This document outlines an agenda for a negotiation skills training session facilitated by Sameer Malgundkar. It includes introductions, training room norms, objectives of the session which are to better understand negotiation challenges and styles. Sample negotiation scenarios are provided for class activities including negotiating a car lease, apartment rental, and a used car sale. The session will cover understanding negotiation, different negotiation approaches and outcomes, behaviors, principles, and how to plan a negotiation. Participants will engage in roleplay simulations.
1. WELCOME ALL NBK DELEGATES
ONTO
NEGOTIATION SKILLS FOR THE 21ST CENTURY
FACILITATED BY
SAMEER MALGUNDKAR
FLEET SALES MANAGER – MICHELIN TYRES
2. SELF INTRODUCTION
PLACE OF BIRTH PROFESSION
MICHELIN EXPERIENCE - OVER 15 YRS. IN TYRE
INDUSTRY
COUNTRIES WORKED
QUALIFICATION OTHER INTERESTS
3. TRAINING ROOM NORMS
• Mobile phones need to be kept silent during the training sessions.
• Feel free to ask Questions anytime
• Respect the break time allotted as training session will
commence immediately after the break
• There will be 2 Coffee breaks – 10.30 AM & 2.45 PM
• Lunch break will be at 12.30 PM
• During the session individuality needs to be respected
• Do not read the Training Manual unless you have been asked to
do so.
4. BRAIN TEASER
“FINISHED FILES ARE THE
RESULT OF YEARS OF
SCIENTIFIC STUDY
COMBINED WITH THE
EXPERIENCE OF YEARS.”
Count the number of “F’s” in this sentence
Point: One’s perception may not always be correct.
6. OBJECTIVES
• Better understand NEGOTIATION
• Challenges in NEGOTIATING by anticipating the strategies of the
other side
• Outcome of a Negotiated Argument
• Different NEGOTIATION BEHAVIOURS
• Conduct self-assessment to know what is your NEGOTIATION
STYLE
• Principles of NEGOTIATION
• PLAN your NEGOTIATION
7. KIDNAPPING LEADS TO NEGOTIATION
An act of kidnapping always ends up with some negotiation and if the
negotiator is not good at negotiating, it may even lead to loss of life. A good
negotiator always tries to maintain a balance between both the parties.
8. SALES NEGOTIATION – BASIC VERSION
THE FISH, FRUIT AND VEGETABLES MARKET IN ABU DHABI
IMAGE CREDIT: ABDEL-KRIM KALLOUCHE, GULF NEWS
PUBLISHED AUG 7, 2011
9. DIFFERENCE BETWEEN SELLING & NEGOTIATION
WHAT IS THE DIFFERENCE BETWEEN
‘SELLING’ AND ‘NEGOTIATION’
SELLING IS THE ART OF ‘PERSUASION’
NEGOTIATION IS THE ART OF ‘BARGAINING’
11. UNDERSTANDING NEGOTIATION
Negotiation is a basic means of getting what you want
from others.
It is a back-and-forth communication designed to reach an
agreement when you and the other side (TOS) have some
interests that are shared and others that are opposed.
12. UNDERSTANDING NEGOTIATION
Purpose of Negotiation
Negotiation involves two parties coming together to forge an
agreement.
It usually involves one or more of the below three purposes –
• To reach new agreements or renew expiring ones;
• To resolve disagreements and prevent conflict from
escalating; or
• To change behaviour
13. UNDERSTANDING NEGOTIATIONS
CLIMATE FOR NEGOTIATIONS
Friendly; Conversational; Problem Solving
Two or more professional people coming together to
examine problems, the solution of which will benefit both,
is what we are aiming for in negotiation relationships.
14. UNDERSTANDING NEGOTIATION
What are the Characteristics of Effective Negotiators?
• Ability to Listen
• Having a vision of what is to be achieved
• Confidence
• Ability to disagree when necessary
• Ability to move on when things are not working out as desired
• Communication and persuasion skills
• Empathy
• Open mindedness
• Persistence
• Tolerance of criticism
• Tolerance of risk
• Ability to be a team player
15. UNDERSTANDING NEGOTIATION
Learning to Communicate
The first rule of negotiation is that one must be able to communicate
and hear the wants & needs of the situation. When we enter into a
negotiation, as a matter of fact any negotiation, we need to
communicate.
