BUSINESS COMMUNICATION

ASSIGNMENT
ON

NEGOTIATION

Submitted By: Group 2 ( PGPM A)

Chandan Sahu Pritam Kumar Kar

Paramita Kundu Suraj Singh Khatri

Isha Mishra Swaraja Sahoo

Jhuna Sahoo Sagar Kumar Barik

Submitted to: Prof. Dr. Nitiranjan Chand

Professor in Business Communication Skills
“Let every eye negotiate for itself and trust no agent”

William Shakespeare
 NEGOTIATION
Negotiation is a part of normal everyday life. Life itself is just one continuous
negotiation.

Negotiation describes any communication process between individuals that is

intended to reach a compromise or agreement to the satisfaction of both parties.
Negotiation involves examining the facts of a situation, exposing the both the
common and opposing interests of the parties involved, and bargaining to resolve
as many issues as possible. Negotiation takes place every day in nearly
every facet of life—from national governments negotiating border disputes, to
companies negotiating work agreements with labor unions, to real estate agents
negotiating the sale of property, to former spouses negotiating the terms of a
divorce. Small business owners are likely to face negotiations on a daily basis
when dealing with customers, suppliers, employees, investors, creditors,
government agencies, and even family members. Many companies train members
of their sales forces in negotiation techniques, and many others hire professional
negotiators to represent them in business dealings. Good negotiation requires
advance preparation, a knowledge of negotiating techniques, and practice.

Definition of negotiation
Negotiation is any activity that influences another person. Here's how a number of
leading thinkers define the topic:

        * Negotiating is the process of getting the best terms once the other side
starts to act on their interest.

On Negotiating by Mark H. McCormack

        * ... negotiating is... a means of achieving one's goals in every relationship
regardless of the circumstances.

The Art of Negotiating by Gerard I. Nierenberg

Examples of negotiations
Everyday examples of negotiation are-

a) A brother & sister debating over a choice of a movie

b) Two friends trying to settle the amount for which one wants to sell his old car to
the other.

C) Two sisters fighting over how a box of chocolates should be divided between
them.

d) A supervisor making a suggestion to his manager.

e) A sales person trying to arrange a meeting with a prospective dealer.

f) In market everyday negotiation goes on.

THE NATURE OF NEGOTIATION
The following two points make the nature of negotiation quite clear:

1. Negotiation takes place between two parties. Both parties are equally interested
in an agreed action/ result.

2. Negotiation reaches agreement through discussion, not instruction, orders or

power.

For e.g-when a manager deals with other managers or customers or suppliers over
whom he has no power, he tries to achieve results by agreement through
discussion, persuasion & argument. In other words he negotiates.

TYPES OF NEGOTIATIONS
There are three types of negotiations.

A] DISTRIBUTIVE NEGOTIATION

B] INTEGRATIVE NEGOTIATION

C] MULTIPARTY AND MULTIPHASE NEGOTIATION

DISTRIBUTIVE TYPE OF NEGOTIATION:

In this type of negotiation the parties compete over the distribution of a fixed
sum of value. The key question in this negotiation is “who will claim the most
value?”In this,a gain by one side is made at the expense of the other.

In this the bargaining centers on who will claim the most value. Some people
refer to this type of negotiation as zero sun or constant sum negotiation. The term
win loss is probably more representative of what is involved.
E.g- (a) While selling a car both parties are unknown to each other. Only money is
important. One may gain the other may lose. Relationship is not important.

(b) Wage negotiations between business owners & their union employees.The
owners know that any amount conceded to the union will come out of their own
pockets vice versa.

INTEGRATIVE TYPE OF NEGOTIATION:

In this type of negotiation , the parties co-operate to achieve maximum benefits by
integrating their interest into an agreement .The negotiations center on creating
value in addition to claim it.

In this your take is of two folds-

1] To create as much value as possible for yourself and for the other party.

2] To claim value for yourself

E.g- Takeover of Satyam by Mahindra.

MULTIPARTY AND MULTIPHASE NEGOTIATION:
In reality many negotiations are not so simple.They involve more than two parties
and they sometimes take place in several phases.Each devoted to one of several
important issues.

For e.g-

As an H.R executive or manager one might find oneself participating in

ongoing H.R department budget negotiations or large, long term projects with H.R
consultants. In addition to one may be involved in class-action employment
litigation or simultaneous contract negotiations with two or more company unions.

Process of Negotiation

Steps to a Successful Negotiation

Ever wonder how you’re going to get any good at negotiating? One way to start is
to follow a plan that ensures you do not miss any steps in the negotiation process.
Inexperienced negotiators often make the mistake of reaching an agreement too
quickly. Slow things down and analyze the negotiation in process so that it will
give you the chance to walk away a winner.

The steps or process can be :

1. Preparation: Do your research ahead of time to so that you know your

opponent and you know what you want from the negotiation.
2. Discussion:

a. Open: Let the other side know what you want and let them tell you what
they want.

b. Argue: Back-up your case with evidence and uncover defects in their
argument.

