A negotiation is a dialogue which is aimed at settling a dispute so that a conclusion is reached which is agreeable between the parties involved. A negotiation is also a bargain which results to an individual advantage. There are many styles of negotiations which are currently in use. A particular style in use will depend largely on the context and interest of the opposite party which is involved in the negotiations. The approaches used during a particular negotiation also depend on the prevailing circumstances which led to the dispute.
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Negotiation happens in, organizations, public offices, legislative processes, internationally and also in marriages during divorce. Therefore, in everyday life, we will always face challenges which will lead us to the path of negotiating with the other party. Negotiation theory is thus the study of negotiation which is quite crucial in contemporary society. In the modern world, there are professional negotiators who can act to represent an individual, organizations and any other party involved.
Factors to consider when preparing for a negotiation
Generally speaking, there are many factors which a person should consider before they engage in any kind of negotiation. As NTI (2010) observes these aspects consist of;
- Competitive investigation- Identifying the behavior of market can help demystify the prevailing working operations of the market.
- Identifying the objectives of the negotiation is also another factor which needs to be considered. Since all sides want to gain form the deal, a party should prioritize their objectives so as not to risk being exploited.
- Price and payment of the negotiation object should also be considered in that negotiators should relate their bargains to a synergistic approach in a joint problem solving situation.
- Maintenance cost of the goods should also be considered. The revenue during maintenance of machinery for example should be considered together with the cost of fuel, safety and performance monitoring.
- The delivery cost can also be imposed on the buyer. Thus a buyer, while negotiating should consider such costs.
BATNA is an acronym for Best Alternative to a Negotiated Agreement. It is a term coined by Roger and Ury, renowned writers and business people. There is no way a wise decision can be made unless the parties involved know what the alternatives are at their disposal.
The individual BATNA is the threshold that protects the individual’s both accepting an offer which is not favorable, or from rejecting a favorable offer (Spangler, 2003). This indicates that one should consider withdrawing from a negotiation should they find it hard to improve the agreement. In doing all these, the cost of withdrawing from negotiation should also be taken into consideration.
Negotiation power is increased when a person has a good BATNA. Determination of ones BATNA should be a critical factor before engaging in any type of negotiation. Thus one should develop a list of actions which serve as an alternative to the agreement, improve some of the prospective ideas which should be also converted to practical options and select the best options from the alternatives (Spangler, 2003).
As an example, when a person does not receive a good job from a particular company, there are a number of things the person needs to do. First the person should invent options which may include whether or not to take a different job, go to another city or even considering going back to school. After doing this invention, the person is required to choose the best option from the alternatives.
Negotiation price is the lowest price which is favorable to a party, in which the party can accept as a final settlement in a negotiation. For instance when person A wants to sell a property to person B, person A will have to consider the walk away point or the threshold value for the property before accepting the offer given by person B. thus this is the minimum price which a seller would accept from a buyer, or the maximum price which a buyer is willing to accept from a seller. Reservation prices are quite familiar to the auctioneering field. These prices are often developed from the BATNAS of the negotiators (The Negotiations Experts, 2010).
Ethical and unethical behaviors in negotiations
During negotiations there are people who may engage themselves in unethical behaviors. This is the dark side of this story. Thus gambits can be used to deceive a party during the act of negotiation.
Multiple gambits include the act of misrepresentation and a negotiator becoming hard nosed with his bargaining. Unethical behavior can also include referring the issue to a higher authority. Thus as a negotiator, you should be able to chose between one or two alternatives on how to respond to such gambits (The Negotiations Experts, 2010).
The other way of reacting to unethical behavior is when the seller mimics the characteristics of the buyer. In this situation, both parties get on each other and both are not willing to back down. Thus the chances of coming up with an agreement are lessened. Worse still, one or both parties are likely to back down from the negotiations.
There are however remedies to these situations. A person is advised to know and differentiate the different kinds of unethical behaviors which can arise during negotiations. This is because it will be much easier to succeed in a counter move should such behavior occurs.
One is also advised never to attack. Instead, one should take up the opportunity and challenge it. It is also good for a person to know their BATNA. Always have an alternative to any given situation.
One should remember that they know how to play their own game better than the other party’s game (The Negotiations Experts, 2010). Thus they should play their own game. It is also worth noting that in any given negotiation, it is all about a person’s future, not the other party’s future. Hence, the reputation of the person after they have struck a deal is critical here.
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The use of distributive and integral negotiations
Distributive negotiations also called win-lose bargaining is a sort of negotiating strategy which is competitive in characteristic. It is used to find ways of distributing fixed resources amongst two parties involved at the negotiation table. Hence the more one party gains the more the other party losses (The Negotiations Experts, 2010). Thus in this kind of negotiation, each party will always find itself trying to gain the most for themselves and does not mind about how much the other party loses.
An integrative negotiation, on the other hand is a situation in which all sides of the negotiations will cooperate so that the outcome is a win-win situation. This results into realization of maximum mutual gains by the two parties. Integrative negotiation is critical because its outcomes are more satisfying than the outcomes from distributive negotiations.
Interest based, rights based, and power based approaches applied in the process of conflict or dispute resolution
Interest based approaches are those approaches which focus on competing interest. This type of bargain demonstrates its ability to enhance negotiation agreement without harming the sides involved (Stepp, Sweeney, & Johnson, 1998).
Thus there is sharing of information, creatively exploring the market and working towards mutual benefit like in the case of integrated negotiation. A good example is when parents quarrel on whether to purchase a new automobile. The father’s interest may be to impress his friends while the mother’s interest may be the issue of transport (Ury, Bret, & Goldberg, 1998).
Another way of solving conflicts is by investigating who is right. The word rights is used here as the short hand for who is right. The outcome here determines who gets what that is why the two parties involved usually outsource the services of another party to resolve the conflict. The third party often has the power to hand down a binding decision.
For instance when a worker claims to be given new overalls to replace the ones he had which were stolen. The boss doesn’t want to replace it so the issue develops into a dispute. The dispute will be resolved by a third neutral party which may compel the company to give in to the worker’s demands.
Power based negotiations are those disputes resolved in line with the basis of power. Thus one party is able to coerce the other inferior party, something that would not be otherwise done by the inferior party (Ury, Bret, & Goldberg, 1998). A good example is when employees go on strike. They exercise their powers by imposing economic costs to the company they are employed in.
Negotiations training institute. 2010. Negotiations Training Tips, Negotiation Seminars Preparation is the Key to Unlocking a Successful Negotiation Web.
Spangler, Brad. 2003. Best Alternative to a Negotiated Agreement (BATNA) Web.
Stepp R. John, Sweeney M. Kevin, Johnson L. Robert. 1998. Interest based negotiation: An Engine Driving Change, The Journal for Quality and Participation.
The Negotiations Experts, 2010. The Unethical Side of Negotiation, Some Objective Insights and consequences of using unethical means to achieve results Web.
Ury L. William, Bret M. Jeanne & Goldberg B. Stephen. 1998. Negotiation Fundamentals, Three Approaches to Resolving Disputes: Interests, Rights, and Power, section 1, Jossey-Bass, Inc.