Module 10

INTERNATIONAL NEGOTIATIONS

PLAN
1. Introduction (definition, etymology, negotiation theory)
2. Types of negotiation
3. Negotiation styles
4. Types of negotiators
5. The essential elements of negotiation (strategies and techniques)
6. Key skills in negotiating
7. Tactics and how to overcome the top ten negotiating tactics 
8. International negotiations (general principles and differences)
9. Challenges of negotiating across cultures

LECTURE

Let's first define what negotiation means. The Random House Dictionary (2nd
Edition) defines "to negotiate" as “...to deal or bargain with another or others, as in the
preparation of a treaty or contract or in preliminaries to a business deal.”
Webster's Seventh New Collegiate Dictionary has it as “ ...to confer with another
so as to arrive at the settlement of some matter. “
But one of the best definition I've come across was given by Robert D.
Rutherford, Ph.D., author of The Twenty Five Most Common Mistakes Made in
Negotiating...and What You Can Do About Them. He defines negotiation as: “...an
effort to resolve a difference between two or more parties by the give-and-take
process.”
Negotiation is a dialogue between two or more people or parties intended to reach
a mutually beneficial outcome, resolve points of difference, to gain advantage for an
individual or collective, or to craft outcomes to satisfy various interests.
Negotiation occurs in business, non-profit organizations, government branches,
legal proceedings, among nations and in personal situations such as marriage, divorce,
parenting, and everyday life. The study of the subject is called negotiation theory. The
foundations of negotiation theory are decision analysis, behavioral decision analysis,
game theory, and negotiation analysis. Another classification of theories distinguishes
between structural analysis, strategic analysis, process analysis, integrative analysis
and behavioral analysis of negotiations. Negotiation is a specialized and formal
version of conflict resolution most frequently employed when important issues must
be agreed upon. Negotiation is necessary when one party requires the other party's
agreement to achieve its aim. The aim of negotiating is to build a shared environment
leading to long-term trust and often involves a third, neutral party to extract the issues
from the emotions and keep the individuals concerned focused. It is a powerful
method for resolving conflict and requires skill and experience. Zartman defines
negotiation as "a process of combining conflicting positions into a common position
under a decision rule of unanimity, a phenomenon in which the outcome is
determined by the process." Professional negotiators are often specialized, such as
union negotiators, leverage buyout negotiators, peace negotiators, hostage
negotiators, or may work under other titles, such as diplomats, legislators or brokers.

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 Etymology
The word "negotiation" originated in the early 15th century from the Old French
and Latin expressions “negociacion” and “negotiationem.” These terms mean
“business, trade and traffic.” By the late 1590s negotiation had the definition, "to
communicate in search of mutual agreement." With this new introduction and this
meaning, it showed a shift in “doing business” to “bargaining about” business.
Types of Negotiation.
Negotiation can take a wide variety of forms, from a trained negotiator acting on
behalf of a particular organization or position in a formal setting, to an informal
negotiation between friends. Negotiation can be contrasted with mediation, where a
neutral third party listens to each side's arguments and attempts to help craft an
agreement between the parties. It can also be compared with arbitration, which
resembles a legal proceeding. In arbitration, both sides make an argument as to the
merits of their case and the arbitrator decides the outcome. This negotiation is also
sometimes called positional or hard-bargaining negotiation.
Negotiation theorists generally distinguish between two types of negotiation:
distributive and intergrative.
Distributive Negotiation
Distributive negotiation is also sometimes called positional or hard-bargaining
negotiation. It tends to approach negotiation on the model of haggling in a market. In
a distributive negotiation, each side often adopts an extreme position, knowing that it
will not be accepted, and then employs a combination of guile, bluffing, and
brinkmanship in order to cede as little as possible before reaching a deal. Distributive
bargainers view negotiation as a process of distributing a fixed amount of value.
The term distributive implies that there is a finite amount of the thing being
distributed or divided among the people involved. Sometimes this type of negotiation
is referred to as the distribution of a "fixed pie." Distributive negotiation is also
sometimes called win-lose because of the assumption that one person's gain results in
another person's loss. A distributive negotiation often involves people who have never
had a previous interactive relationship, nor are they likely to do so again in the near
future. Simple everyday examples would be buying a car or a house.
Integrative Negotiation
Integrative negotiation is also sometimes called interest-based or principled
negotiation. It is a set of techniques that attempts to improve the quality and
likelihood of negotiated agreement by providing an alternative to traditional
distributive negotiation techniques. While distributive negotiation assumes there is a
fixed amount of value (a "fixed pie") to be divided between the parties, integrative
negotiation often attempts to create value in the course of the negotiation ("expand the
pie"). It focuses on the underlying interests of the parties, approaches negotiation as a
shared problem rather than a personalized battle.
Integrative negotiation often involves a higher degree of trust and the establishing a
relationship to achieve mutual gains. It is also sometimes called win-win negotiation.
In the book Getting to YES: Negotiating Agreement Without Giving In Roger Fisher
and William L. Ury developed the method of principled negotiation and five
principles it is based on. Their process of principled negotiation can be used
effectively in almost any type of dispute. Their five principles are:
a) "Separate the people from the problem"
b) "Focus on interests, not positions"
c) "Invent options for mutual gain"

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 d) "Insist on using objective criteria"
e) "Know your BATNA (Best Alternative To Negotiated Agreement)"
Source: Roger Fisher and William L. Ury, Getting to YES: Negotiating Agreement
Without Giving In, Penguin Group (1981)
The Essential Elements of Negotiation
There are many different ways to categorize the essential elements of negotiation.
One view of negotiation involves three basic elements: process, behavior and
substance. The process refers to how the parties negotiate: the context of the
negotiations, the parties to the negotiations, the tactics used by the parties, and the
sequence and stages in which all of these play out. Behavior refers to the relationships
among these parties, the communication between them and the styles they adopt. The
substance refers to what the parties negotiate over: the agenda, the issues (positions
and - more helpfully - interests), the options, and the agreement(s) reached at the end.
Another view of negotiation comprises four elements: strategy, process, tools, and
tactics. Strategy comprises the top level goals - typically including relationship and
the final outcome. Processes and tools include the steps that will be followed and the
roles taken in both preparing for and negotiating with the other parties. Tactics
include more detailed statements and actions and responses to others' statements and
actions. Some add to this persuasion and influence, asserting that these have become
integral to modern day negotiation success, and so should not be omitted.
Adversary or Partner?
The two basically different approaches to negotiating will require different
tactics. In the distributive approach each negotiator is battling for the largest possible
piece of the pie, so it may be quite appropriate - within certain limits - to regard the
other side more as an adversary than a partner and to take a somewhat harder line.
This would however be less appropriate if the idea were to hammer out an
arrangement that is in the best interest of both sides. A good agreement is not one with
maximum gain, but optimum gain. This does not by any means suggest that we should
give up our own advantage for nothing. But a cooperative attitude will regularly pay
dividends. What is gained is not at the expense of the other, but with him.
Negotiation Styles
Kenneth W. Thomas and Ralph H. Kilmann identified 5 styles/responses to
negotiation. These five strategies have been frequently described in the literature and
are based on the dual-concern model. The dual concern model of conflict is based on
two themes or dimensions
a) A concern for self (i.e.assertiveness), and
2. A concern for others (i.e.empathy).
Based on this model, individuals balance the concern for personal needs and
interests with the needs and interests of others. The following five styles can be used
based on individuals’ preferences depending on their pro-self or pro-social goals.
Before we proceed to explain about the different negotiation styles it is important to
note two things. First, people tend to prefer a style. In fact, with practice people can
effectively use all five negotiation styles. Second, there is no universal best
negotiation style. The best style to use differs from negotiation to negotiation.
These styles are: accommodating, avoiding, collaborating, competing and
compromising.
1. Accommodating: Individuals who negotiate with an accommodating style put
great value and emphasis on preserving the relationship. Accommodators are sensitive
to the emotional states, body language, and verbal signals of the other parties.

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 2. Avoiding: Individuals who do not like to negotiate and don't do it unless
warranted. When negotiating, avoiders tend to defer and dodge the confrontational
aspects of negotiating; however, they may be perceived as tactful and diplomatic.
3. Collaborating: Individuals who enjoy negotiations that involve solving tough
problems in creative ways. Collaborators are good at using negotiations to understand
the concerns and interests of the other parties.
4. Competing: Individuals who enjoy negotiations because they present an
opportunity to win something. Competitive negotiators are often strategic. Because
their style can dominate the bargaining process, competitive negotiators often neglect
the importance of relationships.
5. Compromising: Individuals who are eager to close the deal by doing what is fair
and equal for all parties involved in the negotiation. Compromisers can be useful
when there is limited time to complete the deal; however, compromisers often
unnecessarily rush the negotiation process and make concessions too quickly.
Source: Kenneth W. Thomas and Ralph H. Kilmann, Thomas-Kilmann Conflict Mode
Instrument (TKI)
Types of Negotiators
Three basic kinds of negotiators have been identified by researchers involved in
The Harvard Negotiation Project. These types of negotiators are: Soft bargainers,
hard bargainers, and principled bargainers.
a) Soft. These people see negotiation as too close to competition, so they
choose a gentle style of bargaining. The offers they make are not in their
best interests, they yield to others' demands, avoid confrontation, and they
maintain good relations with fellow negotiators. Their perception of others
is one of friendship, and their goal is agreement. They do not separate the
people from the problem, but are soft on both. They avoid contests of wills
and will insist on agreement, offering solutions and easily trusting others
and changing their opinions.
a) Hard. These people use strategies to influence, using such phrases as "this
is my final offer" and "take it or leave it." They make threats, insist on
their position, and apply pressure to negotiate. They see others as
adversaries and their ultimate goal is victory. Additionally, they will
search for one single answer, and insist you agree on it. They do not
separate the people from the problem (as with soft bargainers), but they are
hard on both the people involved and the problem.
1. Principled. Individuals who bargain this way seek integrative solutions. They
focus on the problem rather than the intentions, motives, and needs of the
people involved. They separate the people from the problem, explore interests,
avoid bottom lines, and reach results based on standards (which are
independent of personal will). They base their choices on objective criteria
rather than power, pressure or self-interest. These criteria may be drawn from
moral standards, principles of fairness, professional standards, tradition, and so
on.
Researchers from The Harvard Negotiation Project recommend that negotiators
explore a number of alternatives to the problems they are facing in order to come to
the best overall conclusion/solution, but this is often not the case (as when you may be
dealing with an individual utilizing soft or hard bargaining tactics) (Forsyth, 2010).
Top Ten Effective Negotiation Skills

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 Job descriptions often list negotiation skills as a desirable asset for job candidates,
but the ability to negotiate requires a collection of interpersonal and communication
skills used together to bring a desired result. The circumstances of negotiation occur
when two parties or groups of individuals disagree on the solution for a problem or
the goal for a project or contract. A successful negotiation requires the two parties to
come together and hammer out an agreement that is acceptable to both.
Problem Analysis
Effective negotiators must have the skills to analyze a problem to determine the
interests of each party in the negotiation. A detailed problem analysis identifies the
issue, the interested parties and the outcome goals. For example, in an employer and
employee contract negotiation, the problem or area where the parties disagree may be
in salary or benefits. Identifying the issues for both sides can help to find a
compromise for all parties.
Preparation
Before entering a bargaining meeting, the skilled negotiator prepares for the
meeting. Preparation includes determining goals, areas for trade and alternatives to the
stated goals. In addition, negotiators study the history of the relationship between the
two parties and past negotiations to find areas of agreement and common goals. Past
precedents and outcomes can set the tone for current negotiations.
Active Listening
Negotiators have the skills to listen actively to the other party during the debate.
Active listening involves the ability to read body language as well as verbal
communication. It is important to listen to the other party to find areas for
compromise during the meeting. Instead of spending the bulk of the time in
negotiation explaining the virtues of his viewpoint, the skilled negotiator will spend
more time listening to the other party.
Emotional Control
It is vital that a negotiator have the ability to keep his emotions in check during the
negotiation. While a negotiation on contentious issues can be frustrating, allowing
emotions to take control during the meeting can lead to unfavourable results.
Verbal Communication
Negotiators must have the ability to communicate clearly and effectively to the
other side during the negotiation. Misunderstandings can occur if the negotiator does
not state his case clearly. During a bargaining meeting, an effective negotiator must
have the skills to state his desired outcome as well as his reasoning.
Collaboration, Teamwork and Team Negotiations
Negotiation is not necessarily a one side against another arrangement. Effective
negotiators must have the skills to work together as a team and foster a collaborative
atmosphere during negotiations. Those involved in a negotiation on both sides of the
issue must work together to reach an agreeable solution. Due to globalization and
growing business trends, negotiation in the form of teams is becoming widely
adopted. Teams can effectively collaborate to break down a complex negotiation.
There is more knowledge and wisdom dispersed in a team than in a single mind.
Writing, listening, and talking, are specific roles team members must satisfy.
Problem Solving
Individuals with negotiation skills have the ability to seek a variety of solutions to
problems. Instead of focusing on his ultimate goal for the negotiation, the individual
with skills can focus on solving the problem, which may be a breakdown in
communication, to benefit both sides of the issue.