By closing your channel of communication one loses the opportunity to
learn from the exchange.
16. UNDERSTANDING NEGOTIATION
Learning to Read People
• The other person is listening to your words and you should be listening or observing
the other persons physical / emotional / tonal reactions.
• Speaking is a two-way form of communication where your words provide information
to TOS and his non-verbal reactions provide you with information.
• Rather than thinking about what you will be negotiating in a few moments, pay
attention to the subtle insights TOS is revealing while he / she is at ease.
• Based on what you learn about TOS will help you to decide how best to approach him
/ her once the discussion becomes serious and focused.
17. UNDERSTANDING NEGOTIATION
What is the difference between Persuasion and Negotiation?
“Persuaders give reasons. Negotiators give concessions.”
PERSUASION NEGOTIATION
CONVINCING PROVIDING CONCESSIONS
REQUESTING
ARGUING
ADVERTISING
NAGGING
FLATTERING
CRITICIZING
19. UNDERSTANDING NEGOTIATION
What is the difference between an Argument and Negotiation?
ARGUMENT
• Putting your own opinion
• No willingness to listen to
another point of view
• No willingness to concede on
anything
• No willingness to concede the
value in the other persons
opinion
NEGOTIATION
• To listen to the other side (TOS)
• To understand the basis from which
TOS operates
• To be willing to take action
• To resolve the issue
21. UNDERSTANDING NEGOTIATION
WIN / LOSE
Power to Force
LOSE / LOSE
Compromise
WIN / WIN
Collaboration
It is not pleasant to recall Both have to loose to
achieve compromise
Create an Acceptable
outcome to all
No one likes to be a loser Willingness to work to
resolve the issue is
missing
Willingness to attack the
problem
Force own preferred
outcomes
Neither party wins, or shift
their position, nor willing
to look at other solutions
Looking at other options
to resolve the dispute
TOS unlikely to forget
humiliation
Compromise is built on
loss
Positive communication
No long-term solution
No place in negotiations
22. UNDERSTANDING NEGOTIATION
ACTIVITY – 4 COMPROMISE
Divide yourself into pairs and negotiate amongst each other the below
pay rise and try to reach a compromise within 10 minutes –
• Employee - $ 10 per day rise in daily wages
• Employer - $ 2 per day rise in daily wages
Discuss & present your findings to other members of the group.
23. UNDERSTANDING NEGOTIATION
ACTIVITY – 5 NEGOTIATED OUTCOME
What would be the negotiated outcome if both the parties worked together
to achieve a collaborated outcome (WIN / WIN) in the below example?
• Employee - $ 10 per day rise in daily wages
• Employer - $ 2 per day rise in daily wages
Answer
• no pay rise,
• but maybe a radical change of hours,
• increased bonuses and
• superannuation entitlements*
* - Type of retirement plan set up by the company for benefit of it’s employees
24. NEGOTIATION CHALLENGES: ANTICIPATE TOS STRATEGY
Anticipating TOS strategies in advance
• Be prepared
• Act prepared
• Prepare to answer difficult questions
• Prepare to re-frame
25. OUTCOME OF A NEGOTIATION
ACTIVITY – 6 HOW TO NEGOTIATE A CAR LEASE?
• Prepare to know the specifications of the car
• Terms prepared to accept
• Lease Price
• Residual Value (Paid at the end of term to buy the car)
• Rate
• Turn-in Terms (Worn tires, Scratches, Dents, etc.)
• Mileage
• Available Rebates
• Available Option Discounts
• Dealer Incentives
• Required Down payment and other closing costs
• Trade-in potential of existing car
• Establish buyer credibility
• Let the Sales Consultant know you are knowledgeable
26. OUTCOME OF A NEGOTIATION
Prior to starting a negotiation, we must set clear objectives by
considering
• The best possible outcome – What we Want
• The worst possible outcome – What we Need
The range between our wants and needs determines the arena in
which we negotiate.
27. OUTCOME OF A NEGOTIATION
A skilled negotiator will tell us their wants but will not
disclose to us their needs.
