Negotiation Tactics

Today’s business environment is complex, very competitive, and global. In order to remain competitive, organizations are increasingly engaging in international business ventures. As international business relations grow, so does the frequency of business negotiations among people from different countries. In this context the negotiation process implies a series of decision and actions that should be taken in order to achieve the company’s goals. Mainly this means to conclude the best possible contracts assuring a promising perspective to the firm.

Among the actions above mentioned an important place is “dedicated” to the tactics used during the negotiation. Whatever or not we want tactics work, are used on us and also by us and if they are recognized their effects can be minimized. We can’t ignore their power and importance because they are very subtle and in the same time could represent a defining moment.

But what are tactics? Well we can say that tactics are “actions of capitalization of some conditions or opportunities made step by step during the negotiations” . They “enter in force” for short time in order to obtain a long time advantage. There are two types of tactics, according to the type of negotiation the parties are engaged in: cooperative tactics and integrative or hardball tactics . Sometimes the borderline between the two is very uncertain and only the pressure you put on your opponent can tell them apart. In both situations can be used either tactics of persuasion or tactics of influence, according to the aim of their utilization.

Persuasion tactics can be used in any moment of the negotiation. Their purpose is to convince the partner to accept the deal. In a hardball position there is constraint to

accept the other part offer. By tactics of influence you try to “shape” the partner’s conception and ideas in order to succeed to conclude the agreement. In the non-cooperative negotiation they become manipulation tactics .

Case study

In the following line I will try to present a case study in order to show the importance of tactics in a negotiation especially from the seller’s point of view.

There are two companies X and Y. Company Y is the most important customer for company X, which provides PC games, different kind of software and service, having good professionals. Company Y has one of the biggest shop of Pc games and software programs and one of the most known and important Internet Coffee. In the last period this company had some problems with the company which provides internet. The problem between these two companies refers to the payment. Company Y is always paying later the company X, at 60 days, than they agreed-upon terms. X would like to be paid at 30 days. In order to improve his cash flow X decided to discuss with them this aspect. The negotiation should be very well prepared, because B is one of the most powerful and large customer that they have. After the research which company X made there was underlined the following assumptions by responding to some important questions:

- Why would Y pay later us? If company Y hold on our money longer than we want, they are doing it for a purpose. This could be to stimulate their cash flow, but doing so they prevent us from earning the profit we would make if we got our cash in due time.

- Why are they our customer? We offer them very good service and we are always on hand to help them out in certain situations. Also we have always the newest games to offer.

Prezentat in cadrul seminarului de Negociere Comerciala Internationala al facultatii de Relatii Economice Internationale, ASE, Bucuresti.