Bcom101 | Business Communication | Assessment Answers

Answer:

Introduction

The following study is based on research of two contrasting approaches problem solving interest based negotiation and competitive positional-based negotiation. It is study of training need analysis of United Beverages Pty. Ltd. which is a large sales organisation and beverage company. In the below study the competitive positional based approach and problem solving interest based negotiation are critically explained. The aim of the company is to develop the organisation with training and conduct negotiation training approaches. The company aims at contrast and comparison of the two approaches and recommend the effective one for its training programme.

Competitive positional based approach

The competitive positioning approach is based on creating the market value and differentiating the offerings. It is about putting the stake on ground, digging a self-spot in market and achieving a mindshare in the market- being known for something specific (Filho, Padua and Fernandes, 2017). The good positioning strategy is achieved by considering the following factors:

1. Market profile: It tells about stage of growth, competitors and, size of the company.

2. Competitive analysis: It depicts the threats in the market from its competitors, weaknesses, strengths, and opportunities.

3. Customer segments: it deals with number of possibilities with same needs and wants.

4. Methods for delivering value: This determines the techniques of delivering value to the customer.

Characteristics of competitive positional based approach

It involves holding on to a position or a fixed idea, and argument regarding the same regardless of any interest lying.

It is meant to be first adopted strategy while entering into a negotiation. Because the whole benefit will be enjoyed by one party only the interest and benefit does not get separated.

It has a problematic nature, as the negotiators become more and more committed to their positions.

It is considered as less efficient and less constructive strategy for negotiation than integrative negotiation; because it does not favour the party as each and every aspect has its negative and positive aspect. Providing benefit to one party is a negative aspect for the one who is losing the benefit.  (Grebski, 2016).

Assumptions of competitive positional based approach

Zero Sum: Competitive negotiation is based on a basic assumption of ‘Zero Sum Game’. It is believed that desire of both the people is same, when one loses the other person gains. If one person gets the piece other will not which is like arguing over a pie. It is named as win or lose situation. When person wants something and gets it is called a gainer and the person who losses out is called being cheated on.

Substance only:  The real concern in this field is that what substance is to be traded, and ‘what I can get way’ is the dealing criteria. To translate everything into financial terms is the way of thinking zero sum. For example, before buying or selling a car, a very first thought should be given regarding its resale value. For many negotiators in competitive world, price is the negotiating criteria.

Unimportant relationship: In competitive negotiation, the relationship between the people does not matter. This follows the principle of ‘caveat emptor’ as it does not care about what other thinks and neither about one another. Showing concern in this business leads to showing of weakness; which could be taken advantage of.

Double dealing: The competitive negotiation is to resort to tricky approaches such as deception and aggression and throw the rule book out if the window. The other party may use verbal, physical persuasive methods or even may lie (changing minds, 2018).

Risk of competitive positional-based negotiation

Competitors: Overuse of competitive styles leads to more of competition, which create difficulty for high competitors i.e. who has large customer base. This helps the other party to know the expected behaviour of the individuals and helps them in achieving the same. The competitors are more likely to interest in winning rather than any agreement.

Negotiator’s Dilemma: It involves a tension regarding parties whether they need to compete or cooperate in order to achieve their goals. Accepting a negotiable agreement always include conflicting and common goals. Therefore in order to reach resolution both competition and cooperation are necessary. A degree of competition is required to maintain these two aspects.

Goals, Interdependence, and Process: Conflicts and risks are dependent on many factors. Morton Deutsch in the field of social psychology has developed a theory regarding the approaches of competition and cooperation. Goals on each side and nature of dispute are the most important factors to achieve the goals. The interaction of negotiating parties will depend upon the type of interdependence existing between them. Two basic types of positive and negative interdependences are identified by Deutsch. The chance of attaining one side goal is increased by the probability of the other side successfully attaining its goal; when two goals are tied together in context of positive interdependence. On the other hand in negative interdependence, the goals are tied together and the probability of attaining goals of one side decreases in comparison to another.

Personality and conflict style: While entering into a negotiation the criteria used must be rational such as selection of the style which will to desired goals. Conflict styles brought to the negotiating table play a significant role in personalities of the people.

Impact of competitive based negotiation approach on other people

1. By misleading each other parties try to gain benefit through providing misinformation and false promises due to which communication is obstructed. Ultimately it results in reduced communication as the parties do not have faith on each other regarding information and honest communication.

2. Suspicions to each other’s intentions and mutual negative attitudes are led by lack of helpfulness and obstructiveness. The perception of one person for another one tends to ignore the positives and focus on person’s negative qualities. 

3. The parties fail to duplicate their work efforts due to inability of dividing the work effectively. After dividing the work a continue check of it is required.

4. Participant’s self-confidence and confidence in other parties is reduced due to critical rejection of ideas and ongoing disagreements.

5. The other party’s power is analysed by increasing power of conflicting parties and it is analysed as a threat (Spangler, 2017).