In planning for your negotiations you should put
yourself in the other parties’ position in order to
assess their likely needs and wants.
REMEMBER:
• Always set clear and logical objectives for yourself
• Strive to find out the needs of the other party
• A skillful negotiator gives equal consideration to the other
parties needs as to their own
28. OUTCOME OF A NEGOTIATION
5 OUTCOMES OF NEGOTIATIONS
• WIN / LOSE SITUATION (DOMINATION)
• LOSE / LOSE SITUATION (WITHDRAWING)
• LOSE / WIN SITUATION (SUBMISSION)
• WIN / WIN SITUATION (MUTUAL GAIN)
• B. A. T. N. A. (BEST ALTERNATIVE TO A
NEGOTIATED AGREEMENT)
29. OUTCOME OF A NEGOTIATION
The Bottom Line vs. BATNA
The Bottom Line limits your ability to benefit from what you
learn during negotiation. It inhibits imagination and is likely to
be set too high.
Your BATNA determines what you will do if you do not reach
an agreement.
Remember: BATNA in action gives you the confidence to
reach a “wise” agreement.
The better your BATNA the greater your ability to improve the
terms of any negotiated agreement.
30. OUTCOME OF A NEGOTIATION
ACTIVITY – 7 THE CUSTOMER AND THE NEW CAR
31. NEGOTIATION BEHAVIOURS
Behaviours are measured against two dimensions:
Focus on Relationships –
The degree that your negotiation behaviour builds
or preserves interpersonal relationships.
• Focus on Results –
The degree that your negotiation behaviours
address the unique needs and interests of the
parties.
34. PRINCIPLES OF NEGOTIATIONS
PARTY A PARTY B
‘GIVE/GET’ ‘GIVE/GET’
BOTH PARTIES ARE WILLING TO GIVE SOMETHING IN ORDER TO GET WHAT THEY
WANT
PARTY A PARTY B
‘GIVE/GET’ ‘GET/GIVE’
BOTH SIDES UNDERSTAND THE IMPORTANCE OF ‘GIVE AND TAKE’ IN REACHING
AN AGREEMENT
PARTY A PARTY B
‘GET/GIVE’ ‘GET/GIVE’
BOTH PARTIES ADOPT THE POSITION THAT THEY WILL NOT GIVE UNTIL THEY
HAVE RECEIVED A CONCESSION
Be prepared to make concessions
Never make concessions without getting something in return
35. PRINCIPLES OF NEGOTIATIONS
The Four Points of Principled Negotiation
PRINCIPLE #1 Separate the people from the problem.
Be soft on the people and hard on the problem.
PRINCIPLE #2 Focus on interests, not positions.
Learn to look behind positions for interests, some of which you may share.
PRINCIPLE #3 Invent options for mutual gain.
Use brainstorming techniques to create a larger number of quality ideas to serve
your common interests.
PRINCIPLE #4 Insist on objective criteria.
Appeal to objective standards and outside sources to judge the quality of your
agreements.
37. ELEMENTS OF A NEGOTIATION PLAN
1. RESEARCH
2. YOUR OBJECTIVE
3. THEIR OBJECTIVES
4. WHAT INFORMATION DO YOU NEED FROM THEM?
5. WHAT ARE THE VARIABLES AND THEIR LIKELY
RELATIVE VALUES?
6. TACTICS
38. ELEMENTS OF A NEGOTIATION PLAN
‘You cannot always out-negotiate someone, but
you can always out-plan them!’
IDENTIFY THE RIGHT KEY GOALS
BRAINSTORM ALL THE OPTIONS
39. VARIABLES
A variable is something that can affect the negotiation outcome BUT is
not directly linked to the immediate price.
Rules for Trading Variables
Consider what concessions we commonly make
What is the value to the other side of these concessions?
What would we like to have in return?
What other variables could we possibly trade?
What can we concede that is of low cost to us and high value to
them?
Equally, what could they give us that we value highly but does not
cost them much?
