Task 1 Infrastructure Negotiation
Task 1 Infrastructure Negotiation
Your organisation is planning to negotiate on a project comprising remediating footpaths, car parks and line marking around RAAF Base Point Cook and RAAF Williams Laverton. The scope also includes remediating the rainwater drainage on a building and the stormwater drain on the airfield at RAAF Base Point Cook. You are required to complete the attached negotiation plan for the project negotiation.
Your Assessor will represent the client and for the purposes of this assessment task, will represent the client in a role play, where you must negotiate an approach to the project.
Throughout the negotiation, you are required to:
initiate decision making actions
establish the rules of procedure
identify the information needs of participants
actively encourage the free exchange of information
encourage decisions which are realistic for the situation
All decisions throughout the negotiation processes must be in line with:
legislative, organisation and site requirements and procedures
manufacturer's guidelines and specifications
Australian standards
Employment and workplace relations legislation
Equal Employment Opportunity and Disability Discrimination legislation
Ensure that you adequately minute the negotiation and develop correspondence to relevant stakeholders to advise them of the outcomes. Stakeholders for this project could include:
relevant regulatory authorities
tenders
project managers
contractors
employees
community
customers
suppliers
Negotiation PlanContract: [Number] [Name]
Document number: [TRIM Record Number] Date:
Contact detailsName: Position:
Business Unit: Division:
Phone: Email:
IntroductionThe following Negotiation Plan is will assist Procurement staff when preparing for negotiations. It has been designed as a simple tool to help staff analyse issues and prepare successful negotiation strategies.
The guide will prompt staff to think through the governments requirements and objectives prior to undertaking important negotiations as well as consideration of both sides needs, strengths and weaknesses in order to understand the overall context of the negotiation, leading towards an improved position.
Good preparation and planning are crucial to the achievement of successful negotiation outcomes.
Note that this document is intended to be used as a guide to the creation of a negotiation plan and that as such some of the requirements listed may not be applicable for every scenario.
Possible scenarios where this Negotiation Plan may be useful include but are not restricted to:
RFx finalisation negotiations
contract renewal negotiations
contract variation negotiations
contract management negotiations
sole supplier situations (where appropriate).
Negotiation planContract information and partiesRFx/Contract Number RFx/Contract Name Organisations planned to take part in the negotiations Participants and authorityProcurementName Title Role
Name Job Title, Organisation Chief Negotiator
Name Job Title, Organisation Secretariat
Name Job Title, Organisation Observer
Note: A minimum of two Procurement participants are required in all negotiations
SupplierName Title Role (if known)
Name Job Title, Organisation Chief Negotiator
Name Job Title, Organisation Secretariat
Name Job Title, Organisation Observer
Are you satisfied that the negotiators from the other side have sufficient authority to bring negotiations to a successful conclusion?
Yes NoLocation and expected durationEnsure the location is suitable and conducive to a positive outcome. Locations should be convenient, comfortable, allow for uninterrupted negotiations and have the capacity for teams to break out to confer and strategise.
Location of negotiations Planned negotiation start date Planned negotiation end date Expected number of meetings Reason for negotiationsWhy are negotiations required?(provide supporting information) Who has approved the decision to negotiate?(provide details of briefing note if appropriate) Was the need for negotiations anticipated in the procurement strategy and were respondents advised of this in the RFx documentation? If not, seek legal advice before proceeding. Probity informationProbityAre there any probity concerns with the proposed negotiation?
Yes NoIf so please outline the issues and comment on how they are being addressed.
Concerns Mitigations
Have probity requirements been discussed with the negotiation team?
Yes NoProcurement conduct planThe Procurement Conduct Plan must be provided to all Procurement participants involved in negotiations and a signed Code of Conduct, Probity and Confidentiality Agreement included on the file.
Has each member of the negotiation team signed the Code of Conduct, Probity and Confidentiality Agreement?
Yes NoTRIM Document Number/s Are there any unresolved Conflicts of Interests for participants involved in the negotiation?
