Friday, February 26, 2010

Mudah.my Buying and Selling Online for Malaysians

0 comments
Buying and Selling Online for Malaysians


Personally I would think that Malaysian e-commerce on B2C, i.e Business to Consumers has grown pretty slow, and is rather limited.



There were those lime lights, if my memory serves me right, first with lelong.com.my,

the ebay.com.my and now mudah.my.



I've never tried lelong.com.my and thought it's gone to cyber black hole but visiting the

website today does show some pretty positive signs.



Years back I heard alot about ebay and how people made tons of money,

but it seems selling on ebay.com is more 'beneficial' then just on mudah.com.my as the

market is larger but it seems difficult to get an account on ebay.com



I didn't have much luck with ebay.com.my. However recently mudah.my has been receiving rave comments

from many of my friends, they've managed to get roomate and tenants for their apartments.



We all usually have some useful stuff, that we think we'll use on day, but never do. There's a rule of thumb

if you haven't used it for 6 months, you're probably not going to use it anyway. So I had a couple of things

I didn't really find of use for myself but am sure someone somewhere could want it.



So last month I tried putting up 2 items, namely

1. Tony Buzan's Head First - this book just didn't work for me. It is about mind mapping, yes I do mind map

but my way of mapping is more spontaneous. In the beginning of the book, it indicates an approach

similar to below :

Look at the word :APPLE,

then tells us just to look at the word and close our eyes for a minute of so. Then it asks you what

went thru your mind, saying generally pictures of apples, fruits, green apples etc. So I tried it on myself

and many friends. Yes, many people did see many fruits however there were those who when had

their eyes closed, only saw the word A P P L E. I'm one of them. So my personal deduction is either

it doesn't work for engineers or left handers. Coz in my sample size, most lefties only saw the alphabets

run in their mind when their eyes were closed. Probably indicating which brain is stronger?



2. The other item I tried selling was my mouse, a Logitech Track Man. It is a pretty good mouse, however

did not really fit me. I preferred Microsoft's trackballers more. Here's a picture of the mouse I put

up on mudah.my






So I put up the mouse on mudah.my and in a week I had a propestive buyer and the deal was seal, I received the payment and pos-laju'ed the mouse, nicely packed in bubble wrap to the person.



The limitation of mudah.my is there is still date no referals and no security/gurantee on transactions as it is done directly between buyer and seller. I guess it should be expected as mudah.my is FREE, yes it doesn't charge for posting, or transacting unlike other online e-commerce.



So what did you recently buy or sell? By the way, if you're looking for a book to read, consider Tony Buzan's Head First, you can buy if from me.


Monday, February 8, 2010

Progressing Positions to Issues and Interests combined with Framing Tactics

0 comments
The first thing that occurred to me when writing the title of this post, is the title is long, and confusing. Anyway, this post is based on one of my assignment papers for my MBA, the subject being Negotiations, Mediations, and Advocacy (NMA). It is a written analytical and reflection paper.

This would be my third assignment paper published in my own blog :) . First was about the how the 2007 Sub-Prime Crisis starting from USA lead to a financial meltdown and how this meltdown has effected banks in Malaysia including a scenario analysis. The 2nd paper was a Marketing Analysis, Discussions and Recommendations for Firefly. It's nice to read the comments on both this papers, which people have found informative and helpful.

Now I'd like to share my paper for the Negotiations, Mediations, and Advocacy (NMA) subject. This paper has been one of the most challenging and draining, with a four day residential learning about negotiations, then doing multiple negotiations in class, and then online. Some people might get a thrill of negotiating, and some don't. Some sections of the below paper has been intentionally removed.

