21st Century HR Consultants

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21st Century HR Consultants

• A workshop on Negotiation Skills

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21st Century HR Consultants

• Dr. Farooq-e-Azam CheemaMSc in Human Resource
  Management and Development,
• University of Manchester, UK.PhD in Public
  Administration, University of Karachi.
  drcheema99_at_hotmail.com

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I. Why Negotiation?

• Negotiation is needed to resolve intra-person or
  inter-person conflicts / disagreements / clash of
  interests.
• Negotiation is something that we do all the time
  and is not only used for business purposes. The
  aim of negotiation is to explore the situation,
  and to find a solution that is acceptable to both
  the sides.
• Only man negotiates animals do not when faced
  with larger predator, they do not ask for
  negotiation or justice rather just run away.

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• Negotiation is one of the most difficult jobs a
  person can do. It requires not only good business
  judgment but also a keen understanding of human
  nature.

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Negotiation
Inter-person Negotiation
Intra-person Negotiation
Unplanned Negotiation
Planned Negotiation
Distributive Negotiation
Integrative Negotiation
Hard Negotiation
Soft Negotiation
Principled Negotiation
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Hard Negotiation

• Hard negotiation involves the negotiation of
  positions, rather than interests.
• It is highly competitive, seeing victory as the
  number one goal.
• Hard bargainers, see the participants as
  adversaries. They distrust the other side and
  play sneaky games to try to gain the negotiating
  advantage.  
• Hard bargainers refuse to make concessions and
  demand one-sided gains as the price of an
  agreement. 
• When confronted with a softer opponent, hard
  bargainers almost always will win. When
  confronted with another hard bargainer, however,
  it can result in no agreement, both losing.

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Soft Negotiation

• Soft negotiation also involves the negotiation of
  positions, rather than interests. However, it
  treats the participants as friends, seeking
  agreement at almost any cost, and offering
  concessions easily in the interests of preserving
  (or creating) a good relationship with the other
  side.
• Soft bargainers trust the other side, and are
  open and honest about their bottom line.
• This leaves them vulnerable to hard bargainers
  who act competitivelyoffering few, if any
  concessions.

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Principled Negotiation

• Principled negotiation is the interest-based
  approach to negotiation.
• Fundamental principles of principled negotiation
  are
• it separates the people from the problem
• focuses on interests, not positions
• insists on objective criteria of the solution.

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II. Negotiation Styles
Win / Lose
Win / Win (Collaborating)
Assertive
Compromise
Unassertive
Avoidance
Accommodating
Uncooperative
Cooperative
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Win Lose Style

• The win-lose is the most common style of
  distributive negotiation wherein a person pursues
  his or her own wishes at the expense of other
  party.
• Under this style negotiation is viewed as a game
  to be won. Losing may be taken as failure,
  weakness, and a loss of status.
• When engaged in this style, the parties may use
  different tactics to win like persuasion,
  argument, power, or even threat.

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Usefulness

• A forceful position during negotiation may be
  appropriate when the stakes are high and costs of
  indecision and compromise are non-affordable.
• It is useful when issues of legality and ethics
  are at hand.
• Where you do not expect to deal with people ever
  again, and you do not need their goodwill.
• When there is only one prize.
• At management level, this style is helping when
  unpopular but necessary decisions must be made.
• Win-lose is also a style to use when the other
  party has a tendency to take advantage of you.

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Avoiding Style

• Avoiding the conflict in certain situations
  need of no negotiation at all is also a
  negotiation.
• People may physically withdraw by simply leaving
  the scene of conflict or they can refuse to get
  involved by using silence, or changing the topic
  of conversation.
• Psychologically, avoiders can also deny the
  existence of conflict.
• During formal negotiation, avoiding style is
  exercised by paying deaf ear and / or blind eye
  to the conflicting stimulus.

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Usefulness

• Useful when
• your involvement will only result in negative
  outcomes for you
• issue is insignificant
• cost of challenge / cost is quite high
• there is little chance of success
• relationships are more important to be
  maintained
• to buy time and / or get other party cool down.

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Accommodating Style

• Accommodating style of negotiation entails giving
  in to the wishes of the opponent party.
• Like avoidance, accommodating the other party
  almost in one-sided way, is also a negotiation.
• Unlike avoiders, the accommodators enter into
  negotiation and give in a way that strengthens
  the relationships.
• During negotiation, giving in totally / partially
  may be part of strategic maneuvering.

