If a negotiation results in an offer which does not meet the buyer's minimum requirements, which of the following could the buyer pursue?
Correct Answer: B
Explanation Best alternative to a negotiatedagreement (BATNA) is the plan B or back-up plan in the event of a 'walk away'. In case of no deal, buyer (or supplier) may switch to this option. The zone of potential agreement (ZOPA) is considered an area where two or more negotiating parties may find common ground. It is this area where parties will often compromise and strike a deal. In order for negotiating parties to find a settlement or reach an agreement, they must work towards a common goal and seek an area that incorporates at least some of each party's ideas. STEEPLE offers an overview of various external fields. It is an acronym for Social, Technological, Economic, Environmental, Political, Legal and Ethical. PESTLE is a mnemonic which in its expanded form denotes P for Political, E for Economic,S for Social, T for Technological, L for Legal and E for Environmental. It gives a bird's eye view of the whole environment from many different angles that one wants to check and keep a track of while contemplating on a certain idea/plan. LO 1, AC 1.2
Question 32
When is the best time to adopt accommodating style according to Thomas-Kilmann conflict mode instrument?
Correct Answer: C
Explanation According to Thomas-Kilmann conflict model instrument, there are 5 conflict management styles: Accommodating is an unassertive andcooperative approach to resolving the conflict. Accommodating means conceding to the other party with little debate or fight, not challenging or strongly putting forward your own point of view and generally giving and yielding to the other party's point of view. Accommodating is best used when: 1. When others can resolve the conflict more effectively 2. When the issue is much more important to the other person than to yourself - to satisfy the needs of others and to show you are reasonable 3. To build upsocial credit for later issues which are important to you 4. When continued competition would only damage your cause 5. When preserving harmony and avoiding disruption are especially important 6. To aid in the managerial development of subordinates by allowing them to experiment and learn from their own mistakes LO 1, AC 1.1
Question 33
When is the best time for buyer to propose the negotiation agenda to potential supplier?
Correct Answer: D
A business negotiation agenda is a formal agreed upon list of goals to be achieved or items to be discussed in a particular order during a meeting or negotiation. Agendascan be formal and obvious, or informal and subtle in negotiations. The agenda is one of the main structural elements of negotiation, in addition to such questions as site, identification of participants, and elements of timing. Together, they answer the who, what, when, and where questions. As with other aspects of negotiation, the agenda can be used either manipulatively to enhance leverage or to improve the prospects for agreement and the possibilities for mutual gain. In most cases, it will be used bothways, reflecting the nature of negotiation as a "mixed-motive" situation. Although it can be instrumental to [research] volunteer as a sole source to write the agenda, in most cases it becomes a joint activity to construct a consensual basis for subsequent negotiation. In these situations, agenda-building becomes one of the pre-negotiation activities that set the tone for the relationship (Saunders, 1985). In other situations, the parties may engage in actual negotiation without a formal or written agenda.When this occurs, the risks and uncertainties may be high but the party who appreciates the importance of the informal agenda has a tremendous advantage. Whether one plans it or not, during the course of negotiation the parties will discuss a finite set of issues in some sequence and from a particular perceptual framework. Consciousness of the universality and centrality of the agenda is prerequisite to guiding negotiation to a successful conclusion.
Question 34
Which of the following is considered a weakness of a 'dealer' style negotiator?
Correct Answer: A
Explanation A useful and simple shorthand for preferred negotiation styles is summarised by four simple descriptor: 'warm', 'tough', 'logical' and 'dealer', which can beapplied to describe individuals' dominant preferred style in most circumstances. Warm - a people person Tough - a hard-nosed negotiator Logic - a numbers person Dealer - a trader who loves bargaining Strengths, weaknesses of dealer style are described below: Table Description automatically generated LO 2, AC 2.4
Question 35
At the first stage of CIPSProcurement and Supply Cycle (Understand need), which of the following is the most important duty of procurement professional?
Correct Answer: A
At the first stage of CIPS Procurement and Supply Cycle (Understand need and develop a high-level specification), procurement professional mainly negotiate with internal stakeholders. They have a duty toproportionately and constructively challenge specification if there's genuine doubt over the need or how the need is expressed. This is called demand management. Their first duty is to the organisation's treasury, not to functional managers. Demandmanagement including: negotiation/challenge between procurement and internal stakeholders over the need/requirement/specification. Remember that in any process or product, the greatest opportunity for cost reduction is at the design stage.