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 Decision Making Ability
Leaders with negotiation skills have the ability to act decisively during a
negotiation. It may be necessary during a bargaining arrangement to agree to a
compromise quickly to end a stalemate.
Interpersonal Skills
Effective negotiators have the interpersonal skills to maintain a good working
relationship with those involved in the negotiation. Negotiators with patience and the
ability to persuade others without using manipulation can maintain a positive
atmosphere during a difficult negotiation.
Ethics and Reliability
Ethical standards and reliability in an effective negotiator promote a trusting
environment for negotiations. Both sides in a negotiation must trust that the other
party will follow through on promises and agreements. A negotiator must have the
skills to execute on his promises after bargaining ends.
Tactics
Tactics are always an important part of the negotiating process. But tactics don't
often jump up and down shouting "Here I am, look at me." If they did, the other side
would see right through them and they would not be effective. More often they are
subtle, difficult to identify and used for multiple purposes. Tactics are more frequently
used in distributive negotiations and when the focus in on taking as much value off
the table as possible. Many negotiation tactics exist. Below are a few commonly used
tactics.
Auction: The bidding process is designed to create competition. When multiple
parties want the same thing, pit them against one another. When people know that
they may lose out on something, they will want it even more. Not only do they want
the thing that is being bid on, they also want to win, just to win. Taking advantage of
someone's competitive nature can drive up the price.
Brinksmanship: One party aggressively pursues a set of terms to the point at which
the other negotiating party must either agree or walk away. Brinkmanship is a type of
"hard nut" approach to bargaining in which one party pushes the other party to the
"brink" or edge of what that party is willing to accommodate. Successful
brinksmanship convinces the other party they have no choice but to accept the offer
and there is no acceptable alternative to the proposed agreement.
Bogey: Negotiators use the bogey tactic to pretend that an issue of little or no
importance to him or her is very important. Then, later in the negotiation, the issue
can be traded for a major concession of actual importance.
Chicken: Negotiators propose extreme measures, often bluffs, to force the other party
to chicken out and give them what they want. This tactic can be dangerous when
parties are unwilling to back down and go through with the extreme measure.
Defence in Depth: Several layers of decision-making authority is used to allow
further concessions each time the agreement goes through a different level of
authority. In other words, each time the offer goes to a decision maker, that decision
maker asks to add another concession in order to close the deal.
Deadlines: Give the other party a deadline forcing them to make a decision. This
method uses time to apply pressure to the other party. Deadlines given can be actual
or artificial.
Flinch: Flinching is showing a strong negative physical reaction to a proposal.
Common examples of flinching are gasping for air, or a visible expression of surprise
or shock. The flinch can be done consciously or unconsciously. The flinch signals to

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the opposite party that you think the offer or proposal is absurd in hopes the other
party will lower their aspirations. Seeing a physical reaction is more believable than
hearing someone saying, "I'm shocked."
Good Guy/Bad Guy: The good guy/bad guy approach is typically used in team
negotiations where one member of the team makes extreme or unreasonable demands,
and the other offers a more rational approach. This tactic is named after a police
interrogation technique often portrayed in the media. The "good guy" will appear
more reasonable and understanding, and therefore, easier to work with. In essence, it
is using the law of relativity to attract cooperation. The good guy will appear more
agreeable relative to the "bad guy." This tactic is easy to spot because of its frequent
use.
Highball/Lowball: Depending on whether selling or buying, sellers or buyers use a
ridiculously high, or ridiculously low opening offer that will never be achieved. The
theory is that the extreme offer will cause the other party to reevaluate his or her own
opening offer and move close to the resistance point (as far as you are willing to go to
reach an agreement). Another advantage is that the person giving the extreme demand
appears more flexible he or she makes concessions toward a more reasonable
outcome. A danger of this tactic is that the opposite party may think negotiating is a
waste of time.
The Nibble: Nibbling is asking for proportionally small concessions that haven't been
discussed previously just before closing the deal. This method takes advantage of the
other party's desire to close by adding "just one more thing."
Snow Job: Negotiators overwhelm the other party with so much information that he
or she has difficulty determining which facts are important, and which facts are
diversions. Negotiators may also use technical language or jargon to mask a simple
answer to a question asked by a non-expert.
How to Overcome the Top Ten Negotiating Tactics
Everyone uses negotiation tactics to get what they want. Most of the time, when
you enter a negotiating situation you can expect the other party to use certain
maneuvers to tip the scales in their favor. For example, you can expect a potential
employer to offer you less money than they are actually willing to pay to give
themselves negotiating room. And a buyer will usually act surprised at your stated
price, no matter how reasonable it may be, to pressure you into lowering it.
Everyone uses these tactics, but that doesn’t mean that negotiations can’t be fair.
Some tactics are acceptable, while others are downright sleazy. Tactics are part of the
process, and you can use them and still maintain your negotiations on an honest level.
In other words, the use of tactics doesn’t necessarily mean tricking or manipulating
people.
Some tactics are simply tools to expedite the negotiation process; others are used to
take advantage of the other person. To be successful in negotiations, you must be able
to differentiate between the fair and unfair negotiation tactics so you can use the good
ones to your advantage and deflect the questionable ones. Consider the following ten
negotiation tactics and the methods you can use to deflect them:
Tactic #1: The Wince: The wince can be explained as any overt negative reaction
to someone’s offer. For example, you might act stunned or surprised when your
negotiating counterpart names their terms. This tactic tells your counterpart that you
know your limits, which isn’t under-handed or dishonest. And wincing at the right
time can potentially save you thousands of dollars. Keep in mind that when deals are
negotiable, your counterpart will start high.

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Of course, you won’t always be the wincer. Many times, especially in the sales
profession, you’ll be on the receiving end of the wince. In this case, you can counter
with the next tactic.
Tactic #2: Silence: In the negotiation process, silence can be your strongest tool.
If you don’t like what your counterpart has said, or if you’ve made an offer and you’re
waiting for a response, just sit back and wait. Most people feel uncomfortable when
conversation ceases, and they start talking automatically to fill the void. Almost
without fail, your counterpart will start whittling away his or her position when you
use this tactic.
So what if you find yourself negotiating with a person who understands the
importance of silence as well as you? Rather than wasting time in silence, restate your
offer. Don’t make suggestions; just repeat your terms. This maneuver forces the other
person to respond, and more often than not, they respond with a concession.
Tactic #3: The Good Guy/Bad Guy Routine: This sleazy tactic is often used in
movies, where two detectives are interrogating a person who’s just been arrested. One
detective seems unreasonable and inflexible, while the other tries to make it look like
he or she is on the suspect’s side. This tactic is designed to get you to make
concessions without the other side making any in return.
If you find yourself in a good guy/bad guy situation, the best response is to ignore it.
Recognize this game for what it is, but don’t play along and don’t allow the good guy
to influence your decision. The best technique is to let your counterparts play their
game, while you watch out for your own interests.
Tactic #4: Limited Authority: This tactic is a variation on the good guy/bad guy
routine, but instead of two people working over you, the one person you’re dealing
with tells you that he or she must approve any deals with an unseen higher authority.
Sometimes, this higher authority exists, but other times your counterpart will create
this figure to gain an edge in the negotiation process.
So just because your counterpart tells you, “It’s out of my hands,” don’t automatically
assume the person is being honest. In this type of situation, two options exist: one, ask
to deal directly with this so-called higher authority; or two, test the limits of your
counterpart.
Tactic #5: The Red Herring: This technique comes from fox hunting competitions,
where one team drags a dead fish across the fox’s path to distract the other team’s
dogs. At the bargaining table, a red herring means one side brings up a minor point to
distract the other side from the main issue. Effective and ethical negotiators generally
agree that this tactic is the sleaziest of them all.
When your negotiation process is bogged down with a minor problem, and your
counterpart insists on settling it before they even talk about more important issues,
then you are probably dealing with a red herring. In this case, use extreme caution,
and suggest setting the issue aside temporarily to work out other details.
Tactic #6: The Trial Balloon: Trial balloons are questions designed to assess your
negotiating counterpart’s position without giving any clues about your plans. For
example, you may ask your counterpart, “Would you consider trying our services on a
temporary basis?” or “Have you considered our other service plans?” Essentially,
these types of questions put the ball in your counterpart’s court, and the nice part
about them is they aren’t really offers. They allow you to gain information without
making a commitment.
When you’re on the receiving end of a trial balloon question, you may feel compelled
to answer it thoroughly. To maintain your edge, resist this temptation and counter

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with another question. For example, if someone asks, “Would you consider financing
the house yourself?” respond, “Well, if I did, what would your offer be?”
Tactic #7: Low-Balling: Low-balling is the opposite of the trial balloon. Instead of
tempting you to make the first offer, your counterpart will open the process with a
fantastic offer. Then after you agree, they start hitting you with additional necessities.
For example, say you see an ad for a product priced lower than other stores. But then
after you agree to buy, the sales representative uncovers the hidden costs, such as
shipping or installation. In the end you probably pay more than you would have at
another store listing a higher price on the product. To avoid falling victim to this
tactic, ask your counterpart about additional costs before agreeing to any deal.
Tactic #8: The Bait-and-Switch: Similar to low-balling, the bait-and-switch tactic
should be avoided. Your counterpart may try to attract your interests with one great
offer, but then hook you with another mediocre one. This tactic will almost always
burn you, unless you can recognize it. If your counterpart were really able to offer a
genuinely good deal, they wouldn’t have to resort to bait-and-switch.
Tactic #9: Outrageous Behavior: Outrageous behavior can be categorized as any
form of socially unacceptable conduct intended to force the other side to make a
move, such as throwing a fit of anger or bursting into tears. As most people feel
uncomfortable in these situations, they may reduce their negotiating terms just to
avoid them.
However, the most effective response to outrageous behavior is none at all. Just wait
for the fit to die down before reacting, because emotional negotiations can result in
disaster.
Tactic #10: The Written Word: When terms of a deal are written out, they often
seem non-negotiable.
The best defense against this tactic is simply to question everything, whether it
appears in writing or not. You’ll inevitably run into some standard, non-negotiable
documents, but it never hurts to ask questions. You may be surprised how many
contracts actually are negotiable when challenged.
Better Negotiations in the Future: People have used these ten negotiation tactics
for years, but that doesn’t mean they are always fair. So before you rush into your
next negotiation situation, make yourself aware of these tactics and how they affect
the process. When you learn the uses and defenses of these negotiation techniques,
you can reach more mutually beneficial agreements.
Source: John Patrick Dolan, Negotiate like the Pros™, LawTalk Publications (January
1, 2001)
International Negotiation / Cross –Cultural Negotiations
International negotiation is often a process of power-based dialogue intended to
achieve certain goals or ends, and which may or may not thoroughly resolve a
particular dispute or disputes to the satisfaction of all parties. International negotiation
can be bilateral or multilateral, public or secret, and can involve different forms of
negotiation among states and non-state civilian actors, as well as with anti-state
actors, such as individual terrorists and terrorist organizations. In addition, different
cultures may engage in negotiations with different styles and for different purposes,
with different expectations. Negotiation aimed at conflict management seeks to limit
or minimize tensions and disputes as much as possible, without necessarily changing
the status quo or the relations of power, values, and interests between the disputing
parties. Negotiation aimed at conflict transformation seeks to go beyond the status quo
to transform relations of disputed power, values, and interests in a more “positive”
and less controversial direction although largely expecting a number of disputes and

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differences to remain. Conflict resolution is generally seen as an even longer-term
process that attempts to find a common and complete agreement among the different
parties despite their different values, interests, and power relationships.
Negotiation is an unavoidable part of any international business and an important
instrument of international business communication. International business
negotiations have many characteristics that distinguish them from negotiations in the
domestic markets mainly due to cross-cultural factors. A lot of studies conducted are
focusing on the effect of culture in specific countries. John Graham (2003) has done
studies in the negotiation styles of business people in 16 countries. Graham found that
there were significant differences in the negotiation process in the countries that he
studied. Although negotiators from different countries obtained the same outcome, the
way they negotiated was different. National culture programming leads to patterns of
thinking, feeling and acting. The behavior of the negotiators is strongly influenced by
their cultural background, which defines the range of strategies negotiators develop as
well as tactics and communication styles they implement. Successful negotiations
require understanding of each party's culture and may also require adaptation of the
negotiation strategy so it is consistent with the other party's culture (Hollensen 2001).
Cultural differences in negotiations tend to occur for two main reasons. First, when
confronting cultural differences, people tend to rely on stereotypes. Stereotypes are
often pejorative (for example: Italians always run late), and they can lead to distorted
expectations about your counterpart’s behavior as well as potentially costly
misinterpretations.
Instead of relying on stereotypes, try to focus on prototypes—cultural averages on
dimensions of behavior or values.
A second common reason for cross-cultural misunderstandings is that we tend to
interpret others’ behaviors, values, and beliefs through the lens of our own culture. To
overcome this tendency, we need to learn about the other party’s culture.
Culture is a major element of international business negotiations. It is often
compared to an iceberg; there is more to it than meets the eye. These hidden
elements, if not understood, can make or break an international business transaction.
It is thus important to be aware of cultural influences on negotiations.
Salacuse, a leading expert on negotiations, has identified the ten most important
cultural factors that affect business negotiations. These “top ten” elements of
negotiating behaviour constitute a basic framework for identifying cultural differences
that may arise during the negotiation process. Applying this framework in your
international business negotiations may enable you to understand your counterpart
better and to anticipate possible misunderstandings.
Source: Salacuse, J.W., Negotiating: The Top Ten Ways That Culture Can Affect Your
Negotiation, IBJ (2004)
The ten negotiating traits can be placed on a spectrum or continuum, as illustrated
in the chart below.
The Impact of Culture on Negotiation
Negotiation Factors
Goal Contract <––––––– > Relationship

