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NEGOTIATION

Negotiation describes the process of discussion by which two or more parties aim to reach a mutually acceptable agreement

The negotiation process comprises five stages: 1. Preparation 2.Relationship building 3. The exchange of task-related information 4. Persuasion 5. Concessions and agreement

Stage one: Preparation


1. Research on the composition of the opposing team and the relative authority that the member possess. 2. Research on the business partner 3. SWOT analysis 4. Simulations of negotiations 5. Preparing the location for negotiations

Relationship Building
Is the process of building mutual trust before embarking in business discussions and transactions In many countries, such as Mexico and China, personal commitments to individuals rather than the legal system, form the basis for the enforcement of contracts.

Exchanging task-related information


Mexican negotiators are usually suspicious and indirect, presenting little substantive material and more lengthy, evasive conversation. French negotiators enjoy debate and conflict and will often interrupt presentations to argue about an issue even if it has little relevance to the topic being presented Chinese presentations contain only vague and ambiguous material.

Persuasion
Is an integral part of the process of making concessions and arriving at an agreement. Rough tactics designed to put negotiators in a stressful situation: uncomfortable room temperatures, too-bright lightning, rudeness, interruptions. Specific bargaining pressures include extreme and escalating demands, threats to stop negotiating, calculated delays and take-it-or-leave-it attitude.

Concessions and Agreement


The Russians and Chinese generally open their bargaining with extreme positions, asking for more than they hope to gain, whereas the Swedes usually start with what they are prepared to accept. Negotiators in the Far East, approach issues in a holistic manner, deciding on the whole deal at the end rather than making incremental concessions. The Japanese prefer to operate on the basis of understanding and social trust, considering the contract a waste of time and money in legal costs.

Comparison of negotiation styles


Japanese
Emotional sensitivity highly valued Conciliation Decisions on basis of saving someone from emabarrassment Good of group is the ultimate aim Cultivate a good emotional social setting for decision making

North American
Emotional sensitivity not highly valued Litigation Decisions made on a costbenefit basis Profit motive or good of individual is the ultimate aim Decision making impersonal, avoid conflict of interest.

English Negotiators
Are very formal and polite and place great importance on proper protocol Are reserved and mannered Nuances of communication are important

French negotiators
Protocol, manner, status, education, family and individual accomplishments are key to success when dealing with the French The French enjoy conflict and debate and will interrupt even the opening presentations with arguments of little or no relevance They dislike being rushed into decisions. Punctuality is expected. They rely on highly rational abstract logic and general principles and their position are poften rigid

French negotiators
To the French, negotiation is an art with long tradition in international diplomatic and business relations with French negotiators and the French language at center stage. They are concerned with a concise, rational presentation of ideas in verbal and written form. They are formal and attentive to manners, courtesy and respect is mandatory for success in France

German Negotiators
Protocol is important and formal in Germany, dress is conservative, correct posture and manners are required Germans tend to use a handshake at the beginning and end of meetings Remember to use titles. Since Germans are detail oriented, having technical people as part of the negotiation team is important. Being punctual is expected and german protocol is formal Negotiators are distant and impersonal, planned and well organized, direct in their approach The Germans are men of their word. A handshake is as good as a written contract but they are concerned with the precision of the written word.

Asian Negotiators
The negotiation style is relationship oriented, the social contacts developed between the parties being more significant than the technical specifications and price. Aggressive or assertive behavior is rude In India, bribery is common and having connections is important. Indians view negotiations as a truthful way of solving problems mutually with a focus on finding a solution that will please everyone involved.

Latin America
Handshaking and asking about the health and well being of business contacts and their families are expected Many Latins tend to get passionate and emotional when arguing, they enjoy a warm interaction and a lively debate. Compatibility and mutual trust are primarily concerns. Motivators are power, prestige and recognition, monetary gains are secondary.

Arabs
A persons word may be more binding than many written agreements and insistence on a contract may be insulting.