All posts by John Viner-Smith

Don’t Just Negotiate Your Salary, Negotiate Your Career

If you wait until salary discussions to negotiate, then you’re wasting your time. There’s more in your career you can negotiate well for.

negotiate-your-career

When I was consulting, two of my colleagues were staffed on a project that never really happened. Willhelm and Rob spent three weeks on a project in which the only work produced was a three slide project plan outlining the project approach, before they were stood down.

The client changed their plans and had no use for the team. Wilhelm and Rob were duly staffed on other projects and moved on.

At year end, as is the way with consulting firms, both were up for promotion. They both had to compile feedback from the projects they had been involved in during the year.

Meeting or Exceeding Expectations?

Both approached the manager of the M&A project and had broadly similar conversations, with one crucial difference. Rob called the manager and said “I was on that project that never really kicked off, in fact we only produced that one deck, so can we just agree that I met your expectations?” The manager agreed.

Wilhelm said “I was on that project that never really kicked off, but we did produce that one deck. So can we just agree that I greatly exceeded your expectations? I’m in a promotion year, so it’s a big deal for me”.

The manager agreed. It really made no difference to him (we worked in a different part of the firm), and Wilhelm secured his promotion.

Rob was appalled. How could Wilhelm have pulled such a dirty trick? They both did exactly the same thing and yet he made such a bold claim! Where was the justice? It took him months to shake it off, but when he did, a crucial realisation dawned on Rob; He had let himself down. Wilhelm wasn’t the bad guy; Rob had been naïve.

Through the Eyes of a Negotiator

When you see life through the eyes of a negotiator, you see opportunity where others see risk. Wilhelm recognised this. He guessed (correctly) that the manager wouldn’t care very much about the grade he gave for a consultant in a different business unit, on an inconsequential project that never really happened.

Wilhelm recognised that if the manager didn’t like “greatly exceeded”, he’d probably be ok with “exceeded” and or “met” expectations. He was candid about his reasons. Wilhelm saw a negotiation opportunity, where Rob only saw an admin call.

It’s a fine line between being assertive and being pushy, but sometimes it’s useful to go beyond our own comfort zones. Wilhelm, in addition to being a clever, hardworking and talented consultant, also knew that knowing when to push a little could be the difference between getting the promotion and not.

It was a useful life lesson for Rob, and one that has served him well since. Our careers are full of innocuous little negotiations like these. Getting the most we can from every one of them is key to being successful.

Don’t Just Negotiate for Salaries

Most of what is written about negotiation in our careers focuses on the biggest, most obvious negotiation – “Getting that pay rise”. But the focus of those articles is tactical advice for the negotiation.

It’s ok advice, but if the salary negotiation is the first and only time your boss has seen you try to negotiate assertively, then they may not be convinced that they need to take you seriously now you’ve put your “negotiating hat” on.

However, if you’ve strategically positioned yourself as an assertive, pragmatic, skilful negotiator, who knows how to use negotiation as a problem solving and influencing tool, they will come to that negotiation prepared to work with you.

Imagine you’re working at full capacity and your boss asks you to take on additional work. Refusing may be uncomfortable and counter-productive. You risk being seen as intransigent, lazy or fearful.

But simply saying “yes”, and figuring you’ll find some way to make it happen, poses risks the new project, your existing work and your reputation. Even worse, if you do flog yourself extra hard and managed to deliver everything, you could be seen as a “safe pair of hands”.

That level of output then sets the expectation they have of you. This then becomes the new normal for the year to come. Does that sound familiar? Does it seem unfair?

Setting Clear Expectations – On Both Sides

You could negotiate the terms of the new project. At the very least, this is your opportunity to set expectations regarding the impact of this extra work.

You can protect your time and capacity to do high quality work by making clear to your boss that if they want everything done they are going to have to find some extra resource to help you (not your evenings!).

Additionally you’re showing that you’re sufficiently in control of your workload to understand and have plans to mitigate for the impact of being given extra work. You’re still offering your boss a solution, and positioning it as a less risky one. Best of all, you’ve increased your perceived value.

You’re no longer the pushover who takes on everything and does an ok job most of the time, but sometimes drops the ball. Now you’re the pro-active manager of expectations, who is realistic about what they can achieve, and is comfortable with delegating work effectively and helps find solutions to problems.

Finally, when that salary negotiation comes around, your boss is comes to the table ready to make some concessions, because they are used to you being an assertive negotiator, not a pushover.

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How Automation Could Shift the Negotiation Landscape

Ever wanted to know exactly what the other party in a negotiation is thinking? The growth of automation could potentially provide this and change the negotiation landscape for good.

Automation Negotiation

I read a very interesting scare story in the press recently. The claim was that the Uber smartphone app was monitoring the status of the phone’s battery and, when customers’ batteries were very low, raising the prices of their Uber rides.

For anyone interested in negotiation, this is a fascinating development; an example of automated gathering of information to develop actionable insight and take a position based on the expected influence of that information on the counter-party’s price sensitivity.

Or, to put it in plain English, guessing that a person looking for a cab with a dying phone in their hand will be that bit more desperate and price insensitive than the person who has plenty of power to find an alternative if they don’t like the Uber price.

