All posts by Alexandru Butiri

4 Negotiation Lessons From A Kidnap Response Consultant

What do you do when disengagement is not an option? Alexandru Butiri shares four learnings from high-stakes kidnap negotiations that can be applied in any procurement function.

Image: G-StockStudio/Shutterstock

As far as negotiations go, nothing could be more high-stakes than a kidnap negotiation. How on earth do you put a price on a human life?

Sometimes a procurement negotiation can feel like a kidnapping or hostage situation. Think about the times you’ve had to negotiate with ruthless, uncompromising parties. They maximise all of the perceived or real advantages that they have.

Recently, I had the opportunity to spend time with a kidnap response consultant in a kidnap simulation exercise. We were given a case that involved sea pirates and the kidnap of a crew from a container ship. This training stayed with me long afterwards because I found it so relevant to the day-to-day negotiations we undertake in our procurement roles.

Here are four negotiation tips that I’ve learned from the experience:

1. Set up a response team

The first thing that organisations do in a kidnap situation is to set up a crisis response team of experts, which may contain negotiators, experts in the field of operations, psychologists and others.

When preparing for a critical upcoming negotiation, procurement can take the lead in setting up a dedicated team of cross-functional experts within the organisation. Everything should be coordinated through this lean, agile team. Two key tips to remember are:

  • Leave it to experts to negotiate. People with a stake in the game are poor negotiators. Would you let you CEO negotiate directly with your top suppliers who may subject her or him to pressure tactics?
  • Each team member should have a clearly defined role. Not everyone is the lead – and never underestimate the importance of the note-taker.

2. Build resilience to pressure tactics

It’s vital to be aware of pressure tactics, and (more importantly) to be aware of how you react in pressured situations. Sometimes kidnappers will ask for a big payment in a very short timeframe to “solve the issue rapidly”. But it if you give in and pay, this becomes only the first instalment in long line of payments.

In the corporate world, pressure tactics may refer to tight, unrealistic expectations, timeline pressures to make a “quick” decision. Sound familiar? Avoid an amygdala hijack by planning ahead and putting a process in place that will help you avoid making a mistake under pressure.

3. Understand the game and develop a plan around it

Kidnappers’ demands can seem arbitrary, out of control and very unpredictable, which is why kidnap negotiators make it a priority to understand their motivations and hence predict their behaviour and develop a strategy around it.

In procurement negotiations, take the time to research the other parties’ motivations and their commercial construct. Spend more time in planning and less in negotiating for a better outcome. Game theory-based tools can help in modelling various scenarios. This will help to minimise the quick “think on your feet” risk by anticipating various outcomes and knowing your best position in each scenario. Cost analysis and clean sheets will help you understand not only your commercial model, but also that of the other party. 

4. Learn to influence without a mandate

We’re constantly influencing (and being influenced by) others without being aware of it. Expert negotiators know how to use influencing principles to reach their objective.

How do you influence without a mandate? There are a set of influencing principles valid in all cultures and societies that can get you closer to your objective. Notice that I’m using the word “influencing”, not “manipulating”. Here are some of them to get familiar with:

  • Reciprocity
  • Scarcity
  • Peer pressure
  • Authority.

One classic influencing technique is to make a small concession (typically of very little cost to yourself) to put the other party in your debt. A kidnapper, for example, might extend a payment time-frame, or agree on a communication schedule. In a procurement negotiation, learn to recognise when the other party gives away something menial to make you feel obliged.

Procurement professionals can put these learnings to use not only in negotiating with suppliers, but in their day-to-day dealings with stakeholders in their own organisations.

What do you think? Leave a comment below, or get in touch with me if you’re interested in finding out more details.


Are you based in Australia? Join Alexandru Butiri at the upcoming Big Ideas Summit in Sydney on Tuesday 30th October!

Line ’em Up: Five Ways To Take A Swing At The Biggest Challenges Facing Procurement

What are the hottest topics on the table for Australia’s leading telecommunications company? Telstra’s Alexandru Butiri shares five challenges – and five solutions – to trends that will resonate with procurement professionals everywhere.