3. Proposal:

a. Explore: Search for common ground and agreeable outcomes.

b. Package: Put together different acceptable options for both parties.

4. Agreement:

a. Signal: Show that you are ready to reach an agreement.

b. Close: Come to an agreement and finalize the negotiation.

c. Sustain: Ensure that their side, and yours, follows through with the
negotiated agreement.

In practice, these steps will not be followed exactly. You may get stuck on one
step, or go back to another. Starting off with a definite plan of attack gives the
upper hand and confidence that you would not otherwise have had.

Ways to persuade a successful negotiation

The single biggest danger in negotiation is not failure but to be successful without
knowing why you are successful. - Jens Thang
In negotiation, you have to persuade. It can improve your negotiation results.
Persuasion is something everyone has to do. There is no secret formula on how to
persuade more effectively. It depends on which persuasion principles that you
apply.

The 6 principles of persuasion by Robert Cialdini is not rocket science at all. This
post will provide an overview of the 6 principles of persuasion which you can use
immediately in your next negotiation. These 6 principles are there to guide you and
not rules to live by. We should look at them as guidelines which can open up more
options for you when you negotiate.

1. Principle of Liking

People are easily influenced by what they like. Research have shown that there are
many things you can like someone (e.g physical attractiveness, compliments and
cooperative efforts). However, one factor really stands out. And it’s the most
powerful and easiest to implement: Similarity. The way to bring down the
influence barrier is to let the other party see that you like him. This is more
important than he liking you.

As an effective negotiator, we should spend time in trying to discover similarities

between relevant parties and bring them out. Identify the interests that both parties
have in common.
2. Principle of Authority
People are easily influenced by what they deemed as legitimate authorities. We are
socially influenced to associate credibility with authority. It works amazingly if the
person you are trying to influence recognizes your background, expertise and
credentials in the particular area. People feel secure in following the opinion of an
expert. The problem with some poor negotiators is that they often brag about
themselves. It turns people off. In order to be more persuasive, being an expert is
not sufficient.

You must also be able to communicate that you are a trusted source of information.
For e.g if you are a negotiating on a particular deal, inform parties of your
experience in doing such deals. You can do this in the preliminary conversations
that you have with the other party. Mention your expertise in the subject matter of
the negotiation.

One trick to demonstrate your trustworthiness is by admitting your own

weaknesses. If you are unclear on a particular area, be ready to admit it. This will
actually lower the influence barrier. There is a strategy that many strong
negotiators use when they are in a weaker spot. It will be effective if you are in a
lower position: Before you give your strongest argument, mention a weakness
first.

Tell them even if they already know. Do not pretend to be in a position which you
are not. You show that you are being truthful. Higher credibility, lower barriers.

3. Principle of Scarcity
How to make people want something more? Make it scarce.

When people know that they can’t have something, it’s rare and it’s scarce, they
will want it more than ever. As something or an opportunity becomes less
accessible, it becomes more desirable. The lack of availability and scarcity confer
value on things.

Scarcity is one huge decision trigger.

Before any negotiation, think about what is unique and uncommon that we have to
offer. And they can’t get it if they do not move in our direction. What is there to
lose for them if they do not say yes to us. People are generally more motivated by
the idea of losing something than gaining the very same thing. People are afraid
of the pain of losing than the contentment of gaining. Sometimes, we can be
more persuasive if we are able to present what stands to be lost than emphasizing
what stands to be gained. In negotiation, you can point out the advantages that will
be lost if the proposal is not accepted. Tell them what benefits they will lose.
People feel the need to know what they will stand to lose.

4. Principle of Consistency
People want to appear consistent and rational. They want to be consistent with
what they said and how they act previously. We can use the principle of
consistency quite effectively in negotiations by getting the other party to agree
with the standards he articulated in his prior statements. Anticipate what type of
standards the other party will adhere to and make your arguments based on their
standards. You can get them committed to a set of rules by using written
commitments. The chances of them straying off will decrease tremendously.

Take time out to do more research into parties. Spend more time with them. Figure
out what they are most committed to, most value and most want to attain. Let them
determine what is important to them and go in such a way that is reactive to what
they have pointed out.

Be aware of manipulative people out there who lay consistency traps to get you
agree to a set of standards.

5. Principle of Reciprocity
People return what others have given them. It can be of any form. If you set out to
help someone, you will be more likely to receive help from them in return. They
will feel the obligation to repay you.

In the business world today, there is a lot of room to apply the principle of
reciprocity. Find out more about the parties and see how you can help them. By
taking the first step to help them, they will feel the desire to help you out in the
future. For negotiation, we can increase the chance the other party will be
collaborative by being collaborative first. If you set out to be competitive and
uncooperative during negotiations, you will most likely receive the same treatment.
By giving concessions and sharing information first, you will encourage the other
party to do the same.

The key to using the principle of reciprocity is to be the first.

Be the first to give concession.

Be the first to help.
Be the first to be courteous.
Be the first to be cooperative.
Be the first to give information.

