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 co
espondence 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 Plan
Contract: [Number] – [Name]
Document number: [TRIM Record Number] Date:
Contact details
Name: Position:
Business Unit: Division:
Phone: Email:
1. Introduction
The 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 government’s 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
estricted to:
• RFx finalisation negotiations
• contract renewal negotiations
• contract variation negotiations
• contract management negotiations
• sole supplier situations (where appropriate).
2. Negotiation plan
2.1 Contract information and parties
RFx/Contract Number
RFx/Contract Name
Organisations planned to take part in the
negotiations
2.2 Participants and authority
2.2.1 Procurement
Name 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
2.2.2 Supplier
Name Title Role (if known)
Name Job Title, Organisation Chief Negotiator
Name Job Title, Organisation Secretariat
Name Job Title, Organisation Observe
Are you satisfied that the negotiators from the other side have sufficient authority to
ing negotiations to a successful conclusion?
☐ Yes
☐ No
2.3 Location and expected duration
Ensure the location is suitable and conducive to a positive outcome. Locations should be
convenient, comfortable, allow for uninte
upted negotiations and have the capacity for
teams to
eak out to confer and strategise.
Location of negotiations
Planned negotiation start date
Planned negotiation end date
Expected number of meetings
2.4 Reason for negotiations
Why are negotiations required?
(provide supporting information)
Who has approved the decision to
negotiate?
(provide details of
iefing note if
appropriate)
Was the need for negotiations anticipated
in the procurement strategy and were
espondents advised of this in the RFx
documentation? If not, seek legal advice
efore proceeding.
3. Probity information
3.1 Probity
Are there any probity concerns with the proposed negotiation?
☐ Yes
☐ No
If 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
☐ No
3.2 Procurement conduct plan
The 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
☐ No
TRIM Document Numbe
s
Are there any unresolved Conflicts of Interests for participants involved in the
negotiation?
☐ Yes
☐ No
3.3 Probity advisor
Is a probity advisor required?
☐ Yes
☐ No
If yes, please outline why a probity advisor is required.
3.4 Negotiation protocol
The 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
☐ No
What are the areas of particular concern that wa
ant a negotiation protocol?
3.5 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
☐ No
3.6 Reporting
Describe to whom as well as how and when the progress and results of negotiations will
e reported.
4. Preparation
4.1 Research
Is the subject matter which will form part of the negotiations fully understood by all
members of the negotiation team?
☐ Yes
☐ No
List key areas that will need to be addressed
•
Do you thoroughly understand the products/services and the supply market?
☐ Yes
☐ No
Have you completed the Supply Positioning tool?
☐ Yes (include as an attachment to this plan)
☐ No
List market issues that need to be taken into consideration.
•
Have you conducted research on the company that you are negotiating with?
☐ Yes
☐ No
What 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)
☐ No
Have you read their financial reports?
☐ Yes
☐ No
What have you discovered?
Are you aware of precedents that could assist your cause?
☐ Yes
☐ No
If 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
4.2 Interests
Our interests Their interests
4.3 Our strengths and weaknesses
Strengths Weaknesses
4.4 Their anticipated strengths and weaknesses
Strengths Weaknesses
4.5 Risks
Our risks Their risks
4.6 Competitive pressure
What 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?
4.7 Alternatives to a negotiated agreement
What 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
emove constraints and improve our
BATNA position?
4.8 Their alternatives to a negotiated agreement
What 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
emove constraints and improve our
BATNA position?
5. Objectives and negotiation points
5.1 Our objectives
List 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
5.2 Their objectives
List 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
5.3 Negotiation points
Negotiation Point Cu
ent Position Revised Position Must Nice
5.4 Concessions
Concession List the concessions that we will be prepared to conside
6. Positions
6.1 Our position
Clearly and systematically outline our starting position.
[Guide Note: Consider the credibility of your targets. Are they too ambitious? Not ambitious
enough? Are they realistic?]
•
6.2 Their anticipated position
Clearly and systematically outline what we think their starting position will be.
•
6.3 Best case scenario
Describe what you think our best case result would be.
•
6.4 Bottom line
What is our worst case acceptable negotiated position?
•
7. Approvals
This 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
Task 2-
You are the Director of Tomo
owland real estate
• Tomo
owland owns a 20,000 m2 property in West of Sydney
• Due to financial crisis facing the company, they decided to sell the property
• Tomo
owland posted an ad for selling the property
• You have received interest from two potential buyers:
− The Future Developers
− High Sky Real Estate
❖ The Future Developers:
Planning to build a residential apartments project
Strong in the market
Expert Negotiators
Proposed Offer:
• 5 million AUD
• Offer expires in 5 working days
• Fair offer with respect to the real estate market
❖ High Sky Real Estate:
Planning to build luxury villas
Fair Negotiators
Proposed Offer:
• Not made any offer yet
• CEO will call you tomo
ow for discussions
Facts:
1. The property was