Communication and Negotiation Problems in Business Deals

Introduction

Today's communities present individuals with a multitude of choices, and more emphasis is placed on the freedom of choice. Within the business community, this force is most often revealed through the growing role of the customer, who now represents the core of corporate operations. Client satisfaction is the key to organizational revenues, and in order to attract it, manufacturers and service providers implement a wide range of strategies.

Most of the time, the ultimate customer decision is made based on the arguments and information received, and this information is often delivered through the process of communication. Communication has grown in relevance throughout recent years, largely due to rapid technological advancements.

The mGAMES Case and Negotiation Challenges

In the relations established between economic agents, however, communication alone is not sufficient for achieving organizational goals. Since more and more agents choose to collaborate in order to strengthen their positions, their values, goals, and resources become unified through the process of negotiation. "In simplest terms, negotiation is a discussion between two or more disputants who are trying to work out a solution to their problem" (Maiese, 2003).

To best understand the concept, one should examine a real-life example and identify how the players in a particular situation implement the processes of communication and negotiation. The article presents the situation of mGAMES and the problems faced by its CEO. These issues are only suggested to the reader and could revolve around the following instances:

Rumors are always a matter of uncertainty, as they offer unverifiable information that could affect the negotiation process. In the case of mGAMES, "specifics could not be provided, but rumors were circulating throughout the bank that a large and well-respected personal digital assistant (PDA) manufacturer was in the process of arranging financing to make a play for mGAMES" (Hill, 2002). The decision on whether to act on rumors belongs to each entrepreneur and is shaped by the risk aversion of each party.

The speed of the negotiation process is yet another concern, and it is also determined by the personal characteristics of each party involved. The specialized literature reveals a tendency toward increasing the speed of the negotiation process; however, this may not always serve the best interests of the participants. "Knowing this, some negotiating opponents set arbitrary deadlines and speed up negotiations to gain an advantage. They even manipulate speech patterns to that end, talking quickly and employing short, abrupt sentences" (Volkema, 1999). The most fruitful results are derived from an efficient negotiation rather than simply a speedy one.

Goals, Benefits, and Competitive Position

Another important issue raised during a negotiation process is that of the interests of each partner. For a negotiation to be successful, it is generally desirable that the involved parties share similar goals — both short- and long-term. Not only must these goals be aligned, but they should also be SMART — that is, specific, measurable, achievable, relevant, and time-framed. "Clear goals, consistent with our selected roles, are crucial to charting and navigating the tumultuous seas of our professional, community, and personal life" (Walesh, 2003).

A negotiation process must also address the benefits each party would receive if an agreement is reached — this is often considered the most vital point on a negotiation agenda. In the case described in the article, the Scandinavian telecommunications company would benefit from undivided attention, expertise, and the dedication of a committed team of specialists. mGAMES, in turn, would benefit from reliable contracts, assistance in adapting to new market requirements, and additional research funding. The benefits associated with a negotiation process are sometimes considered synonymous with its goals; however, a distinction must be made: goals refer to the future or expected benefits, whereas actual benefits are more concrete and secure.

A mutual benefit would be the combined ability to strengthen market position, ultimately resulting in a superior standing relative to competitors. As noted in the case study, "competition in the emerging handheld device industry was fierce. Essentially well-established PC manufacturers, every telecom manufacturer, most electronics manufacturers, and many others sought to become players in this multi-billion dollar segment. New technologies and new models were constantly being released. Color capability, communication capabilities, screen size, processor speed, RAM capacity, overall unit size, and total functionality were all key criteria in the consumer's purchase decision" (Hill, 2002). By joining forces and reaching common ground through the negotiation process, the two companies could gain increased access to required resources and strengthen their competitive position.