Negotiation represents making a decision on negotiations basis, this element determining the differences by comparing with all other forms of decisions making. We are doing transactions with goods that are cheaper for us but that are appreciated by the other negotiator for other different elements. The task of negotiators of both involved parties is that of leading the negotiation process over all obstacles and along all barriers in order to reach to a transaction. Negotiation can be defined as a main form of communication, a complex of activities residing in contracts, meetings, and consultations, transactions carried out between two or more partners in order to achieve an agreement.negotiation, competing economy, social phenomenon

Liliana Nicodim

English

Research Papers in Economics

ŒCONOMICA 
 
  79
 
Why Are We Negotiating Businesses and When? 
 
Senior Lecturer Liliana Nicodim  
“Ovidius” University of  Constanta 
 
Abstract: Negotiation represents making a decision on negotiations basis, this element determining the 
differences by comparing with all other forms of decisions making. We are doing transactions with 
goods  that  are  cheaper  for  us  but  that  are  appreciated  by  the  other  negotiator  for  other  different 
elements. The task of negotiators of both involved parties is that of leading the negotiation process over 
all obstacles and along all barriers in order to reach to a transaction. Negotiation can be defined as a 
main form of communication, a complex of activities residing in contracts, meetings, and consultations, 
transactions carried out between two or more partners in order to achieve an agreement. 
Keywords: negotiation, competing economy, social phenomenon 
Jel Classification: D70, D79 
 
 
In business, the success depends to a great extent on the manner the negotiations are 
carried  out  especially  under  the  terms  of  a  competing  economy  when  these  are 
focused on “the efforts of diversifying the directions and fields of the performed 
activities, playing the role of giving answers to complex problems”. 
In a market economy, a dynamic economy with more or less difficult problems - 
almost everything is negotiated - and the diversity of businesses - of any kind - 
makes  that  the  negotiation  to  be  one  of  the  most  exigent  attributes  of  the 
contemporary life. 
In fact we all confront with the topics involved by negotiations but a few are content 
with their results. 
Meantime the successful conclusion of a business, coordination of a group - large or 
not - to a considerable extent depends on the knowledge and observance of some 
constant rules and included in the value system of a company or a group. Such rules 
regarding preparation, organization and performance of the negotiations firstly have 
to be known by those who carry out independent activities involving discussions, 
exploring, compromising, in one word - negotiations - but also by the managers of 
the institutions, public persons. ACTA UNIVERSITATIS DANUBIUS                                                       Nr. 1/2007 
 
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Practice demonstrated that success in negotiation firstly depends on the skill and 
care with which the negotiation plan is prepared. Preparation done by negotiators 
before the effective meeting with the partners is the most important determinant of 
expected performances. Everything that was or was not done by negotiators before 
reaching the negotiations table, certainly it will be reflected in what they do when 
they  are  there.  Therefore  preparation  of  successful  negotiations  starts  long  time 
before parties sit at negotiation table. 
It is easy to recognize that a negotiator not prepared or superficially prepared is not 
able to lead his partners to the followed target as he does not have an action plan and 
as he does not know where he has to reach and how he will not action with clarity 
and more than this he will react to the events around him. 
A weak trained negotiator demonstrates – sooner or later - that he does not know 
what he is talking about. This aspect will be recognized by his partner whose own 
trust will increase and consequently he will considerably strengthen his commitment 
towards his demands. 
Art of negotiation resides in defining correctly the demands that have to be satisfied 
and decide the manner they will be satisfied. Considering this point of view the 
constructive preparation is essential. 
All negotiators either they are interested in purchasing or selling have to consider 
preparation of negotiations as a continuous activity and not only something that has 
to be done one day before the proper negotiation. First, negotiators have to know 
very well their own business and what they do expect on short term as well as on 
long term. Meanwhile they have to know why they want what they want. They also 
have to collect more information regarding the aspirations of the partner and the 
circumstances he is in. An organizational buyer has to be permanently well informed 
about his organization, suppliers, competitors of his suppliers and competitors of his 
organization.  Additionally  negotiators  have  to  determine  -  long  time  before  the 
debut of the negotiations - which are the available alternatives for their organization 
if  negotiations  do  not  have  success  as  better  the  alternatives  are  stronger  their 
negotiations  position  will  be.  It  is  not  less  important  the  negotiators  to  do 
presumptions as correct as possible regarding potential alternatives for agreement 
and available for their partners as their negotiation position will partly depend on 
options available for them if agreement will not be achieved. 
Another aspect to be considered before starting negotiations is referring to the limits 
of negotiation or more exactly to what the negotiator is willing to offer in order to ŒCONOMICA 
 