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Usefulness

• When other issues are more important that need
  satisfying others and maintaining cooperation.
• When social credit is to be built for some latter
  issue.
• To minimize loss when one is already losing.
• When relationships are more important than the
  interests.
• Though frequent yielding is not a virtue, a
  yielding to a fellow in ire, a balanced yielding
  among spouses, or even the frequent yielding
  obedience of a child to a parent or teacher is a
  healthy move.

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Compromising Style

• Compromising, the most common style of conflict
  resolution, entails splitting the differences and
  reaching an acceptable middle ground solution
  through give-and-take whereby each party should
  gain something and may have to lose something.
• Parties under this style of negotiation,
  generally use techniques like trading,
  bargaining, smoothing over differences, and
  voting etc.
• Most of the negotiations though start with
  lose-win style, do end up at the compromising
  style.

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Usefulness

• It is useful
• when two parties have relatively equal power and
  have mutually exclusive goals
• when time is not available to solve problems that
  are complex and require a great deal of effort to
  sort out all the issues
• to allow for a temporary solution until more time
  could be devoted to unravel and analyze the
  complexities and
• when competition or collaboration fails to lead
  to a solution.

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Collaborating (Win-Win) Style

• Collaborating is based on a willingness to accept
  other partys needs while asserting your own
  needs as well.
• It assumes that there is some reasonable chance
  that a solution can be found to satisfy both
  parties in conflict without losing much.
• Such solution, most of the time, is not possible
  but a collaborator believes that it is worth
  trying to find that.

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Illustrative Story

• Two brothers had an orange. Each of them wanted
  to have it.
• Ultimately they resolved the conflict through
  splitting the orange into two halves, one half
  for the each.
• Elder brother ate the pulp and threw the peeling.
  
• The younger brother who did not have an innate
  liking for the oranges and just wanted the
  peeling as a recipe ingredient, used the peeling
  and discarded the pulp.

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Your Comments

• What negotiation style(s) the two brothers
  adopted to resolve the conflict? Offer your
  comments over degree of usefulness of the
  style(s) used in this situation.

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Case Study 1
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III. Preparing for Negotiation

• 1. Set your negotiation goals

• Take care, your negotiation goals should be
  insightfully prepared. If there is no harbour to
  seek, every wind is the right wind.
• Further realize that the more realistic and
  reasonable are your goals, the more likely you
  will reach them.
• When setting the goals, do not forget one of the
  most fundamental point in negotiation Leave
  Yourself Room To Negotiate.

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• Always keep in mind some alternative goals to
  your main goals. Your alternative goals
  constitute a fallback position--the deal you are
  willing to settle for if your original suggestion
  s turned down.
• The beauty of preparing alternative goals in
  advance is that by arming yourself with
  alternatives, you can hear the word no without
  losing face.

2. Set alternative goals
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• BATNA (Best Alternative to Negotiated
• Agreement)

• Before you negotiate, you should also consider
  the options you have if you cannot reach an
  agreement. These options make up your BATNA- your
  best alternative to a negotiated agreement.
• Developing a BATNA in advance of the negotiation
  will keep you from accepting poor terms-- or
  turning down terms that you ought to accept.

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• Once youve determined what you want, what
  youre willing to settle for, and what you can
  afford to lose, you have to consider any and all
  forces that will work in your favor. Any factors
  that bolster your primary base are called your
  secondary bases.
• You should keep these forces in mind as you
  negotiate--they will boost your confidence and
  prevent you from setting for an unsatisfactory
  deal.

4. Getting on to Secondary Bases
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• The more hard facts, statistics, and
  documentation you have, the more difficult it
  will be for anyone to turn you down. More complex
  negotiations will require more elaborate files
  and documentation.
• You dont want to rely on memory alone during
  the heat of the discussion, when you may be under
  a lot of pressure. Having all the information you
  need on paper will also free up your attention to
  focus on what the other person or people are
  saying---which is where your concentration should
  be.

5. Doing Your Homework
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• 6. Get Organized

• All the files in the world wont help you if
  theyre spilling out of your briefcase onto the
  floor. You cannot afford to break a deep
  discussion while you fumble for a document or
  search for an important piece of information.
• If you arent organized, you will appear less
  effective and less competent and you could lose
  your negotiating momentum.
• All documents relating to each major subject
  under negotiation should be separated into
  individual folders and each folder with a large,
  boldly written title thats easy to read.