Today, we’re at the point where we need to look forward to see what’s coming, understand where the dynamics of the industry are going, and make sure we participate in those trends. It’s equally important, however, that we address the biggest trends and challenges facing our organisation today.

The following five challenges are not the result of theory or a brainstorming session on the whiteboard. Each point is a red-hot issue that we, as a procurement function, are currently experiencing first-hand.

  1. Faster than anticipated global supplier consolidation

The challenge: The biggest suppliers on the market are growing at a great rate and becoming increasingly powerful. Supplier consolidation isn’t new, but it’s happening much faster than anticipated. This, in the context of value being captured at the layer of applications and services, can fundamentally impact our telco business.

Solution: One way to address this trend is for operators to join forces and form telco buying consortiums to aggregate volumes and share benchmarks. These can be cross-industry groups that use their combined numbers to counter the weight of global suppliers. Examples of buying consortia in my sector are BuyIn, Telefónica and VPC

  1. Increased complexity adding risk to the supply chain

The challenge: No matter how far down the supply chain it occurs, any instance of modern slavery, child labour, or environmental breaches will reflect very poorly on the purchasing organisation. The supplier ecosystem is now so complex that it can be full of grey areas, making it all the more necessary to do your due diligence not only with your direct suppliers, but with second, third and fourth-tier suppliers.

Solution: Again, forming alliances or joining ventures that certify or give some form of accreditation to suppliers is more effective than trying to tackle such an enormous challenge alone. Organisations need to educate their first-tier suppliers to do the same for their suppliers, and so on. This challenge is relevant from both a social and legislative perspective

  1. Getting the most out of procurement systems

The challenge: Today we are spoilt for choice with procure-to-pay (P2P) systems. While there are many start-ups and new solutions that are elegant, user friendly, and beautifully designed, the reality is that companies our size have to integrate multiple systems. We can’t just throw legacy systems out the window. Another challenge is that any investment in technology will be wasted if it’s grafted onto poor internal processes and unclear accountabilities.

Solution: Do your housekeeping before investing in technology by cleaning up internal processes and driving discipline around the use of P2P systems. Align the process, then align the technology. In other words, prepare your organisation so they can use the technology constructively, otherwise you’ll risk wasting money.

  1. Connecting the dots between disruptive technologies

The challenge: Used in isolation, disruptive technologies can potentially have an impact, but few organisations are looking at them in conjunction. For example, augmented reality will get an incredible boost from AI, while AI will be significantly enhanced by quantum computing. Take Yellow Pages (printed phone directories) as an example. In the early 2000s they recognised that Google’s desktop-based search engine was a competitor, but didn’t imagine that the incredible rise of mobile phones that enhanced their competitor’s reach. The fact that everyone had Google in their pockets had an impact on their business model which was more significant than anticipated.

Solution: Build operating models that are flexible enough to adapt and integrate these new technologies, and think about how they can be combined to further augment each other. Keep in mind the difficulty that big companies have in flexing fast – so prepare by disrupting yourself before someone else does.

  1. Gaining the elusive seat at the table

The challenge: Seeking a seat at the decision-making table has been a procurement goal for so long that it has become something of a cliché, but it is so important that it remains important to keep pushing. In today’s environment, a third party can at the same time be your supplier, your customer, your competitor, and your partner in different fields. All of a sudden, you’re looking at a complex, 360-degree ecosystem, and who sits at the centre of that relationship? Procurement.

Solution: Procurement can prove its worth by providing credible solutions to business challenges, owning the bottom line, and (importantly) owning cross-company transformation landing. Why? Because any transformation program will require your suppliers’ technology and knowledge to land successfully. Procurement controls those partnerships, so should therefore be central in any successful transformational program.

Telstra is a leading Australian telecommunications and technology company, offering a full range of communications services and competing in all telecommunications markets. Hear more thought-leadership from Telstra at Procurious Big Ideas Summit Melbourne on Monday 30th October.