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| Section | Objectives |
|---|---|
| Negotiation strategies and tactics | - Approaches to negotiation
|
| Negotiation planning and preparation | - Preparation techniques
|
| Power, ethics and communication in negotiation | - Influencing factors
|
| Negotiation fundamentals | - Principles of commercial negotiation
|
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NEW QUESTION # 278
A procurement manager is preparing fora negotiation with an important supplier. He plans to withhold some crucial information so that his company gains the upper hand in the negotiation. Is this correct when considering using integrative approach to the negotiation?
Answer: D
Explanation:
Integrative negotiation is a negotiation strategy in which the involved parties work together to find a solution that satisfies the needs and concernsof each. This process often involves group brainstorming and creative thinking for individuals to suggest different ideas that benefit both parties.
Compromising is often common in integrative negotiation, and both sides may need to give up certain needs to reach a solution. Honesty can also promote successful integrative negotiation because it can lead to a comprehensive understanding of the issue and what each party needs to be satisfied with the result.
NEW QUESTION # 279
Different types of relationships impact negotiations. Which source of leverage would most support the buyer?
Answer: A
Explanation:
Legitimate power comes from formal authority and organisational backing, making it a credible and sustainable leverage source in negotiations. Personality power or reliance on colleagues and friends lacks long- term weight and may not influence suppliers strategically. Buyers who use legitimate power, backed by governance and authority, negotiate from a position of credibility and professionalism, reinforcing stronger outcomes.
Reference: CIPS L4M5 (2nd ed.), LO 3.1 - Sources of power: legitimate, coercive, expert, referent.
NEW QUESTION # 280
Listening is a key activity in any negotiation. Which of the following are characteristics of effective listeners?
Answer: C
NEW QUESTION # 281
Upper Woodborough Council is a government organisation that is seeking to reduce regular expenditure on facilities management services. Which of the following charges is an example of a fixed cost, that the council could renegotiate with the facilities management contractor to achieve savings?
Answer: D
Explanation:
Fixed costs are regular, predictable charges that do not vary directly with usage or demand. Monthly cleaning services are typically charged at a fixed, recurring rate, making them a clear example of a fixed cost that can be renegotiated to achieve savings. Fuel costs and reactive maintenance vary with activity levels, while inflation indexation is a pricing mechanism rather than a cost itself. CIPS advises buyers to focus on fixed-cost elements when seeking sustainable cost reductions, as changes deliver predictable and ongoing savings.
Reference: CIPS L4M5 Commercial Negotiation (CORE), 2nd edition - LO 2.2: Fixed and variable costs in negotiation and cost reduction.
NEW QUESTION # 282
"BATNA is a concept that should be considered at the start of negotiations." Is this statement correct?
Answer: B
Explanation:
BATNA (Best Alternative to a Negotiated Agreement) is a core preparation concept and should always be considered before negotiations begin. It gives the buyer clarity on the minimum acceptable outcome and provides leverage by ensuring they do not accept a deal worse than their alternative. BATNA is not a legal requirement, nor should it be developed only when negotiations fail, as this weakens negotiating confidence and decision-making. CIPS emphasises BATNA as a fundamental planning tool that underpins effective and disciplined negotiation behaviour.
Reference: CIPS L4M5 Commercial Negotiation (CORE), 2nd edition - LO 2.2: BATNA and walk-away points in negotiation preparation.
NEW QUESTION # 283
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