40. ACTIVITY – 10 USED CAR SALES
GROUP ACTIVITY – USED CAR SALES
SELLER
MITSUBISHI PAJERO, 2010 YEAR MODEL, MAROON RED COLOR,
BELOW 25,000 Kms MILEAGE, SINGLE OWNER, LADY DRIVEN, GOOD
INTERIORS AND EXCELLENT OVER-ALL CONDITION
VARIABLES THAT YOU WANT TO GIVE IN A NEGOTIATION
VARIABLES THAT YOU WANT TO GET IN A NEGOTIATION
41. PLANNING YOUR NEGOTIATION
Developing a plan will help you to anticipate your opponent’s needs, offer positive
solutions to problems, and anticipate your opponent's actions.
This plan will cover the following steps:
1. Identify the issues in the negotiation (e.g., the business objectives to be met or the
price of the product/service.)
2. Identify the needs of the other party. Don't concentrate on specific solutions to your
issues.
3. Identify one or more solutions based on your needs and the needs of the other party.
4. Decide on your strategy and tactics.
5. Decide on approaches to possible positions or behaviours of your opponent.
Anticipate your opponent's moves.
6. Practice defensive strategies, some "what-if" analysis of actions taken by your
opponent.
7. Develop a plan or agenda.
42. ACTIVITY – 11 NEGOTIATION OF AN APARTMENT
ROLE PLAY:
TENANT
Before you start the negotiation you must write down: -
The most you will pay
The least you think the landlord will accept.
LANDLORD
Before you start the negotiation you must write down: -
The least you will accept
The most you think the tenant will pay.
You will have 25 minutes in which to reach a deal
43. WIN / WIN NEGOTIATION
The best possible resolution to a conflict is one from which both people walk away thinking
they gained more than they expected from the exchange. This will achieve a win / win
solution.
The whole pie approach to negotiations is based on the theory that the sum of the parts
exceeds their individual values.
Before focusing on the basic or primary terms of a negotiation, work with TOS to identify
as many additional wants or needs as possible, as this expands the scope of the
discussion.
These incremental incentives / concessions potentially add value to the entire negotiation.
44. NEGOTIATIONS IMPACT RELATIONSHIPS
• At the end of the negotiation find ways to make the other person feel good
about something. In a business setting, compliment the other person’s
performance, professionalism and knowledge. Indicate your appreciation that
the other person was personally involved in working things out. Ease back
from a transaction discussion to a more personal level of conversation.
• Be a good winner by reaching out to the other person to stem any residual ill
will as these efforts will play dividend.
45. ACTIVITY – 12 NEGOTIATION SIMULATION
GROUP ACTIVITY:
Management
• Take about 30 minutes to discuss your options and your strategy with the members
of your bargaining team. You will then begin negotiating with the union team. In collective
bargaining, the UNION typically takes the lead in making initial proposals; the company
reacts.
• You will have about 45 minutes for this part of the negotiation.
• After the initial negotiation session you will meet with your own team again. Take about 30
minutes to discuss the proposals made by the other team and to decide where you
might be willing to compromise to achieve an agreement and where you are
determined to remain firm.
• Finally, you will bargain with the UNION team one more time in an attempt to settle the
outstanding issues and come to an agreement. Again, you’ll have about 45 minutes for
this final phase of the bargaining session.
46. ACTIVITY – 12 NEGOTIATION SIMULATION
GROUP ACTIVITY:
UNION
• Take about 30 minutes to discuss your options and your strategy with the members
of your bargaining team. You will then begin negotiating with the management team. In
collective bargaining, the union typically takes the lead in making initial proposals; the
company reacts.
• You will have about 45 minutes for this part of the negotiation.
• After the initial negotiation session you will meet with your own team again. Take about 30
minutes to discuss the proposals made by the other team and to decide where you
might be willing to compromise to achieve an agreement and where you are
determined to remain firm.
• Finally, you will bargain with the MANAGEMENT team one more time in an attempt to settle
the outstanding issues and come to an agreement. Again, you’ll have about 45 minutes
for this final phase of the bargaining session.
47. NEGOTIATION SKILLS FOR 21ST CENTURY
THANKYOU TO ALL NBK DELEGATES
FOR YOUR PARTICIPATION ON
NEGOTIATION SKILLS FOR 21ST CENTURY
FACILITATED BY
SAMEER MALGUNDKAR