L4M5 CHAPTER 1 1.2 Differentiate between the types of approaches that can be pursued in commercial negotiations

Question 1

What are the two (2) approaches to managing conflicts?

Answer 1

Collaborative - win-win or integrative

Distributive - win-lose or zero-sum approach

Question 2

What is the MIL criteria?

Answer 2

Must achieve - minimum target/maximum you can concede, fall-back position

Intend to achieve - realistic target you are aiming for

Like to achieve - stretch target to achieve on this point

Question 3

What is a true statement about the Collaborative approach in negotiation?

Answer 3

Collaborative approach in negotiation can to some degree satisfy the concerns of both sides. Integrative, interest-based negotiation therefore can facilitate constructive, positive relationships and establish contracts between parties on a foundation of goodwill. It can only facilitate the positive outcomes, it does not ensure that neither party will seek to be opportunistic in later time during the life of the contract.

Question 4

What is a Distributive approach in negotiation?

Answer 4

Adversarial: Both parties seek to maximize position at the expense of the other. Almost no trust, communication and cooperation. These suppliers will probably provide non-core products or services with the buyer purchasing them on a one-off basis.

In a win-lose approach, a negotiator wants to maximize the value obtained in a single deal, the relationship with the other party is not important. Therefore, a strong party may win more than 50% of the metaphorical ‘pie’.

Question 5

What is Pragmatic and principle style negotiation?

Answer 5

An approach to negotiation focusing on a collaborative approach to conflict management and dispute resolution.

Question 6

What are the four (4) fundamentals of principled negotiations?

Answer 6

People - separate the people from the problem

Interests - focus on interests, not positions

Options - invent options for mutual gain

Criteria - insist on using objective criteria