Negotiations in international procurement management (original) (raw)
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The Importance of Negotiation in the Public Procurement Process
2020
ABSTRACT: Negotiation has been and is one of the key elements when it comes to business success. The largest companies in the world were founded as a result of the abilities of their leaders to manage to find the optimal balance between personal goals and objectives, and at the same time, the respect and the knowledge to know when and how to relate to the negotiating partner. Negotiation is present in all areas of our lives, and trade negotiation is just an extended aspect of negotiation that already takes place at every moment, in different everyday situations. Negotiation is first and foremost a form of communication: negotiating means communicating in the hope of reaching an agreement. International trade negotiation is an organized process of communication between companies, which aim to gradually adapt their interests related to the object of negotiation in order to achieve a mutually acceptable business agreement, materialized in the international contract. In the process of a...
International Journal of Business and Development Research, 2012
This theoretical essay discusses various aspects, through documental research and professional experience, dealing with the influence of negotiation at national and international levels, specifically in the exportation, the facilitating and restrictive factors in global business. From the documental research, the types of negotiations taking place in a term of trade, where communication between the parties is extremely important factor are identified. The professional experience points to a lack of qualified professionals in the area of Foreign Trade, who have little knowledge of all nuances of the intrinsic process of exporting. In this sense, investments in education, both at the primary level, in order to educate citizens with character and ethics, and investments at secondary level, aiming to improve the basic English or Spanish to the students at second level, are fundamental for Brazil to achieve the increase in exports, as advocated by the national government. Similarly, the Brazilian universities have vital responsibility to train managers of international negotiations, with personal skills, and knowledge on linguistic and technics. Cultural differences must be respected and understood, where the negotiator can use specific methods and processes of decision-making. The personal identities of negotiators are identified with their culture of origin. The most salient personal characteristics are interpersonal skills and a cooperative or competitive profile, skills of agility, building relationships, adapting to different situations of each negotiation and credibility. As the negotiation taking place in practice, the interaction between people who are negotiating issues requires mutual respect and cultural specificities, and the use of strategies of attack and counterattack.
Negotiating international strategic alliances: success and failures - some closing thoughts
European J. of International Management, 2019
This special thematic issue of the European Journal of International Management focuses on the analysis of case examples of negotiation processes of strategic alliances. This thematic issue applies a multi-lens approach in which a range of theories and models are selectively applied to specific cases to gain better insight into the business case, the development of the negotiations and to identify lessons for future negotiators of strategic alliances. Negotiation theory is applied to concrete M&A as negotiations as well as to other forms of negotiations of strategic alliances, for instance between governments, between private sector companies and cross-sectoral alliance negotiations between private sector actors and other actors such as governments. Special attention has been paid to analysis of business diplomacy and trust development.
Integrative Agreements in Multilateral Negotiations: The
Theory defines negotiation as a continual interpersonal interactive process of decision making. Multilateral negotiations are differentiated from bilateral negotiations because of their wider size, bigger complexity and greater heterogeneity. Management studies relating to negotiations have focused mainly on the negotiation processes between companies, customers and suppliers, and industrial relations. Less investigated, however, are the negotiations involving two companies that design strategic paths of cooperation, especially regarding the effect of the intervention of outside (third) parties. The aim of this paper is to understand the role that the third who joins(a key stakeholder in this case) can play in multilateral negotiations in achieving integrative agreements, through the analysis of the case studies relating to the treaty put in place between Fiat and Chrysler to establish a strategic alliance in the automobile sector.
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Global companies increasingly rely on the effectiveness of business negotiations for their survival and growth. As an important business function for creating and maintaining successful relationships, international business negotiations during the last decade (1990)(1995) have attracted considerable attention among researchers. Although these research efforts have shed light on several aspects of international business negotiations, there has been neither a comprehensive assessment of the knowledge gained, nor a systematic analysis of the issues that this research appears to have left unexplored. It is the purpose of this study to provide a thorough review of the publications on international business negotiations generated in the last decade, identify trends, assess where the discipline currently is and where it might be going.
