Additional Materials for Mother

Here are the additional materials.

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▪ Uniform Commercial Code
▪ United Nations Convention on Contracts for the International Sale of Goods
▪ American Arbitration Association standards
▪ ISO 9000 quality standards
▪ State, local, and federal laws
▪ Market or industry standards
8. Examine alternatives: Prepare in advance your alternatives to the important negotiation issues or objectives. Successful
negotiators know their best-case, most-likely, and worst-case (walk-away) alternatives for all major objectives. (See Appendix A
Form 9.)
9. Select your strategy, tactics, and countertactics: Negotiation strategies provide the overall framework that will guide how you
conduct your negotiation. Negotiation strategies can be divided into two types: win-lose and win-win.
Figure 9-3 Importance of Ts and Cs

The win-lose negotiation strategy is about winning today, despite the potential long-term effect tomorrow and beyond. Common
characteristics of the win-lose strategy include concealing one’s own position and interests, discovering the other party’s position
and interests, weakening the other party’s resolve, and causing the other party to modify its position or accept your position on all
key issues. Although the win-lose negotiation strategy is not a politically correct approach, it is a commonly used negotiation
strategy worldwide. The win-win negotiation strategy is about creative joint problem solving, which develops long-term
successful business relationships. The win-win negotiation strategy, however, may sometimes be difficult to accomplish. Among
the obstacles to developing the win-win business environment are previous adverse buyer-seller relations, lack of training in joint
problem solving and conflict resolution, and complex and highly regulated contracting procedures in some organizations,
especially large companies and government agencies. Winning or losing a contract negotiation is, indeed, a matter of perspective,
which is based on your knowledge, experience, and judgment. The only way to know whether you have won or lost a negotiation
is to compare the results to your negotiation plan. Did you get what you wanted? Is what you got closer to your best-case, most-
likely, or worst-case alternative? Clearly, without a contract negotiation plan, you have no basis against which to evaluate the
negotiation outcome. To achieve your desired contract negotiation results, you need not only a strategy, but also tactics and
countertactics, which are a means to a desired end. The key to using tactics successfully is to know what they are, identify the
tactic when it is being used, and know how best to counter the tactic. Table 9-2 presents some common tactics and countertactics
used in contract negotiation.
Table 9-2 Negotiation Tactics and Countertactics

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Many other negotiation tactics and countertactics are available. Those listed in the table will provide a basis for discussing good
and bad tactics and countertactics that may be used by either party while conducting the negotiation.
10. Develop a solid and approved team negotiation plan: The conclusion of contract negotiation planning should be the summary
and documentation of all planned actions. If necessary, have the negotiation plan reviewed and approved by higher management
to ensure that all planned actions are in the best interests of the organization. (See Appendix A Form 10.)

Conducting the Negotiation

The following activities are necessary to conduct the negotiation:

11.Determine who has authority: If possible, before the negotiation, determine who has the authority to negotiate for each party.
At the start of the negotiation, ensure that you know who has that authority, who the lead negotiator is for the other party, and
what limits, if any, are placed on the other party’s authority.
12.Prepare the facility: Most buyers want to conduct the negotiation at their offices to provide them with a sense of control. Try
to conduct the negotiation at a neutral site, such as a hotel or conference center.Other key facility considerations include the—
▪Size of the room
▪Use of break-out rooms
▪Lighting
▪Tables (size, shape, and arrangement)
▪Seating arrangements
▪Use of audiovisual aids
▪Schedule (day and time)
▪Access to telephone, fax, restrooms, food, and drink
13.Use an agenda: A proven best practice of successful negotiators worldwide is creating and using an agenda for the
negotiation. Provide the agenda to the other party before the negotiation begins. (See Appendix A Form 11.) An effective agenda
helps a negotiator to—
▪Set the right tone
▪Control the exchange of information
▪Keep the focus on the objectives
▪Manage time
▪Obtain the desired results
14.Introduce the team: Introduce your team members, or have team members make brief self-introductions. Try to establish a
common bond with the other party as soon as possible.
15.Set the right tone: After introductions, make a brief statement to express your team strategy to the other party. Set the desired
climate for contract negotiation from the start.
16.Exchange information: Conducting contract negotiation is all about communication. Be aware that information is exchanged
both orally and through body language, visual aids (pictures, diagrams, photographs, or videotapes), and active listening.
17.Focus on objectives: Never lose sight of the big picture.
18.Use strategy, tactics, and countertactics: Do what you said you were going to do, but be flexible to achieve your objectives.
Anticipate the other party’s tactics, and plan your countertactics. Adjust them as necessary.
19.Make counteroffers: A vital part of conducting the negotiation is providing substitute offers, or counteroffers, when the other
party does not accept what you are offering. Document all offers and counteroffers to ensure that both parties understand any
changes in the terms and conditions. (See Appendix A Form 12.)
20.Document the agreement or know when to walk away: Take time throughout the negotiation to take notes on what was agreed
to between the parties. If possible, assign one team member to take minutes. To ensure proper documentation, periodically
summarize agreements on all major issues throughout the negotiation. At the end of the negotiation, summarize your agreements
both orally and in writing. (See Appendix A Form 13.) If a settlement is not reached, document the areas of agreement and
disagreement. If possible, plan a future meeting to resolve differences.Remember: Do not agree to a bad deal—learn to say, “No
thank you,” and walk away.

Documenting the Negotiation and Forming the Contract

The following activities are conducted to document the negotiation and form the contract.

21. Prepare the negotiation memorandum (minutes or notes): Document what was discussed during the negotiation. After having
the memorandum word processed, spell checked, and edited, have it reviewed by someone within your organization who attended
the negotiation and someone who did not. Then determine whether they have a similar understanding.
22. Send the memorandum to the other party: As promptly as possible, provide a copy of your documented understanding of the
contract negotiation to the other party. First, e-mail or fax it to the other party. Then send an original copy by either overnight or
2-day mail. Verify that the other party receives your negotiation memorandum by following up with an e-mail or telephone call.
23. Offer to write the contract: As the seller, offer to draft the agreement so that you can put the issues in your own words.
Today, most contracts are developed using electronic databases, which facilitate reviews, changes, and new submissions.
24. Prepare the contract: Writing a contract should be a team effort with an experienced contract management professional at the
lead. Typically, automated standard organizational forms, modified as needed, are used with standard terms and conditions that
were tailored during negotiation. At other times, a contract must be written in full. Ensure that no elements of the contract are
missing. (See Appendix A Form 14.) After the initial contract draft, obtain all appropriate reviews and approvals, preferably
through electronic data.