Written analytical

&

reflection paper


Progressing Positions to Issues and Interests combined with Framing Tactics

1. Identification of Topic. 4

2. Literature Review.. 4

2.1. Issues: 4

2.2. Interest: 5

2.2.1. Intrinsic, Instrumental, Principle, Substantive and Relational Interests. 5

2.3. Issues and Interest or Positions?. 6

2.4. Framing. 6

3. Critical Incidents. 7

3.1. Before Workshop – House Renovation. 7

3.2. Workshop Incident - El Tek and Negotiations in Organisations. 8


4. Action Plans. 10

5. Reflection. 12

6. APPENDIX. 13

6.1. Appendix 1: Similarity of El-Tek and my work industry. 13

6.2. Appendix 2: Post Workshop Incident - A typical process flow in my industry. 13

6.3. Appendix 3: Post Workshop Incident - Questioned. 14

6.4. Appendix 4: A Comprehensive Reflection on El-Tek Negotiations. 14

6.5. Appendix 5: A Summary on Post Residential Negotiations Result 15

7. REFERENCE. 16

1. Identification of Topic

There were a number of interesting themes covered during the workshop, many new to me, many which I have tried to put into practice. Assessing myself by looking at my previous negotiations before the workshop, during and now most recently a few negotiations after the workshop, I have come to realize that out of the many new useful themes I have learnt, one them will be of significant value to me in my learning about negotiations. After the workshop, with the new understanding of progressing positions to interest, needs and values combined with framing tactics, I have applied it to my negotiations. It has been a challenge to apply, as it is slightly against my norm of trying to be a nice guy, maintain relationships, giving in, doing favours and trying to be humble, by being accommodating instead of voicing out personal or group’s interest and contributions. I strongly belief that based on Kolb’s Learning Cycle, this paper will further enable me to improve my understanding of the concepts and application by reviewing literatures, reflecting on past experience, helping me develop concepts and ideas and finally testing out this concepts in practice, enhancing new concrete experience.

2. Literature Review

2.1. Issues

First there is a need to define ‘issues’ before progressing to identifying interests. Lewicki, Barry & Saunders (2009) clarify that multiple issue negotiations lend themselves to more integrative negotiations because parties can use processes such as logrolling to create issue ‘packages’ that are mutually beneficial, for example price may seem like the only issue in the sale of the house, but parties tend to realize that other issues are equally central: for example financing and repairs. Next the defined issues need to be prioritized, to avoid yielding to points aggressively argued by the other-side rather than to yield based on priorities. Finally determine whether the issues are linked or independent.

2.2. Interest:

Lewicki, Barry & Saunders (2009) say that if issues help define the needs, understanding interest defines why we want it. This is further reinforced by Ury (1991) that asking ‘why’ questions bring critical values, needs or principles to surface in the negotiations. Fisher, Ury & Patton (1991) explain that while negotiations might have difficulty satisfying each other’s specific positions, an understanding of the underlying interests may permit them to invent solutions that meet their interests.

Lax & Sebenius (c1999) cautions that negotiators often focus on interests but conceive of them too narrowly, and need ways to assess the relative importance of those various interests. They further argue that many negotiators retard creativity by failing to distinguish the issues under discussions from their underlying interests.

Lewicki, Barry & Saunders (2009) suggest that in integrative negotiations, both negotiators need to pursue the other’s thinking and logic to determine the factors that motivated them to arrive at their goals, so they may recognize possible compatibilities in interests that permit them to invent new options that both will endorse. Lax & Sebenius (c1999) advice, besides the obvious careful listening and clear communication, getting uninvolved third parties help render insights, as well as playing the other party’s role can offer deepened perspectives. This basically put’s a practical and effective approach to the commonly used term, to put one’s self in the other’s shoes.

2.2.1. Intrinsic, Instrumental, Principle, Substantive and Relational Interests

In addition to the existence of interests in principle, concerning for example fairness and ethics, Lax & Sebenius (1986) state that interests are divided into intrinsic (value of itself) and instrumental (to derive other outcomes) interests.

Lewicki, Barry & Saunders (2009) also suggests interest can be divided into substantive interest which relate to the focal issues, process interests which relates to the way a dispute is settled, and relationship interests, where relationships is valued and is cautious to take actions that might damage it. Clyman & Tripp (July, 2000) comment that parties will often have more than substantive interests about the issues.

Therefore it is useful to consider that negotiation styles tally with the priorities and concerns between relational outcome and substantive outcome which can be summarized by the Dual Concerns Model (Savage, Blair & Sorenson 1989).

