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21st Century HR Consultants

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21st Century HR Consultants A workshop on Negotiation Skills 21st Century HR Consultants Dr. Farooq-e-Azam Cheema MSc in Human Resource Management and Development ... – PowerPoint PPT presentation

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Title: 21st Century HR Consultants


1
21st Century HR Consultants
  • A workshop on Negotiation Skills

2
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

3
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.

4
  • 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.

5
Negotiation
Inter-person Negotiation
Intra-person Negotiation
Unplanned Negotiation
Planned Negotiation
Distributive Negotiation
Integrative Negotiation
Hard Negotiation
Soft Negotiation
Principled Negotiation
6
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.

7
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.

8
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.

9
II. Negotiation Styles
Win / Lose
Win / Win (Collaborating)
Assertive
Compromise
Unassertive
Avoidance
Accommodating
Uncooperative
Cooperative
10
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.

11
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.

12
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.

13
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.

14
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.

15
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.

16
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.

17
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.

18
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.

19
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.

20
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.

21
Case Study 1
22
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.

23
  • 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
24
  • 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.

25
  • 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
26
  • 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
27
  • 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.

28
  • 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?

29
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.

30
Case Study 2
31
IV. At the Table
  • Negotiation Strategies
  • Communication Skills

32
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.

33
  • 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.

34
Approach
Strategy
LOWBALL
VINEGAR-HONEY
He was going for the lowest possible price.
35
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?
36
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.
37
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38
FEINTING
This strategy gives the impression one thing is
desired whereas primary objective is really
something else.
39
This planned action is leaked by a reliable
resource to test acceptability before final
action is taken.
40
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.

41
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42
  • 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.

43
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.
44
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45
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.
46
DEFER
Deferring strategy allows the negotiators time to
reevaluate their positions. Deferring a decision
to make often proves that patience pays.
47
  • The salesperson told them,
  • I called the builder while
  • you were away. He gave a
  • little, but Rs. 478,000 just
  • wont do.

48
SPLIT THE DIFFERENCE
Ahmad and Hassan looked towards each other and
accepted with pleasure.
49
Case Study 3
50
Communication Skills
  • Oral Communication
  • Non-verbal Communication

51
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.
52
  • Use simple language instead of complex
    terminology. However use frequent jargons when
    negotiating with your professional counterpart.
  • Be as descriptive as possible. Avoid generalities.

53
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.

54
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.
55
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
56
  • 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.

57
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.

58
  • Do not assume that the other party knows your
    weaknesses. Rather assume that they do not. You
    may be better off than you think.

59
  • 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

60
  • 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.

61
  • 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.

62
  • 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.

63
  • 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

64
  • 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.

65
  • 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.

66
  • 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.

67
  • 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.

68
  • 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.
69
  • 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.

70
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.
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