Question 1:
The process of international business negotiation process is divided into three
different stages: pre-negotiation stage, face-to-face negotiation stage and post-
negotiation stage.
Pre-negotiation: In this stage , parties attempt to understand each other’s
needs and demands, which is done through information gathering and
informal meetings. This stage is included:
o Set title;
o Re-evaluate the author;
o Assess your strengths and weaknesses;
o Making plans and business plans;
o Develop a negotiation strategy,conduct trial negotiations.
Face-to-face negotiation: Consists of 5 steps:
o Introduce the opening and build an intimate atmosphere;
o Find out the point of view;
o Presentation and persuasion;
o Creative solutions and choices;
o End.
Post-negotiation: Included:
o Learn from experience
o Contract review
o Follow up on the implementation
o Maintain relationship.
The negotiation stage refers to face-to-face negotiations and the post-negotiation
stage refers tothe stage when parties have agreed to most of the issues and are to
agree on contract language and format
and signing the contract.
Question 2: Which stage is the most important in a negotiation process?
In a negotiation process, Pre-negotiation stage is the most important stage.
Because this is the stage to learn the information of the partner and identify the
problems that need to be negotiated. Through this phase, the two parties will be
able to overcome some problem to achieve these objectives. By establishing the
first relationship, the two parties will trust and confidence in each other.
According to Thompson (2009), about 80% of negotiators’ efforts should go
toward the preparation stage.
Question3:
In the negotiation process,we need to concentrate in two factors are:
- Background
o Objectives: are defined as the end stage each party desires to achieve.They
are often classified as common, conflicting or complementary.
o Environment: The environment refers to the political, social and structural
factors relevant to both parties.Variation of the parties with respect to
environment, in international negotiation, often hinders the process.
o Third parties: Most international business negotiations involve third parties,
ie parties other than the buyer and seller, such as governments, agents,
consultants and subcontractors.These parties may influence the negotiation
process as they have different objectives.Often, governments are involved
and influence the buyers towards complementary objectives, such as
infrastructure, employment opportunities, foreign exchange considerations
and any other prospective relationship between the countries involved.
o Negotiators: Negotiators influence the negotiation process with their own
experience and negotiating skills. Negotiators operate within two limits:
firstly, they act to increase common interests and to expand cooperation
among the parties; secondly, they act to maximize their own interests and to
ensure an agreement valuable to themselves. The personality of the
negotiators also plays a role, particularly when information about the other
party is lacking and there is greater stress. A good personality is defined as
an individual with the ability to make others understand his position, to
approach strangers with ease and confidence and to appreciate the other
person’s position.
- The atmosphere:
o The existence of both conflict and cooperation is a fundamental
characteristic of the negotiation process. On one hand, parties have some
common interests in finding a solution to the problem which fits both the
parties. On the other hand, a conflict of interest may arise, as cost to one of
them can mean income to the other. The magnitude of conflict or
cooperation in the atmosphere depends upon the objectives of the
negotiating parties. Some relationships are more complementary — and
consequently less conflicting —than others.
o The power/dependence relation is another basic characteristic of all
negotiation processes. It is closely related to the actual power relation, which
is influenced by the value of the relationship to the parties and their available
alternatives. Background factors for example the market position — can
influence the power/dependence relation. The ability to control a
relationship is related to the perceived power of two parties, their relative
expertise and access to information.
o Expectations. Firstly, there are long-term expectations regarding the
possibilities and values of future business. The stronger these expectations
are, the more inclined the negotiators are to agree on the present deal. Long-
term expectations are related to primary objectives. Secondly, there are
short-term expectations concerning prospects for the present deal. The
parties‘ decision to enter negotiations and to continue after each stage
implies expectations of a better outcome from participating than from not
participating.
Cultural factors:
Time
Individual vs. Collective Behavior
Pattern of Communication
Emphasis on Personal Relations
Strategic Factors:
Presentations
Strategy
Decision-Making
Need for an Agent