Yes NoProbity advisorIs a probity advisor required?
Yes NoIf yes, please outline why a probity advisor is required.
Negotiation protocolThe use of a negotiation protocol should be considered where there is:
significant contract value or amounts
a considerable government commitment
sizeable liability or risk
concern over the previous conduct of the other party.
Will a negotiation protocol be created and signed by both parties before the beginning of negotiations?
Yes NoWhat are the areas of particular concern that warrant a negotiation protocol?
Government Information (Public Access) Act
Have the other parties been advised that files and papers pertaining to the negotiation may be subject to the Government Information (Public Access) Act 2009 and could potentially have to be disclosed?
Yes NoReportingDescribe to whom as well as how and when the progress and results of negotiations will be reported.
PreparationResearchIs the subject matter which will form part of the negotiations fully understood by all members of the negotiation team?
Yes NoList key areas that will need to be addressed
Do you thoroughly understand the products/services and the supply market?
Yes NoHave you completed the Supply Positioning tool?
Yes (include as an attachment to this plan)
NoList market issues that need to be taken into consideration.
Have you conducted research on the company that you are negotiating with?
Yes NoWhat have you discovered?
Have you completed the Supplier Preferencing tool to better understand how they view us?
Yes (include as an attachment to this plan)
NoHave you read their financial reports?
Yes NoWhat have you discovered?
Are you aware of precedents that could assist your cause?
Yes NoIf yes what are they?
Is an expert category and/or legal expertise required assist with the negotiations?
Category Insert name if known
Legal Insert name if known
No experts required
InterestsOur interests Their interests
Our strengths and weaknessesStrengths Weaknesses
Their anticipated strengths and weaknessesStrengths Weaknesses
RisksOur risks Their risks
Competitive pressureWhat competitive pressures does the other party face? Can what is being offered be sourced elsewhere?
If so, how difficult would the sourcing be? How important is this deal to them? Alternatives to a negotiated agreementWhat alternatives do we have if the negotiation is lengthy and unsatisfactory or ends without agreement? What is our best alternative to a Negotiated Agreement (BATNA)?
(Note: a strong BATNA position means a strong negotiation position) What could improve our BATNA? Can we remove constraints and improve our BATNA position? Their alternatives to a negotiated agreementWhat alternatives do we think they have if the negotiation ends without agreement? What is their best alternative to a Negotiated Agreement (BATNA)?
(Note: a strong BATNA position means a strong negotiation position) What could improve their BATNA? Can we remove constraints and improve our BATNA position? Objectives and negotiation pointsOur objectivesList and describe our objectives in order of priority and preference. Consider if each objective is a must have or a nice to have.
Objective Must Nice
Objective A X Objective B X
Their objectivesList and describe what you think their objectives may be, in order of priority and preference. Consider if each objective is a must have or a nice to have for them.
Objective Must Nice
Objective A X Objective B X
Negotiation pointsNegotiation Point Current Position Revised Position Must Nice
ConcessionsConcession List the concessions that we will be prepared to consider
PositionsOur positionClearly and systematically outline our starting position. [Guide Note: Consider the credibility of your targets. Are they too ambitious? Not ambitious enough? Are they realistic?]
Their anticipated positionClearly and systematically outline what we think their starting position will be.
Best case scenarioDescribe what you think our best case result would be.
Bottom lineWhat is our worst case acceptable negotiated position?
ApprovalsThis Negotiation Plan must be reviewed and approved by your director prior to proceeding with negotiations.
