• I had to decide to exclude F from the short list
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Negotiation would have been theright choice (5)• F learnt about the outcome of the competition – but not from I .• F tried to influence the client by asking a common friend to try to bribe
the management of the client. He did not succeed.• The relationship between the client and F suffered from the failed
corruption initiative.• The client chose the furniture company, obviously not F.• I learnt that F is furious about the story. I tried to contact F, but F did not
want to speak with I.• I was thinking about initiating a negotiation, but rejected this idea later.
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Negotiation would have been theright choice (6)• THE RELATIONSHIP BETWEEN THE FURNITURE COMPANY
AND THE INTERIOR DESIGNER AGENCY WAS DESTROYED!
• THE FURNITURE COMPANY LOST AN IMPORTANT CLEINT.
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MORAL
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• Avoiding the negotiation did not only result in losing abusiness oppportunity
• It had a negative impact on the relationship between theparties, too.
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CONSTITUENTS OF A NEGOTIATION
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• Content: the subject of the negotiation
• Process: how the negotiation goes on
• Relationship: relationship between the parties, howthe negotiation affects it
A negotiation is considered successful if it isaltogether successful.
REFERENCES
• Fischer, R. – Ury, W. – Patton, B., Getting to Yes -Negotiating Agreement Without Giving In, 1994 PenguinBooks.• Fisher, R. – Brown, S., Getting Together: Building
Relationships as We Negotiate, Penguin Books New York• Ury, W., Getting past no.Bantam Books 1991 New York• Gosselin, Tom (2007): Practical Negotiating: Tools,Tactics, & Techniques. John Wiley & Sons. Inc.
• Fisher, Roger – William Ury – Bruce Patton (1991): Gettingto Yes: Negotiating an Agreement Without Giving In.Houghton Mifflin Company.
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THANK YOU FOR YOUR ATTENTION!
Neuman Péter: [email protected]ó Krisztina: [email protected]
Tanács János: [email protected]
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