mgmt org leadership

profileAssignmensToDo
9ConsensusBld_Negotiation_Fnl.ppt
Home>Business & Finance homework help>Operations Management homework help>mgmt org leadership


Consensus Building and Negotiation

*

Negotiation

  • Negotiation is a method by which people settle differences. It is a process by which compromise or agreement is reached while avoiding argument.

  • In any disagreement, individuals understandably aim to achieve the best possible outcome for their position (or perhaps an organization they represent). However, the principles of fairness, seeking mutual benefit and maintaining a relationship are the keys to a successful outcome.

  • The point of negotiation is to try to reach agreements without causing future barriers to communications.

*

Stages of Negotiation

The process of negotiation includes the following stages:

Preparation

Discussion

Clarification of goals

Negotiate towards a Win-Win outcome

Agreement

Implementation of a course of action


*

Preparation

  • When and where will the meeting will take place?

  • Who will attend? 

  • This stage involves ensuring all the pertinent facts of the situation are known in order to clarify your own position. 

  • Undertaking preparation before discussing the disagreement will help to avoid further conflict and unnecessarily wasting time during the meeting.

*

Discussion

During this stage, individuals or members of each side put forward the case as they see it, i.e. their understanding of the situation.  Key skills during this stage are questioning, listening and clarifying.  Sometimes it is helpful to take notes during the discussion stage to record all points put forward in case there is need for further clarification.  It is extremely important to listen, as when disagreement takes place it is easy to make the mistake of saying too much and listening too little.  Each side should have an equal opportunity to present their case.

*

Clarifying Goals

From the discussion, the goals, interests and viewpoints of both sides of the disagreement need to be clarified.  It is helpful to list these in order of priority.  Through this clarification it is often possible to identify or establish common ground.

*

Negotiate Towards a Win-Win Outcome

  • This stage focuses on what is termed a Win-Win outcome where both sides feel they have gained something positive through the process of negotiation and both sides feel their point of view has been taken into consideration. 

  • A Win-Win outcome, although not always possible, should be the ultimate goal.

  • Suggestions of alternative strategies and compromises need to be considered at this point.  Compromises are often positive alternatives which can often achieve greater benefit for all concerned compared to holding to the original positions.


*

Agreement

  • Agreement can be achieved once understanding of both sides’ viewpoints and interests have been considered.  It is essential to keep an open mind in order to achieve a solution.  Any agreement needs to be made perfectly clear so that both sides know what has been decided.

  • If the process of negotiation breaks down and agreement cannot be reached, then re-scheduling a further meeting is called for.  This avoids all parties becoming embroiled in heated discussion or argument, which not only wastes time but can also damage future relationships.

*

Implementing a Course of Action

  • From the agreement, a course of action has to be implemented to carry through the decision.

  • Informal Negotiation
  • There are times when there is a need to negotiate more informally.  At such times, when a difference of opinion arises, it might not be possible or appropriate to go through the stages in a formal manner. 
  • However, remembering the key points in the stages of formal negotiation may be very helpful in a variety of informal situations.


*

Focusing on Interests Rather Than Positions (Cohen)

  • We are normally prepared for the substance of negotiations, however, the process is unsettling – why?
  • Position-based versus Interest-based negotiation – what’s the difference?
  • Interest-based negotiation techniques can help us focus our energy on the process – how?

*

Focusing on Interests Rather Than Positions

  • Rules of Negotiation:
  • Separate the people from the problem
  • Distinguish between interests and positions
  • Consider your BATNA (Best Alternative to a Negotiated Agreement)
  • Silence is golden
  • Pursue fairness
  • Only one person can get angry at a time

*

Focusing on Interests Rather Than Positions

  • Separate the people from the problem
  • View the problem as that which needs resolving rather than the defeat of another person
  • Technique: Alternative Table arrangement

  • Distinguish between interests & positions
  • “Fighting over the orange”
  • Not only consider “what they want” but also “why do they want it”? This also applies to your interests.

*

Focusing on Interests Rather Than Positions

  • Silence is golden
  • Particularly effective if the other party is highly emotional and demanding
  • Most people are troubled by silence
  • Silence is often viewed as disapproval and may sometimes lead to modifications or concessions
  • An important element in Active Listening
  • Requires you to focus on what is being said, not shaping your response
  • Will show that your are paying attention and are interested in the other party’s interests and opinions

*

Focusing on Interests Rather Than Positions

  • Pursue fairness
  • If participants view the process of fair, they are more likely to “buy into” the result
  • If parties can agree to standards it can result in “face-saving”
  • How can one make the negotiation process “fair”?
  • Only one person can get angry at a time
  • If it’s not “your turn” you can use your energy to clearly observe the process
  • Yelling at each other in not negotiation, it is confrontation

*


Focusing on Interests Rather Than Positions

  • Consider your BATNA (Best Alternative to a Negotiated Agreement)
  • Must be based on interests rather than position
  • What’s the best alternative if an agreement is not reached?
  • Knowing your BATNA allows you to “walk away” if needed and accept your BATNA
  • What is the other party’s BATNA?