Attitude Win/Lose <––––––– > Win/Win

Personal Styles Informal <–––––––– > Formal

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Communications Direct < –––––––– > Indirect

Time Sensitivity High < –––––––– > Low

Emotionalism High < –––––––– > Low

Agreement Form Specific < –––––––– > General

Agreement Building Bottom Line < ––––– > Top Down

Team Organization One Leader < ––––– > Consensus

Risk Taking High < –––––––– > Low

Negotiating Goal
The purpose of negotiations varies among cultures. For some cultures, the primary
goal of negotiations is to reach a deal and sign a contract (North American culture),
while other cultures (Asian cultures) view it as the establishment of a long term
relationship between the parties which will eventually lead to a contract. Salacuse
found that whereas 74 percent of the Spanish respondents claimed their goal in a
negotiation was a contract, only 33 percent of the Indian executives had a similar
view.
Negotiating Attitude
Parties from different cultures tend to come to the negotiation table with a win-lose or
win-win attitude. The win-win negotiators view the negotiations as collaborative
efforts where both parties gain, whereas the confrontational nature of the win-lose
negotiators usually results in one side winning and the other losing. For example,
whereas 100 percent of the Japanese respondents claimed that they approached
negotiations as a win-win process, only 33% of the Spanish executives took that view.
Personal Style: Informal or Formal?
Culture strongly influences the personal styles of negotiators. Negotiators with a
formal style tend to address their counterparts by their titles and avoid discussing
personal matters. In contrast, negotiators with an informal style tries to start the
discussion on a first-name basis and tend to quickly establish a friendly relationship.
For an American, calling someone by the first name is an act of friendship and
therefore a good thing. For a Japanese, the use of the first name at a first meeting is an
act of disrespect and therefore bad.
Communication: Direct or Indirect?
Cultures can differ in preferred communication styles. Some cultures value direct and
simple methods of communication whilst others prefer indirect and complex methods
such as the use of figurative forms of speech, facial expressions and body language. In
a culture that values directness, such as the American or the Israeli, you can expect to
receive a clear and definite response to your proposals and questions. In cultures that
rely on indirect communication, such as the Japanese, reaction to your proposals may
be gained by interpreting seemingly vague comments, gestures, and other signs. What
you will not receive at a first meeting is a definite commitment or rejection.
Sensitivity to Time: High or Low?

11
Attitudes to time vary among cultures. It is said that Germans are always punctual,
Latins are habitually late, Japanese negotiate slowly, and Americans are quick to
make a deal. For Americans, the deal is a signed contract and time is money, so they
want to make a deal quickly. Americans therefore try to reduce formalities to a
minimum and get down to business quickly. Japanese and other Asians, whose goal is
to create a relationship rather than simply sign a contract, need to invest time in the
negotiating process so that the parties can get to know one another well and determine
whether they wish to embark on a long-term relationship. This reflects their
contrasting views on the purpose of a negotiation.
Emotionalism: High or Low?
Some cultures show their emotions at the negotiation table, while others hide their
feelings. According to the stereotype, Latin Americans show their emotions at the
negotiating table, while the Japanese and many other Asians hide their feelings.
Obviously, individual personality plays a role here. There are passive Latins and hot-
headed Japanese. Nonetheless, various cultures have different rules as to the
appropriateness and form of displaying emotions, and these rules are brought to the
negotiating table as well. Deal makers should seek to learn them.
Form of Agreement: General or Specific?
Culture affects the form of the written agreement. Americans prefer very detailed
contracts where all the possible eventualities and risks have been anticipated. This is
because the contract is governed by law. In contrast other cultures, such as the
Chinese, prefer a contract in the form of general principles rather than detailed rules.
as the foundation of the contract lies in the relationship between the parties.
Building an Agreement: Bottom up or Top Down?
Some cultures tend to start negotiating on general principles and then proceed to
details, i.e. bottom up approach or the inductive process. In contrast, others prefer to
first obtain agreements on specific details such as price and delivery dates and merge
all the details to arrive at the final contract, i.e. a top down approach or the deductive
process. According to many observers, Americans tend to favor the building-down
approach, while the Japanese tend to prefer the building-up style of negotiating a
contract.
Team Organization: One Leader or Group Consensus?
Cultural values greatly influence how a negotiation team is organised and the decision
making power and process. Some cultures give more importance to individuals whilst
others to the group. One extreme is the negotiating team with a supreme leader who
has complete authority to decide all matters. Many American teams tend to follow this
approach. Other cultures, notably the Japanese and the Chinese, stress team
negotiation and consensus decision making. In the first type, the negotiating team is
usually small; in the second it is often large.
Risk taking: High or Low?
It is observed that some cultures are more risk averse than others. (Geert Hofstede,
Culture’s Consequences: International Differences in Work-related Values (Newbury
Park, CA: Sage Publications, 1980). This influences the behaviour of the negotiating
counterparts whether they will reveal information and how they deal with
uncertainties. The Japanese, with their emphasis on requiring large amount of
information and their group decision-making process, tend to be risk averse.
Americans, by comparison, are risk takers.
Faced with a risk-averse counterpart, how should a deal maker proceed? The
following are a few steps to consider:

12
 1 Don’t rush the negotiating process. A negotiation that is moving too fast for one of
the parties only heightens that person’s perception of the risks in the proposed deal.
2 Devote attention to proposing rules and mechanisms that will reduce the apparent
risks in the deal for the other side.
3 Make sure that your counterpart has sufficient information about you, your
company, and the proposed deal.
4 Focus your efforts on building a relationship and fostering trust between the
parties.
5 Consider restructuring the deal so that the deal proceeds step by step in a series of
increments, rather than all at once.
With the knowledge of the ten negotiating traits discussed above, you may be better
able to understand the negotiating styles and approaches of counterparts from other
cultures. Equally important, it may help you to determine how your own negotiating
style appears to those same counterparts.
It is also essential to take into account five considerations for analyzing cross-cultural
negotiations given by Fisher, a well-known intercultural expert:
(1) the players and the situation;
(2) styles of decision making;
(3) national character;
(4) cross-cultural noise;
(5) interpreters and translators.
Each consideration presents questions that should be answered before entering
international negotiations.
Different Cross-Cultural Negotiating Methods
Understanding how to properly integrate your own personal negotiation style into a
cross-cultural setting is vital for success in global markets. Make sure you do your
research before you engage in a negotiation with someone from a different culture.
The following tips should serve you well prior to any future cross-cultural
negotiation:
1) Learn a bit about the culture you are going to be negotiating with – go online,
read books or even better find someone from that culture willing to answer questions.
2) Understand their expectations from the negotiation process – prior to the
meeting, pick up the phone or send an email with an agenda and some ideas on what
you seek to achieve in order to prompt similar preferences from the other side.
3) Be clear with yourself about the stance and strategy you are going to take – if
you feel you need to adopt a new strategy, i.e. being more relationship focused rather
than business orientated or listening more than talking, then make sure you sit down
and think it all through.
4) Don’t jump to assumptions and conclusions in the negotiation process – if
someone says or does something that seems really odd, the chances are it isn’t. Think
about possible cultural reasons behind the behavior and try not to rationalize
according to your own view of the world.
5) If you sense confusion always clarify and re-check for understanding – when it’s
impossible to work out what’s going on, put the brakes on and ask. Simply expressing
your willingness to learn or show sensitivity can lead to good things.
6) Speak slower, avoid fancy language and keep it simple – always, always, always
temper your language. Think how you would feel being in another country trying to
negotiate in another language.

13
 7) Use your active listening skills – it’s always a good policy to ask questions, sit
back and listen to the answers. The more you let the other party speak, the more
information you will have to use to your advantage.
8) Explain the decision making process from your side and ask for them to clarify
theirs – who makes the decisions tends to differ from culture to culture. In more
hierarchical countries, it is usually always the boss who has the final say. Outline how
it works from your end and elicit the same from them so you are able to plug any
potential gaps in terms of information or next steps.
9) Pay attention to potential gender dynamics – if you are working across cultures
and genders, make sure you are fully aware of any sensitivities. For example, some
Muslims tend not to shake hands with the opposite sex. In some cultures they may
assume that the woman present is not of consequence whereas in reality they may be
the decision maker.
10) Keep it professional no matter how challenging it may get – even if the
negotiations are testing your patience always remain courteous and keep it to
business. Some cultures like to test and prod the other party to gauge their
trustworthiness factor. Others may take any loss of temper as disrespectful and soon
kill off any further discussions. 
To conclude, every culture has a different way of viewing the world and therefore a
different way of negotiating.
There are some cultures that like to have a team of negotiators rather than just a
single negotiator. Other cultures want to create a friendly relationship. That is to say,
they may want to know the person with whom they’re doing business. Others care
little about the people and just want the contract signed or price agreed. There are
cultures that like to stay silent and others that have a penchant for storming out of
negotiations. Some cultures see the negotiation as a battle that must be won; others
want a win-win outcome.
These differences stem from cultural backgrounds. Thus, understanding differences
can prevent misunderstanding between individuals and create mutually beneficial
business relationships.

Recommended Textbooks & Resources

1. Hofstede G., (1980). Culture’s Consequences: International Differences in Work-
Related Values, Beverly Hills, CA: Sage
2. Hall E.T., (1981). Beyond Culture: Perspective in Practice (2nd. ed.), Garden City,
NY: Anchor/Doubleday
3. Lewicki, R., Saunders, D., Minton, J. And Barry, B. 2006. Negotiations. New
Yourk: McGraw-Hill Irving.
4.Lewicki, R. 2011. Essentials of Negotiations. New Yourk: McGraw-Hill Irving.
5. Roger Fisher and William L. Ury, Getting to YES: Negotiating Agreement Without
Giving In, Penguin Group (1981)
6. Salacuse, J.W. 2003. The Global Negotiator: Making, Managing and Mending
Deals Around the World in the Twenty-first Century. New York: Palgrave Macmillan.
7. Salacuse, J.W., Negotiating: The Top Ten Ways That Culture Can Affect Your
Negotiation, IBJ (2004).
8. Thomson, L.L. 2005. The Mind and Heart of the Negotiator. Upper Saddle River,
NJ: Pearson Education International.
9. Trompenaars, A., Wooloams, P. (2003) Business Across Cultures. Oxford:
Capstone.

14
INTERNATIONAL NEGOTIATIONS

SESSION 1

Assignment 1
Read the following quotations. Comment on the quotations or/and answer the
questions. Do you agree with these quotes? Explain why. Give examples from your
own experience. Why do we negotiate? Can you think of three reasons?
1. «Let us never negotiate out of fear. But let us never fear to negotiate.»
(J.F.Kennedy)
2. «In business, you don't get what you deserve, you get what you negotiate.»
(Chester L.Karass)
3. «To be successful, you have to relate to people…»
(George Ross)

Read the questionnaire, tick the most appropriate phrases, add the points and
check your score.

Results or relationships? Get the deal or build trust?

What kind of negotiator are you? Do you feel it's more important to have a good
relationship with the other party or is it more important to win the contract? For most
people, building a relationship and getting the deal are important aspects of an
effective negotiation.

1. How important are you feeling in a negotiation?

b) If I reveal my true feelings, the other party will take advantage of them.
c) I don't consider the consequences my feelings can make on my opponent.
d) I hide my feelings from my opponent by using the correct body language.

2. What priority does building a relationship have in a negotiation?

b) Keeping a good relationship is more important than making somebody

angry by rejecting a marginally acceptable deal.
c) A good relationship is essential in any negotiation.
d) My interests are more important than building a relationship.

3. When is it important to close a deal?

b) A marginally acceptable deal is better than no deal at all.

c) «Something for nothing» is always better than «something for something».
d) I look after my interests, but I also look after theirs, too.

4. How do you deal with how the other party views you?

b) I don't worry about rejection when negotiating.

c) I am willing to give in when a relationship is important.
d) If the other party lets me take advantage of a situation, then I do.

15
 5. What role does power pay for you?

b) It is best to be open about true intentions.

c) If the other party is under pressure, I puss harder.
d) Power is more important than a good cause.

Your score:
1 a – 1; b – 3; c – 2. 2 a – 2; b – 1; c – 3. 3 a – 1; b – 3; c – 2. 4 a – 3; b – 1; c – 2. 5 a
– 1; b – 2; c – 3.