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obtain what he wants. Sometimes this is easily settled. In case of a purchase of a 
common item it is easily to decide which is the correct price. But some other times, 
even these apparently routine transactions become more complex when it is about 
price negotiation. Many variables may become important and consequently they can 
influence the price level the negotiator wants to pay. If negotiators did not consider 
all these in due time it is possible that when they are at negotiations table to manifest 
an inflexible behavior, this would be to their detriment. Specific circumstances may 
push them - in a certain moment – to grant concessions in their trials to reach an 
agreement and if such concession was not thoroughly prepared in due time there is a 
high probability to reach to an unfavorable agreement for them. 
Business negotiations have three stages: 
• Stage of preliminary negotiations or “diagnosis” stage  
• Stage of definition of ‘adequate’ formula  
• Stage of details. 
Negotiations  have  to  follow  carefully  the  realities  presented  by  the  approached 
matter, to know certain contexts and specific perceptions of the parties in dispute 
and the manner they perceive their interests. 
In order the reached solution not to launch other problems, negotiators have the 
obligation to know the most frequently used techniques, but the most useful too. 
The most desired negotiation method is that according to which both negotiators win 
(gain-gain), the others being those: “I win, you lose”, “I win, you lose“, “We both 
lose”.  
The result gain-gain offers to the two parties an impulse in order to achieve the 
agreement and conclude the contract. Based on their experience they will be willing 
to do business in future to convey to the others the good mutual opinion. This form 
is  based  on  the  gained  trust  between  negotiators.  This  occurs  when  negotiators 
proved  their  seriousness,  know  each  other  for  long  time,  did  good  investments, 
mutually  helped  each  other,  they  did  not  take  advantage  one  from  the  other.  A 
person gains the trust of a partner by her own qualities and deeds. Mutual trust allow 
to the negotiators to enlarge the relationship and business spectrum and find easier 
solutions  for  difficult  problems.  The  most  unwanted  negotiations  way  is  that 
according to which both partners lose, consequences being hardly tolerated. 
The other form according to which one gains and the other loses involves the most 
strategies: some of them more lent, others - calmer or more rapid or tougher. ACTA UNIVERSITATIS DANUBIUS                                                       Nr. 1/2007 
 
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Irrespective of the obtained results by the above mentioned methods are achieved by 
communication. Generally people communicate in three ways: 
• 70% by the language of the body; 
• 23% by the tone of the voice; 
• 7% by words. 
In case of the analysis of the data of the negotiated problem people negatively react 
to what they perceive as written insults, impoliteness, hardness and menace. In order 
to be easier during performance of negotiations, it is recommendable for those who 
have  fright  to  use  telephone,  fax,  computer  (internet)  in  order  to  reaffirm  their 
positions. 
If  the  other  communication  form  -  the  gestures  -  point  something  different  in 
comparison  with  words  it  is  possible  that  credibility  problems  to  occur.  Also 
menaces,  promises  and  commitments  have  a  minor  effect  if  they  cannot  be 
communicated. 
Therefore  take  care  of  the  manner  you  do  communicate,  the  gestures,  tone  and 
words  as  they  are  the  most  important.  As  regards  the  motive,  the  goal  of  the 
negotiations is that we negotiate in order to find acceptable solutions to the occurred 
problems. In the beginning there are settled the objectives – better prepared they are 
(considering the number of the approached aspects) – more sure the negotiators will 
be in negotiations approach. 
Maxim  efficiency  obtained  with  a  minim  price  is  also  an  aim  targeted  by 
negotiators. It is important who gains more. 
As  we  mentioned  problems  settlement  involves  trust  between  parties  and  safety 
regarding everyone’s motivations. Unilateral trials for settlement occurred in case of 
a  dispute  will  expose  you  to  the  strategic  interaction  exercised  by  the  other 
negotiators, if these continue to use a competitive style.  
The goals are to obtain gains for both parties, focusing on mutual interests and not 
on disputes, adoption of a position in which confrontation and ‘a priori’ judgment 
are eliminated, appliance of the standards of  “correctitude”, “common sense“ and 
“rationalism”. 
It is considered that the other negotiators can be motivated to replace the selfishness 
with their own moderate interest. 
Further these achievements negotiators improve their negotiations capacities. ŒCONOMICA 
 
