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1、 Module One Basics of NegotiationInternational Business Negotiation Module Two Planning the NegotiationInternational Business Negotiation Learning Objectives After studying this session,you will be able to Form Negotiating Team Create Information Base Draft the Negotiating Plan Make Physical Prepara
2、tionsLead-in QuestionsWhat is negotiation?What is International Business Negotiation?What,do you think,should negotiators prepare before a negotiation starts?Size of a Team Companies are represented by several individuals with different expertise needed to negotiate a specific contract.Teams vary in
3、 terms of size,composition,and authority.Parties expect to work with counterparts of more-or-less equivalent position,status,and authority.Size of the team can often be construed as overpowering the other side.Personal qualities of team memberAdaptabilityFlexibilityIntuitive sensitivityCommunication
4、Stability HumorPatience Understand and work effectively with the decision-making processes peculiar to the countries theyre dealing with.Handle delicate issuesBe able to empathizeBe able to handle stressCommunicate and relateBe able to“break the ice”Work under pressureCriteria for Picking Negotiatio
5、n Team Members The particular skills you seek.The personality of potential team members.Any organizational considerations that affect selections.Your overall negotiation strategy.Any agreements you have on team size.Make-up of the teamLeaderFinancial personnel Legal personnelTechnical personnelGener
6、al corporate managementInterpreter Creating Information Base Obtaining general information Obtaining Market Information Obtaining Laws and Regulation Information Obtaining Cultural Information General Information The Qualification and Credit Status of the Partner Company Negotiation Representatives
7、Profiles Existing Contract Files Counterpart Relationship History Other Companies Other External Sources Market Informationtechnological specificationsusespurchasing costsquantity availablefreight chargesdomestic market pricesinternational market pricesProducts life cycle and competitivenesspatentsn
8、ecessary accessoriesafter-servicesthe like of the negotiating item Drafting the Negotiation Plan Perform a Context Analysis Complete an Issue,Interest,and Power Analysis Complete a Process Design Context AnalysisIdentify and understand the people and parties who will be involved in negotiations.Unde
9、rstand the situation in which negotiations will occur and the general purpose of the negotiationsIdentify positive preconditions for negotiations and develop strategies to mitigate negative onesIssue,Interest,and Power Analysis Explore the potential framing of issues Identify the potential interests
10、 Assess the emotional charge of the negotiations,and develop strategies Evaluate the parties willingness to talk and reach agreements and develop strategies Assess the parties means of influence and powerProcess Design Participant Organization Communication Agreement Physical Preparation Plotting th
11、e LocationHome court negotiatingGuest court negotiating Third place negotiating Design the Physical SurroundingsDcorBusiness and Personal AmenitiesTemperature and LightingSeating Fighting the Fatigue Factor Planning Travel Schedules Following the Negotiators Diet Eat lightly.Avoid rich food.Avoid al
12、cohol.Dominating the Psychological Environment Resolving to Alter the Environment Module Three Executing the NegotiationInternational Business Negotiation Learning Objectives After studying this session,you will be able to Define the opening,bargaining and closing phases Describe each step in these
13、phases Identify the common mistakes made in each phase of negotiationLead-in QuestionsHow many stages are there in a negotiation?What does a negotiator do when a negotiation begins,proceeds and closes?Building the ClimatePositive and friendly atmosphereBrief and straightforward atmosphereTense and C
14、ontradictory atmosphereSedate and Reserved Atmosphere Building the ClimateLocation Will you meet at your place or theirs?Seating Will members sit across table or at each end?Refreshment Will there be any?If so,what kind?People Who is there and who is not?Access to tech&Is there a phone,fax,computer,