What kind of negotiator are you?

1 – 5 points
You are concerned with relationships and you seek CO-operation. Your target is to
win the war, even if it means losing the battle. But be careful, or you may be taken
advantage of.

6 – 10 points
You believe that a negotiated outcome can benefit both sides. You place value on both
relationship and results. Remember that preparation is still key.

11 – 15 points
You are concerned more with results than with relationships. In order for one party to
win, the other party may have to lose. You prefer to take something for less than you
give.

Assignment 2
a) You are going to read and analyse articles A – D about different negotiating
styles. Before you read, match the words from each article with their definition.
Then answer the questions after the articles.

Article A

1 tactics a) be flexible
2 make compromises b) not changing your opinion or attitude
3 consistency c) the methods you use to get what you want

Negotiations are demanding and may become emotional. You may find your
Russian negotiator banging his or her fist on the table or leaving the room. Accept
such tactics with patience and calmness. They are designed to make it difficult for you
to concentrate.
Russian negotiating teams are often made up of experienced managers whose style
can be like a game of chess, with moves planned in advance. Wanting to make
compromises may be seen as a sign of weakness.
Distinguish between your behaviour inside and outside the negotiations. Impatience,
toughness and emotion during the negotiations should be met with calmness, patience
and consistency. Outside the negotiating process you can show affection and personal
sympathy.
From the Financial Times

Article B

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1 speak your mind a) when you find out what the other side wants
2 place great weight on b) say what you think
3 exploratory phases c) consider very important

As well as being formal, negotiations are direct. German managers speak their mind.
They place great on the clarity of the subject matter and get to the point quickly.
Excessive enthusiasm or compliments are rare in German business. You should give a
thorough and detailed presentation, with an emphasis on objective information, such
as your company's history, rather tan on clever visuals or marketing tricks.
Prepare thoroughly before the negotiation and be sure to make your position clear
during the opening stage of the talks, as well as during their exploratory phases.
Avoid interrupting, unless you have an urgent question about the presentation.
From the Financial Times

Article C

1 attach little importance to a) style of behaviour

2 protocol b) pay little attention to
3 manner c) the way things are done on official
occasions

Communicating is a natural talent of Americans. When negotiating partners meet, the

emphasis is on small talk and smiling. There is liberal use of a sense of humour that is
more direct than it is in the UK. Informality is the rule. Business partners do not use
their academic titles on their business cards. Sandwiches and drinks in plastic or
boxes are served during conferences.
This pleasant attitude continues in the negotiation itself. US negotiators usually attach
little importance to status, title, formalities and protocol. They communicate in an
informal and direct manner on a first-name basis. Their manner is relaxed and casual.
The attitude 'time is money' has more influence on business communication in the US
than it does anywhere else. Developing a personal relationship with the business
partner is not as important as getting results.
From the Financial Times

Article D

1 counterparts a) count on / depend on

2 rely on b) give your opinion
3 put your point across c) the people on the other negotiating team

At the start of the negotiations you might want to decide whether you need
interpreters. You should have documentation available in Spanish. Business cards
should carry details in Spanish and English.
During the negotiations your counterparts may interrupt each other, or even you. It is
quite common in Spain for this to happen in the middle of a sentence. For several
people to talk at the same time is accepted in Latin cultures, but is considered rather
unusual in Norther Europe.
The discussion is likely to be lively. In negotiations, Spanish business people rely on
quick thinking and spontaneous ideas rather than careful preparation. It may appear

17
than everybody is trying to put his or her point across at once. That can make
negotiations in Spain intense and lengthy, but also enjoyably creative.
From the Financial Times

b) Аnswer these questions. Then with the whole class call out the answers.

А. In which country (Russia, Germany, the US or Spain):

1 should you start a negotiation with general conversation?
2 do negotiators show strong emotions?
3 is it common for there to be several conversations at the same time during a
negotiation?
4 do negotiators focus on results rather than developing relationships?
5 do negotiators plan their tactics carefully?
6 should you not stop someone while they are talking?
7 is it usual for the atmosphere to be relaxed and friendly?
8 do negotiators prefer to think of ideas during a negotiation rather than before it
starts?
9 do negotiators like to talk about business immediately?
10 should you not give the other side too much as they will not respect you?

c)
1 If you are from one of these countries in the article, do you agree with what the
article says?
2 If you are from another country, which of these countries is the nearest to your own
country in terms of negotiating behaviour? Why?

Assignment 3
Read about the experiences of negotiating internationally below and answer these
questions.

1 What are your personal reactions to the experiences described and views expressed?
2 Would the experiences described be
a) normal, b) a little unusual, or c) very unusual in your country?

1. It was very different to what I am used to. They didn't seem to want to write
anything down. There was a real emphasis on getting to know you – lots of small talk.
l felt it was all rather slow. No one seemed to be in a hurry to get anything done.

2. Our negotiation was interrupted by new people coming in all the time. There was
also a lot of attention paid to the business cards, which was new for me. We had three
meetings before we talked about any business at all. We were kept waiting for a long
time.

3. There were too many jokes and first names. It wasn't clear who was in charge and
making the decisions. It was too casual and relaxed for me.
l think people should behave more formally, use surnames and behave like business
people.

4. We thought we had a deal and made an agreement. Then they asked for some new
concessions. It was all quite hard line.

18
5. There was no compromise. It was a real fight. In the end, we reached deadlock and
they walked out. There was a lot of emotion and shouting – I was not sure if it was
normal or not. It upset me a bit, if I am honest.

6. There was a lot of eating and drinking during the negotiation, having lunch at the
same time as working.

7. They seemed to want to discuss everything at the same time. It felt disorganised
and without structure, I prefer some kind of agenda – you know, more logical.

8. It was more like some kind of competition. They seemed to just want to win - to
get something for nothing.

Useful language

Negotiation Phrases
Welcoming and Establishing a Rapport
 It’s my pleasure to welcome you to …
 I would like to welcome you to …
 Is this your first visit to …?
 Did you have a good journey?
Setting the Negotiation Agenda
 I would like now to begin by suggesting the following agenda.
 To start with, I think we should establish the overall procedure
 Is this okay with you?
Negotiation Phrases for Making Proposals
 We’d like to propose that …
 We propose / suggest …
 Regarding your proposal, our position is …
 How do you feel about …
Responding to Suggestions
 Maybe it would be better to …
 Perhaps a better idea would be …
 May we offer an alternative? We propose that …
 From where we stand, a better solution might be …
Agreeing – Reacting to a Negotiation Proposal
 I think we can both agree that…
 I agree with you on that point.
 I think that would be acceptable.
Negotiation Phrases for Objecting
 That’s not exactly how I look at it.
 If you look at it from my point of view…
 I have some reservations about that…
 From my perspective…
 I’m afraid we couldn’t agree to that…
Giving a Reason in Negotiations

19
  The reason for that is …
 This is because …
Prioritising Interests
 The most important issue for us is …
 Our intention is …
 Our main priority is …
 We might like to …
Giving Clarification in Negotiations
 If I understood you correctly …
 Are you suggesting that …
 Do you mean …
 What exactly do you mean by …?
 I’m not sure I fully understand your point.
 Could you clarify one point for me?
 Could you be more specific?
 Can we summarize your position up to this point?
 Am I right in thinking that …?
Negotiation Phrases for Compromising
 If you were prepared to …, we might be able to…
 We are ready to accept your offer; however, there would be one condition.
 Would you be willing to accept a compromise?
 In return for this, would you be willing to …?
Accepting a Negotiation Proposal
 This agreement is acceptable to us.
 I think we have reached an agreement here.
 That sounds reasonable.
 I think we have a deal.
 I believe we have an agreement.
 I can agree to that.
Negotiation Phrases for Concluding
 Let’s just summarise our agreement?
 I think you’ve covered everything.
 Let’s just confirm the details, then.
 Have I left anything out?

INTERNATIONAL NEGOTIATIONS

SESSION 2

Assignment 1
Read the following quotations. Comment on the quotations and answer the
question. Do you agree with these quotes? Explain why, or why not. Give examples
from your own experience.

«Failing to plan is planning to fail»

(Anonymous)
«There is no substitute for the hard work of preparation.»

20
(Winston Churchill)
«Fact-finding is the mother's milk of negotiation.»
(Richard Nixon)

Mini-lecture
Success Through Preparation, Strategy, and Planning
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
negotiation, parties understandably aim to achieve the best possible outcome for their
position. However, the principles of fairness, seeking mutual benefit and maintaining
a relationship are the keys to a successful outcome.
In order to achieve a desirable outcome, it may be useful to follow a structured
approach to negotiation. The process of negotiation includes the following stages:
2. Preparation
3. Discussion
4. Clarification of goals
5. Negotiate towards a Win-Win outcome
6. Agreement
7. Implementation of a course of action
Before negotiations begin, preparing and planning are very important.
1. The most difficult aspect in negotiating preparation is finding out about the other
side. It is essential to get as much information as possible about the situation. If
dealing with people from another culture, be sure you find out about its etiquette and
negotiating styles: the way people negotiate, what they consider to be acceptable and
unacceptable behaviour, its attitude to body language, physical contact, conversational
rules, relationship building, hierarchy, attitudes to time, and so on. It is demanding
work, but it will pay off in making your negotiation successful and effective. Here are
some key points to check off before you start your negotiation:
 Do you know who the opponent is? Find out their names and positions.
Have you (or members of your team) met them?
 Where does your opponent come from? Do you know their cultural
background, language ability, personal attitudes?
 What experience does your opponent have? How did they behave in other
negotiations? Are they new in their job(s)?
 What approaches and tactics did they use in the past? Can you identify
any patterns or characteristics that help you to understand them better?
 Does the opponent have the authority? Will the agreement stick or does
your opponent need permission from someone else?
 Do you know what your opponent wants? What are their wants and
needs? What are they willing to give in order to reach those wants and
needs?
 What kind of pressure (time, money) is your opponent under? Does your
opponent have a time limit or are they under pressure financially?

21
  What possible hidden agendas and motives are there? What hidden factors
might influence them? What motivates them and 'turns them on' or 'off'?
Negotiations take place between people who often view the exact same facts and
statements differently. So put yourself in their shoes. Prepare a list of questions you
can ask which will help you find out more.
2. Secondly, it is necessary to work out your initial bargaining position (what your
needs and objectives are), decide your priorities and prepare a fallback position:
conditions that you will accept if your original objectives are not met. Prepare a HIT
list which refers, in negotiation terms, to H – HAVE TO HAVE, I – INTEND, T –
TRADABLE (or the mnemonic L-I-M that stands for Like, Intend, Must)
A HAVE TO HAVE is an essential aspect or outcome for one of the parties in the
negotiation. Generally, there are only one or two in each negotiation. However
they are a MUST. You must achieve these items in order for your negotiation to
be successful.
INTEND refers to something that is less essential, but still important in the
negotiation. You might be prepared to be flexible with respect to these items.
You only have a few of them, i.e. perhaps two to five.
A TRADABLE item is something you put in your proposal which you believe
your partner would like to have. You are prepared to exchange this item for
something which you would like to obtain.
Before you begin the negotiations with your partner, it is very important to determine
these issues and decide which category they belong to from your point of view. These
issues should be clear to all members of your negotiating team. The clearer you are
about your goals and needs and of those of the opposite party, the more effective you
can be as a negotiator.
When you decide on your «H's» it is best to set very clear and targeted objectives. To
help you define them effectively, it is recommended to set SMART goals. Your
objectives must be:
Specific – state exactly what you want to achieve
Measurable – know how much you want to achieve
Achievable – choose realistic goals for the given circumstances
Relevant – find interesting points for both parties
Timed – set a realistic deadline
To check how REAL your goals are, you can ask yourself the following questions:
Can you Rate them? How important are the goals?
Are they Exact? How clearly defined are the goals?
Are they Achievable? How realistic are the goals?
Are they Logical? Do the goals make sense for both parties?
If you are negotiating as part of a negotiating team, be sure you allocate your roles
and responsibilities.
3. Thirdly, any good negotiation has an agenda. Organizing and planning an agenda
helps you in three ways:
 you identify your own issues, priorities and goals