*

BATNA

  • Best Alternative To a Negotiated Agreement
  • What you would most prefer to do if you and the other party are not able to reach a deal.

  • Importance of BATNA:
  • Help you make smarter choices because they remove the pressure to reach an agreement.
  • Gives you more bargaining power because they help you quickly identify how a proposed deal stacks up against your alternatives

*

*

BATNA

  • Developing a BATNA
  • Brainstorm possible alternatives to a negotiation.
  • Weigh your underlying interests for each of the alternatives that you propose— cost, time constraints, relationships, etc.
  • Determine which alternative is your best alternative.

  • Speculating About the Other Party's BATNA
  • Consider what the other party's BATNA might be and what value the other party places on it.
  • Don't fall into the trap of deciding how the other party should see it versus how he or she really views it.

*

*

Identify your own BATNA

Describe a negotiation you’re facing in the future

Ask yourself “What will I do if this agreement cannot be reached?”

List Alternatives

Outline the interests that the alternatives meet or don’t meet. Consider – ease, process, time pressure, relationships, risks

What else could you do to improve your analysis?

Are the alternatives practical and actionable? Could they be improved?

Which one is best? The highest value alternative is your BATNA

*

*

Speculate on the other Party’s BATNA

Speculate what the other party will do if this agreement cannot be reached”

List Alternatives

Speculate about the interests that the alternatives meet or don’t meet. Consider – ease, process, time pressure, relationships, risks

What else could you do to improve your analysis? What can you do to better understand the other’s environment?

Bias check – have you fairly imagined the other party’s options?

Which one seems best? The highest value alternative is the other party’s BATNA.

What questions can you ask during negotiation to uncover the other party’s interests? List them

You’re ready to begin your negotiation. Remember – a BATNA is the standard against which any proposed agreement must be measured.

*

*

Examples of BATNA

  • What do you get if you walk away from the deal?
  • Another day at another car dealer
  • Keep the existing job

*

*

Common Negotiation Traps

  • Failing to identify your interests
  • Avoid this trap by clarifying your full range of interests.
  • In addition to price, consider other interests, such as: maintaining a positive working relationship; focusing on the "spirit of the deal" (how the agreement will work in practice); and ensuring that the negotiation process is perceived as fair and respectful by both sides.
  • Neglecting your BATNA
  • Avoid this trap by developing a BATNA—your best alternative to a negotiated agreement.
  • Determine what you would do if an agreement cannot be reached.
  • Ignoring the other side's problem
  • Avoid this trap by viewing the negotiation from the other party's perspective.
  • Speculate about their underlying interests and BATNA.
  • Compare your interests with those of the other party and look for opportunities for mutual gain.
  • Overlooking differences
  • Avoid this trap by searching for differences in interests that can suggest new options for mutually beneficial deals.

*

*

Common Negotiation Traps

  • Introducing biases
  • Avoid this trap by not letting cognitive biases such as role bias (over committing to your own point of view) and partisan perceptions (painting your side with positive qualities while vilifying your "opponent") enter into a negotiation.
  • Confusing the deal and the relationship
  • Avoid this trap by keeping issues surrounding the deal (such as price and service levels) and the relationship (such as mutual understanding and respect) separate.
  • When you and the other side don't feel that you need to trade the quality of the relationship for the terms of the deal, you exchange information more freely and become more creative and collaborative in your discussions.
  • Failing to make appreciative moves
  • Avoid this trap by keeping a constructive dialogue going.
  • When negotiations stall, solicit the other party's ideas and perspectives on an issue and express your appreciation of what the other party brings to the table.
  • Ignoring the spirit of the deal
  • Avoid this trap by clarifying expectations about how your negotiation will be implemented.
  • Determine how you and the other party will work together, resolve disputes, communicate, and handle surprises, before the ink has dried on the contract.

*

*

Consensus Building

  • A process:
  • Presentation/Proposal
  • Clarifying Questions
  • Discussion
  • Take general feelings on the proposal
  • Call for Major Objection or Strong Concern
  • A major objection blocks the proposal from passing. If you have a major objection it means that you cannot live with the proposal if it passes.
  • A strong concern does not block the passing of a proposal, but it is a public statement of why you dislike it

*

*

Consensus Building

  • Consensus – Overwhelming agreement.
  • Not unanimity
  • A product of a good-faith effort to meet the interests of all stakeholders
  • Facilitation
  • nonpartisan or neutral
  • helping groups work together in meetings
  • Mediation
  • helping parties deal with strong disagreement

*

*