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• In most of the everyday negotiations, you can
  successfully and confidently represent yourself.
  But certain negotiations that carry important
  financial or legal ramifications (such as buying
  or selling a home or negotiating a labor issued)
  require professional help.

• Who Else Is on Your Side?

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8. Psyche Yourself Up For Negotiation

• Before you can be successful in any negotiation,
  you must believe that you can be successful. Once
  youve settled your position, review the issue
  from all angles until youre fully convinced of
  the merits of your case. Your conviction and
  enthusiasm will be obvious when you negotiate.

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Case Study 2
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IV. At the Table

• Negotiation Strategies
• Communication Skills

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Negotiation Strategies

• Ahmad and Hassan decided to purchase an office
  for their newly started business three months
  ago. Their first choice was an office located in
  a new development, and priced Rs. 500, 000 (about
  Rs. 25,000 above their limit). Ahmad thought they
  could get the price down through negotiation with
  the salesman Mr. Sheikh around their limit while
  Hassan was less optimistic in that regard.

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• Ahmad conducted some research on the development
  and learned that several of the offices including
  the one they liked had been on the market almost
  a year. Though the house they liked was their
  first choice, other offices were also quality
  offices and could be accepted as a second
  choice. Ahmad met the other salesman, Mr. Agha
  and learned that the prices of those offices were
  also within their limit. With this homework done,
  he made an appointment with Mr. Sheikh and
  decided to meet him alone.

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Approach
Strategy
LOWBALL
VINEGAR-HONEY
He was going for the lowest possible price.
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PINPOINT THE NEED
It had been established that the seller would
take less than the asking price but not Rs.
450,000. The task then was to pinpoint how much
less than Rs. 450,000?
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CHALLENGE
A strategy designed to put the other party on the
defensive in an effort to win some concessions.
Added to the Pinpoint, the Need strategy assists
in determining what the seller will actually
take.
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FEINTING
This strategy gives the impression one thing is
desired whereas primary objective is really
something else.
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This planned action is leaked by a reliable
resource to test acceptability before final
action is taken.
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LIMITED AUTHORITY

• Limited authority is an attempt to postpone the
  decision on a pretext to get approval from a
  competent authority. Whereas the real aim is to
  gain time for reconsideration, and / or keeping
  the opponent under pressure for a possible
  negotiation breakage.

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• You are spoiling almost a
• concluded deal. I offer Rs.
• 475,000 though I am not sure
• my partner will agree to it. A slight budge from
  your position can bring the deal back on track,
  murmured Ahmed to the salesman in confiding
  style.

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GOOD GUY / BAD GUY
The good guy / bad guy is an internationally used
strategy. One member of a team takes a hard line
approach while other member is friendly and easy
to deal with.
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The builder has not been around, but I have
availed my own limit and reduced the price to Rs.
482,000 provided you could give us your offer
in writing today with the 20 deposit.
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DEFER
Deferring strategy allows the negotiators time to
reevaluate their positions. Deferring a decision
to make often proves that patience pays.
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• The salesperson told them,
• I called the builder while
• you were away. He gave a
• little, but Rs. 478,000 just
• wont do.

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SPLIT THE DIFFERENCE
Ahmad and Hassan looked towards each other and
accepted with pleasure.
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Case Study 3
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Communication Skills

• Oral Communication
• Non-verbal Communication

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Oral Communication

• Phrase the words properly it delivers.

Two priests were so addicted to smoking that they
desperately needed to puff on cigarettes even
when they prayed. Both decided to ask their
superior for permission to smoke. The first
asked if it was okay to smoke while praying?
Permission was denied. The second priest asked
if he was allowed to pray while he was smoking.
His superior found his dedication admirable and
immediately granted his request.
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• Use simple language instead of complex
  terminology. However use frequent jargons when
  negotiating with your professional counterpart.
• Be as descriptive as possible. Avoid generalities.

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Listening a strong negotiation tool!

• Perhaps the best strategy to adopt while the
  other side lets off steam is to listen quietly
  without responding to their attacks.
• You often get more through listening by finding
  out what the other person wants than you do by
  clever arguments supporting what you need.
• Standard techniques of good listening are to pay
  close attention to what is said, to ask the other
  party to spell out carefully and clearly exactly
  what they mean, and to request that ideas be
  repeated if there is any ambiguity or
  uncertainty.