22
  you identify your opponent's issues, priorities and goals
 it helps you maintain discipline
«When you know where you are and where you want to go, it is a lot easier to make
the trip.»
It is very important to understand the difference between the three points: issues (the
points on the agenda), positions (what you want to ask for) and interests (why you
want what you want) It is essential to analyse these points from your side as well as
from the opponent's side. Clarify them before you finalize your agenda.
4. Finally, Before any negotiation takes place, a decision needs to be taken as to when
and where a meeting will take place and who will attend.  Setting a limited time-scale
can also be helpful to prevent any disagreement. If you are in a position to influence
the choice of venue, decide whether you prefer to:
 be on your own ground / on home ground
 go to see the other side on their ground
 meet on neutral ground
Now let's move on to a negotiating scenario. At the beginning of a negotiation,
follow these steps:
 Meet and greet your opponents, i.e. representatives of the other company and
introduce your colleagues.
 Offer coffee / tea and a small talk. Try to create a relaxed atmosphere and
build good rapport with the other party .
 Go to the meeting room and suggest that you get down to business.
 Have a clear agenda and a timetable. Go through the agenda and ask for
agreement.
 First, give the background to the negotiations. Talking about the situation is a
good way of reminding people of key facts and issues.
 Then kick off the negotiations themselves, perhaps by finding out more about
the priorities of the other side or talking about your own requirements.
Negotiation styles
When you are negotiating with people from other cultures, it is important to be aware
of their negotiating styles, that is the way people negotiate and what they consider as
'normal' behaviour. There are big differences in the way that people from different
cultures conduct negotiations. In some cultures, business partners form long-term
relationships. In other cultures, the relationship lasts only as long as the contract. Let
us look at an attitude to small talk, time and the basis for reaching agreement in the
cultures with long-term relationships and cultures with short-term relationships. In
long-term relationships small talk is important for getting to know people on a
personal level before starting to discuss business. In short-term relationships work is
separated from private life. When discussing business, it is considered a waste of time
to talk about personal matters. Speaking of attitude to time, In long-term relationships
people are willing to invest a lot of personal time in relationships. Socialising outside
office hours is essential. In short-term relationships apart from lunch breaks, not much
time is given to socialising. In relation to the basis for reaching agreement, you won't
reach an agreement unless you like and trust your business partners in long-term

23
relationships unlike short-term relationships where people reach an agreement on the
basis of strong arguments, e.g. this is the best product / price.
Five negotiation styles: an overview
Before we proceed to explain the different negotiation styles it is important to note
two things. First, people tend to prefer a style. This does not mean that they can use
other styles. In fact, with practice people can effectively use different negotiation
styles. Second, there is no best universal negotiation style. The best style to use differs
from negotiation to negotiation.
There are five negotiation styles: accommodating, avoiding, collaborating,
competing and compromising.
People often ask "which is the best negotiating style?" As with much management
theory there is no single 'best' or 'right' approach. All five profiles of dealing with
conflict are useful in different situations. Although we're capable of using all five,
most of us tend to have one or two preferred negotiation conflict styles that we use
unconsciously in most conflict situations. Why? Either because our preferred styles
have worked for us in the past, or because of our temperament (nature) or because of
our upbringing (nurture).
So if you're involved in business negotiations, which negotiation styles are likely to
reward you with the biggest profit prizes? This question will be answered later. First
let's consider each of these important negotiation styles.
Competing / Compete (I win - You lose) / Hard bargaining
Individuals who prefer the competing style of negotiation see negotiation as a game
that must be won at any cost. It is an ideal style when dealing with negotiation where
lasting relationships are not very important. However, when preservation of the
relationship is an issue, the competing style of negotiation is less suited.
In hard bargaining, each party tries to achieve their aims without making concessions
or making only few or small ones. The aim is to 'beat' the other side.
Competitive style negotiators pursue their own needs - yes, even when this means
others suffer. They usually don't want to cause others to suffer and lose, they are just
so narrowly focused on their shorter term gains that they plunder obliviously through
negotiations like a pirate. They often use whatever power and tactics they can muster,
including their personality, position, economic threats, brand strength or size or
market share. At its extreme negotiators call their behaviour aggressive or psychotic.
When to use?
When you need to act or get results quickly. Competition is critical when you are
certain that something is not negotiable and immediate compliance is required.
What's the Danger?
The difficulty with people who are high compete (which a large percentage of buyers
are) is that competitive styles overuse competition. This means that the other party
knows exactly what behaviour to expect and can prepare more easily. In a negotiation
of roughly equal power, high compete behaviour is very likely to lead to deadlock -
which will get you nowhere. They may also be more interested in "winning" rather
than reaching an agreement. . So if a relationship is important to you, and if your
market reputation is important, then be careful to curb your competition.

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Self Defense
The most important thing to remember is: Don't Cave In! Some people say that they
make concessions in the face of a competitive negotiator demanding a concession - in
order to create goodwill. Don't listen to these self deluders, they're bleeding profits.
Appeasing competitive negotiators doesn't create goodwill - it just creates requests for
more concessions. What's more, a competitive style negotiator will see you as weak,
and come back for more. Restate your position firmly using strong language (not 'we'd
like' or 'want', but rather: 'we require' or 'need') and never reward bullies.
Accommodating /Accommodate (I Lose - You Win)
Individuals who negotiate with an accommodating style put great value and emphasis
on preserving the relationship. It is a great style when in negotiation with a recurring
party (say a recurring trade partner) however, it is less ideal to use when chances are
high you will only negotiate once with this party.
It is the opposite of competing. For accommodating style negotiators, the relationship
is everything. Accommodating profiles think that the route to winning people over is
to give them what they want. They don't just give products and services, they are
generous with information too. Accommodators are usually very well liked by their
colleagues and opposite party negotiators.
When to use?
When you or your company are at fault, repairing the relationship is critical, and if
you have nothing else that would benefit the other party. i.e. an olive branch or gift to
rebuild bridges.
If you are in a very weak position then sometimes your best option is to give in
gracefully. Think about it: if they can crush you, and they know it, what is likely to be
the outcome if you resist? It may be worth (humbly) reminding them that you will
both stand to lose if they put you out of business, and ask if they really want to push
you out of that market. If you both intend to work together in the longer term, then
refocus the negotiations on the longer term, thereby reminding the other negotiation
party that their taking advantage of you now may hurt them in the future.
What's the Danger?
It is almost always a bad idea to accommodate when negotiating against high compete
styles. With high compete negotiators your generosity will be seen as a sign of
weakness to be taken advantage of.
Giving away value early in the negotiation can leave you with a poor hand to play in
the rest of the negotiation.
Giving away value too easily too early can signal to your negotiation counterpart that
you've very deep pockets, and your gift is just a taster of bigger and better gifts to
come.
Warning: some of the faulty thinking that puts accommodators into negotiation
damage control is thinking that because the goal is unimportant to you, it must have
little value to the other party. Remember to do your homework by asking the value of
your concession to the other party before making your trade or concession.
Self Defense
When someone is offering you a gift at the negotiation table, do you humbly accept
their generosity? Be careful, as theirs may be a proverbial 'Greek Gift' - i.e. they may

25
be luring you into reciprocation, obliging you to give back something of greater value
in return. So keep in mind the value of the item being given - the relative value to both
sides. You also need to be careful that they are not an incompetent negotiator, making
big concessions that jeopardizes the viability of their business, or agreeing a deal that
their managers will later veto. If they go bust because they are giving away too much,
you could both end up losing.
Avoiding /Avoid (I Lose - You Lose)
This style is used by parties who dislike negotiation and tend to avoid it. When
trapped in a negotiation, parties will tend to concede swiftly and have little initiative.
This can be viewed as diplomatic. The downside is that avoiding parties will not be
very likely to obtain a satisfactory result in the negotiation.
This is most often referred to as "passive aggressive". People who habitually use this
style really dislike conflict. Rather than talk directly with you about the issue,
avoiders may instead try to take revenge without you knowing about it. The avoid
style can be a typical reaction to high compete negotiators.
When to use?
When the value of investing time to resolve the conflict outweighs the benefit; or if
the issue under negotiation is trivial (trivial to both parties). If there is a lot of emotion
in a negotiation, it's pointless pushing through and hammering it out. Better to allow
people to calm down first, let the testosterone hormone leave everyone's system first
so that reason and rationality can reappear. At that point an avoid style is likely the
most pragmatic alternative - suggest a timeout of 15-20 minutes.
What to do when you're dragged into a negotiation unprepared? Under these
circumstances, avoidance is probably the most sensible strategy. Either avoid the
meeting, or avoid discussing the issues upon which you need to prepare.
What's the Danger?
Whoever has the greater urgency will usually end up with the short end of the
avoidance stick. Stalling is a common sales tactics, when sales / the vendor knows
that procurement needs their product or service yesterday.
Conversely a buyer may hold out until the last day of the a quarter or month, knowing
that the sales person needs to meet his or her target. So be careful about what
information you reveal about the urgency of your need.
When communication channels are cut off, you leave the other party to fill in the
blanks. They may believe you need more time, or may think that you're no longer
interested in a business relationship with them, resulting in their approaching your
competition, or contemplating downsizing.
Self Defense
Set clear expectations of timing early on in your negotiations. Understand their
decision making process and levels of responsibility. Having these insights can assist
you in invalidating their reasons for avoiding, and will make your sharp questions
more difficult to side-step. Escalation options will also be clearer to you.
If you have a good enough relationship, then agree a process on resolving differences.
As John F. Kennedy was quoted as having said: "The time to repair the roof is when
the sun is shining."

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Compromising /Compromise (I Lose / Win Some - You Lose / Win Some) /Soft
bargaining
Parties that value fair and equal deals in negotiation tend to prefer the compromising
style. This style tends to get fast results from a negotiation. In soft bargaining, the
parties try to reach an agreement by giving concessions very freely. A pitfall of this
style is that concessions often come too fast, without properly discovering the
underlying issues.
Too many people confuse the word 'Compromise' with 'negotiation'. Compromising
often involves one or both negotiators settling for less than they want or need. In the
absence of a good rationale or properly exchanged trades, half way between the two
positions seems "fair". What compromising ignores however, is that the people that
take the most extreme positions tend to get more of what is on offer.
When to use?
When you are pushed for time and you are dealing with someone who you trust. They
also need to be clear that it would not be in their best interest for them to "win" a
cheap victory. Both parties win and lose - but make sure you win the right things and
lose the right things.
Meeting half way reduces strain on the relationship, but usually leaves precious gold
on the table.
What's the Danger?
When you use compromising as an excuse for not preparing properly. If the outcome
of the negotiation is critical, then you should not compromise on things that you
absolutely must have.
One of the problems with compromising is: if you make concessions within your
position with no strong rationale, the other party may assume that you are going to
continue to make more concessions. If you get known for being a compromise styled
negotiator, look out! Your trading partners will wise up to your negotiation style and
they will start to make more and more extreme opening positions. Bigger opening
positions result in greater chances of deadlocks. Compromises cheat both sides out of
innovative solutions.
Self Defense
Only retreat within your position when you have a solid rationale for doing so, and
when you're being rewarded in another way. i.e. make a reasoned exchange. Trade
across goals and interest. All too often negotiators try resolve 1 single goal at time,
before moving on to the next tabled agenda item.
Stay with the problem or opportunity for longer. Don't give in so easily to the
temptation of splitting differences until you've explored other alternatives.
If the other party starts with an extreme opening position, be sure to quickly bring
them back to reality, or counter balance with your own extreme position. Caution:
extreme positions can lead to drawn out dog fights that result in more deadlocks.
Collaborating / Collaborate (I Win - You Win)
Collaborating style is also known as Principled negotiating. In their book, Getting to
Yes, Fisher and Ury introduced the term Principled negotiating. It refers to a style
which focuses on discovering the interests behind the position. The principled
negotiator separates the person from the issue and concentrates on mutual gain in

27
order to reach agreement. In short, it leaves both sides with a sense of achievement,
i.e. a win-win situation.
Collaborating parties tend to enjoy coming to creative solutions during negotiation.
This can potentially lead to positive results or transform simple problems into difficult
solutions. Either way, parties that prefer a collaborating style make a real effort to
understand the issues of the opposing party of the negotiation.
Most people confuse "Win/Win" or the collaboration style with the compromising
style. This is most definitely not the case. "Win/Win" is about making sure both
parties have their needs or goals met, while creating as much mutual value as time and
resources allow. "Win/Win" negotiators usually evolve through the other profiles,
growing into collaborative negotiators. This means collaborative profile negotiators
can revert to one or two of the other styles when pushed or when the situation calls for
it. Collaborative profile negotiators are adamant that their needs must be met - and
they acknowledge that the other party has needs that must be met too.
Often referred to as 'expanding the pie', collaborative negotiators are willing to invest
more time and energy in finding innovative solutions, feeling secure in the fact that
there will be more value to share out later on. The mantra of collaborative negotiators
is: 'it's not enough that I win, I will not be happy until you have won too.'
When to use?
Under most circumstances collaboration is the primary style you should use for most
goals in business to business negotiations. If a relationship is important to you, and if
your market reputation is important, if the other party needs to perform and not just
exchange a standard product for cash, high risk (e.g. new market or new product or
both), if there is a large amount of money at stake, then you are best advised to think
about all the ways in which you can build a more trusting collaborative working
relationship. If you need to understand the feelings and deeper interests or motivations
of all negotiators, then collaboration is your best path.
What's the Danger?
Be careful not to collaborate with competitive style negotiators – unless they agree to
and live up to your agreed (written or unwritten) rules of collaboration. Die hard
competitive negotiators can be treated in transactional trading manner - e.g. "I'll only
give you this if you give me that".
When we share information we need to make sure that we share information at the
same level of detail. Too much and we could be exploited - too little and the other
party can lock up like a clam.
Collaboration requires more time and needs to be at the right level. So if you're a
vendor and your buyer doesn't have the authority or knowledge or won't invest the
time, save your effort. Same advice goes for buyers in reverse.
Self Defense
So when might you need to defend yourself against a Collaborative negotiator? If you
have decided that it's not in your interest to use a collaborative style with a negotiator,
then decide on your alternative style. So a commodity supplier who suffers a great
deal of competition in their market place will try to get their foot in your door. A wise
procurement manager will be careful to not investing too much time, or give any time
- unless there is value. Your time is short, so be careful who you collaborate with.

