A Project

ON

Negotiation skills & Technique Lab

Submitted in partial fulfilment for the award of the degree

Master of Business Administration

Chhattisgarh Swami Vivekanand Technical University, Bhilai

Submitted by,

Mekha M Cherian

MBA – 3rd

Session 2017-19

Approved By, Guided By,

Dr. Manoj Verghese Sushil punwatkar
Head of the Department Assistant Professor

Department of Management Studies

Rungta College of Engineering & Technology
Kohka, Kurud Road, Bhilai (C.G.)
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 DECLARATION BY THE CANDIDATE

I the undersigned solemnly declare that the report of the thesis work entitled Negotiatin
skills and technique Lab is based on my own work carried out during the course of my study
under the supervision of Sushil punwatkar.

I assert that the statements made and conclusions drawn are an outcome of my

research work. I further declare that to the best of my knowledge and belief the report does

not contain any part of any work which has been submitted for the award of MBA degree in

this University or any other University of India or abroad.

_________________
(Signature of the Candidate)
Mekha M Cherian
Enrollment No:

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CONTENTS

Topic Page no

1 Negotiation………………………………………………………….. 4
2 Tactics adopted in negotiation……………………………………....5
3 Importance of non-verbal communication………………………….6
4 Cross-culture Negotiation…………………………………………...8
5 Quality of effective negotiator………………………………………10
6 Crux of negotiation on electronic media…………………………....12

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 Q 1. Define Negotiation. Discuss various tactics adopted in negotiation.

Ans. Negotiation is a method by which people settle differences. It is a process

by which compromise or agreement is reached while avoiding argument and
dispute.

In any disagreement, individuals understandably aim to achieve the best possible

outcome for their position (or perhaps an organisation they represent). However,
the principles of fairness, seeking mutual benefit and maintaining a relationship
are the keys to a successful outcome.

Specific forms of negotiation are used in many situations: international affairs,

the legal system, government, industrial disputes or domestic relationships as
examples. However, general negotiation skills can be learned and applied in a
wide range of activities. Negotiation skills can be of great benefit in resolving
any differences that arise between you and others.

People negotiate daily, often without considering it a negotiation. Negotiation

occurs in organizations, including businesses, non-profits, and within and
between governments as well as in sales and legal proceedings, and in personal
situations such as marriage, divorce, parenting, etc. Professional negotiators are
often specialized, such as union negotiators, leverage buyout negotiators, peace
negotiator, or hostage negotiators. They may also work under other titles, such as
diplomats, legislators, or broker

Negotiation tactics
Negotiation tactics are the detailed methods employed by negotiators to gain an
advantage. Negotiation Tactics are often deceptive and manipulative and are used
to fulfil one party’s goals and objectives – often to the detriment of others. This
makes most tactics in use today ‘win-lose’ by nature.

We would like to caution negotiators to only make use of ethical negotiation

tactics, and to think first about the context of your negotiation (e.g. car, house,
commercial negotiations) and relationship (family, friends, strangers). When
buying or selling a car or house to a stranger, these contexts are ideal for using a
wider array of tactics. Whereas when selling the same car or house to a family
member, you should of course carefully consider the long term impact on your
relationship and reputation before employing tactics.

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Here is a list of the 10 tactics in negotiation

1. Extreme demands followed up by small, slow concessions. Perhaps the

most common of all hard-bargaining tactics, this one protects dealmakers
from making concessions too quickly. However, it can keep parties from
making a deal and unnecessarily drag out business negotiations. To head off
this tactic, have a clear sense of your own goals.
2. Commitment tactics. Your opponent may say that his hands are tied or that
he has only limited discretion to negotiate with you. Do what you can to
find out if these commitment tactics are genuine. You may find that you
need to negotiate with someone who has greater authority to do business
with you.
3. Take-it-or-leave-it negotiation strategy. Offers should rarely be
nonnegotiable. To defuse this hard-bargaining tactic, try ignoring it and
focus on the content of the offer instead, then make a counter-offer that
meets both parties’ needs.
4. Inviting unreciprocated offers. When you make an offer, you may find
that your counterpart asks you to make a concession before making a
counteroffer herself. Don’t bid against yourself by reducing your demands;
instead, indicate that you are waiting for a counteroffer.
5. Trying to make you flinch. Sometimes you may find that your opponent
keeps making greater and greater demands, waiting for you to reach your
breaking point and concede. Name the hard-bargaining tactic and clarify
that you will only engage in a reciprocal exchange of offers.
6. Personal insults and feather ruffling. Personal attacks can feed on your
insecurities and make you vulnerable. Take a break if you feel yourself
getting flustered, and let the other party know that you won’t tolerate insults
and other cheap ploys.
7. Bluffing, puffing, and lying. Exaggerating and misrepresenting facts can
throw you off guard. Be skeptical about claims that seem too good to be true
and investigate them closely.
8. Threats and warnings. Want to know how to deal with threats? The first
step is recognizing threats and oblique warnings as the hard-bargaining
tactics they are. Ignoring a threat and naming a threat can be two effective
strategies for defusing them.

