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International Negotiations

International Negotiations. Student Handout Distance Learning. Slide Order. Negotiations. Definition: Two or more parties must make a decision about their interdependent goals and/or objectives. The parties are committed to a peaceful solution.

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International Negotiations

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  1. International Negotiations Student Handout Distance Learning

  2. Slide Order

  3. Negotiations Definition: • Two or more parties must make a decision about their interdependent goals and/or objectives. • The parties are committed to a peaceful solution. • There is no clear method or procedure for making a decision.

  4. Negotiations Definition: A process in which one party tries to change the attitudes and/or beliefs of another party.

  5. Negotiations Definition: A method of conflict settlement.

  6. Elements of a Negotiation • Actors • Structure • Strategy • Process • Outcome

  7. Distributive Bargaining

  8. Positive Bargaining ZoneExample

  9. Negative Bargaining ZoneExample

  10. BATNA Best Alternative To a Negotiated Agreement “Plan B”

  11. Integrative Bargaining Win-Win Negotiations Mutual Gains Bargaining “Getting to Yes”

  12. Integrative Bargaining Problem solving vs. fighting Both parties working towards a solution One party doesn’t gain at the loss of another party.

  13. Integrative Bargaining Characteristics: • Open flow of information • Search for solutions • Parties understand conflicting & common goals • Understand each other’s point of view

  14. Integrative Bargaining Separating the people from the problem Focusing on interests not on positions Insisting on objective criteria Inventing options for mutual gain

  15. Short vs Long Term Planning

  16. Culture

  17. Definition Culture is a set of meanings, values and beliefs that characterize national, ethnic, or other groups and orient their behavior.

  18. Definition • True values will be revealed through behavior • Culture is a substitute for instinct • Culture Answers questions before they are raised • Culture is a bearer of social norms a guide to behavior or triggers specific actions in a particular situation

  19. Definition The basis of understanding other cultures comes from the comparison to our own culture. “A fish does not know how essential it is to live in water until it is taken out of it”

  20. Iceberg Theory

  21. Iceberg Theory

  22. Iceberg Theory

  23. Points of Culture Beliefs, values, ideas Language Customs (habits) Rules / Laws Family patterns Artifacts (art, architecture) History

  24. Points of Culture Social Groups (status and gender) Position in the world People Environment Space & Time Ability to change Personality

  25. Subcultures Age Profession Industries Education Interests and so on …

  26. Stereotypes

  27. National Negotiating Style • Power Distance • Collectivism / Individualism • Masculinity / Femininity • Uncertainty Avoidance • Confucian Dynamism

  28. Parts of International Negotiations Actors Structure Strategy • Apollonian – conflict avoidance • Dionysian – elicit conflict

  29. Parts of International Negotiations Process Outcome

  30. Research Books, Magazines, Periodicals Who?  Where?  What is their background?

  31. Research Internet  Respectability of the site  Verify the information  Who?  Where?  What is the background

  32. Research Natives of the country  Who?  What is their background?  What is the relation or knowledge to your culture?

  33. Research People from your own country that have been to the foreign country  Who?  What is their background?  Why were they there?  What experiences did they have?

  34. Negotiating Globally

  35. Negotiating Globally • Individual Characteristics • Situational Contingencies • Strategic & Tactical Processes

  36. Individual Characteristics Qualities of good negotiators differ culture to culture.

  37. Individual Characteristics • Communication Direct / Indirect • Emotionalism High / Low

  38. Individual Characteristics • Risk Taking • Buyer / Seller Relationship

  39. Situational Contingencies • Location • Physical Arrangements • Participants • Time Limits

  40. Situational Contingencies • Status • Personal Style Informal / Formal

  41. Strategic & Tactical Processes Integrative Bargaining Win – Win Negotiations

  42. Structure of International Negotiations • Preparation • Relationship Building • Information Exchange • Persuasion • Concessions • Agreement

  43. Extras

  44. Dynamics of International Business Negotiations

  45. External Stakeholders  Competitors  Customers Demand vs. Boycott  Labour Unions Reduce vs. Increase Employment  Organised Business Organisations  Shareholders

  46. 1. Negotiators Personality Background Experience Culture Attitude Knowledge Personal Benefits 2. Company’s Managers, Employees, BoD Financial Career (Promotion) Ego Prestige Wages / Salary Economic Security Immediate Stakeholders

  47. Integrative Bargaining Win-Win Negotiations Mutual Gains Bargaining “Getting to Yes”

  48. Integrative Bargaining Separating the people from the problem Focusing on interests not on positions Insisting on objective criteria Inventing options for mutual gain

  49. What do we need to do? TRUST Location Timing Obfuscation (confusion) Positioning

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