Relational Outcome Important?

Substantive Outcome Important?

YES

NO

YES

Collaboration

Accommodation

NO

Competition

Avoidance

Table 1: The Dual Concerns Model

Source : Newsom (c1989)

2.3. Issues and Interest or Positions?

I initially thought that identifying interests instead of positions are always the best solutions. Lax & Sebenius (c1999) point out that focusing on interest does help enhance creativity and break impasses by reformulating issues to align better with interests, but there are times when dealing with positions and issues work better, for example in cases of ideological conflicts.

Even though it is usually better to approach a negotiation with issues and interests on the table, it is important to do proper preparation to understand the positions, issues and interests on hand, and then decide which approach to use.

2.4. Framing

Tversky & Kahneman (1981), summarize that for identical problems, with the outcomes just described differently there is a pronounced shift from risk aversion to risk taking, where choices involving gains are often risk averse and choices involving losses are often risk taking. This conforms to the Utility Model. Therefore when faced with a choice, a rational decision maker will prefer the prospect that offers the highest expected utility (Tversky & Kahneman 1981).

Bazerman (2004) elaborates that framing has an important implication on negotiators: the need of being aware of the presence of frames and consider the possibility of alternatives. Bazerman (2004) further points out that we can use frames to our advantage in three areas of negotiations: (1) softening “must have” positions, (2) increasing acceptance of negative outcomes, and (3) mediating disputes among others. Bazerman (2004) advices, to affect the frame, managers and other mediators must emphasize the situation’s realistic risks, thus calling attention to its uncertainty and leading both sides to prefer a sure gain through settlement.

Ury (1993) offers a five-step response to barriers: don’t react, disarm your opponent, change the game, make it easy to say yes, and make it hard to say no. By turning positions into issues, then identifying the interests, coupled with the knowledge at hand, enables the negotiator to change the game from a win-lose to a win-win. Subsequently framing the proposition to indicate risk adverse options for gains, and risk taking options for losses, makes it easy to say yes and hard to say no.

This is a summary of how I see that moving from positions to issues and interest by a number of methods among others logrolling, brainstorming and role playing then finally framing a better statement of the negotiation on hand is what I am in need of, knowing my capabilities and current gaps, as well as the culture and challenges in my industry.

3. Critical Incidents

3.1. Before Workshop – House Renovation

Prior to the workshop, I had engaged a contractor to do some renovation on my recently purchased house. Contractors are typically known to be hard to deal with, and our limited knowledge about masonry and other renovation work makes it a difficult environment to negotiate in. The contractor I finally engaged was recommended by a friend who had been satisfied with his work, therefore providing credibility.

When we negotiated about the works, it was interesting that we requested a breakdown of each item, and then negotiated what’s needed and what’s nice to have based on the list. Later we discussed the best price for each item. However the contractors preferred to list down a lump sum and give a discount on the overall price. As the negotiations progressed, we started to discuss on the commencement date, estimated time of completion and progressive payment preference.

3.2. Workshop Incident - El Tek and Negotiations in Organisations

El-Tek (this was the company in our negotiations practice, with 3 individuals in each divisions negotiating against the other) is in sorts similar to companies in my industry, a large integrated company with several divisions, some independent of each other and some being internal customers or suppliers, and even sometimes having competing products or services.

The critical incident in El-Tek negotiations was that even though both parties were under the same parent company, both came in strong with their positional bargaining. This went on for some time, each party doing some hard bargaining, and making some blunt comments. Hearing the other division’s demands and making counter-offers, with not much progress, we replied straight forwardly, “Look, your demands make our group loose money” so let’s be more realistic that yes you created the technology, but we need to move on and look at making this beneficial for both divisions and the company. Then we took a 2 minute break to re-group. During this time both sides re-looked at positions and when we met back, we agreed we were not getting anywhere and running out of time.

Basically at this point, we moved out of positional bargaining to integrative bargaining. Now we seriously discussed and questioned both sides’ issues and interest: eager to achieve the best for our respective groups and the company as well as not going to the boss for arbitration. It was difficult to reach this stage, as we did not look into each others issues and interest initially. And yes out of three major interests, we now agreed we shared two common interests. The other party had some interest in principle also that we had turned down the research previously, they had taken the risk and cost to develop the technology. It was a valid principle and concern which we then addressed.