15、Internet,orcommunication calculator?Will there be team seating?Time Frame How much time is allocated for this meeting?AgendaAd hoc discussionsGroup discussionsAlternating Choices of ItemsCreating a Simple AgendaRanking according to ImportanceWorking from General Agreements to DetailsPlacing Less Dif
16、ficult Items FirstAddressing the Boulder in the RoadGrouping Trade-Offs or PackagingIncremental or Alternating Discussion and Agreement Assigning Smaller Issues to SubgroupsAgenda Activities for first meetingsWelcoming Comments,Greetings,or SpeechesPsychological and relationship welcomesProcedurally
17、 focused welcomes or greetingsSubstantive welcomes or greetings Activities for first meetingsWelcoming Comments,Greetings,or SpeechesIntroduction of Individuals,Team Members,or Other ParticipantsBuilding Working Relationships and TrustInitiating Discussions on Substantive,Procedural,or Relationship
18、IssuesOpening StatementsOffer Offer means offering price and terms,which includes not only products inquire,but includes a variety of conditions of the entire transaction including the quantity of goods,quality,packaging,price,shipping,insurance,payment,inspection,claims,arbitration,etc.Counter-offe
19、rA proportional counter offer refers to a proposal in which one party asks the counterpart to adjust the quotation proportionally;to lower the total price by a certain percent.A cost-based counter offer is made on the basis of cost analysis of the items under negotiation,proposing an appropriate pri
20、ce for the counterparts quotation.Making an offer It gives lots of information to the other side.The other party can adjust his own opening offer to be more or less extreme than planned.Having the other party to offerIt gives you an immediate idea of how far apart the respective positions are.You ma
21、y receive a better offer than what you would be willing to settle for.Ways to Encourage Acceptance of an OfferMake an Conditional Offer in Terms of Time Putting a time limit on an offer puts pressure on the other side to give it prompt considerationOffer Incentives for Prompt Acceptance If we can cl
22、ose this deal today,well absorb the shipping charges over the course of the contract.Establish an Imperative Deadline The President has given us until Wednesday to finalize this,or the money is going for another research project.Strategies for Your Opening Offer:Clear Decisive Specific Bargaining St
23、andard Counter-offer In general practice,when an offeree has received an offer,he usually would not accept it immediately,instead he would try to amend or alter some terms of the offer.How to make a counter-offer?Techniques for Justifying and Getting a High PriceTechniques for Overcoming Anyones Pri
24、ce ObjectionsTechniques for Finessing the Offer into NegotiatingCoping with a“Best and Final”Offer You Dont WantUsing the Shock Value of a“Quick Hit”OfferHow to Parry Counter-offers EffectivelyAsking for the Moon to Get What You WantMaking Concessions concession-making for different reasonsconcessio
25、ns critical agreement long-term relationshipTactics Do your homeworkPrioritize your goalsKnow your walk-away and alternativesKnow which person will make the decisionShow that you want to negotiateTry not to be first side to make a major concession Do not wait until the deadline to offer a compromise
26、 Start with small compromisesTactics Use your concessions to your advantageDont make unreciprocated concessionsUse your offers to communicate your standDo not push too hardRemember the split does not have to be evenSeek win-win compromisesTry not to close too quicklyPromote the long-term benefitsSta
27、y focused on the issues Closing PhaseKey actions Putting a Potential Deal Together Make an agreementCommon problems in the closing phase“We dont understand the agreement(or what we are agreeing to).”“We do not understand the wording/interpretation/translation.”“We need more time.”or“We will have wor
28、d from our superiors within the next week/month/year.”Common Problems in the Closing Phase“What you did/said earlier offended us.We expect an apology/a new offer/a concession from you to make it right”“By the way,we have one more issue.We need one additional thing from you in order for us to close t
29、he deal.”“Well,we are not getting anywhere.I am leaving.”Common problems in the closing phase“Isnt there just a little bit more?”“A sweetener for me/my boss/the organization would help get this approved in a timely manner.”“Dont you trust us?”“I want my lawyer(or legal team)to review our agreement.”