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Remember
Before you negotiate, stop and ask yourself:
 What is my preferred style of negotiation? Once you know your style, you've
taken the first step to gaining flexibility in your negotiations. There is much
you can do as a member of a negotiation team, if you know your fellow team
members' profiles.
 Which of these 5 styles best describes your business client or vendor
negotiation relationship?
In a successful negotiation, everyone should leave the negotiating table happy with
the outcome: there should not be winners and losers. The negotiators should try to
reach a win-win solution. This can be achieved in a number of ways.
One way of furthering negotiations is probing ( asking the right questions and
listening carefully to the answers). If you want to succeed in a negotiation, find out as
much as you can about the needs and concerns that underlie a party's position.
Clearly, different interests generate different results. Use questions (i.e. who, what,
when, where, why, how) to gather information on interests. Here are some probing
questions:
 What is the situation on production at your plant at the moment?
 What sort of quantities are you looking for?
 What are we looking at in the way of discount?
 What did you have in mind regarding specification?
 What were you thinking of in terms of delivery dates?
 How important to you is the currency for payment?
Another way of furthering negotiations is a proposal (offer) and counter-proposal
(counter-offers).
A proposal is an offer made by one party to the other. Proposals can be made in
written and/or verbal form. They provide the basis for the negotiation and a possible
settlement, i.e. the deal. A successful proposal is one that results in an agreement.
A counter-proposal offers an alternative proposal that may suit both parties. This can
happen when one party refuses or does not agree with the original proposal.
Through a series of proposals (offers) and counter-proposals (counter-offers) the two
sides work towards an agreement which will benefit them both.
Useful language
Here are some ways of presenting / making proposals and counter-proposals and
asking for / clarifying information:

presenting / making proposals and asking for / clarifying information

counter-proposals

I/We propose … …is correct, isn't it?

I/We suggest … Can you tell me how…?

How about …? Is it alright with you if …?

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Would it be possible …? Would it be possible …?

How do you feel about …? It seems … What is your opinion?

Would / Could you consider …? Do you suggest…?

Would / Could you accept …? Do you mean…? / What do you mean

by…?

One more way of furthering negotiations is a concession and a trade-off. In order to

succeed in a negotiation the parties make concessions or trade-offs. When you offer to
change your position to one that is less favourable to yourself, you make a concession.
Perhaps this is in exchange for a concession from the other side, although there is no
guarantee of this. Your concession may be a goodwill gesture: a concession you make
hoping that the other side will see this as friendly and make a concession in return.
But even in a friendly negotiation, there may be horse-trading, with each side making
a series of concessions in return for concessions from the other side. If you argue
about something for a long time, especially about the price of something, you haggle.
A series of concessions in exchange for concessions from the other side is a series of
trade-offs. If you make a concession, you may not get anything back. If you make a
trade-off, you give something away and get something in return.
Assignment 2 (Test)
A. Choose the correct option to complete each sentence.

1 At the start of a negotiation, it can be important to establish a . . . . . . . . . . . . with

the other side.
a) rapport b) stalemate c) guarantee

2 When both sides give something away in order to make a deal, they reach a . . . . . . .
......
a) concession b) compromise c) guarantee

3 When one side gives something away, they make a . . . . . . . . . . . . .

a) compromise b) breakthrough c) concession

4 Something which stops a negotiation going smoothly is a . . . . . . . . . . . .

a) limit b) sticking point c) lock

5 A situation in a negotiation where no progress can be made is a . . . . . . .

a) deadweight b) deadline c) deadlock

6 A . . . . . . . . . . . . is a creative solution which allows the negotiation to progress.

a) breakthrough b) breakout c) breakpoint

7 If both sides in a negotiation leave the table without a deal (empty handed), the
negotiation process . . . . . . . . . . . . .
a) breaks down b) breaks off c) breaks out

8 The minimum offer you are willing to accept is

known as your . . . . . . . . . . . . .

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a) opening position b) fallback position c) bottom-line position

9 Some negotiations may involve a time restriction or . . . . . . . . . . . . .

a) deadlock b) deadline c) dead end
B. Which of the ideas in the test could contribute to the success or failure of an
international negotiation?
Assignment 3
Which of these negotiating tips do you agree with? Why? Why not?

1 In the early stages, you need to ask the other side a lot of questions.
2 Always interrupt if you don't understand something.
3 Never make a concession for free. Always get something in return.
4 Use simple, direct language and be open about your aims.
5 Signal what you are going to do. For example, say, 'I'd just like to clarify that.'
6 Summarise often so that everyone is clear when you reach agreement.
7 Adapt your language so that you don't appear aggressive.
8 Talk about your emotions and how you are feeling.
Assignment 4
A. Answer the following question.
How effective are these negotiating styles?
a) Playing the 'tough guy'; being persistent in stating your demand and negotiating
as long and hard as possible until the other person finally gives in
b) Being flexible; being prepared to make concessions when appropriate and
achieving a win-win situation, although you may not get everything you want
c) Staying 'silent'; pausing between sentences, listening more and talking less so
that the other person trusts you and is more vulnerable
B. Match these negotiating techniques (1-4) with what the negotiators actually say
(a-h). What other negotiating techniques do you know?
1 Explain the value of a concession
2 Testing the situation
3 Responding to an unacceptable concession
4 Checking with a higher authority
a) What if I take 4,000 units? How much that would cost me?
b) Yes, and your sales also increased because of that, right?
c) Let me run this by my boss and I'll get back to you, OK?
d) I see … (silence)
e) What would you say if we were to extend the deadline by a fortnight or so?
f) I'd like to do business with you, but I am afraid we are simply too far apart.
g) We'll pay for the delivery. In real terms, that's a saving of about $600.
h) Here she is! Well, if you don't mind, our Purchasing Manager will take over
from here.

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C. Complete a sales manager's notes below on making concessions with the words
and phrases in the box. What do you think of the advice?

understand its value 'take-it-or-leave-it' big concession walk away one by one
some sort of compensation willing to make concessions ill-will

Sales negotiations: making concessions

1 I don't give the first ………. .
2 Don't assume you have to match your customer's concessions ………. .
3 Don't give a concession away without ………… .
4 Never give away a concession unless the customer ………… .
5 The best time to ………… is when you're offering one.
6 Whatever you do, don't advertise you're ………… .
7 The ………… offer is unacceptable – it only creates …………. .
8 If the customer isn't planning to buy, you need to ………… .

Case study: Ashbury Guitars

Background
The Kim Guitar Company (KGC) in Seoul, South Korea, makes electric guitars for
Japanese manufacturers and distributors in Europe and the US.
A major US distributor, Ashbury Guitars, has contacted KGC about marketing a range
of guitars under its own brand name for the Californian market. Ashbury Guitars is a
well-established company with an up-market image. It has had no previous dealings
with KGC. Ashbury’s owner, Richard Grant, plans to put three models on the market:
the Ashbury SG1000 (the most expensive model), the SG500 and the SG200. The
body of die guitars will have an experimental shape as well as advanced technical
features.
It is now early January. KGC has agreed to manufacture the guitars for Ashbury, even
though it is a very busy time of the year for them. The two companies have had some
initial correspondence by e-mail and now a face-to- face meeting is required.
Several points of the contract need to be negotiated. KGC’s owner, David Kim, has
flown to San Francisco to meet Richard Grant. At the meeting, the Marketing Director
of each company will be present. The purpose of the meeting is to make a deal
acceptable to both sides, and which could be the basis for a long-term relationship.
You are negotiating as either:
• The KGC team: David Kim and Marketing Director
• The Ashbury team: Richard Grant and Marketing Director
Read your information files. Identify your priorities and work out your strategy and
tactics. Then negotiate so that you get the best deal for your company.

Assignment 5
As the owner of either Ashbury Guitars or KGC, write an e-mail summarising the
points agreed during the negotiation. Indicate any terms of the contract requiring
discussion or clarification.

Information file: KGC

Models

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 You can supply three models in the first year: Ashbury SGiooo, SG500, and SG200.
The SG1000 will be costly to produce because it has advanced technical features.
Quality
To reduce costs of production, you want 40% of the order to be manufactured by
other Korean firms.
Quantity
You want Ashbury Guitars to place a first order of at least 2,000 guitars. You need a
large order to cover the costs of setting up the production lines. Try to persuade
Ashbury to buy a large number of the SGiooo model because your profit margin on
this guitar is high.
List price (USS Estimated cost Prices quoted
of production to Ashbury

SG1000 510 920

SG500 340 550
SG200 290 475
Payment
By bank transfer, as soon as the goods have been dispatched.
Delivery
30 June . If an earlier delivery is required, production costs will increase by 10%
because of overtime payments to workers. Before 30 June, the factory will be
fulfilling orders for other customers
Discounts
Your company policy is to offer new customers 3% off list price for a first order, and
5% for second and further orders.
Guarantee
You usually offer a guarantee of 5 years.

Information file: Ashbury Guitars

Information file: Ashbury Guitars

Models You want KGC to supply three models:
Ashbury SG1000, SG500 and SG200.
The SGiooo has some special
additional features.
Quality You want KGC to produce all the
guitars in their own factory. If they use
other manufacturers for part of the
order, the quality of the guitars may
not be very good.
Quantity You want to place the following first
order:
Model Quantity
SG1000 400 SG500 1,200 SG200 200
You are sure that demand will be good
for the SG1000. The cheaper guitars
may sell well. However, there is strong
competition in the lower price ranges.
Price KGC have quoted these prices:
SG1000 US$920 SG500 US$550

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 SG200 US$440
All prices include transport costs to
Pusan, Korea.
Payment By bank transfer. You want to pay a
deposit of 50% immediately, and the
remaining 50% one month after
receiving the goods.
Delivery By 1 June. A later date will result in
reduced sales. (Music festivals in
California in May create demand.)
Discounts Although this is a first order, you hope
to negotiate a discount of at least 6%
off the quoted price. If you place other
orders in the future, you hope to have a
discount of
8%.
Guarantee At least three years.

INTERNATIONAL NEGOTIATIONS

SESSION 3

Assignment 1 Read the following quotations. Comment on the quotations or/and

answer the question. Do you agree with these quotes? Explain why, or why not.
Give examples from your own experience.

«The aim of argument, or of discussion, should not be victory, but progress»

(Joseph Joubert (1754-1824), French moralist and essayist)

«Strength lies in differences, not in similarities»

(Stephen Covey, US author and management consultant)

«If you destroy a bridge, be sure you can swim»

(African (Swahili) proverb)

«Forty for you, sixty for me. And equal partners we will be.»
(Joan Rivers, American comedian and businesswoman)

Assignment 2
A. Do you agree or disagree with these statement? Why? Why not?
1 Conflict is not always a bad thing.
2 Where there is a conflict, it is best to keep things rational rather than showing
your emotions.

B. Look at this checklist of techniques used to deal with conflict. Which do you
most often use? Which get the best / worst results? What other techniques have you
used or seen used?
1 Ignore the problem – it will sort itself out
2 Try to put yourself in the other person’s shoes.

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 3 Use humor to defuse a tense situation.
4 Say loudly and clearly exactly what is on your mind.
5 Remain calm and do not get emotional.
6 Ask a lot of open questions.
7 Speak more than you listen.
8 Try to reach a compromise.
9 Accept you are in the wrong – anything for a quiet life.
10 Summarise what the other person says in your own words.

Mini-lecture
Confrontation / Deadlocks and Mediators / Reaching Agreement
Negotiation is a method by which people settle differences.  In any disagreement,
individuals understandably aim to achieve the best possible outcome for their position
(or perhaps an organisation they represent).
Sometimes one side is in a stronger position than the other: they have more
bargaining power. For example, during a recent strike at Lamda Inc., the company
was in financial difficulty and the public was on the workers’ side, so Lamda was
negotiating from weakness. The strikers’ union knew this: they were negotiating
from strength.
The union made demands: objectives that were so important that they were unwilling
to change them. They wanted a 15 per cent pay increase. Later they moderated these
demands, and said they would accept ten per cent. However, their demand for a
week’s extra holiday was non negotiable: they would not accept less.
Lamda said they were being forced to accept something that they did not want. They
accused the union of making them negotiate under duress.
Eventually Lamda conceded to most of the union’s demands and gave them what they
wanted. The media said that Lamda had backed down, climbed down and given in.
The feelings had been very strong on each side: the dispute was bitter, and the
negotiations were confrontational and adversarial.
In that sort of situations negotiation is seen in terms of ‘getting your own way’,
‘driving a hard bargain’ or ‘beating off the opposition’.  While in the short term
bargaining may well achieve the aims for one side, it is also a distributive  or win-lose
approach.
This means that while one side wins the other loses and this outcome may well
damage future relationships between the parties.  It also increases the likelihood of
relationships breaking down, of people walking out or refusing to deal with the
‘winners’ again and the process ending in a bitter dispute. Distributive negotiation is
also sometimes called positional or hard-bargaining negotiation. It tends to approach
negotiation on the model of haggling in a market. The term distributive implies that
there is a fixed amount of value (a "fixed pie") to be divided between the parties
involved. Sometimes this type of negotiation is referred to as the distribution of a
"fixed pie."
Confrontational negotiating tactics
Negotiations are rarely easy, mainly because they tend to consist of two sides trying to
“beat” the other. In that sense, deception, bluff and lies and finally threats are tools
that come naturally and logically to negotiators in order to manipulate favourably the
balance of power.