Problem solving interest based negotiation

When parties collaborate to find a win-win solution to the disputes it is called as problem solving interest based bargaining. It is also called integrated bargaining and win-win bargaining. The focus lies on the development of mutual beneficial agreements based on disputants and interests. Interest includes desires concerns, needs and, fears which are important to each side. These are the reasons behind people getting into conflict. When the interest of the parties is enlarged with the pie and the joint value is increased it refers to interest based bargaining; it is possible only when there are multiple issues involved while negotiating. Because of this, parties become able to satisfy each other’s wants (Grebski, 2016).

Characteristics of problem solving interest based bargaining approach

Problem solving integrated bargaining approach produces satisfactory outcomes in comparison to positional bargaining for the parties involved. It does not work on the interest of the parties in relation to their loss or profit.

Problem solving interest based bargaining is based on opposing viewpoints, fixed positions and tends to result in no agreement at all or in a compromise.

It is a collaborative process in which parties help each other in order to satisfy their own wants. The main motive is to identify the benefit of each other.

Interest based bargaining facilitates positive and constructive relationship between the adversaries.

Assumption of problem solving interest based approach

This approach assumes that there is no significance of knowing the interest of customer in the particular product; it’s just that the both the parties should get equal level of satisfaction i.e. in a win-win situation.

It is only based on enlarging the quantity of the product and increasing the joint value by involving into negotiation of multiple issues.

The basic aim is to look for win-win opportunity.

Risks underlying interest based bargaining approach

It is said not to collaborate with competitive style negotiators- unless an agreement is done between the parties regarding the rules of collaboration.

Too much sharing of information also becomes a risk for the parties. The details should be shared on the same level.

The time, knowledge and efforts should be invested y seeing the buyers and vendors potential otherwise it could lead to wastage on the part of lending party.

Impact of interest based negotiation approach on other parties

The groups who pay attention to one another and ideas are accepted by them and influenced by them it leads to an effective communication between the parties. Groups like these face fewer problems in understanding and communicating with each other.

Conversations include helpfulness, friendliness and, less obstructiveness. Each group and the members tend to be more satisfied with the group and contributions made by them as well as its solutions.

There are few factors which exist in the cooperative groups like orderliness in discussion, task achievement orientation, high productivity, division of labour and, coordination of efforts.

In cooperative groups a sense of basic similarities in values and beliefs with the idea of agreement as well as confidence in the value of other groups and faith in own ideas is obtained.

Recognizing the legitimacy is facilitated by collaborative efforts of each other’s interest and a search for the solution; defines the conflict interest (Spangler, 2017).

Suggestions regarding effectiveness of one of the two approaches

From the above study and its impact on the other parties; it clearly justifies that the problem solving interest based negotiation approach is better than the competitive positional based bargaining approach. It has been analysed that in competitive positional based negotiating approach it is a situation in either party will lose or win; but in problem solving interest based bargaining both the parties are in a win-win situation. It simply tells that the both the parties should get equal chance to be satisfied and get maximum benefit. In the competitive positional approach the either party loses and another wins which leads to a situation of sacrifice made by one party.

For e.g. if there is any fruit which needs to be distributed between two girls it need to be distributed equally by dividing into half. This will provide equal level of satisfaction to both the girls. It does not determine the interest of any party indulged in the product, it just justifies the benefits which will reach to them in the end. But, as everything has it pros and cons unlike positional based integrated problem solving approach also has some. It does not focus on the interest of the parties. It only thinks about providing overall benefit to the parties. In its theory it is been said that instead of having many criticisms problem solving integrated approach is liked by many people.

Conclusion

By analysing both the studies, it is been elucidated that competitive positional based negotiation approach is based on the market strategy, competition in the market, delivery of value and customer segment. This concept studies that the one party will definitely lose and another one will win the consideration. On the other hand, in the problem solving interest based approach is based on the win-win approach. These are the two negotiating approaches, one tells the betterment of both the parties and another tells the loss of one and profit to another. In the study the relevancy of one approach is also explained that which is more relevant. It is analysed that the problem solving interest based approach is taken as more relevant. The reason behind it is that in this approach both the parties will get benefit.

References

Gerbski, J. (2013) The Art of Negotiation, Positional vs Interest Based Bargaining. [online] Medium. Available at: https://medium.com/swarm-nyc/the-art-of-negotiation-positional-vs-interest-based-bargaining-c1931ce9ab4b [Accessed 07-05-18].

Padua Filho, W., Padua, I. and Fernandes, N. (2017) Negotiation: techniques, strategies and approaches to medical professionals. International Journal of Healthcare Management, pp.1-6.

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Spangler, B (2017) Competitive and Cooperative Approaches to Conflict. [online] available from: https://www.beyondintractability.org/essay/competitive_cooperative_frames. [ Accessed 07/05/18]

Folberg, J., Golann, D., Stipanowich, T. and Kloppenberg, L. (2010) Cooperative or Interest-Based Negotiation. 2^nd ed.

Changing minds. (2018) Competitive Negotiation. [online] Available from: https://changingminds.org/disciplines/negotiation/styles/competitive_negotiation.htm. [Accessed 07/05/18]

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