Whatever you do first, will come back to you eventually.

6. Principle of Social Proof

When it comes to decision making, people look to what others have done. To
decide what is important for us in a given situation, we look to other similar
individuals. In times of uncertainty, people tend to follow the lead of others.

In negotiations, the situation can be ambiguous and the issues being discussed can
be very complex. When in such a situation, parties will look to experts to guide
their decision. If you reach an impasse in your negotiations, point out that how
similar negotiations have been conducted and how they are being resolved. Provide
evidence that others like them have made this choice and how they have been
benefited from their decision.

When people have witnessed what others have done before, they will be more
willing to make the same decision.
Conclusion
Negotiation plays an effective role in a work place. In fact it is a skill which
applies in almost every aspect of our life- From formal relationship to personal
relationship. Negotiation is a process, not an event. There are predictable phases -
preparation, identifying interests and making proposals, bargaining, and selecting
outcomes - that you will go through in any negotiation. Depending on the situation,
there are various negotiation approaches that can be utilized to increase the
likelihood of a successful outcome.

If the steps of negotiation are well understood and the techniques of negotiating is
well known then, a person can be a successful negotiator. When negotiation skills
increases , one will discover that negotiating is fun.
 PERSONAL VIEWS

Name: Pritam Kumar Kar

Reg No- PGPM/2010-12/32

Views:

Negotiation is a part of our daily life. We almost negotiate

daily with everyone starting from our family members to
outside people. A proper negotiation helps us build new
and good relationships, complete many works smoothly.
So proper knowledge of negotiation skills are very
essential.

Books reffered:

1.Business Communication by M K Shegal &

Vandana Khetarpal.

2. Communication Skill by Joshner Kelly

 PERSONAL VIEWS

Name: Suraj Singh Khatri

Reg No- PGPM/2010-12/53

Views:

Negotiation skill is effective in dealing with any kind of

situation. It is very helpful in business world. In our day
to day life we need to negotiate everywhere and every
time. We have to negotiate with people, group, situation
etc. Sometimes to make strong relationship we need to
have strong negotiation skills.

Books reffered:

1.Negotiation Skill and Strategies by A. Flower

 2.Business Communication by P D Chaturvedi &
Mukesh Chaturvedi

PERSONAL VIEWS

Name: Chandan Sahu

Reg No- PGPM/2010-12/08

Views:

1. Negotiation is a vital part of our life. (starting from

a small matter which involves family members to a
very vital business deal involving business tycoons.
negotiation is needed.)

2. It is process by which people arrive at a fair

agreement.

3. It helps to build and maintain good relationship in

business world as well as outer environment.
 A manager should be a good negotiator .

Books reffered:

1. Communication Skill by Chris Orford

2. Communication Skill by Richard Ellis.

PERSONAL VIEWS

Name: Paramita Kundu

Reg No- PGPM/2010-12/28

Views:

A proper negotiation helps us build new and good

relationships, complete many works smoothly. So proper
knowledge of negotiation skills are very essential.
Negotiation skill is effective in dealing with any kind of
situation. Robert Estabrook rightly said," He who has
learned to disagree without disagreeable has discovered
the most valuable secret of negotiation".

Books reffered:

1. Improve your communication skill by Alan

Barker

2. Communication Skill by Chris Orford.

PERSONAL VIEWS

Name: Isha Mishra

Reg No- PGPM/2010-12/18

Views:

Negotiation is the best skill which has to be acquired to

get success in every aspect.

Books reffered:
 1.Communication Skill by Richard Ellis.

2.Communication Skill by Joshner Kelly.

PERSONAL VIEWS

Name: Jhuna Sahoo

Reg No- PGPM/2010-12/28

Views:

After a long discussion on negotiation skill, I think,

NEGOTIATION is a very important tool to achieve fair
outcomes for both sides & also very essential to get
success. It itself is not a skill but combination of skills
which together enable a negotiator to perform well.

Books reffered:

1. Improve your communication skill by Alan

Barker

2. Communication Skill by Chris Orford.

PERSONAL VIEWS

Name: Swaraja Sahoo

Reg No- PGPM/2010-12/56

Views:

A proper negotiation helps us build new and good

relationships, complete many works smoothly. So proper
knowledge of negotiation skills are very essential.
Negotiation skill is effective in dealing with any kind of
situation. It is very helpful in business world. In our day
to day life we need to negotiate everywhere and every
time.

Books reffered:

1. Improve your communication skill by Alan

Barker

2. Communication Skill by Chris Orford.

PERSONAL VIEWS

Name: Sagar Kumar Barik

Reg No- PGPM/2010-12/36

Views:

A proper negotiation helps us build new and good

relationships, complete many works smoothly. So proper
knowledge of negotiation skills are very essential.
Negotiation skill is effective in dealing with any kind of
situation. It is very helpful in business world. In our day
to day life we need to negotiate everywhere and every
time.

Books reffered:

1. Improve your communication skill by Alan

Barker

2. Communication Skill by Chris Orford.