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 9. Belittling your alternatives. The other party might try to make you cave in
by belittling your BATNA Don’t let her shake your resolve.
10. Good cop, bad cop. When facing off with a two-negotiator team, you
may find that one person is reasonable and the other is tough.

Q 2. Explain the importance of non-verbal communication as a key to effective

negotiation.

ANS. Researchers in nonverbal communication claim that as much as 90

percent of the meaning transmitted between two people in face-to-face
communication is nonverbal. This means that little of your verbal communication
will have an impact on the outcome of your negotiations! If these figures are even
close to reality, the importance of nonverbal negotiation skills cannot be
overestimated.

Learning the language of nonverbal communications is almost as difficult as

acquiring fluency in a foreign language. In addition to studying your own gestures
and the meaning you are conveying, you must also become aware of what your
counterpart is conveying.

Gesture Clusters

Many skeptics argue that it is difficult to tell what someone is thinking by

singling out one gesture: and they are right. A single gesture is like a single word;
its true meaning is difficult to understand out of context. However, when gestures
come in clusters, their meaning becomes clearer. For example, while a person’s
fidgeting may not mean much by itself, if that person is avoiding eye contact,
holding his hands around his mouth, touching his face and fidgeting, there’s a
good chance he is not being totally honest.

As you study nonverbal behavior, you will begin to understand the clustering
process. When scanning a counterpart for clusters of gestures, a good formula to
follow is to divide the body into five categories:

1. Face and head. The face and head truly provide a window into your
counterpart’s soul. Look for the following signs.
 Someone who is trying to hide something will avoid eye contact.

 Someone who is bored may gaze past you or glance around the
room.

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  Someone who is angry or feels superior to you may maintain
piercing eye contact.
 Someone who is evaluating what you are saying may turn his
head slightly to one side, almost as though trying to hear you
better.
 Someone who is in agreement may nod his head as you are
speaking.
2. Body. The body also plays an important role in nonverbal
communication. Here are some signs to watch for:
 Someone who is interested and in agreement with you will
usually lean toward you or position her body closer to you.
 Someone who is in disagreement with, uncertain about, or bored
with what you are saying will generally turn her body away from
you and lean back farther in her chair.
 Someone who feels insecure, nervous or in doubt may move
from side to side, shifting her weight.

To create a win/win outcome, you should always position your body toward the
other party.

 Arms. In general, an open arm position suggests that someone is receptive

to the negotiation process. Watch especially for changes in arm position. If
your counterpart’s arms are lying open on the table where you are both
sitting as you start the negotiation, and he takes his arms off the table and
crosses them over his chest when you mention that your company has a
standard deposit of 50 percent on all first-time orders, that’s a good
indication that this information was not received well. You may want to
clarify your words or, better yet, ask your counterpart whether he has a
concern about the deposit.
 Hands. People’s true feelings are commonly revealed through hand
movements. For example, open palms generally convey a positive message.
This goes back to medieval days, when people showed their open palms to
prove they were not carrying any weapons.

Involuntary hand movements can be particularly telling. People often touch

their nose, chin, ear, arm or clothing when they are nervous or lack
confidence in what they are saying.
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  Legs. When asked why they cross their legs, most people say they do so for
comfort. Although they are being truthful, they are only partially correct. If
you have ever crossed your legs for a long period of time, you know that
this position can become painfully uncomfortable.

Crossing your legs can have a devastating effect on a negotiation. In a study

described in How to Read a Person Like a Book, Gerard I. Nierenberg and
Henry H. Calero found after videotaping 2,000 transactions that no sales
were made by people who had their legs crossed.