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This is the main aim that is reached, the others being derivates. Higher the negotiator 
qualification  is,  more  registered  successes  are.  Irrespective  of  the  manner  the 
negotiations concept is defined there are some features that are generally applied: 
1. The negotiation process is a social phenomenon that involves communication 
between  people  this  bearing  the  distinct  mark  of  the  human  behavior.  Thus  the 
human behavior represents the main element on which the negotiations theory is 
based and that determines the result of the negotiations. 
2. Negotiation is an organized process in which it is desired the avoidance of the 
confrontations  and  that  involves  a  certain  competition.  In  any  case  negotiation 
parties have to observe certain demands of procedural and ethical type established in 
time. 
3.  Negotiation  is  a  process  with  precise  affinity  that  involves  harmonization  of 
interests. It has as task the achievement of a will agreement and not necessarily a 
victory; both partners (and not opponents) have to end the negotiation process with 
the feeling that they achieved maxim of what they proposed. 
4. Negotiation involves presentation of his own position as well knowledge of the 
other’s  position,  presentation  of arguments  and  attentive  listening  to the counter 
arguments, achievement of an impartial judgment and finally reach an acceptable 
solution for all those involved in the negotiation process. 
Practice of negotiation points has the main difficulty and deadlock in reaching the 
goal resides; in fact most of the time negotiators start from the idea that the interests 
of  the  two  parties  have  to  be  turned  into  mutual  aims.  This  is  leading  to  the 
conclusion that negotiators must find a mutually agreed solution. More than this the 
negotiation theory has a “law”, a rule that states that there has not to be pushed to 
achieve a special process but built up on a conjuncture weakness of the partner 
especially when negotiators know each other and do business directly. 
5.  By  excellence  negotiation  is  a  competitive  process  that  claims  some  efforts 
aiming avoidance of confrontation and reach mutual benefit solutions. On its turn 
the competition will allow to face out the individual competences in proposed target 
achievement. 
6.  Negotiation  involves  repeated  and  mutual  concessions  till  the  equilibrium  is 
reached  this  one  being  appreciated  according  to  their  own  needs  and  possessed 
information. ACTA UNIVERSITATIS DANUBIUS                                                       Nr. 1/2007 
 
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Negotiation  appeals  the  rhetoric,  logics  and  argumentation  theory  items,  doesn’t 
matter where it is taking place and which are the involved parts. Sometimes are used 
performant manipulation and communication techniques, like transactional analysis, 
euro-linguistic planning. Notions such as offer, demand, position claims, objections, 
compromise,  concession, argument,  transaction,  non-verbal  argumentation,  proof, 
etc., could frequently be involved in the negotiation process. At the same time, the 
non-verbal elements, like physiognomy, mimicry, gestures, position, clothes, general 
appearance have a great importance. The partners’ culture and the parts negotiation 
power are elements to be taking into account. 
The  strategy  and  tactics  elements,  the  rhetoric  tricks  and  snaps  as  well  as  the 
perception psychological knowledge could have a crucial role in obtaining great 
advantages versus small granting. 
 
References  
 
Pistol Gh. (2002). Tehnica si strategia negocierilor, Bucuresti: Editura Universitara. 
Plaias I. (2003). Negocierea afacerilor, Cluj Napoca: Risoprint.  
Mecu  Gh.,  Mecu.  D.  (2004).  Negocierea  afacerilor  in  economia  de  piata  functionala,  Bucuresti: 
Editura Irecson.  
Tran V., Stangiugelu I. (2001). Teoria comunicarii, Bucuresti: Editura SNSPA. 
 
 
 
 
 
 
 
 
 
 
 

Negocierea afacerilor in economia de piata functionala, Bucuresti: Editura Irecson.

Tehnica si strategia negocierilor, Bucuresti: Editura Universitara. Plaias I.

Teoria comunicarii,

Why Are We Negotiating Businesses and When?

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Why Are We Negotiating Businesses and When?

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