Unit 10 negotiating

Task 1 Read the text and retell it briefly. You may use the following phrases:

The main idea of the article is to show (to describe, to explain)…

The text covers such problems as…

It consists of (contains) … (3 parts; 6 passages)

The 1^st (2^nd…) passage of the text deals with (presents information on) …

The article concludes with …

Many people stumble at the opening of their negotiation. This can set the stage for a less than optimum outcome. Here are just a few points that might be helpful to keep in mind when you start a negotiation.

Don't set your initial offer near your final objective. Give yourself room to negotiate. It doesn't matter what you are negotiating – hours on a project, scope-of-work, specifications, price, who's going to do what, etc. When you start any negotiation you must assume the other party will always put their maximum positions on the table first. Equally important is the fact that they probably will not disclose to you the minimum they are willing to accept. Don't be shy about asking for everything you might want and more during a negotiation.

Give yourself enough time to negotiate. Before you start make sure you have allowed a realistic amount of time for the negotiation process to take place. Hours, weeks or months—it will frequently take longer than you expect. Rushing through the negotiation almost always works against you.

Don't assume you know what the other party wants. It is far more prudent to assume that you do not know and then proceed to discover the realities of the situation by patient testing and questioning. If you proceed to negotiate a deal on the basis of your own untested estimate, you are making a serious mistake.

Do not assume that your aspiration level is high enough. It is possible that your demands are too modest, or too easy to achieve. The other party may not know what they want or may have a set of values quite different from your own.

Finally, never accept the first offer. Many people do if the offer is as good as they expected or hoped to get. There are two good reasons not to accept. First, the other party is probably willing to make some concessions. Second, if you take the first offer, the other party is often left with the feeling that they were foolish for starting too low. In any case, the negotiator who takes the first offer too fast makes a mistake.

No matter what negotiating mode you're in, or what techniques you and your team may be using, you will substantially increase your chances of achieving long lasting, Both-Win agreements with just one prime ingredient. That prime ingredient is planning.

Internet resources provide today's negotiators instant access to a wealth of information regarding industries, competitive products, price-points, supply issues, and information on the organizations and individuals involved in the negotiation. You need to do your homework before entering a negotiation.

Failure to provide adequate time to gather information will impact your ability to successfully plan for your next negotiation, and may limit your ability to develop creative agreements.

However, as important as it is, in today's working environment we don't always have the opportunity to use our time for planning…

Here are 13 tips for negotiators who have little or no time for negotiation planning:

• Before talks begin, jot down your wants in order of priority. Distinguish between "must have" and "would like to have" wants.

• Figure out what your opening offer and target will be on each issue to be discussed.

• Determine what you will say after the other party says "no." There will always be "nos."

• Make a list of things you will ask for if you must make concessions.

• Choose the best time and place to meet.

• Write down ideas that may help create a "Both-Win" opportunities. Think of assets you or your organization have, and then match these up with needs you think the other party or organization has.

• Build in "lack of authority" and "time to think" defenses to avoid being pushed into decisions that are premature.

• Think about bringing an associate who can help you to listen better, ask good questions, and say the right things.

• Ask the question, "What are some factors that might limit their negotiating power?"

• Plan how to support your positions and what types of backup you might need.

• Ask yourself, "What do they want that's under the 'iceberg'?" Things they want or need, but aren't asking for.

• Ask yourself, "What's our next option if these talks fail?"

• Decide if there is something you should ask for now that you'll wish for after the negotiation is over.

With a plan in place, even if it's made with little time, effective negotiators are better prepared to gain important concessions from the other party and, when needed, better prepared to grant only those concessions that make sense to their side. During this period of give-and-take, areas of needs and wants that are outside the original issues of the negotiation will emerge. That's where you can find the better deal for both parties and work out more successful Both-Win agreements.

Task 2 Work in groups. Imagine that you are to discuss the terms of delivery and payment with your supplier. Plan your talks using 13 tips for negotiators.

Task 3 Read and remember the information about MEMOS.

Memos are written internal communications which advise or inform staff of company policies and procedures. They are usually quite formal and impersonal in style. Memorandum is the full term, but the abbreviated form is usually used.

Memos may be put on a notice board for everyone to see, or circulated in internal mail. In the latter case the receivers may be asked to sign the memo to acknowledge that they have read it.

Companies often use headed paper for memos. This gives less information about the company than the letterhead for external correspondence, but indicates which department has issued the memo.

A memo should state who it is to, who it is from, the subject, and the date. It may also be signed.

Memos can be short or long. They can address many different subjects, from informing staff of retirement to announcing important administrative or structural changes in the company. They can deal with a number of different points but these should be connected to the same topic. For example, a single memo which tried to deal with canteen facilities, punctuality, and a new accounting system might confuse its readers. It would be better to write a separate memo for each topic.

To The Board of Directors From Derek Logan, Sales Director Date 15 October 20__ Subject Introduction of Internet sales

Memo

The Sales Department research team came to the following conclusions on the issue of Internet sales. Internet sales have expanded steadily in our markets in recent years for three main reasons: (1) the range of goods we can offer in a virtual warehouse environment, (2) convenience, and (3) increased security with the development of digital signatures. The main area of expansion - over 21% in the period concerned - has been in clothes, especially children's clothes covering the age groups of 4-11 years. If we concentrate on the garment area of the market we estimate an increase in our annual budget of 4.8%, which includes administration, warehousing, expanding stock, advertising, and the capital needed for new technology. This will increase our present turnover in this area by 7% over a two-year trial period. The Finance Department suggests that this increase in capital investment should come from share issues rather than loans because, in the case of the latter, increasing interest rates will reduce profits. Conclusions With our main competitors already in this market, and its potential for international sales, we recommend that we should implement a new Internet strategy as quickly as possible. I would suggest a meeting before the end of this financial year.

Task 4 Role play this situation: a representative of a website maintenance company meets a company manager to negotiate a maintenance contract. You may base your negotiation on the information from the memo above. Read your role cards. Then do the negotiation.

Role card A

Website maintenance company representative

You want:

1. A three-year contract

This allows you to offer the best service to customers and it will be profitable for you.

2. To test the website each month

This will give the best level of service to the client and increase your earnings.

3. Response time-24 hours

You want the company to contact you by e-mail if there is an emergency. You want up to 24 hours to solve any problems.

Role card B

Company manager

You want:

1. A one-year contract

You want to see how well the company does the job and if they are reliable before giving them a long contract.

2. To have the website tested every three months. You want the maintenance costs to be as low as possible. However, you would like to have weekly checks on the security of the website.

3. Response time-two hours

You want to contact them at any hour by phone if there is an emergency. You want the maintenance company to solve any problems within two hours.