The Best Negotiators in The World Have These Attributes

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 First let me get it out of the way.  Contrary to what you read everywhere, the best negotiators are not the ones who excel at “getting an unfair advantage” or “getting the upper hand” or “getting the other side to agree to your demands”.

Can you imagine a supply chain predicated on each individual link trying to get an unfair advantage over the other links?  Let’s get out of this 1950’s mentality ASAP! Center for PSCM Excellence Logo

Let me run through the skills that I see in the world’s best negotiators. I’ve trained many of them, and my fingerprints are all over the strategies below.

The first skill I see is that the world’s best negotiators recognize that negotiations are won and lost before they ever start. The best negotiators understand that memorizing negotiation room tactics and counter-tactics is for the birds.

The best negotiators recognize that it’s not what you do in the negotiation room that counts, but it’s what you did before you ever entered the room that counts.  90% of your time should be spent in preparation, and your analysis and preparation is what sets you up for success, not your negotiations ploys.

The second skill I see is that world class negotiators are experts at investigative negotiations.

Investigative negotiators spend deep amounts of time understanding the unique needs and wants of the other side and don’t assume the only reason the supplier is negotiating with you is to get your money.  If that’s what you assume, guess what you will spend the whole negotiation fighting over?  You guessed it, the money.

The third skill I see with the world’s best negotiators is that they are not outstanding talkers, but rather, they are outstanding listeners.  Listening not only aids you in gathering counter intelligence, it also brings down barriers and makes the other party start to know, like, and trust you – which are vital components if you want the supplier to help you experience negotiation success.

The fourth skill I see is that world class negotiators don’t just negotiate what’s on the table, but they also negotiate what’s not on the table.  World class negotiators know how to create value and invent solutions that can satisfy the other party without impacting their TCO value proposition.

The video you see of me on YouTube that gets 5,000 views a month (just type “purchasing” in the search box and I’ll be the first one, below the Ads) is there because a client of mine came up with the idea of creating value by letting me have rights to the tape from the conference I spoke at.  I came down in price and was thrilled that I got a copy of a high quality video of me speaking.  This wasn’t part of the negotiations originally – the other party invented this value and reduced their costs in the process.  Both of us were thrilled.

The fifth skill I see is that the world’s best negotiators have not fallen into the trap that psychological negotiation techniques are all you need for negotiation success.  The world’s best negotiators understand that you need to do cost modeling.  Should cost, must cost, total cost modeling – all of them need to be a part of your arsenal, and you need to do the right ones at the right times.

Remember, you have to influence both the left and right hemisphere of the brain to drive negotiation success. The right hemisphere is responsible for emotions and feelings, while the left hemisphere is responsible for logic and analysis.  If you just come to the table with behavioral negotiation strategies, you are only addressing the right hemisphere, and you won’t be able to influence the other side effectively.

The sixth skill I see is that the world’s best negotiators map out their concession strategies in advance.  They know before negotiations start what they plan to give away and what they plan to receive in return.  And this is mapped out in such a way to give away high value but low TCO concessions, while receiving in return high value but high TCO concessions

This means that what you give away is highly valued by the supplier but costs you little, and what you receive is highly valued by you, but buys you a lot.  For instance, you might receive a significant price reduction in return for letting the supplier use your company logo in advertising.  If your company allows this, it costs you near nothing, but buys you a lot.  All of this has to be planned before negotiations start.

Finally, the world’s best negotiators are not hammering suppliers for lower prices, but instead are taking costs out of the supply chain and driving product design for TCO.   Read this twice: Only about 10 – 20% of the negotiation opportunity is in negotiations.

The rest of your savings opportunities are in driving upstream product design for TCO and determining how to streamline what is being purchasing to take costs out of the equation – and then doing the same with supply chain costs that can be influenced.  Hammering suppliers for a lower price is not going to get you there.

There you have it.  I want you to help make this profession better.  There’s a lot that goes behind each of these.  Each of them is a one day course. But now you have my list.  Now I want you to do your part to make this profession better, starting now.

If you’re not doing these things, then you are stuck in the old role of purchasing – the one where we are a non-value added service provider whose job is to get out of the way.  That’s not you and that’s not us. We’ve come too far to settle for that.  Our profession needs to be and be perceived as a value added center of profit inside the company.

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Now go off and do something wonderful.

Be your best!

Omid G.

 

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