国际商务谈判：理论、案例分析与实践(第五版)英文版课件Chapter-14.pptx

1、Chapter FourteenNegotiation Risks Negotiation Risks and Managementand Management A common definition of the risk is the possibility that an event will occur and adversely affect the achievement of an objective or a deviation from an expected outcome.So risks involves interaction with uncertainty.The

2、 negotiation risk is defined as the possibility that negotiators are unable to realize their objectives fully or partly due to the uncertainty occurred in the process of negotiation and in the implementation phases.Common risk identification methods Objectives-based risk Scenario-based risk identifi

3、cation Taxonomy-based risk identification Common-risk checking Risk chartingII.External risks This book chooses those which have high correlation with negotiations and puts them into four categories as political risks,market risks,social and cultural risks and environmental risks.1.Political risk po

4、litical risk refers to the complications businesses and governments may face as a result of what are commonly referred to as political decisionsor“any political change that alters the expected outcome and value of a given economic action by changing the probability of achieving business objectives”T

5、here are both macro-and micro-level political risksMacro-and micro-level political risks Macro-level political risk looks at non-project specific risks.Macro political risks affect all participants in a given country.Micro-level risks focus on sector,firm,or project specific risk.An examination of t

6、hese types of political risks might look at how the local political climate in a given region may affect a business endeavor.2.Market risk Market risk is the possibility of an investor experiencing losses due to factors that affect the overall performance of the financial markets in which he or she

7、is involved.The most commonly used types of market risk are:Interest rate risk Equity risk Currency risk,Commodity risk3.Social and cultural risks Social and cultural factors are those issues that relate to physical and attitudinal changes in populations.One most prominent feature of social and cult

8、ural factors is its diversity.Once again these provide opportunities as well as threats or risks for negotiators.This Chapter categorizes the risk stemming from differences from social-cultural factors as the following:Values Cultural symbols Professional culture4.Environmental risk The environmenta

9、l uncertainty issues not only include those natural disasters stem from climate changes,weather and geographical locations but also the way of doing business environment friendly.Natural disasters:A natural disaster is a major adverse event resulting from natural processes of the Earth Economic envi

10、ronment:all business are affected by the economy-locally,nationally and internationally.III.Internal risks Internal risks refer to those risks specifically occurring in the process of the negotiation and have direct impacts on the result of the negotiation.1.Information asymmetry One single most imp

11、ortant source of risks for negotiators is information asymmetry,which deals with the study of decisions in transactions where one party has more or better information than the other.Typical examples of information asymmetry are adverse selection and moral hazard.Adverse selection and Moral hazard Ad

12、verse selection refers generally to a situation where sellers have information that buyers do not have,or vice versa,about some aspect of product quality Moral hazard Adverse selection is related to the concept of moral hazard.In moral hazard the ignorant party lacks information about performance of

13、 the agreed-upon transaction or lacks the ability to retaliate for a breach of the agreement.2.Fraud The worst case of information asymmetry may occur when one party intentionally cheat the other party in the negotiation.In law,fraud is deliberate deception to secure unfair or unlawful gain,or to de

14、prive a victim of a legal right.The cost of fraud is very high.The typical organization loses five percent of its annual revenue to fraud,with a median loss of$160,000 Case:One steel plant in Ukraine3.Failure of negotiators to implement the agreement such a case often happens that one party may not

15、be trustworthy,which is that there typically are incentives for negotiating party that enter into coordination agreements to not be able to implement the agreement.The reasons for that may be because of insufficient funding,or change of the ideas of the management or simply cheat the other party.For

16、 whatever motivation,consider Figure 14.1Figure 14.1:Hypothetical Profit Levels for Two Parties with and without Action Coordination Party B Party B Does Not Coordinate Coordinates Party A Does not Coordinate Party A Coordinates Party As Profit=75 Party As Profit=150Party Bs profit=75 Party Bs Profi

17、t=25Total profit=150 Total Profit=175Party As Profit=25 Party As profit=100Party Bs profit=150 Party Bs profit=100Total profit=175 Total profit=2004.The other party not be trustworthy Mistrust can be a source of risk and cause negotiations to fail.One important reason giving rise to mistrust is that

18、 some negotiators are only obsessed with using tricks and cynical ploys to throw others off track when negotiating,Outright lies and deceptions to fool you,power plays to intimidate you,and surprise moves to confuse you Unscrupulous negotiators have a wide variety of manipulative tactics at their di

19、sposal-from lying and verbally abusing their negotiation counterpart to using various forms of pressure to make you feel uncomfortableNegotiators personalities Chapter nine explains that peoples personalities are diversified and peoples personality profile is multi-sided As a result of cultural vari

20、ety,negotiators personalities become an unpredictable factor for the negotiation eg.Donald Trump,the 45th President of the United States has been described by American media as capricious and many of his public statements were controversial or false.Communication Barriers The term“communication”is t

21、he act of conveying meanings from one entity or group to another through the use of mutually understood signs and semiotic rules.“mutually understood”should be highlighted because in cross cultural negotiations,in many cases it is very hard to share the meaning of the same word eg.Charles Waldheim,t

22、he formal Secretary General of the United NationsManaging risks Risk management is the identification,evaluation,and prioritization of risks and economical application of resources to minimize,monitor,and control the probability or impact of unfortunate events or to maximize the realization of oppor

23、tunities.Risk managements objective is to assure uncertainty does not deflect the endeavor from the business goals Strategies to manage risks or uncertainties with negative consequences typically include:1.Risk avoidance:The simplest way to avoid risks is not to perform an activity that could carry

24、risk.2.Risk reduction:Risk reduction involves reducing the severity of the loss or the likelihood of the loss from occurring.3.Risk sharing:Risk sharing is briefly defined as“sharing with another party the burden of loss or the benefit of gain,from a risk,and the measures to reduce a risk.”4.Risk re

25、tention:Risk retention involves accepting the loss,or benefit of gain,from a risk when it occurs.SimulationA Negotiation of Information Asymmetry Students in the role play should discuss first with your team members what are the risks and what are the gains of taking the risk of disclosing the infor

26、mation.What are the conditions that will make you disclose the important information to the other side?Work out your plan and approaches to reduction of the risks.Engage in the negotiation and see how you will address this situation.Case studyEnrons Indian Negotiation DebacleRead the case study,Enrons Indian Negotiation Debacle.Discuss what are the external and internal risks that contribute to Enrons investment failure in India.