Chapter 9 International Business Contract Negotiation

*What roles are needed? No1.The spokesperson will normally be the most experienced negotiator in the team. No2.The back-up acts as the spokesperson’s assistant.

*Key points for managing your negotiating team Guidelines: Reading book P80 Pitfalls to avoid: Autocratic team leadership. Trying to do everything yourself before and during the negotiation. Blaming someone else for every mistake and difficulty.

(3)Building integrative agreements How can I get from here by a route that does not seem possible? An integrative agreement is one that reconciles the parties interests. Integrative agreements produce solutions that are more satisfying to the negotiators than compromises, tossing a coin and other mechanical types of agreements.

(3)Building integrative agreement How can you achieve integrative agreement? Integrative agreements are sometimes based on known alternatives, but more often than not they involve the development of novel ones. Therefore, they require a considerable amount of creativity and imagination.

If none of these combinations is accepted by the other party, you relax or drop your lower priority goals and again propose all possible combinations, continuing this cycle until the other party accepts a proposal. If none of these combinations is accepted by the other party, you relax or drop your lower priority goals and again propose all possible combinations, continuing this cycle until the other party accepts a proposal.

*What are the routes for moving from opposing demands to a solution that reconciles the two parties' interests? ^(1) They can ‘expand the pie ‘ Some integrative agreements are built by increasing the available resources so that both sides can get what they want. ^(2) They can use ‘log- rolling ‘ A second way to build integrative agreements is to exchange concessions on different issues, with each party yielding on issues that are of low priority for themselves and of high priority to the other party.

(Continued) (3) They can make trade- offs Such trade-offs are sometimes achieved through ‘non-specific compensation’. (4) They can reach agreement through ‘cost cutting ‘ This happens when somebody (one of the negotiators or a third party ) examines the concerns that underlie the positions taken by one or more of the parties and looks for a way to achieve these concerns. (5) They can look for ‘bridging’ solutions Such solutions are devised by an analysis of both parties’ underlying concerns.

* Key questions for devising integrative solutions ^For expanding the pie : How can both parties get what they are demanding? Is there a resource shortage? How can the critical resource be expanded? ^For log-rolling : What issues are of higher and lower priority to myself ? What issues are of higher and lower priority to the other party ? Are some of my high-priority issues, low priority to the other party and vice versa ? Are several issues bundled together (for either party) which can be separated ?