30、“This would be very difficult.”Or“No,it is not possible!”Common Problems in the Closing PhaseCommon problems in the closing phase Module Four Strategies and TacticsInternational Business Negotiation Learning Objectives After studying this session,you will be able to Describe standard negotiation str
31、ategies.Use strategies countering negative negotiation tactics.Apply the methods to develop your negotiation strategies.Lead-in questionsDo you know any strategies in a negotiation?What are the advantages and disadvantages of these strategies?Strategies Standard Negotiation StrategiesCountering Nega
32、tive TacticsDeveloping Your Own StrategiesStandard Negotiation StrategiesWin-win strategyStonewalling The Good Samaritan approachThe Good Cop/Bad Cop CaperSurprise as a toolA weak position as an advantageHardball tactics Stonewalling Stability HumorPatience Understand and work effectively with the d
33、ecision-making processes peculiar to the countries theyre dealing with.Criteria for Picking Negotiation Team Members The particular skills you seek.Flexibility Stonewalling Make-up of the teamLeaderFinancial personnel Your overall negotiation strategy.Using Surprise as a Negotiation ToolIntroduce a
34、completely new element into the negotiation.Adding competition.To undermine the other sides position.Bringing in an expert to contradict the other sides position.To signal a shift in your thinking.To escalate the level of negotiations.To create a sense of urgency.Bullying tacticsIntimidating behavio
35、rThreatsLiesNo authority NibblingStressful environmentUnreasonable demands and offersCountering Negative Negotiation Tactics How to deal withDeveloping your own strategiesThe competitive strategyThe accommodation strategyThe compromising strategyThe collaborative strategyThe avoidance strategy The C
36、ompetitive StrategyAlternative to settlementAnything but that.Bluffing Bringing in the mediaCreating deadlockDiversion/distraction Done dealIrrational behavior Context AnalysisIdentify and understand the people and parties who will be involved in negotiations.Understand the situation in which negoti
37、ations will occur and the general purpose of the negotiationsIdentify positive preconditions for negotiations and develop strategies to mitigate negative onesIssue,Interest,and Power Analysis The Accommodation StrategyFace-savingIdentificationTake the lead oarTake reasonable actions The Compromising
38、 StrategyBit-by-bitConditional proposals“Log-rolling”“Splitting the baby”Tit-for-tat The Collaborative StrategyBe flexibleFocus on processIdentify with others in similar circumstancesThe Avoidance Strategy Negotiate money issue firstNegotiate non-money issues firstRefuse to combine negotiation of re
39、lated disputesWalk out of negotiationWithdraw an issueSwitch strategies Module Five Breaking an ImpasseInternational Business Negotiation Learning Objectives After studying this session,you will be able to Identify the causes of an impasse in negotiation Understand the strategies of breaking an impa
40、sse Apply the strategies in negotiation simulationLead-in QuestionsWhat is an impasse?How do negotiators break an impasse?Causes of an ImpasseBoth parties are with widely divergent objectives.One party mistakes firmness for rigidity and will not make concession.One party uses impasse as a deliberate
41、 tactic during a negotiation to force the other party to reconsider itss position and make concessions.Invent options when you dont have any.Make last minute concessions to get agreement.Shift gears to reach final agreement.Overcome the last-minute offer withdrawal.Take adjournment.Strategies of Bre
42、aking an ImpasseInvent options when you dont have any.Stretching out delivery dates.Relaxing product and/or packaging specifications.Increasing or decreasing the quantity of items bought.The inclusion of an option provision for additional quantities.The inclusion of performance,cost,and/or delivery
43、incentives.More favorable payment terms.Six approaches for getting through the decision makerSuggest to move to a higher level for resolution.Find a justifiable reason for involving superiors.Bring your own boss into the negotiation meetings.Have your boss contact the superiors on the other side.For
44、ce the issue to the highest level on the other side.Go over the other negotiators head yourself.EstablishDeadlinesto move a deal along Module Five Communication SkillsInternational Business Negotiation Learning Objectives After studying this session,you will be able to Identify the four styles of co
45、mmunication.Develop your communication style.Master non-verbal communication skills.Know cultural differences in style preferences.Lead-in QuestionsWhat are the communication principles that you know and apply in your life?Are there any special communication principles for IBN?Four Styles of Communi
46、cationDirect CommunicationMeasured and Systematic CommunicationOpen CommunicationEmotional CommunicationDevelop your communication styleAction styleProcess stylePeople styleIdea style Figure 6.1 The Four Communication Styles(Source:Negotiations:How To Achieve Win-win Outcome,by Geof Cox,FT Publicati
47、ons,2012)PEOPLELess directive;more responsiveIDEASMore directive;more responsivePROCESSLess directive;Less responsiveACTIONMore directive;Less responsiveAction StyleDescription People talk about:People areAction-oriented mind-set is fundamentally geared to changing things,improving existing situatio
48、ns,translating ideas into actions,being effective,getting things down,moving ahead and achieving good results.Preferred type of Agreement:deal.Preferred style of Discourse:bargaining.Results Objectives Performance Deals Challenges Moving ahead Responsibility Achievements Change DecisionsPragmatic Di
49、rectImpatient Decisive Quick Energetic Challenging Process StyleDescription People talk about:People areThe process-oriented mindset is characterized by the need to know,be factual,understand,organize,structure,set up strategies,tactics,establish rules,regulations,systems and manage.Preferred type o
50、f agreement:logical solution.Preferred style of discourse:debate.Facts Details ObservationsProcedures Planning Proof Organizing Controlling Testing AnalysisSystematicLogical FactualVerbose Unemotional Cautious PatientPeople StyleDescription People talk about:People areThe people-oriented mindset is