Near project completion the customer requests a reduction in cost of goods, which will affect the sales department’s budget and forecast. To reach agreement and close the project successfully, what should the project manager do first?

The project manager's first step should be to analyze the negotiation boundaries. This involves understanding the customer's acceptable range for cost reduction and the sales department's limits regarding budget and forecast impact. By defining these boundaries, the project manager can identify common ground and potential solutions that satisfy both parties' core needs without immediately conceding or escalating. Submitting a change request is premature without understanding the full scope of the request and its implications. Identifying and satisfying underlying interests is a subsequent step, best done after understanding the negotiation parameters. Complying with the customer's request without analysis could negatively impact the sales department and is not a balanced approach to conflict resolution.