Data Gathering & Behavioural Economics

The truth behind the story is less sensational but no less impactful. A little more research led me to the source of the story – an interview on NPR’s excellent ‘Hidden Brain‘ podcast with Keith Chen, Uber’s head of economic research.

The episode (entitled “Your Brain on Uber”) gives fascinating insight into the ways in which Uber combines unprecedented levels of wholly automated data gathering and insight with understanding of behavioural economics to assess what price they should be charging for a ride.

Uber does track your smartphone’s battery level and, while they’re adamant they won’t charge you more just because your iPhone is low on juice, they do know exactly how much more likely you are to accept their already controversial “Surge Pricing” when you’re low on power.

Uber raise prices when demand surges. So if demand temporality exceeds supply, Surge Pricing kicks in and the Uber drivers charge more for their service. Uber defend Surge Pricing by saying it provides an economic incentive for their drivers to “Surge” to where the excess demand is. This can be extremely useful where that Surge is unforeseen.

For example, a recent strike on London’s Docklands Light Railway led to me and several thousand other unfortunates to become stranded on Canary Wharf. Uber drivers all around London got the message; “Get to the Canary Wharf area. Surge Pricing is in effect”, and the message had the desired effect. Every Uber in town made money that night. Drivers who weren’t even planning on working saw the message on their phones and drove down.

To give you an idea of why they would do that, Surge Pricing can be up to 9.9 times the normal fare. That’s a powerful incentive to get yourself to the right place at the right time. Contrast this with Black Cabs’ static pricing. If the cabbies were doing ok in the West End, they weren’t going to make any extra by driving for free to Canary Wharf to pick up passengers who wouldn’t even pay a premium for their efforts.

The Buy Side

So the behavioural economics of the supply side of the deal stack up, but Uber talk less about the buy side of that trade. Yes, the opportunity to make more money out of short-term scarcity of supply will incentivise more supply, but while that imbalance persists you’re going to make a lot of money by exploiting desperation on the demand side.

For the most part I’m not minded to criticise Uber for that. If it meant a bunch of bankers and consultants had to pay more to make their table at Nobu Berkeley, I’m inclined to say “They can afford it”. And if they can’t, they can always pick up a sandwich and wait it out in a pub.

But there are people who can’t afford it. There were people on the Wharf that night who had to choose between not being there to pick their kids up from childcare and paying a week’s worth of disposable income to be there. As in all negotiation, it’s rarely about fairness. One other factor in Uber’s defence; the app makes finding people to share a ride with quite easy, which might mitigate against the impact of Surge pricing.

Optimising Yields

Uber’s Surge pricing algorithm is a particularly effective, automated negotiator. It is hugely well prepared, in the sense that it knows it’s counterparty and their motivations intimately. It is implacable and unemotional and it does the job that is intrinsic to all negotiators; it gets more for its stakeholders.

Surge pricing is a development of Yield Management, which is extremely commonplace in certain industries (travel in particular). What’s interesting in the Uber example is the innovative way that Uber is optimising yields through the use of ever more data.

As in everything else we do, automation is going to become a bigger and bigger part of negotiation. Negotiators will find more and more innovative applications for data science to equip them with information which leads to actionable insight, and some of these innovative applications will be more intrusive than others. Today it’s Uber accessing the battery meter on your smartphone, tomorrow’s risks will be far more wide reaching.

Automation in Negotiation

Ever thought how interesting it would be to hook your negotiation counterparty up to a lie-detector? You can have the next best thing today. If you could find a hacker to plug you into the data flow between your counterparty’s iWatch and their iPhone, you could watch their heart rate in real time on your phone as you negotiate with them. It’s an exaggeration, but that doesn’t mean it isn’t feasible and useful.

Recently I sat in on a meeting between a client in professional services and an Artificial Intelligence-based IT vendor. At the close of the meeting the vendor showed off his company’s personal assistant app on his smartphone, and a senior figure in my client was so impressed he immediately downloaded it from the App store and installed it on his company smartphone.

When the vendor left, I pointed out that he had probably signed away access to his email, phone records and contacts and diary to a vendor who was likely to be involved in a sourcing process, meaning that vendor could in theory see which other vendors the client was meeting, and when, and with which internal stakeholders coming along for the ride.

I’m not suggesting for one moment that the vendor in question had any intention of doing any such thing, but I can say that the client in question looked very sheepish and quickly deleted the app!

Technology constantly changes and develops but information is and always will be key to the balance of power in our negotiations. Think carefully about what you share, how you share it and who you share it with.

The best way to negotiate

Welcome to the third article in a monthly series from John Viner-Smith.

How to negotiate effectively

If you’re a student of negotiation (and, as a procurement professional, how could you not be a student of negotiation?) then you should have a well-thumbed copy of Richard Fisher and Bill Ury’s “Getting to Yes” within easy reach on your bookshelf. Fisher and Ury literally wrote the book on what is termed “principled” or “interest-based” negotiation (often simplified to “win-win” negotiation). When asked “what’s the best way to negotiate?” most academics will point you to this approach.

How to negotiate - getting to yes

There are five central guiding principles to this approach.

