Negotiations Produce Agreement

Mediation usually consists of a negotiation process in which a “mutually agreed” third party is used to resolve a dispute between the negotiating parties in order to find a compatible agreement to resolve disputes. Production staff should also be involved in licensing negotiations. They must provide their knowledge of the necessary production equipment, the need for further training and the need for facilities. Production experts can also estimate production costs and reconcile variable costs for certain production volumes. (Variable cost studies help determine the extent to which production costs are sensitive.) Production staff will also be able to provide advice on quality control requirements. For co-development agreements, production experts may be essential to provide advice on the feasibility of production. Product developers who work in the lab are often unrealistic about how easy it will be to produce a product in commercial quantities. Production staff can bring debate to reality. A final theme for production experts is to understand the potential costs that could be incurred in different environments (for example. B developed relative to developing countries).

It may be desirable to seek production in a developing country to ensure the lowest costs. Do not indicate that there are things you want to grant or compromise too early in the negotiations. Try to give the impression that you are approaching negotiations in a positive way without revealing your position. Your concession strategy is a plan of goals/positions and sometimes the underlying interests that you will act with the other party. Before starting negotiations, you should at least have some clarification on your objectives and the other party`s objectives, and a sequence of objectives that you wish to act or exchange. Concession strategies vary in detail. The “concession strategy” is more specifically called the “trade plan.” It must be clear that each of the qualification areas complements the others. For example, a technology licensing agreement must assess the relative capabilities of the potential licensee`s production and marketing services. A licensee can be strong in production, but weak in marketing or strong in marketing, but weak in production.

If the differences are too large, implementation of the agreement can be difficult. In this case, the agreement should have tangible performance obligations for activities where the business is weak and flexibility when the business is strong. Marketing, finance and production employees must work together to complete these assessments. Depending on who has bargaining power in the negotiations, the terms and conditions used may be yours, those of the supplier or a mixture of the two. The vast majority of negotiators consider that the fundamental scope of an agreement is given. They may consider a limited choice – for example, shorter or longer-term cases – but overall their tactics are guided by a comparison between their BATNA and the proximity of a preferred outcome that they think they can achieve.

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