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Non-verbal Communication
Feelings and emotions received from others
through their body actions
Vibes
Symbolic
Kinesics
Paralanguage
How something is said instead of what is said
i.e. volume, rate and rhythm, silent pauses,
sighs etc.
Facial expressions, body gestures, dress etc.
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Avoiding eye contact
Lack of confidence in bargaining position
Trying to bully or intimidate
Making excessive eye contact
Lack of confidence in bargaining position
Fiddling with objects such as hair, pencils, or
papers
Impatient wants to cut a deal quickly
Crossing and uncrossing the legs
Keeping legs and arms crossed
Not receptive to your bargaining position
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• Be careful, actions speak louder than the words.

• When we do not know others, there body language
  remains the first source of building image about
  them.
• What people say may be reinforced or contradicted
  by the non-verbal cues.
• When there is no congruence between the verbal
  and non-verbal communication, reliance is placed
  on the non-verbal aspect that creates a
  credibility gap on part of the speaker labeled as
  the non-verbal liar.

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Negotiation Tips

• Do not underestimate your power. Most people tend
  to have more power than they think. Your base of
  power rests on a foundation of more than just
  competition or financial matters. Commitment,
  knowledge, risk taking, hard work, and
  negotiation skills are also real sources of
  power. Making a systematic analysis of these
  sources, you can understand your strengths.

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• Do not assume that the other party knows your
  weaknesses. Rather assume that they do not. You
  may be better off than you think.

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• that some people with PhDs quit learning years
  ago
• some people in authority are incompetent
• a specialist may be excellent in their field but
  without skill in other areas
• learned people, despite high positions of power,
  sometimes lack the courage to pursue their
  convictions or have none.

• Dont be intimidated by status. We are so
• accustomed to showing deference to titles and
• positions that we carry our attitudes to the
• negotiating table. It is well to remember that
  some
• experts are superficial

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• Dont be intimidated by statistics, precedents,
  principles, or regulations. Its 2007, some
  decisions are made on the basis of premises and
  principles long dead or irrelevant. Be skeptical.
  Challenge them.

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• Most negotiation will require some concession
  making. Dont set your initial demand near your
  final objective. There is sufficient evidence to
  conclude that it pays to start high. Dont be shy
  about asking for more. Many times your demands
  may be too modest, or too easy to achieve.

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

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• First, the other party probably is willing to
  make some additional concessions.
• Second, if you do accept the first offer, there
  is a chance the other party will have the feeling
  that their offer was foolish. They may find ways
  to spoil the agreement later.
• In either case, the negotiator who takes the
  first offer too fast makes a mistake.

• Never accept the first offermany people do.
  There are two good reasons not to

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• Never give a concession without obtaining one in
  return. Dont give concessions away free or
  without serious discussion. A concession granted
  too easily does not contribute to the other
  partys satisfaction nearly as much as one that
  they struggle to obtain.

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• Never fear to negotiation, no matter how great
  the differences are. Fear can create enormous
  pressure on you and impact your negotiating
  success. Remember, negotiation is not a contest.
  Dont shy away from negotiating just because you
  are afraid of making a mistake or doing poorly.

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• Never trust your assumptions. They are likely to
  be as wrong as right. They are neither right nor
  wrong until proven so. However, they can defeat
  you before you even start negotiating through
  lowering your expectations.

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• How much you are prepared, something unforeseen
  always seems to come up in most negotiations.
  When it doesa time-out is called for. It might
  just be a caucus with yourself (i.e. Please
  excuse me I need to use the restroom), or a
  meeting among your own people to discuss the new
  issue. Diplomatic negotiations are usually 10
  percent conference and 90 percent time-out
  whereas most business deals reverse this time
  relationship.

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• It helps reduce the other persons aspiration
  level
• It gives you a chance to test the strength of the
  other person and their willingness to stand firm
• It also helps you gather valuable information
  about the other persons position and feelings.

12. The case for high demands but slow and
reluctantly given concessions is a strong one.
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• Our emotions get in the way of effective
  negotiations regularly. Nothing kills creativity
  quicker than anger, pride, embarrassment, envy,
  greed, or other strong negative emotion. Anger is
  often an expression of fear, or lack of
  confidence in our ability to get what we think we
  want.
• If we can improve our ability to manage our
  emotions and respond without getting defensive,
  we have gone a long way toward creative
  negotiation.

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Common mistakes to be avoided

• Inadequate Preparation
• Ignoring the give/get principle
• Use of intimidating behavior.
• Impatience.
• Loss of temper.
• Talking too much, listening too little, and
  remaining indifferent to body language.
• Arguing instead of influencing.
• Ignoring conflict.