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1.

0 Content
NO INDEX PAGE
2.0 Introduction
2.1 Definition of Negotiation
2.2 Elements of Negotiation Process Behavior Substance

3.0 Body
3.1 Types of Negotiation in Organization
A) Day to Day / Managerial Negotiations
Explanation
Parties Involves
Examples
B) Commercial Negotiations
Explanation
Parties Involved
Examples
C) Legal Negotiations
Explanation
Parties Involved
Examples
3.2 Parties Involve in Negotiation
A) Different Levels of Managements
B) Legal Advisers
C) With Colleagues
D) Trade Unions

E) Suppliers
F) Government
G) Customers
4.0 Conclusion
5.0 Reference
6.0 Coursework



















2.0 Introduction
2.1 Definitions of Negotiation
Negotiation is a type of communication which is used specifically in situations of
conflicting interests in order to reach agreement, to get a bargain or to create outcomes
that satisfy certain interests. Negotiation is necessary when at least one party requires the
other party's agreement to achieve its goals. Or, to use the words of Zartman, negotiation
is "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."
(Zartman, 2002)
Negotiation involves direct interaction between two or more parties. If a third
(neutral) party is involved, the process is called mediation, although the techniques and
principals involved are largely the same. If the third party even gets the final vote or the
right to make the final decision in the negotiations, then the process is called arbitration.
Negotiation and negotiation techniques are mainly researched in the field of
Negotiation Theory. Negotiation theory especially involves two fields of interest, namely
decision theory and game theory. The latter is especially of interest for this thesis.
The focus will especially be on different negotiation techniques. These
negotiation techniques can usually be matched to different strategies in a game. Some
aspects of negotiation will be kept out of this thesis. For example cultural influences are
kept out as much as possible. Although the influence of culture on negotiations is quite
interesting and can be significant, cultural differences are irrelevant here. Even though
the environment in which the research has taken place is internationally oriented, the
population of people involved in this thesis is homogenous: all people involved are native
Dutch males with a technical background.
The rest of this paragraph is therefore used to describe what negotiators are, a few
common negotiation techniques and approaches and some circumstantial influences on
negotiation.
2.2 Elements of Negotiation Process Behavior Substance
According to Burgess (2004), there are traditionally two negotiation strategies. These
strategies are called interest-based and positional. Fisher and Uri (1981) argued that a
third variant should be added: principled negotiation.
Furthermore, Fisher and Uri found that each negotiation strategy holds at least, to
some extent, a bit of these parameters:

Process
The process of negotiation describes how, according to game theoretical
principles, a strategy is actually implemented. It describes the parties involved,
their tactics, the context of the meeting and all the moves which are about to be
made.
Behavior
Behavior involves how the parties behave during the negotiations. It expresses
their relationship toward each other, what their interactions with each other
look like and what styles they adopt.
Substance
Substance is what is being discussed, or what is put on the agenda of a meeting.
For example, the problems or issues. On the other hand, also opinions, solutions
or solution concepts and agreements (if any) which are reached at the end.

The tree different negotiation strategies are discussed below. Furthermore, a
selection of the most commonly used negotiation techniques, which can be seen as
implementations of the strategies, are presented. Sometimes a clear connection with a
strategy in game theory can be made. If this is the case, this will be mentioned.

3.0 Body
Depending upon the situation and time, the way the negotiations are to be conducted differs. The skills of
negotiations depends and differs widely from one situation to the other. Basically the types can be
divided into three broad categories.

Types Parties
Involved
Examples
Day-to-day/
Managerial
Negotiations
1. Different levels of
Management
2. In between
colleagues
3. Trade unions
4. Legal advisers
1. Negotiation for pay, terms and
working conditions.
2. Description of the job and fixation
of responsibility.
3. Increasing productivity.
Commercial
Negotiations
1. Management
2. Suppliers
3. Government
4. Customers
5. Trade unions
6. Legal advisors
7. Public
1. Striking a contract with the
customer.
2. Negotiations for the price and
quality of goods to be purchased.
3. Negotiations with financial
institutions as regarding the
availability of capital.
Legal Negotiations
1. Government
2. Management
3. Customers
1. Adhereing to the laws of the local
and national government.




1. Day-to-day / Managerial Negotiations
Such types of negotiations are done within the organization and are related to the internal problems in
the organization. It is in regards to the working relationship between the groups of employees. Usually,
the manager needs to interact with the members at different levels in the organization structure. For
conducting the day-to-day business, internally, the superior needs to allot job responsibilities, maintain a
flow of information, direct the record keeping and many more activities for smooth functioning. All this
requires entering into negotiations with the parties internal to the organization.
2. Commercial Negotiations
Such types of negotiations are conducted with external parties. The driving forces behind such
negotiations are usually financial gains. They are based on a give-and-take relationship. Commercial
negotiations successfully end up into contracts. It relates to foregoing of one resource to get the other.
3. Legal Negotiations
These negotiations are usually formal and legally binding. Disputes over precedents can become as
significant as the main issue. They are also contractual in nature and relate to gaining legal ground.
IS NEGOTIATION NECESSARY ?
Negotiation, at times can be a lengthy and cumbersome process. By asking whether it is necessary, time
may sometimes be saved and unnecessary compromise avoided. On occasions, a request to negotiate may
best be met by pointing out that the party making the request has no standing in the matter. If a manager
has the undoubted authority to act, making a decision rather than negotiating about it may be the best
tactic.
Alternatively, there are cases in which the best response to a request or a claim is to concede it without
argument. Why waste time negotiating if the other party has a good case and there are no adverse
consequences in conceding ? Unnecessary negotiation, followed, perhaps, by a grudging concession of the
other partys claim, will lose all the advantage that might be gained with a quick unexpected yes.
An alternative to a simple yes or no when a difference of view occurs is to skip negotiation and proceed
immediately to some form of third party intervention. An alternative to a simple yes or no when a
difference of view occurs, is to skip negotiation and proceed immediately to some form of third party
intervention. On the most formal basis, this might imply a decision to take a dispute to court : informally,
two managers who quickly realize that they cannot reach agreement about a working problem may jointly
agree to stop wasting time in argument and refer the matter to a senior manager for resolution.
It is good to follow the general rule :
Do not negotiate unless you have to or unless you can obtain some direct or indirect advantage by doing
so.


















6.0 Reference
1) http://www.laynetworks.com/TYPES-OF-NEGOTIATION-IN-
ORGANIZATIONS.html
2)
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