Dynamics of Negotiation
Negotiation is an essential tool that aids in unlocking business stalemate. In other instances, it ensures a business gets an ideal deal mostly by cutting the cost of the initial deal. Parties to a negotiation must be interdepended to each other to have a preferred outcome. Both parties in a negotiation process need to understand each other. More importantly, they should be willing to consider changing their hard stance for a win-win agreement to be achieved. Research posits that the more one party knows the other party, the more the effective bargaining and exchange of information and offers could be realized. A successful negotiation is achieved by understanding some critical concepts. With the contention, this paper seeks to explore some terms commonly used in the negotiation process, which include; bargaining mix, ZOPA, reservation price, concessions, tradeoffs, and BATNA.
From the onset, negotiation is realized from a situation that conflicting parties lack common objectives. Nevertheless, to offset this kind of stalemate, some issues need to be considered, and perhaps the informing aspects that guide the negotiation process are ideal in this case. The bargaining mix gets defined as the issues that are set to be discussed on the negotiation table (Lewicki, Barry, and Saunders, 2016). The larger the bargaining mix, the more opportunity for conflicting parties as there will be varied preferences that are not identical to each issue. The bargaining mix is linked to several interests. Substantive interest falls in the first categorization, and it is more concerned with the subject of the perceived conflict (Lewicki, Barry, and Saunders, 2016). This interest can be well be defined by an instance of two conflicting parties that are discontented about who receives the largest share of cash prize. The bargaining mix is coupled up with other interests that are process-based and relationship-based.
Negation is an involving task. In most cases, parties engage in the negotiation process, each having a stand that must be achieved. Otherwise, a party is more likely to turn down the offer and render the negotiation process null. Having an alternative is critical in this instance. Parties do enter a negotiation process by having alternatives. Alternatives increase a party’s negotiating power (Fells, and Sheer, 2019). In reality, it makes a party aim higher and does not concede easily. This kind of alternatives is perhaps the source of the idea of BATNA in the negotiation process. In its basic form, BATNA gives negotiating parties options in the event negotiations fail, and agreements are impossible (Lewicki, Barry, and Saunders, 2016). BATNA is intertwined with reservation price because a party having BATNA is more likely to have an ideal reservation point. This point refers to the worse price that a party is willing to pay in a negotiation deal. On the other hand, the reservation price denotes the best price for both parties (Lewicki, Barry, and Saunders, 2016). For example, the seller can have the least amount of price that can be made, and however, the negation is enticing, it cannot surpass the least price set. For a buyer, this would mean the maximum price they are willing to pay. Both BATNA and reservation concepts are vital in a negotiation process as they ensure that each party is satisfied with the outcome.
As much as negotiation is about convincing each other to settle on an agreement, sometimes parties bow to the pressure either willingly or unwillingly. This surrendering to the negation terms’ pressure is referred to as either concessions or tradeoffs (Lewicki, Barry, and Saunders, 2016). This stage implies that there is a common ground and an agreement has been reached. Concession and tradeoffs are ideal in a negation process as they bring to an end a stalemate. This stage ensures that both parties are satisfied with the process, and each party’s desires have been taken care of (Lewicki, Barry, and Saunders, 2016). These two concepts can be best dealt with where the negation process is more concerned with the overall well-being that spans beyond the aggrieved parties. For example, the concession can be best considered in an event where customers are more critical. These concepts are also perceived to be interlinked with ZOPA, an acronym that stands for Zone of Possible Agreement. While the latter is more concerned with breaking a stalemate by either of the conflicting parties succumbing to the pressure and agreeing with the set terms, the former is more concerned with a range that is more likely to settle a disagreement.
In conclusion, negotiation is a complex process that needs to be assessed to realize ideal agreements. One step to having an ideal negotiation process is to have a comprehension of the essential terms that are used in negotiating. These terms include BATNA, ZOPA, bargaining ix, and reservation price. The bargaining mix has been defined as the set of issues that are set to be discussed in a negotiation table. These concepts are vital for the negotiation process to be successful as it elaborates each party’s desires. BATNA is vital as it helps an aggrieved party set high standards when negotiating and not easily succumbing to pressure as there is always an alternative to settle on.
Bibliography
Fells, R., and Sheer, N., 2019. Effective negotiation: From research to results. Cambridge University Press.
Lewicki, R.J., Barry, B., and Saunders, D.M., 2016. Essentials of negotiation. McGraw-Hill.