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A) Lying, deceiving or bluffing?
To Lewicki (1983), the primary purpose of lying in negotiation is to increase the liar's
power over its opponent by using false or misleading information. These lies can take
many forms from which bluffing and deceiving play an important part.

B) Threatening
Threats can be considered in three different approaches: decision making,
communication and commitment.
If Threats have a tendency to increase the conflict on an individual basis and when
they don't produce the immediate expected effect, they initiate counter measures and
damage significantly the level of trust in the relationship.

In a distributive / adversarial negotiation, each side often adopts an extreme position,

knowing that it will not be accepted, and then employs a combination of guile (lie),
bluffing, and brinkmanship (threats, confrontation, ultimatums) in order to cede as
little as possible before reaching a decision.
Although using tricks isn’t recommended, there are negotiators who:

■ issue threats, final offers or ultimatums: they say that the

other side must accept something, with very bad
consequences for them if they refuse. Brinkmanship is a
type of "hard nut" approach to bargaining in which one party
pushes the other party to the "brink" or edge at which the
other negotiating party must either agree or walk away.
Successful brinksmanship convinces the other party they
have no choice but to accept the offer and there is no
acceptable alternative to the proposed agreement.
■ lie and bluff: they threaten to do something that they do not
intend to do, or are not able to do. Negotiators propose extreme
measures, often bluff, to force the other party to chicken out
and give them what they want. This tactic can be dangerous
when parties are unwilling to back down and go through with
the extreme measure.

Of course, you can always call someone’s bluff: pretend to believe them, when you
know they are bluffing.

Although negotiators generally consider themselves to be very logical, many of their

decisions are made without thinking them through. Sometimes tactics are used to
make negotiators uncomfortable and force quick, gut reactions. Here are some
common tactics:

 Demand immediate responses.

 Don’t allow breaks or time to rest.

 Make personal negative comments.

 Always refer back to concessions already made.

36
  Explain that the bosses just won’t agree.

 Add a demand to every concession made.

Don’t let yourself be pressurized by these tactics. Remain calm and take your time to
consider the implications before you respond.

Dealing with problems

When negotiations get stuck, and don’t progress, there are a number of things you can
do to avoid stalemate.

 Listen to the other party’s explanations actively an respectfully.

 Avoid unnecessary confrontation. Don’t get into arguments.
 Hold back on your reactions and stay focused. Ignore attacks.
 Deal with the impasse together. Try to see the reasons behind the standstill and
look for solutions.
 Avoid escalation. Show the other party that they can only win if you win, too.
 Underline common ground: the areas where agreement has been reached.
 Reassure the other side on key points that have been decided: confirm that
you have not changed your mind.
 Be willing to compromise on your original objectives: be ready to accept less
than you wanted in exchange for compromises from the other side.
 Identify the exact obstacles or sticking points: the problems that are causing
negotiations to become difficult.
 Postpone discussions until later so that each side can reconsider its position.

Steps in managing conflict / confrontation effectively

Here are 4 steps to handle any conflict.

Facilitate Discussion
 Identify differences in perception and interpretations of the facts
 Have the parties discuss each of their needs
 Have the parties imagine themselves in the other parties' shoes
 Lay the ground rules that no one will be blamed for the problem
 Lay the ground rule that all will be discussed
 Encourage each side to make proposals that appeal to the other party or satisfy
their interests
 Before beginning, make sure the key players with authority are a part of the
negotiations and discussions.
 Acknowledge the other party's emotions, such as fear or anger. Do not ignore
or dismiss the other's feelings.
 Maintain open communications in negations, mediations and discussions by
listening carefully.
 Summarize points made by the other party and use body language that shows
you are hearing what is being said (lean forward, nod your head, arms in open
position)

Listen to what the other person is saying

37
  Demonstrate a true willingness to bring about a solution to the problem
 Try to identify underlying needs
 Instead of focusing on past events or problems, concentrate on future
solutions.
 Everyone's suggestions should be considered for a win/win solution.

Deadlocks and Mediators

Deadlock is a situation in which an agreement cannot be made : a situation in which

ending a disagreement is impossible because neither side will give up something that
it wants. It is a situation, typically one involving opposing parties, in which no
progress can be made. Let me illustrate it with the following example. Every year (in
Baseland ) there are negotiations between the baseball players’ union and the baseball
team owners about pay and conditions for the coming season. Last year, after months
of negotiations, there was deadlock: the negotiations broke down. Some
commentators said there was stalemate; an impasse: a situation where no progress
can be made. There were irreconcilable differences between the two sides and it was
impossible to reach an agreement. The baseball players went on strike.

The two sides agreed to bring in a mediator, someone from outside to help restart the
negotiations and bring the two sides close together in a process of mediation. The
person they chose was a respected retired politician. He recommended a cooling-off
period where each side would take no action. The payers ended their strike for the
time being.

Another month passed, and still there was no progress. The two sides agreed to accept
an agreement imosed by an arbitrator. A judge was chosen. She looked at the claims
of each side and imposed a settlement or resolution to the dispute, fixing the salaries
and the working conditions of the players. In this case, arbitration had settled the
dispute.

Conducting Negotiations Through The Mediator

There are many ways to use the mediator to your delegation’s strategic advantage in
the negotiation process. Most frequently, parties use a mediator as an information
conduit to express their views or position on the matters in issue to the other party.
There are other ways to effectively use the presence of a mediator in international
negotiations; for instance, the mediator may facilitate the provision of responses to
questions that have thus far been refused or ignored in the negotiation process or to
better define the interests and goals of each side to the other.
• “Opening” statements can be an effective tool to persuade the mediator and the
decision maker from the other party of the delegation’s understanding and position on
the matters in issue..
• The mediator may have all parties in one room until it is no longer productive. At
that time, the mediator will typically break the parties apart into separate rooms for
further “shuttle” negotiations.
• It is important to use caution when providing confidential information to
the mediator.

Using Experts

38
Experts can be useful in negotiations involving complex or technical issues. There are
two distinct ways to effectively use experts in negotiations:
• Use an expert that is not perceived to be affiliated with any party to provide
persuasive arguments and solutions for complex issues. For such an expert to be
effective all parties must have confidence in the expert’s neutrality and in the
usefulness of such expert’s opinions.
– Such an expert will be more effective if perceived by the other parties to be neutral
– Your delegation should recognize that no expert is truly neutral. Each expert brings
his or her own biases, individual and cultural, to the negotiation.
• Use an expert as a member of your delegation’s negotiation team. Such an expert
can advise the delegation on complex issues and offer creative solutions. Such an
expert can quickly and effectively address technical concerns raised by the other
parties if required.
– Interpreters, scientists, economists and lawyers are an example of the type of
technical experts that delegations typically utilize.
– Your delegation can expect that the other delegations and the mediator will have a
lawyer as part of their negotiation team.
Reference
PILPG and Baker & McKenzie

Negotiating After Deadlock. Moving from Confrontation to Collaboration.

To move negotiators from confrontation to collaboration means knowing how to

break a deadlock and move the negotiations forward even when the people you’re
negotiating with decide to take a firm stand against you.

Four deadlock causes and strategies to break the deadlocks are:

DEADLOCK CAUSE DEADLOCK BREAKER

Pushing Your HOT button Go To The Balcony
Lack of Benefit Understanding Step to Their Side
Resistance to Your Ideas Build a Golden Bridge
Lack of Consequence Use Your Power to Educate

The First Deadlock Cause & Breaker. The first deadlock may have been caused by
your own natural reaction when someone pushed one of your buttons. Natural
reactions occur, such as “striking back.” Reactions such as that are not conducive to
successful deadlock breaking. A better strategy is to suspend that reaction, regain your
mental balance and refocus on achieving the goals you set. A Harvard professor, Dr.
Ronald Heifetz, coined a phase to explain this strategy. He called it, “Going to the
Balcony.” It is his metaphor for taking a step back and getting a better perspective.
The Second Deadlock Cause & Breaker. Of course, all deadlocks are not caused by
reactions to other people’s words or actions. Some may be caused by someone else’s
negative emotions, such as defensiveness, fear, suspicions, and hostility. When this
occurs, you not only need to regain your own mental balance – you need to help the
other person regain theirs, too. A good strategy is to do the opposite of what’s
expected. Instead of arguing against the person’s point as he might expect, ask him to
further explain. Practice active listening and people will be more inclined to listen to
you. This strategy is called, “Step to Their Side.”
The Third Deadlock Cause & Breaker. This deadlock comes about when a proposal

39
has been made but the other parties can’t see the benefits of agreeing to it. This could
be caused by a number of things. They may feel they can’t go along because it wasn’t
their idea - agreeing might make them “lose face.” In these instances a strategy called,
“Building a Golden Bridge” may be successful in breaking the deadlock. Simply put,
this strategy means to show them how they benefit from the agreement.
The Fourth Deadlock Cause & Breaker. The fourth deadlock breaker is “Use Your
Power to Educate.” In the third deadlock we learned to show the benefits of agreeing.
In this one, we do the opposite: we make them see the consequences of filing to agree.
The other parties are unaware, or don’t understand what can happen if you do not
break the deadlock and move on. It’s in this closure phase of negotiation that most
deals are decided. If you’ve tried everything else, make them see the negative
consequences of not reaching a mutually advantageous agreement.
In summary, these strategies are:
Go to the Balcony – You can only control your own behavior. This strategy allows
you to do that. Belay (fix, stick to) your natural tendency to “fight fire with fire” and
remember your goal. Instead of getting mad or thinking of getting even, buy some
time and calm down.
Step to their Side – To move from confrontation to collaboration, a favorable climate
must be created. The “Step to their Side” strategy does just that. It gives you an
opportunity to take the first step towards cooperation by listening to their side,
acknowledging their authority and
competence.
Build a Golden Bridge – If the people you’re negotiating with are resisting your
suggested solutions, you may have to convince them that these solutions are in their
best interest as well as yours. The “Bridge” is the strategy that helps them understand
that your solutions are really
victories for them.
Use Power to Educate - Simply said, some people just don’t understand the
downside of not coming to an agreement. This strategy is used to elevate their
understanding of the negative consequences of deadlock.

The sequence in which you use these strategies is important. For example, you can’t
defuse someone’s negative feelings unless you’ve gotten your own under control.
That means that you’ve got to make sure that your reactions are designed to move the
negotiations forward and that they do not cause or contribute , to the deadlock.
Performing these strategies in sequence, however, doesn’t mean that once you’ve used
one you won’t have to use it again.
Negotiations are fluid. You may find yourself moving back and forth and using a
particular strategy to break deadlocks in the early stages of negotiation as well as the
later stages. Also, because every negotiation is different, you need to use your specific
knowledge of the situation
to determine which strategy to use and when to use it in order to break the negotiation
deadlock.
REFERENCES
Ury, William, Getting Past No, Bantam Books, New York, New York 10036

If the process of negotiation breaks down and agreement cannot be reached, then an
adjournment or re-scheduling a further meeting is called for.  This avoids all parties
becoming embroiled in heated discussion or argument, which not only wastes time but
can also damage future relationships.

40
At the subsequent meeting, the stages of negotiation should be repeated.  Any new
ideas or interests should be taken into account and the situation looked at afresh.  At
this stage it may also be helpful to look at other alternative solutions and/or bring in
another person to mediate.
Inexperienced negotiators often avoid taking adjournments because they feel this
might make them appear weak. Experienced negotiators, however, aren't afraid to call
for a break. They frequently make effective use of them in order to:
 consider a new point or proposal
 reconsider a strategy or objective
 get out of a circular argument
 slow down the negotiation.
When it's necessary for you to take an adjournment, follow these steps:
1 Give a reason for the adjournment and state how much time is needed.
2 Summarize the current state of affairs before you go.
3 Withdraw to a private area.
Agreement
Agreement can be achieved once understanding of both sides' viewpoints and interests
have been considered. 
It's surprising how often negotiators miss the close. Many are afraid to end the
negotiations because they fear they may have missed or forgotten something. The
other side often misinterprets this fear as a delay trick and believes that the first party
is uninterested or wants even more. They often become confused and defensive and
the agreement begins to fall apart.
Closing is a matter of instinct as well as common sense. It's necessary to look for the
non-verbal signals and listen to the verbal ones. It's also important to keep your goal
in mind. If you've reached it, then make the deal!
It is essential for everybody involved to keep an open mind in order to achieve an
acceptable solution.  Any agreement needs to be made perfectly clear so that both
sides know what has been decided.
An agreement of any kind is a deal. When you reach an agreement, you can talk about
clinching a deal or closing a deal.
A bargain is also an agreement reached through negotiation. People who get what
they want in a negotiation are said to drive a hard bargain.
An agreement may be in the form of a contract. Contracts vary in their form and
content. They can be oral and verbal, binding and legal, employment and labour,
commercial and others.