4. Action Plans

Major strengths would be the confidence to call a bluff or hard-balling when I see it, for example I called the good cop/bad cop which was initially played out during the El-Tek negotiations. I value relationships and reciprocate, however do so carefully taking actions of the other party with a pinch of salt, and constantly checking for validity.

A major area for improvement would be firstly to prepare well and identify whether the negotiation is really a distributive negotiation. If it is not, it would be wise to not spend resource, time and energy to just argue over positions. Secondly, is to engage the other party and convince them to look at the negotiation as integrative instead of making demands and concessions. By getting both sides to acknowledge this, we can move on to discussing about issues, interests and principles in concern. Therefore we can concentrate on achieving a positive negotiation and look at enlarging the pie.

A number of concepts and practical lessons can be deduced from the literature to help me improve on my negotiation behaviours. Firstly the benefits and methods to move away from positions towards working on identifying issues. Again I now realize that even though parties might have similar issues, it could be that they are trying to satisfy different interests be it substantive, process, relationship or a mixture of those to achieve either an incremental or intrinsic gain. Contrastingly, parties may share similar interest, for example getting a good product out to the market, but need to address separate issues for example fixing critical issues versus meeting the delivery dates.

I have also realized that in many cases even though people come in as hard negotiators, or keep on stressing on positions which is frustrating at times, rather then reciprocate in kind, it provides a sense of self satisfaction if I manage to progress a discussion towards a more conducive interest-based discussion which creates value, and a feeling of satisfaction for both sides.

Based on the literature review, I have come up with my own ‘onion’ of items to consider during negotiations and to help focus on moving towards the outer circle of the ‘onion’ in most cases.

Figure 1: A representation of progressing Positions to Interest through Issues

I am also now aware that sometimes it is wiser to focus on a position because interest and issues may be a huge conflict, thus by just focusing on addressing a narrow interest or position we can move to a better resolution. Sometimes this is also a good option when the effort needed for integrative solutions is not worth the bargaining item, for example an additional day of support for a project that has the time and resource to spare. Instead it would be a plus to use some positional bargaining, by giving in to the request but highlighting it as a favour or out of the way effort to support them, so to build a better relationship and bridge for future negotiations that will occur sooner or later.

I have already started to apply these actions into practice, evidently with the after-workshop-incident, as well as in other daily negotiations and negotiations for coming projects in the next few months.

5. Reflection

Reflecting onto my pre-residential experience, it reinforces the literature study that though we discuss about similar issues, for example date of renovation commencement, both parties were addressing different interest, the contractor’s interest was optimizing resource that was available and also locking in prices of raw material which was relatively low at that time. For me, our interest was in being able to move in faster.

Reflecting on the workshop negotiation for El-Tek (Appendix 4), I have learnt to also consider the bigger picture, in this case the “super-ordinate” goal. Negotiating as a member of a team is advantageous when roles are clearly defined and there is no friction. What I would do differently is call for more frequent breaks when I see an impasse or some gap within the team to re-group.

For after the workshop, I now appreciate that active listening and querying not only shows empathy and usually gets reciprocity from the other side, but also helps identify actual issues and interests. I have also learnt that clarifying our positions, issues, and commitment towards a similar interest gets both parties to be more inclined to look for opportunities to create value. Point of view or framing of a situation plays a significant role in negotiations, as Tversky & Kahneman (1981) mentions.


6. APPENDIX

6.1. Appendix 1: Similarity of El-Tek and my work industry

Divisions have their own budgets and earnings vs. spending guidelines and expectations. Overall good in keeping creativity alive, it does introduce some internal competition sometimes healthy sometimes not. And in many instances, it does happen that discussions and negotiations tend to focus more in advancing a certain division’s position instead of looking at the whole picture or enlarging the pie.