Q 3. Explain in brief the concept of cross-culture Negotiation.

ANS. Cross cultural negotiation is one of many specialized areas within the wider
field of cross cultural communications. By taking cross cultural negotiation
training, negotiators and sales personnel give themselves an advantage over
competitors.

“Intercultural negotiation involves discussions of common and conflicting

interests between persons of different cultural backgrounds who work to reach an
agreement of mutual benefit.”

Richard D. Lewis Model

Communication across cultures is challenging. The model developed by Richard

D. Lewis illustrates how each culture perceives a situation and communicates.
This approach is very useful for leaders who have to manage a company/industry
across countries with different cultural backgrounds. The Richard D. Lewis model
can serve as a guideline to help them understanding the situation and use a
suitable leadership style. It is also used to improve performance and efficiency in
a multinational team. The cultures are divided into three main categories:

Linear Active – refers to societies where people focus on jobs. They separate
their social and professional life. They work on one task at a time but have a
detailed plan. They prefer polite and direct conversation with limited body
language.

Multi Active - refers to societies where people focus on building relationships.

Their decisions are based on emotions. They work multi-task and plan their work
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life only partially. They prefer to communicate emotionally and talk most of the
time with unlimited body language.

Reactive – refers to societies where people listen most of the time and react to
others’ action. They prefer being polite and to communicate indirectly. They
never interrupt a conversation and take decisions as they are. They focus mainly
on building close trusting relationships.

All these categories will be explained in the chapter: Typical mistakes in

intercultural negotiation / real life approach.

There are three interconnected aspects that need to be considered before

entering into any cross cultural negotiation.

The Basis of the Relationship

In much of Europe and North America, business is contractual in nature. Personal

relationships are seen as unhealthy as they can cloud objectivity and lead to
complications. In South America and much of Asia, business is personal.
Partnerships will only be made with those they know, trust and feel comfortable
with. It is therefore necessary to invest in relationship building before conducting
business.

Information at Negotiations

Western business culture places emphasis on clearly presented and rationally

argued business proposals using statistics and facts. Other business cultures rely
on similar information but with differences. For example, visual and oral
communicators such as the South Americans may prefer information presented
through speech or using maps, graphs and charts.

Negotiation Styles

The way in which we approach negotiation differs across cultures. For example,
in the Middle East rather than approaching topics sequentially negotiators may
discuss issues simultaneously. South Americans can become quite vocal and
animated. The Japanese will negotiate in teams and decisions will be based upon
consensual agreement. In Asia, decisions are usually made by the most senior
figure or head of a family. In China, negotiators are highly trained in the art of
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gaining concessions. In Germany, decisions can take a long time due to the need
to analyse information and statistics in great depth.bIn the UK, pressure tactics
and imposing deadlines are ways of closing deals whilst in Greece this would
backfire.

Q 4. Explain in brief the quality of effective negotiator.

ANS. Qualities of effective negotiators

1. Be patient, persistent and creative.

Advantage always goes to the patient negotiator who persistently pursues

creative win/win solutions. Negotiation is a complex process that takes time.
Progress usually comes in small increments. Impatient negotiators who lack
persistence often leave potential results on the table and make costly mistakes.
The most successful and effective negotiators are the most creative. Good
solutions eventually come to those with the patience to wait for them, the
persistence work for them and the desire to produce innovative win/win results

2. Listen, listen and then listen some more.

The most successful/effective negotiators spend far more time listening and
asking questions than they do talking. Gathering information and then thoroughly
understanding that information takes precedence over sharing information. Once
you fully comprehend your counterpart’s frame of reference, it’s easier to know
what to share and how to share it in order to build trust and move the negotiation
forward. Win/Win negotiators use:

3. Show empathy.

What is empathy? It’s an attempt to understand, be aware of and sensitive to the

feelings, thoughts, experiences, frame of reference, interests (needs/priorities) and
positions of your counterpart. Successful/Effective negotiators understand that in
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order to manage conflicting points of view and achieve a win/win result, you
must provide your counterpart with convincing reasons to exchange their ideas
for the ones you suggest. Your counterpart will be much more receptive and your
rationale much more convincing if he/she is confident that you understand and
that you are sensitive to his/her point of view, interests (needs/priorities) and
position. Empathy builds rapport, encourages information sharing, establishes
mutual respect and moves the negotiation forward in a positive direction.

