Strategic partnership and negotiations

Strategic partnership is important for the implementation of joint ventures. On the one hand we are dealing with difficult conditions to compete in a complex and dynamic environment, on the other hand - the need for establishing permanent, mutually beneficial relations with contractors based on trust and loyalty.

In determining and evaluating the issues and objectives of the negotiations it is very important to take into account two types of issues:

• Substantive issues concerning a particular transaction,
• Relationship with a partner (including a partnership of strategic importance),

Because the weight we attach to good relations, changes the behavior of people who try to negotiate.

Both issues should be considered as related to each other and also disjoint. On the one hand, both the substantive problem solving and the development of mutual relations may advantageously interact with each other. The condition is of course to assign importance to both these issues, targets for each transaction. On the other hand, both the issues should be treated separately, in the sense that a solution of one of them should not have a negative impact on the other. Acceptance of unfavorable agreement for the price of maintaining positive relations between the partners is not advised. Deterioration of mutual relations by seeking to obtain immediate benefits at the expense of the partner is not advised too.

Strategy for concluding profitable transactions

The Krattenmaker T. [2006] presents seven concepts, recommended by experts for managers seeking to improve skills of building effective relationships in business:

• Realize that the transaction is rarely a one-time relationship,
• Plan the negotiations strategy
• Sit for negotiations "on the same side of the table",
• Careful selection of representatives,
• To ensure the participation in the negotiation of those responsible for the implementation of the contract,
• Promoting the idea of cooperation, not competition,
• Promote the dissemination of ideas and Knowledge (exchange of information),
• Promoting the idea of community, rather than castes.

Strategic partnership and negotiations — recommended articles

Negotiation style — Sales techniques — Negotiation — Compromise — Management by conflict — Intercultural management — Internal marketing — Internationalization — Organizational culture and project management

References

• Dess, G. G., Lumpkin, G. T., & Eisner, A. B. (2010). Strategic management: Text and cases.