6.4. Appendix 4: A Comprehensive Reflection on El-Tek Negotiations

The outcome of the negotiations was favorable, with an agreement for a transfer price and a ban on sales to direct competitors, thus giving both division opportunities to make money. This was finally achieved because both divisions agreed to focus on interest of each division as well the “super-ordinate” goal of the company.

The consequences of the outcome was an opportunity for both divisions to benefit, improving the company’s bottom line while maintain good relationship and status of both divisions and managers.

The key issues for my team were to avoid escalation to the boss and getting license to produce the proprietary magnet. By clarifying and querying each others’ priorities, interests and concerns we agreed that even if Sal does not sell us the magnets, sooner or later the competitors will catch up, so instead of a blanket ban, it is best to agree to something that makes business sense. Our settlements are better then some which would not have been either optimum for one of the other. The Zone of Potential Agreement (ZOPA) is actually large in this context, however we have identified that there exist optimum and sub-optimum agreements. The transfer price can be taken out of consideration for the company’s point of view as it is a zero-sum. The BATNA of no agreement was to escalate to the boss for arbitration which is not favourable for both sides. Our goal was somewhat to increase the pie while not making sacrifices to our portions. Sal’s image and career were at stake due to his decision not to take up the research initially. Negotiating as a member of a team was advantageous as all members were emphatic to the other’s point of view and had clear roles to play. It also helped in keeping a check and balance while backing-up the other members in the negotiations. The planning preparation was done effectively, with us identifying our BATNA, reservation price and target price. We clearly identified areas of low priority and high priority. We also tried to figure out the same items for the other division to get a picture of their issues and interests. The negotiation process was interesting and challenging. Initially Chris Carlson and their team came in strongly to create a bigger power distance. However after clarifying to them that their demands do not make sense as it is way below our reservation price and noting our clear stance on negotiating and not just giving concessions, Carlson’s team changed tactic the 2nd time the team met because they sensed that the negotiation will end up with no-deal. Interestingly after the negotiations, Chris also shared that since two out of the three opposing parties were more ‘soft’ on the negotiations, he tried to single out the third person as he believed he could get a better deal by only focusing on two of the team members. Thus creating some ‘gap’ between our group. We did not catch that approach,but thanks to our initial planning stage where we clearly identified each others roles and agreed to work as a team with check and balance, the tactic did not succeed to Chris’ expectations but did have some impact.

I would firstly work out within the group that to ensure we do not give in to pressure tactics, we agree beforehand that final decisions will only be made upon an internal discussion, thus creating some space to maneuver and not getting pushed into an agreement in the heat of negotiations.

7. REFERENCE

Bazerman, MH 2004, 'Picking the right frame: Make your best offer seem better', Negotiation: a newsletter from Harvard Business School Publishing and the Program on Negotiation at Harvard Law School, pp. 3-5.

Clyman, DR & Tripp, TM July, 2000, 'Discrepant Values and Measures of Negotiator Performance', Group Decision and Negotiation, vol. 9, no. 4, pp. 251-74.

Fisher, R, Ury, W & Patton, BM 1991, Getting To Yes, Houghton Mifflin Harcourt.

Lax, DA & Sebenius, JK 1986, The manager as negotiator: bargaining for cooperation and competitive gain‎, Illustrated edn, Free Press.

---- c1999, 'Interests: The measure of negotiation', Negotiation theory and practice, no. Cambridge, Mass, pp. 161-80.

Lewicki, RJ, Barry, B & Saunders, DM 2009, Essentials of Negotiation, McGrawHill.

Newsom, WB c1989, 'The Dual Concerns Model', Academy of Management Executive.

Savage, GT, Blair, JD & Sorenson, RL 1989, 'Consider Both Relationships and Substance when Negotiating Strategically', Academy of Management Executive, vol. 3, pp. 37-47.

Tversky, A & Kahneman, D 1981, 'The Framing of Decisions and the Psychology of Choice', Science, vol. 211, pp. 453-8.

Ury, W 1991, Getting Pasat No: Negotiating with difficult people, Bantam Books.

---- 1993, Getting Past No: Negotiating your way from controntation to cooperation, revised edn, Bantam Books.

 

Popular Posts

Popular Posts this month

Recent Posts