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Integrated procurement strategies such as private finance initiative (PFI) and prime contracting are the UK government’s preferred procurement strategies. Essentially, they both seek to place responsibility for design, construction and aspects of facility management onto the private sector. These strategies undoubtedly have profound implications for organisations in the construction sector. It is argued that they represent a departure from the contemporary change agenda (e.g. Latham 1994; DETR 1998) to one that has consequences for industry structure. The dominant focus of the change agenda within the sector has been to report, remark upon and make recommendations regarding managerial practice. This agenda has recently been criticised for its lack of sensitivity to the contextually embedded nature of managerial practice. Integrated procurement strategies are argued to redefine the context within which organisations seek competitive advantage. This shift therefore presents a new way in which to conceptualise the emergence and implementation of alternative managerial practice. In this sense, the adoption of new managerial practice is not so much left to serendipity but emerges in parallel with, and as a consequence of, an evolving context. This paper will seek to understand the way in which integrated procurement strategies have brought about an evolving context within which alternative managerial practice can emerge. An ongoing research project is described that seeks to make sense of emergent practice in this evolving context.
The concepts of power in international business negotiations: An empirical investigation
Journal of Transnational Management, 2017
This article examines the bases of social power, namely individual information power, expert power, legitimate power, and referent power on successful international business negotiations (IBNs). The author conducted an online survey among international business executives working in the UK for multinational corporation subsidiaries who were asked to report on the success of their most recent negotiating experience in terms of cooperative (integrative) and competitive (distributive) outcomes. Information power, expert power, and referent power were supported by these results in terms of significance. Unexpectedly, however, information power was positively correlated with integrative or cooperative outcomes and processes. The correlation related to legitimate power was negative but not statistically significant so this hypothesis was not supported. Our results not only contribute to international negotiation theory, but also can assist in the selection and training of practitioners. The academic contribution of this study also relates to model exploration. It brings causal statistical objectivity to qualitatively developed concepts as an essential step in development of knowledge. These theoretical and managerial implications of the study are examined. Furthermore, directions for future research that build on the findings of the study are indicated.
Articulo de Science direct International business negotiations
Negotiating communication has created new challenges, as business becomes global, and the distance between the two parties do not allow to negotiate fully -to take full advantage of the bargaining power remotely. The use of innovation can be beneficial not only to support the negotiation process but also in the preparation phase of the negotiations. In order to properly prepare for negotiations is need to form an effective negotiating team whose analytical work and skills could help to achieve the highest outcome of the negotiations. This is particularly important in the preparation and in the course of intercultural negotiations, which require an understanding of other cultures, other languages, possession of legal knowledge, knowledge of the negotiation context, etc. In preparation for the negotiation phase is needed to know the best way possible about the other side of the negotiation. Knowing the technical communication capabilities of other negotiation side it is possible to prepare effective negotiation support tools. Negotiation's success often depends on the effectiveness of the preparation -the better it will be known the other side of the negotiation and negotiation context, the better results will be achieved. In this article is made the analysis of global scientific literature in international business negotiations innovations. As well there is examined the preparation of business negotiations and considered the formation of negotiating teams. In the conclusions the author provides suggestions for further negotiations research.
Rethinking Procurement in the Era of Globalization
Mit Sloan Management Review, 2008
ver the past 25 years, the role of procurement within companies has changed dramatically from that of simply buying goods and services to overseeing an integrated set of management functions. Procurement has crept into every aspect of management, from category management to managing supplier relationships, contracts and payments, and strategy. As companies look beyond short-term costs and the scope of procurement-related issues has grown, procurement professionals are paying more attention not just to what they spend on goods and services but to the broader costs of operating, maintaining and replacing the items and resources they purchase over time. Despite procurement's increased level of importance, it has yet to achieve the high-level recognition it deserves. There are two main reasons for this. First, it is often difficult to document procurement's specific contributions: Were the cost savings the result of skillful negotiations with vendors or a fortuitous shift in the market? The financial benefits of a favorable procurement deal often extend beyond the initial purchase price to other aspects of performance (for example, improved working capital or reduced financing costs), so there is more than one bottom line to consider. Second, the line between the responsibilities of procurement and those of other stakeholders can be ambiguous. The result: Procurement often shares whatever successes it achieves with other groups; in failure, however, it typically gets all the blame. The need to place procurement in a broader strategic context has become all the more pressing in the current era of increasing globalization. Global sourcing links procurement decisions to strategic decisions. "Make or buy" decisions-for example, whether to move production offshore to your own subsidiaries or outsource it to outside producers and subcontractorsare typically made at the senior executive levels. However, other important decisions (such as where to buy, from whom and under what conditions) are usually handled by procurement professionals. The reality is that these decisions are no longer based entirely on an understanding of direct purchase costs or on easily observable transaction costs, such as transport expenses and import duties, but on many other types of transaction costs as well, including those related to cultural, institutional and political differences. In this article, we will explore the role of these other transaction costs in sourcing decisions and offer a new framework for evaluating costs associated with sourcing and procurement in an increasingly globalized market.