Checking the deal

It’s important to check the points of an agreement to avoid misunderstandings. You
could say:
● Let me just go/run over (repeat and summarize) the main
points. On A, we agreed that...
 As far as В is concerned (in relation to B), we agreed ...
● We still have the question of C to settle (decide and agree

41
on). And there’s still the outstanding (remaining undecided)
issue of D. We’ll send you a written proposal.
 We’ll draw up (write) a contract based on those points.
 I think that covers everything.

Implementing a Course of Action

From the agreement, a course of action has to be implemented to carry through the
decision.
Negotiation Settlement
There are a number of signals that indicate that negotiations are coming to a close.
This may not always mean that an agreement has been reached. In many cases, there
are many rounds of negotiations. The preliminary round may uncover the major
issues, while subsequent rounds may be needed to discuss and resolve them. Here are
some signals of talks coming to a close:
 A difference of opinion has been significantly reduced
 One party suggests signing an agreement.
 One or both parties indicate that a period of time to pause and reflect is
necessary.
Beware of last-minute strong-arm tactics
Even if you make the decision to treat your negotiating opponent with honesty and
kindness, the other party may not extend you the same respect. Be prepared to stand
your ground firmly, yet cordially, especially in the last few minutes of the
negotiations. This is the time when manipulative parties may employ certain tactics in
order to try to fool you into losing focus or lowering goals and standards. Remember
that conflicts are generally resolved in the last few minutes. The theory behind last
minute tactics is that one party may be more willing to give in out of fear that all of
the concessions or progress made up to that point (perhaps hours or weeks of talks)
might be lost. People also get tired or have other commitments that need to be met,
such as making an important phone call before another business closes, or picking up
children from school. Here are some last minutes tricks that negotiators often use at
this time:
 Walking out of the room
 Offering a short-term bribe
 Telling you to take it or leave it
 Giving an ultimatum
 Abrupt change in tone (used to shock the other party into submission)
 Introducing new requests (used at to get you to concede with little thought or
consideration)
 Stating generalizations without evidence (dropped without significant
statistics/proof)
 Adopting the Mr. Nice Guy persona (used to try to make it look like they are
doing you a favour in hopes that you will lower your expectations)
Language to use in closing
 It sounds like we've found some common ground.
 I'm willing to leave things there if you are.
 Let's leave it this way for now.

42
  I'm willing to work with that.
 I think we both agree to these terms.
 I'm satisfied with this decision.
 I think we should get this in writing.
 I'd like to stop and think about this for a little while.
 You've given me a lot to think about/consider.
 Would you be willing to sign a contract right now?
 Let's meet again once we've had some time to think.
Formalize the agreement/negotiation
In most business negotiations it is a good idea to get something down in writing. Even
if a decision has not been made, a letter of intent to continue the negotiations is often
used. This is a way for each party to guarantee that talks will continue. A letter of
intent often outlines the major issues that will be discussed in future negotiations. In
some cases a confidentiality agreement is also necessary. This is a promise from both
parties to keep information private between discussions. When an agreement has been
decided, a formal contract may be required. On the other hand, depending on the
seriousness of the decision, and the level of trust between the two parties, a simple
handshake and verbal agreement may be all that is needed. For example, an employer
may offer a promotion and an employee may trust that the new salary will be reflected
on the next pay cheque. However, even if nothing is put formally in writing, it is wise
to send an e-mail or letter that verifies the terms and puts the agreement on record,
especially when a specific number is decided on.

Assignment 3
Which of these are good ways of dealing with conflict / confrontation in a
negotiation?

1 Avoiding eye contact.

2 Smiling a lot.
3 Sitting back and appearing relaxed.
4 Stopping the discussion and coming back to it later.
5 Saying nothing for a long time.
6 Saying “I see what you mean”.
7 Finding out why the other side is unhappy.
8 Focusing on the issues, not on personalities.
9 Saying something humorous.
10 Speaking calmly and slowly.

Asking questions has to purposes: getting information and building trust. In both
cases, it’s essential to be diplomatic. Therefore ask open and indirect questions rather
than closed ones.
An open question is created by using a question word like how, when, why, who, etc.
A closed question gives you a yes/no or I don’t know answer. Open questions give
you much more information than closed questions. They will also help you to get out
of an impasse or stalemate. By using open questions, you show the other party you are
interested in their concerns.
An indirect question in English is polite and, therefore, helps to build trust, e.g.
direct question How did you arrived at that figure? as compared to indirect question

43
Can you tell me how you arrived at that figure?

Research shows that skilled negotiators often use the techniques listed below to
achieve their negotiating objective.

Assignment 4
A. Match the techniques (1-5) to their definitions (a-e).

1 Open questions
2 Closed questions
3 Softening phrases
4 Signalling phrases
5 Summarising

a) Say what you are going to do before you do it.

b) Modify language so that it does not appear too aggressive.
c) Go over the points covered to highlight when agreement is reached.
d) Gather information and explore the opposite number's views.
e) Check understanding and ask for precise information.

B. Match each expression to the correct technique in exercise A.

a) Can you offer any collateral?

b) There seems to be something wrong with your figures.
c) Let's go over what we've agreed.
d) What sort of loan are you looking for?
e) Let me clarify my last point. What I meant was, we would want to retain control of
the business.

C. Read the dialogue and identify expressions that match the techniques. Then
place each expression under the correct heading in the Useful language box below.
(Market Leader. Upper Intermediate Business English Course Book. 3d Edition.
Unit 9.)

CD3TRACK 5 (B = BANK MANAGER, C = CLIENT)

B I've looked at your business plan and I like some of your ideas for
expanding your business. Could I ask you, what other people are providing finance for
you?
C Well, two family members have offered I 00,000 Eurus for a small stake in the
business. 1 haven't decided anything yet, and my partner is also investing some more
money. We're still discussing the exact amount.
B Have you approached any other bank, if I may ask?
C Yes, two banks, but they turned me down.
B Oh, sorry to hear that - these are difficult times to raise money. I'd like to make a
suggestion. Why don't you revise your business plan? And especially, put in a bit
more about your competitors, for example. That'd help.
C Certainly, l can do that.
B Good. Could l ask what sort of repayment terms you have in mind?
C I'm pretty sure we could repay a loan - the whole amount, that is – within three
years.

44
B Right. That might be a bit optimistic, I'd say. Anyway, suppose we were to offer
you a loan of, say, 250,000 Eurus, once you've rev bed your business plan? How
would you feel about that?
C Let me clarify what the money's for. The 250,000 would be for working capital, and
to hire more staff; a finance director, marketing people, money for the extension of
the factory . . .
B Well, we can talk about that a little later. Your first task is to strengthen the
management as we discussed earlier.
C OK. Well, in that case, 250,000 would certainly help me to achieve some of my
objectives in expanding the business.
B Good. We seem to be getting somewhere now. Let me sum up what we've agreed so
far, then we can talk about your marketing strategy.

Useful language

OPEN QUESTIONS CLOSED QUESTIONS

Why do you need a loan? Do you have any other backers?

What other sources of finance do you Can you transfer the money by next
have? week?

What did you have in mind? Could you improve your credit terms?

Where does your information come Will you pay our price?
from?

SIGNALLING PHRASES SUMMARISING

I'd like to make a proposal. I think we Let's see what we've got so far.
should ...

Could I make a suggestion: why don't Let's recap before we go on to ...

we ... ?
Let's look at this another way.

SOFTEN I NG PHRASES So, to sum up, ...

I'm sorry, we can't go that high.

We were hoping to pay a little less.

That seems very expensive

Work in groups of four made up of two pairs.

Pair A and Pair B: Read your instructions below.

Pair A

1 Look individually at the points to consider in an international negotiation listed

45
below and add two more.
2 Choose the five most important points from your list.
3 Talk to your partner and agree the five most important points.
4 Join up with Pair B and try to agree the five most important points from your two
lists.

1 Keep an open mind and be flexible.

2 Propose a strict agenda and keep to it.
3 Anticipate the interests of the other side.
4 Let the other side make the first offer.
5 Be very clear and direct about what you want from the other side.
6 Pay careful attention to building a rapport.
7 Put pressure on the other side to make an agreement.
8 Pay attention to the other side’s body language.
9 Don’t change your plan during the meeting.
10 Have a deadline for getting a deal.

Pair B
1 Look individually at the points to consider in an international negotiation listed on
the right and add two more.
2 Choose the five most important points from your list.
3 Talk to your partner and agree the five most important points.
4 Join up with Pair A and try to agree the five most important points from your two
lists.

1 Prepare carefully before you negotiate.

2 Avoid an agenda. Let the negotiation develop naturally.
3 Ask a lot of questions to find out the position of the other side.
4 Try to disguise what you really want.
5 Be prepared to walk away without a deal.
6 Never compromise on your key points.
7 Be careful not to let the negotiation break down.
8 Summarise often points you agree on.
9 Make no concessions until the end.
10 Make sure you 'win' the negotiation and get the best possible deal.

Agree on a single list of the five most important tips from your lists.

Assignment 5
Write some tips for negotiating successfully with your culture.

Assignment 6
In his book The Art of Winning, Harry Mills says that most negotiations have seven
stages. These are listed below, but in the wrong order. Put the stages in order.
What word do the initial letters of the stages spell?

 Tie up loose ends (Confirm what has been agreed. Summarise the details on
paper.)
 Explore each other’s needs (Build rapport. State your opening position. Learn
the other side’s position.)

46
  Ready yourself (Prepare your objectives, concessions and strategy. Gather
information about the othe side.)
 Probe with proposals (Make suggestions and find areas of agreement.)
 Close the deal (Bring the negotiation to a clear and satisfactory end.)
 Signal for movement (Signal that you are prepared to move from your original
position. Respond to signals from the other side.)
 Exchange concessions (Give the other side something in return for something
you need or want.)

Assignment 7
In his book The Pocket Negotiator, Gavin Kennedy describes two extreme styles of
negotiator: Red stylists and Blue stylists.
Read the summary of the two styles. Then decide if you are:

1 A Red stylist
2 A Blue stylist
3 Somewhere between the two styles

Red stylist Blue stylist

 Want something for nothing.  Want to trade something for

 Try to win by showing they are
stronger than the other person.
 See negotiations as a short-term
activity.
something.
 Try to succeed by cooperation
with the other person.
 See negotiations as a long-term
activity.

 Use tricks and pressure to get  Do not use tricks. They think
what they want. about each other’s interests.

Assignment 8
Get prepared to role-play this situation in pairs.
A. Large foreign sportswear supplier and a local retailer have been negotiating the
supply of running equipment. Look at the information and finalize the agreement
using the expressions in the Useful language box.

Partner A.
You are a large foreign sportswear supplier and have been negotiating with a new
client for the supply of running equipment.
Now you are meeting with your new customer to finalize the agreement. Summarize
the information you have agreed on, set up an action plan, and close the negotiation.

Partner B.
You are a sportswear retailer and have been negotiating with a new supplier for the
supply of running equipment. This is the meeting in which you hope to finalize the
agreement, set up an action plan, and close the negotiation.

Item Quantity Quality Price

p.a.

47
Running shoes 500 pcs. leather $ 49
high
Running shoes 300 pcs. leather / cloth $ 35
mid
Running shoes 450 pcs. suede leather $ 30
low
Running shorts 500 pcs. nylon / cotton $ 15
black
Running shorts 500 pcs. pure cotton $ 14
white
Running top 1,000 pcs. mixed fibres $ 15
black
Running top 750 pcs. pure cotton $ 14
white

Useful language

Guaranteeing Expressing deadlines

I / We guarantee you that …
I / We can assure you that …
I / We will do my / your best to …
We should come to a decision within /
by…
You will be hearing from us by …
The closing date for … is …
I / We would be grateful if you could
implement this by …

We have to set a time limit of … weeks /

Summarizing
(Just) to summarize …
So far we have established …
Let me just repeat, if I may.
Can I just recap on these points?
This is where we stand.
I would like to summarize as follows …
I / We think / believe we all agree here That would be wonderful.
that …
We have certainly covered a lot of ground I am /We are very much looking forward
today!
…days to obtain the information.
There is a deadline of …days /…months
to finalize the agreement.
Closing discussion
Great! We’ve got a deal.
Thank you for fruitful discussion /
productive meeting.
I / We would certainly like to intensify my
/ our business relations with your
company.
Thank you for having us.
I / We had hoped / expected to get a lot
out of this meeting, and I / we did.
I /We feel exactly the same.
Well, it has been a pleasure. Thank you
for coming.
to …

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49