L4M5 e-Learning

L4M5 e-Learning



1.0  Understand key approaches in the negotiation of commercial agreements with external organisations

1.1  Analyse the application of commercial negotiations inthe work of procurement and supply

  • Definitions of commercial negotiation
  • Negotiation in relation to the stages of the sourcing process
  • Sources of conflict that can arise in the work of procurement and supply
  • Team management and the influence of stakeholders in negotiations

1.2  Differentiate between the types of approaches that can be pursued in commercial negotiations

  • Collaborative win-win integrative approaches to negotiations
  • Distributive win-lose, distributive approaches to negotiation
  • Pragmatic and principled styles of negotiation
  • Setting targets and creating a best alternative to a negotiated agreement (BATNA)

1.3  Explain how the balance of power in commercial negotiations can affect outcomes

  • The importance of power in commercial negotiations
  • Sources of personal power
  • Organisational power: comparing the relative power of purchasers and suppliers
  • How suppliers gather information on purchasers
  • How purchasers can improve leverage with suppliers

1.4  Identify the different types of relationships that impact on commercial negotiations

  • The relationship spectrum
  • Building relationships based on reputation, and trust
  • Repairing a relationship

2.0  Know how to prepare for negotiations with external organisations

2.1  Describe the types of costs and prices in commercial negotiations

  • Types of costs: direct and indirect, variable and fixed
  • Break-even analysis: cost volume profit formulae
  • Costing methods such as absorption, marginal or variable and activity based costing
  • Volumes, margins and mark ups and their impact onpricing
  • Negotiating prices

2.2  Contrast the economic factors that impact on commercial negotiations

  • The impact of microeconomics and market types on commercial negotiations
  • Macroeconomics and its influence on commercial negotiations
  • Sources of information on micro and macro economics

2.3  Analyse criteria that can be used in a commercial negotiation
Criteria such as:

  • Setting objectives and defining the variables for a commercial negotiation
  • The bargaining mix
  • Positions and interests
  • Openings and presenting issues

2.4  Identify the resources required for a negotiation

  • Choice of location
  • Involving appropriate colleagues
  • Use of telephone, teleconferencing or web based meetings
  • Room layout and surroundings

3.0  Understand how commercial negotiations should be undertaken

3.1  Identify the stages of a commercial negotiation

  • Defining the stages of a negotiation such as: -preparation, opening, testing, proposing, bargaining, agreement and closure
  • How behaviours should change during the different stages of a negotiation

3.2 Appraise the key methods that can influence the achievement of desired outcomes

  • The use of persuasion methods
  • The use of tactics to influence the other party

3.3 Compare the key communication skills that help achieve desired outcomes

  • Types of questions
  • Effective listening
  • Push and pull behaviours
  • Nonverbal communication
  • The influence of culture in commercial negotiations
  • The use of emotional intelligence in commercial negotiation

3.4 Analyse how to assess the process and outcomes of negotiations to inform future practice

  • Reflecting on performance
  • Opportunities for improvement and development
  • Protecting relationships after the negotiation

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