Unit 1: Introduction to Business Negotiation Flashcards
What are situations in which negotiation may occur?
Business situations but also in daily life; deciding what to eat, selecting a movie to watch, etc.
TRUE or FALSE
The final agreement of a negotiation is optimal for everyone
FALSE
What is the goal of negotiation?
To solve a conflict
When do you intend to achieve the most in a negotiation?
By actively participating in the negotiation
Which communication styles are essential within negotiation
verbal and non-verbal
What are the characteristics of negotiation? (4)
- Two or more parties
- There is a conflict of needs/wishes
- Parties negotiate with the assumption that the agreement will benefit them
- It is a ‘give-take’ game, the final agreement will be different from the initial approach
When is negotiating inadvisable? (7)
When..
* a party can lose everything
* a firm’s stock is finished
* there are non-ethic demands
* you do not have time to negotiate
* you are acting in bad faith
* your own position may improve
* the negotiation is not prepared
Why is it not advisable to negotiate if a firm’s stock is finished?
Because there is no win for you in negotiating, you are already performing really well, and you sold everything you produce. In this case, your product is so good it has a vertical demand curve.
Why is it inadvisable to negotiate if you have no time?
Because rushing drives to mistakes
What are the 7 elements of negotiation?
- Object
- Subjects
- Power of each party
- Objective of each party
- Environment
- Level of confidence/trust
- Level of information
What is the object of a negotiation?
What is negotiated about
What is meant by: the subjects of the process?
The people that represent the parties involved
What is meant by: the power of each party?
The power that each party has can be of impact to the negotiation.
Party of scale - increases power
Power with need or urgency - decreases power
What is meant by: the objective of each party?
The claim of each negotiator
TRUE or FALSE
It is possible to have more than 1 objective
TRUE
What are the requirements of an objective? (3)
- Must be well-defined and delimited
- They should be hierarchical, essentials first
- They must be realistic, leading to a balanced result
What are the types of objectives when negotiating? (3)
- Acceptable minimum
- Medium or reasonable
- Utopian (idealistic)
What is meant by: the environment of the negotiation?
A set of circumstances where the negotiation takes place
Which two aspects are there to the environment of negotiation?
Time and Place
How can time affect a negotiation?
The lack of time tends to affect negatively to the weaker party
How can place affect a negotiation?
It may take place in any of the part’s offices or a third place. Being in the own place could be an advantage, by creating a certain sense of leadership.
How can ‘the level of trust between parties’ affect the negotiation?
Mistrust creates misgiving that can harm the negotiation process
How can ‘the level of information that each party has’ affect the negotiation?
The higher the information, the lower the uncertainty and thus the likelihood of finding unexpected results.