Factors that Affect Negotiation Outcomes

Negotiation is a dialogue that occurs between two or more people with the goal of
arriving at an outcome that is agreeable to all the parties partaking in the negotiations
(Lewicki, Barry, & Saunders, 2016). Negotiations occur both at organizational and personal
levels. For instance, governments negotiate with each other over issues such as security and
trade. Business organizations negotiate with other businesses over matters such as mergers
and acquisitions while individuals negotiate with each over personal matters such as divorce
and family conflicts. This paper examines how factors such as communication and
personality as well as benefits, costs, and risks affect the outcome of negotiations.

My Negotiation Experience

In the course of my life, I have participated in many negotiations. The most recent one
is the purchase of a car. One thing about prices of cars is that they are always negotiable. As
it is the case with all negotiations, it is important to prepare thoroughly before the actual
negotiation. Luckily for me, there is a lot of information about cars on the internet. From my
research, I learnt the price range of the car that I wanted to buy and the various dealerships
that I could buy the car from. I also learnt various negotiation tactics that would help me get
the car that I wanted at the lowest possible price. The tactic was the threat of walking away.
By making such a threat, one can extract more concessions from the car salesman than they
would get without them.
Having gathered all the information that I needed, I walked into the car dealership and
began negotiating a deal for the car that I wanted to buy. I requested the salesman to reduce
the price of the car by 20%. He refused. Apparently, all the prices were fixed. After he stood
his ground after my repeated pleas for price reduction, I told him that I was going home to
discuss the deal with my family and that I would return at a later date. After making a few

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steps from the dealership, the salesman called me back. He probably guessed that I was
leaving for good. He offered to reduce the price by 10%. Upon further pleading from me, he
cut down the price by even a bigger percentage of 15%. That cut was satisfactory to me.
Therefore, he called in the manager and we closed the deal.

Analysis of Communication and Personality

Communication
There can be no negotiation without communication. Both verbal and non-verbal
communication play a key role in determining the outcome of negotiations (Lewicki et al.,
2016). Effective communication helps negotiating parties to better understand each other and
the positions that they each hold. At its heart, negotiation is an exchange of opinions,
thoughts, and ideas. If one of the parties partaking in negotiations fails to express their
opinions, thoughts, and ideas clearly the other party will not understand the other’s position
or what is expected of them in the negotiation (Lewicki et al., 2016). As a result, the
negotiations are likely to fail.
In my negotiation with car salesman, I made sure that I communicated as clearly as
possible. I let the salesman know the specifications of the car that I wanted. After he
informed me about the car’s price, I let him know the price that I was willing to pay. Apart
from verbal communication, the negotiation also involved a lot of non-verbal
communication. For instance, when the salesman claimed that the price of the car was fixed, I
knew that he did not mean what he said because he spoke in a hesitating manner and without
force to his words when he was making that statement. He also avoided eye contact. From his
non-verbal cues, I realized that I could get a better price if I tried harder. Also, when I told the
salesman that I was going home to consult with family members and that I would return at a
later date, he knew straight away that I was unlikely to return and that I was probably going

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to another car dealership. That is why he called me back and offered me a better price for the
car. Therefore, my experience with the car salesman shows that effective verbal and non-
verbal communication are important in negotiations.
Personality
Personality traits of individuals participating in negotiations also have a major impact
on the outcome of the negotiations. Personality traits can either hinder or promote effective
negotiation. The impact of the personality traits also depends on the cultural context under
which the negotiations are being carried out (Wilson et al., 2016). For instance, having
conciliatory predisposition and agreeable personality works well in negotiations involving
people from cultures such as those of East Asia but not in cultures that value a combative
approach to negotiations.
For negotiation to be effective, it is important that the negotiating parties share
personality traits such as openness (Wilson et al., 2016). In my negotiation with the salesman
I was lucky to share personality traits with him. Both of us are extroverted, charming, and
observant. Being keen observers, we could study each other’s body language and understand
what each wanted even when we did not express everything verbally. Our shared personality
traits also made us to enjoy the negotiation experience and arrive at a deal without me feeling
that I had been manipulated or pushed into making a deal that I was not comfortable with.

Impact of Benefits, Risks, and Costs on Negotiation

Benefits, risks, and costs have a major impact on negotiation outcomes. The best deal
is one that leaves each party feeling that it gives them the most benefits and at the lowest cost
and risk possible. In deciding whether to accept a deal or not, one lists all the benefits of the
deal, the costs that they will incur by accepting the deal, and the risks associated with the deal
(Boudy, 2013).

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In my case, the main benefit of buying a car was that it would give me a convenient
means of moving around, especially when going to and from work. This benefit was
important to me I did not have another car. I did not consider the risks of buying the car high
because the car had full warranty. Therefore, I knew that if something happened to it, I would
always receive help. The cost of the car was perhaps my biggest consideration when buying
it. I did not want to buy a car whose cost would force me into taking debt. That explains why
I was keen to have the salesman reduce the car’s price. When he agreed, to reduce the price to
an amount that I was comfortable paying, I had no problem closing the deal. Therefore, my
decision to buy the car was primarily influenced by its low cost.

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References

Boundy, C. (2013, June 19). The three key things to think about when negotiating business
contracts. Enterprise Nation.
https://www.enterprisenation.com/learn-something/the-three-key-things-to-think-
about-when-negotiating-business-contracts/
Lewicki, R. J., Barry, B., & Saunders, D. M. (2016). Essentials of negotiation. McGraw-Hill.
Wilson, K. S., DeRue, D. S., Matta, F. K., Howe, M., & Conlon, D. E. (2016). Personality
similarity in negotiations: Testing the dyadic effects of similarity in interpersonal
traits and the use of emotional displays on negotiation outcomes. Journal of applied
psychology, 101(10), 1405.