THE NEGOCIATION

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  • TRABAJO DE FIN DE GRADO

    The negotiation

    (La negociacin)

    Autor: Jorge Moreno Hernndez

    Tutor: D. Ignacio Amate Fortes

    Grado en Economa

    Facultad de Ciencias Econmicas y Empresariales

    UNIVERSIDAD DE ALMERA

    Curso acadmico: 2014/2015

    Almera, Junio de 2015

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    Index

    1. Introduction

    2. What is negotiating?

    3. The origin of the negotiation

    3.1 The Game Theory

    3.1.1 Concept

    3.1.2 The origin of The Game Theory

    4. Types of negotiations

    5. Negotiation process.

    5.1 Relationship building techniques

    5.2 Haggling

    5.3 Closing

    6. Negotiation techniques.

    7. Non-verbal communication and how to detect lies in a negotiation.

    7.1 The glance

    7.2 Hands

    7.2.1 Ways of palming

    7.2.2 The handshake

    7.2.3 What should I avoid about giving a handshake?

    8. International deals.

    8.1 Why negotiate internationally?

    8.2 What does the culture mean in international deals?

    8.2.1 Personal and professional relationships.

    8.2.2 Confrontation and cooperation.

    8.2.3 Time and punctuality in different countries

    8.2.4 Verbal and written agreements.

    8.3 Some different culture cases

    9. Negotiation in teams.

    10. Errors to avoid in a negotiation.

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    11. Experiment. Negotiation abilities; who develops better negotiation skills along the

    degree?

    12. Conclusion

    13. Bibliography

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    1. INTRODUCTION

    This project is based on negotiation. It is about all aspects people should consider

    regarding the negotiation such as its pertinent techniques, how to begin or close a deal,

    how it should be negotiated with foreign people, etc.

    The project consists of four essential parts:

    Part I; Key aspects about negotiation such as the origin or the definition itself.

    Part II; Negotiation techniques and how to begin and close a deal.

    Part III; How to negotiate with foreign people, the negotiation in teams or errors to

    avoid when it is negotiating.

    Part IV; Negotiation experiment. Male vs female.

    Within the mentioned aspects, the most important one is considering an experiment which

    was accomplished at the University of Almera, Spain. In this experiment, it is tried to

    discover what gender is better at negotiating as the students advance their degree so as to

    comprehend if they increase their negotiating knowledge as they grow. To research this,

    there will be three objects to negotiate in the first, second and third year of the degree.

    (Degree in Economics; University of Almera).

    One the one hand, it is decided to analyse the negotiation itself because this fact affects to

    our daily life. This is, most of people are continually negotiating in order to achieve what

    they desire, therefore I thought it was necessary some standards about how to negotiate.

    Thus, this project will show all these aspects connected to negotiation.

    If it might return to the main subject of this project, the experiment, it has to be said that

    because of the lack of financial and business education to our students, it is decided to

    represent an experiment with the purpose of verifying this lack. Accordingly, it is

    considered this topic as vital for the future.

    Finally, the objective of this project is exhibiting how a person should negotiate in

    different situations. Apart from this, the second objective is related to the behavioural

    economy. This objective is aimed at analysing how people behave when they try to

    negotiate for the lowest price and observe if the students make use of their acquired

    knowledge.

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    PART I

    2. WHAT IS NEGOTIATING?

    Negotiate is concerning Universidad of Alicante (2007) an activity in which two or more

    people who are interested in a matter. Moreover, they agree on particular rules and seek an

    agreement with the objective of fulfilling the interests of each other.

    Three conditions must be achieved to be a negotiation process:

    There are two different points of view about one issue.

    Both of the parts want to come to an agreement.

    To reach that, they communicate each other by sharing proposals and concessions.

    On the one hand and in regard to European Business School (2014), an effective

    negotiation is a result from the cession of some elements by both parts in order to keep

    their own interests. Moreover, traditional negotiation is sometimes called win-lose due to

    the toughness of every negotiator with the objective of winning as much as they can for

    themselves. But, over 1980, three prestigious teachers called Roger Fisher, William Ury

    and Bruce Patton arose the concept win-win such as CEFNE, (Centre for studies and

    training in business negotiation), points out. With regard to this conception, each part will

    be satisfied by obtaining benefits. Therefore, this is an excellent manner to avoid any

    future conflicts. These three teachers were the co-founders of Harvard Negotiation.

    On the other hand, the key to deal with success is the conversation. There are lots of

    components that can affect the negotiation but the conversation, the phrases and the

    language are the most successful ones. Nevertheless, feelings and emotions play a large

    role in the final result when we are negotiating.

    According to IE Negotiation Center (Business School, 2014), which is located to Madrid,

    explains how negotiation should works. Negotiation must be based on researching new

    sources to obtain the mentioned term win-win. To explain this affirmation, we will have

    as support one example below:

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    Imagine that there are two options at the time to negotiate and they do not want to

    change their options. Therefore, this is what would happen in the negotiation.

    Employee Director of Human Resources

    Objective

    Increase his/her

    knowledge.

    Do not employ more staff

    Proposal

    Be promoted as a Director

    of Marketing

    Impossibility to promote

    somebody.

    As it can see, this negotiation will be failed if both refuse to research some resources. To

    achieve the success, both parts must ask each other:

    Employee: What other options can I achieve my objectives with?

    Director of Human resources: What other options can I offer?

    Once they have asked themselves, we are going to see how it would be a win-win

    negotiation (according to Harvard negotiation) following with the last example.

    Employee Director of Human Resources

    Objective - Increase his/her

    knowledge. - Do not employ more staff

    Proposal

    - Study another degree.

    -Do a master degree.

    - Finance the master.

    - Establish a flexible schedule

    to work and study at the same

    time.

    Having seen this mediation, it has been achieved what each part wanted. That is the key of

    the negotiation.

    To finish with this section, we are going to see how Roger Fisher, who was the director of

    the Hardvard Negotiation Project, conceptualised the negotiation in 1985: The negotiation

    is a basic mean to achieve what we want from each other. It is a double procedure to come

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    to an agreement, when you and other people share some interests in common but both of

    you have some opposite ones.

    3. THE ORIGIN OF THE NEGOTIATION

    With reference to Business European School (2013), which is located to Spain, it can be

    known that the origin of the negotiation was produced in the nomadic period. Once the

    water was discovered, the nomads appreciated this resource in order to develop the

    agriculture. It must be said that it is in this period when the barter is created, since the

    nomads exchanged meat for vegetables.

    3.1 The Game Theory

    3.1.1 Concept

    The Game Theory is connected to the Economics area and this game represents the

    probability to succeed by taking account decisions from others. It is necessary to say that

    The Game Theory is highly related to the negotiation, since in this one, our opposing parts

    decisions have to be considered in order to achieve better deals.

    According to Expansion (2015) and within this concept, it can be denominated winning

    as those results which generate one profit for the player. Once this concept has been

    assimilated, it must be supposed there are two types of strategies.

    Optimal strategy; it is produced the maximum profit in both players.

    Dominant strategy: it is existed an optimal strategy whatever the opponent

    conduct is.

    Nevertheless, it should be noteworthy that the typical situation is that one in which it exists

    a certain grade of interdependence among the players.

    Apart from these strategies, The Theory Game also articulate different sorts of strategies to

    consider. The mo