(Solution) ROSHN CIPS PIN Negotiation Type and Strategy

Solution

The negotiation type will influence the approach taken:

Principled Negotiation: This approach builds a long-term partnership that is more appropriate for high risk and high return products such as AI supplier, where ROSHN may enjoy from ongoing refinements and technology advances.

Positional Negotiation: When ROSHN needs to put forward rigorous conditions like low prices or specific timeframes, especially for simple products and C services of which suppliers are many.

Kraljic Matrix and Supplier Preferencing

Using the Kraljic Matrix, ROSHN can classify each category of technology (see figure 5). For instance:

• Strategic Items (high risk, high profit impact): Robotics and blockchain for real estate are strategic, requiring a collaborative negotiation approach.
• Leverage Items (low risk, high profit impact): Communication networks can be negotiated for better pricing due to the availability of multiple suppliers.

Supplier Preferencing also helps ROSHN understand how suppliers view them:

• Core Supplier: For strategic suppliers like ATSM Company, which provides multiple critical technologies, establishing a core relationship can lead to beneficial terms.
• Exploitable: For one-off purchases or low-value items, suppliers may view ROSHN as exploitable, leading to a more cautious approach in negotiation.

2.2.3.4 Objectives and Outcomes

Clear objectives ensure ROSHN’s negotiation aligns with its goals. Objectives could include securing favorable pricing, establishing long-term partnerships, or achieving robust service-level agreements (SLAs). Desired outcomes include:

• Competitive pricing aligned with budget constraints.
• Flexible terms on maintenance and support.
• Agreements that reduce risk (e.g., data security protocols for IoT providers).

2.2.3.5 Concessions and Negotiation Tools

In negotiation, concessions are planned trade-offs that allow ROSHN to secure important terms. To manage concessions, ROSHN can use tools such as:

• Concession Tracker: To monitor offers made and received.
• MIL (Most Important Limit): The absolute minimum ROSHN can accept.
• MDO (Most Desired Outcome): The ideal result ROSHN aims for.
• LDO (Least Desired Outcome): The lowest acceptable outcome.
• ZOPA (Zone of Possible Agreement): The range within which an agreement can be reached.
• BATNA (Best Alternative to a Negotiated Agreement): The backup plan if negotiations fail.
• By understanding these concepts, the team can anticipate the supplier’s behavior, plan responses, and adjust the strategy as needed.

2.2.3.6 Location of the Meeting

The location of the meeting affects the dynamics and perception of control:

ROSHN’s Premises: Enables ROSHN to exert the necessary amount of control over certain factors effectively creating an authoritative atmosphere.

Supplier’s Premises: This may just show the supplier respect and build good will.

Neutral Venue: Suitable for the difficult or critical negotiations because it gives equal standing between the two parties.

In addition to, intentions, dynamics, and the mood should be taken into consideration to provide the most suitable climate. In the event that refreshments or small gifts are given to the clients, the corporate entertaining and gift policy of Roshn might be in force.

Online Negotiation: Pros and Cons

A few times it might be possible to negotiate online, for instance, before engaging in proper negotiations. Some of the benefits of online negotiation are; flexibility,affordability and capability to record the conversation made. However, there are also cons:

• Word Choice and Tone: Tentative understanding can be skewed without facial, verbal, gesture and tone clues.
• Body Language: Especially for reading supplier reactions which may not be very clear in an online context.
• Response Time: May result in failures and distortions in the perception of certain points, or delays in response to important points.

For ROSHN it is like online negotiation should be applicable where there are more formal meetings that build relations and agreement however for the final tougher negotiations could be appropriate where the use of more frequent face to face meetings could help in better understanding of each other’s position. The purpose of said planning is to provide a structure for success when engaging third party technology suppliers in the preparation stage of procurement negotiation. Risk profiling preparedness, planning the team and the agenda for negotiation, type of negotiation to undertake as well as the determination of concessions in negotiation place ROSHN in the right stand to negotiate. The recognition of the supplier side, the idea of how power is going to be played, and the selection of the place (or an online session) adds to the worth of the negotiations.

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