4. Be sensitive to nonverbal cues.

Not only are successful/effective negotiators sensitive to nonverbal cues, they can
also read the ones that actually matter. Experienced negotiators are really good at
sending nonverbal cues meant to disguise information, and in some cases,
outright deceive their counterparts. Win/Win negotiators focus on two nonverbal
sources that are difficult (not impossible) for inexperienced negotiators to control:
the eyes and the voice.

5. Be an innovative and creative problem-solver.

Negotiations are competitive. And so they should be. If a win/win solution is to

be found, this spirited rivalry calls for a cooperative attitude capable of joint
problem solving and compromise. When successful/effective negotiators find
themselves faced head-on with problematic issues that impede the movement
towards a mutually acceptable conclusion, they suggest the following joint
problem solving approach. This requires both negotiators to view problem issues
as opportunities rather than impossible barriers:

6. Stay flexible.

Negotiation is movement. It is an exercise in flexibility. The opening offer or

counter offer is never the final mutually acceptable solution. Yes, all
generalizations are false (including this one)! Experienced negotiators go through
the habitual ritual of developing:

Successful/Effective negotiators show their flexibility by proposing creative ways

to satisfy the interests of both sides at the lowest cost to one another. A win/win
solution within the respective settlement range is the focus. As the negotiation
unfolds, you must be both flexible and adaptable in order to effectively tolerate
conflict and stress.

7. Learn from your mistakes.

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As you strive to be a successful/effective negotiator, no matter what stage of
development you are in currently – newbie, absolute pro, or somewhere in the
middle – there will be times when your intuition, intellect, self-control or self-
discipline fails you. When that happens, you make mistakes that can find you
doing or saying things that are not in your best interests…

 When you fail to plan adequately and find yourself failing in the negotiation
 When you focus on positions instead of interests
 When you assume everything is negotiable and it isn’t – or vice versa

Q 5. Explain in brief the crux of negotiation on electronic media such as email,

video conference, etc.

ANS. Increasingly negotiations are taking place through channels other than
face-to-face meetings. Sometimes certain sections or parts of the negotiation will
take place via telephone or email and in some cases the entire negotiation will
take place in this way.

In addition to the telephone and email you may also find other medium being
used such as VOIP, video conferencing, conference calls, Webex or instant
messaging services. This post will largely focus on the two most common
channels – telephone and email as the principles can then be applied to the other
medium.

The communication challenge

Any time you are talking with someone, whether you’re chatting about what you
did at the weekend or negotiating an important deal, you and the other person are
receiving a lot of non-verbal information or “contextual cues”. These cues give
the words that are spoken appropriate meaning. Research shows that words make
up 30% or less of communication – the other 70% consists of non-verbal cues.

We rely heavily on body language such as gestures, posture, facial expressions

and tone of voice to give context to the words that we hear.

Face-to-face communication is a “rich” medium as all of the contextual cues,

from which a significant proportion of the meaning of a particular communication
is derived are present.

Telephone and Email Negotiation – The Research

Research has identified a collection of challenges to negotiating via telephone and
email:
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 Parties communicating via telephone were found to be prone to more
distrust, competition, and contentious behavior than those in comparable
face-to-face interactions
 Email negotiators rely more heavily on logical argumentation and the
presentation of facts, rather than emotional or personal appeals
 Email communicators are more task-orientated and depersonalized than
those engaged in face-to-face interactions.
 Information exchanged in email tends to be less nuanced than information
exchanged face-to-face and the elimination of important back-channel and
clarifying information such as speech acknowledgements (“OK”, “Uh-Huh”
or Huh?”) compound this.
 E-communication tends to be less inhibited than face-to-face
communication due to physical distance, reduced social presence, reduced
accountability and a sense of anonymity
 The lack of social cues in e-communication causes people to act more
contentiously than they do in face-to-face encounters, resulting in more
frequent occurrences of swearing, name calling, insults and hostile
behaviour.
 Email communicators trust their counterparts less than negotiators in similar
face-to-face interactions – at all stages of the process.
 E-negotiators are more likely to suspect their opposite of lying, even when
no deception has taken place.

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