Name Name Signature Date
Prepared by Reviewed by Approved by
Appendix A - Qualities of an effective negotiatorAn effective negotiator:
prepares carefully, analyses and thinks the issues through
uses every negotiation meeting to learn more and prepare further
is confident, listens, questions and contests without aggression
is adaptive to the prevailing atmosphere of the negotiation and can be resolved and firm when needed
thinks before speaking, communicates clearly and creates an atmosphere of trust
recognises position shifts and takes advantage of opportunities
will look to pick up a benefit in return before conceding a point (i.e. If we agree to this, will you agree to that)
considers strengths and weaknesses from both sides as well as time constraints influencing the negotiation and uses this knowledge to tactical advantage when appropriate
understands where the obstacles are and can suggest imaginative and practical ways forward. Can produce reasoned options that can be beneficial to both sides
works with the other side to generate a sense of ownership for solutions put forward
focuses on interests, not on people and positions and never loses sight of objectives throughout the negotiation process
compares the proposed solution(s) to his partys BATNA before finalising any agreement
consider role-plays or conducting a mock negotiation prior to the formal negotiation meeting.
Appendix B Negotiation roles and responsibilitiesIn considering the make-up of the negotiation team, take into account the relevant and complementary skills and knowledge of participants by:
involving the manager who will be responsible for ongoing management of the contract, e.g. the category manager or client representative (if a client-specific contract)
understanding whether the team has the required communication, problem-solving, technical and financial skills, along with an understanding of the relevant industry. The SWOT analysis tool may assist in considering the teams strengths and weaknesses. If negotiations will include changes to the standard terms and conditions of government agreements, ensure you have sought legal advice prior to the negotiations and consider including a legal representative on the negotiation team
using professional advisors if the negotiations are likely to be complex, where there may be difficulties reaching agreement, or if there is a need for specific expert advice
understanding the extent and limits of your authority to negotiate terms. Clarify your delegation to act on behalf of NSW Procurement prior to the negotiation meeting
not overloading the team! A cast of thousands may slow down negotiations and overwhelm the other party. Note that a minimum of two NSW Procurement representatives must participate in the negotiations.
Role Responsibilities
Chief or lead negotiator Final preparation of negotiation strategy
Set agenda, introduce team members
Keep eye on the prize maintain overarching view of negotiation process and progress; keep discussions on track
Negotiation specialist/ advisor May be chief negotiator
Specialist advice on negotiation strategy and tactics
Negotiator Member of procurement team
Contribute to preparation of strategy
Participate in negotiations on the day
Technical expert Provide specialist technical knowledge to negotiation team
Determine if proposals during negotiation meet technical requirements
Legal advisor Provide legal advice on proposed terms and conditions
Determine if amended clauses are acceptable (subject to final sign-off by General Counsel)
Probity advisor Independent observer of negotiation process
Oversee preparations, negotiations and post-negotiation processes to ensure probity provisions are maintained
Observer Member of procurement or management team observing negotiations to ensure compliance with NSW Procurement process and procedures
Note / minute taker Administration or procurement support staff, responsible for documenting key discussions, drafting and finalising minutes, seeking concurrence from negotiation participants
Appendix C Additional resourcesThe following resources are available to assist planning your negotiations
Negotiation Protocol
Negotiation Points Planning template
Post Negotiation Review
Supply Positioning tool
Supplier Preferencing tool
SWOT Analysis
Balance of Power Tool
Observation Checklist
Observation Criteria S NS
Obtained, interpreted and confirmed work requirements Accessed, interpreted and applied documentation required to conduct business negotiations Identified and targeted available business opportunities Facilitated discussions with stakeholders to develop strategies and ideas to meet objectives Analysed information to allow for assessment of the short-term and long-term position of the business Ensured agreed decisions and recommendations fall within the operations business objectives and legislative requirements Consulted and/or lobby key stakeholders who can assist in achieving the objectives Ensured preparation for the meeting is sufficient to enable effective business negotiations and to achieve desired objectives Ensured contributions to the negotiations are clear, concise and relevant to achieving business objectives Documented/recorded in writing key outcomes of negotiations according to workplace procedures Evaluated outcomes of negotiations according to workplace procedures Referred outcomes of negotiations to key stakeholders Reviewed outcomes of negotiations for improvement Followed up, and circulate as necessary, outcomes and decisions