  1. Separate the people from the problem. In other words, seek to decide issues on their merits rather than the emotions, fears and egos of the negotiators
  2. Focus on interests, not positions. Fisher and Ury assume that almost all disputes can be resolved with principled negotiation because, when you cut through the positions adopted by negotiators to their actual interests, they are often more easily reconciled
  3. Invent options for mutual gain. By working creatively and collaboratively around the interests, negotiators can achieve outcomes that deliver gains to both sides.
  4. Insist on objective criteria for decisions. The classic examples quoted here are the purchase or sale of something like a house or a car, where there will be plentiful benchmark data available pointing to the “fair” price for the item being traded or an independent appraisal can be carried out.
  5. Know your BATNA (best alternative to a negotiated agreement). Your BATNA is the best outcome you can achieve if you don’t do this deal. If the proposal on the table is as good as or better than your BATNA, the deal is worth doing. If it isn’t, it’s not.

There are definite advantages inherent to this approach. If you genuinely have scope to negotiate this way you can engineer “all gain” deals which add value to both sides. In some cases, correct and thorough preparation on both sides and conscientious commitment to maintaining an atmosphere of curiosity, creativity and collaboration can result in deals which represent increased value to both sides and are the foundation of strategic partnership in business.

In a previous Procurious article I wrote that “win-win” is a myth, so you may be wondering how I reconcile that view with the idea of engineered, all-gain deals. “Win-win” is a term that is bandied about so much it has lost all meaning. All too frequently it’s used by one side or the other when they’re winning something, but haven’t given any real thought to what the outcome does for the other side. Engineered, All-Gain deals are only possible when both sides are genuinely curious enough to understand the other side’s underlying interests and candidly share their own. Sharing that information makes both sides vulnerable to the other, so an environment of trust and authentic commitment to the long term is vital. Business relationships like that are like marriages, and it is no more appropriate to talk about who won what in such a relationship than it is to call a winner in a marriage.

So is interest-based negotiation the best way to negotiate? My answer would be “sometimes”.

Let’s start by looking at this idea of calling interest based negotiation “principled”. Does that imply that all other kinds of negotiation are unprincipled? That’s a dangerous value judgement to make! Let’s use an example to explore this question. “Joe” is buying a house.

  • Joe’s budget is £500,000
  • The asking price for the house is £510,000
  • The vendor (unbeknownst to Joe, of course) needs £455,000 from the sale
  • The identical house next door sold last week for £489,000

Getting to yes-style, “principled” negotiation theory dictates that Joe should work with the vendor to find the deal that best suits both their interests and is fair to both, possibly taking market benchmarks into account. Under these conditions, you might consider that a settlement around £490k is fair and principled.

Instead of doing that deal, Joe uses an array of questioning skills, market knowledge and tactics to establish that the vendor could do the deal at £455k and wants money fast.  Joe then uses that information to apply pressure on the vendor to close the deal for £460k, thirty thousand pounds less than the “objective”, “fair”, benchmark price. Recognising that he’s never going to see the vendor again and therefore there is no value in a warm or trusting relationship, Joe uses every available lever to push the vendor down to a price that is closer to their walk-away point than the middle of the range.

Joe’s negotiating methodology is the antithesis of Fisher and Ury’s approach. He deliberately makes the person the focus by using the pressures on the vendor to create leverage. He focuses that leverage entirely on meeting his own interests to the greatest degree at the expense of the vendors’  and makes no attempt to come up with options for mutual gain. He ignores the objective criteria, focusing instead on the subjective pressures in the vendor’s head. Finally he closes a deal, keeping the lion’s share of the value in the deal for himself. So does that make Joe unprincipled?

If you’re tempted to say “yes”, ask yourself why. Certainly Joe is unlikely to enjoy a warm relationship with the vendor after the deal but why should that matter? He’s never going to see the vendor again. So if you did answer “yes”, is it possible that you just don’t like Joe? Maybe he seems greedy. Maybe you have some sympathy for the vendor. Viewed in isolation, Joe’s approach might seem aggressive and selfish. But let’s say Joe has a family, ask yourself this; who has more right to Joe’s £30,000; the vendor or Joe’s kids? They can’t both have it. Viewed that way, you might conclude that by pushing the vendor to accept the lowest possible price and saving himself enough money to put one of his kids through University without debt, Joe’s actions are entirely principled.

Life (personal and business life) is complex. We all balance complicated and often conflicting principles and duties and it is tempting, in the stress of negotiation, to lose sight of who’s interests you are there to serve. As a matter of principle you owe yourself the best deal possible. You owe your stakeholders the best deal possible. You owe your counterparty only what the circumstances of the deal at hand dictate that they are due, at the lowest possible cost to yourself.

Saying “It’s always best to adopt an interest-based approach to negotiations…” is correct in academic terms, but in the real world you have to qualify that by adding “…when you can”. As a negotiator you have other options available to you and they will be valid some of the time. In selecting which approach you adopt, I offer you a single guiding principle that works for me;

“Adopt the approach that will deliver the greatest benefit to yourself and the interests you represent”.

If circumstances allow an interest-based approach, this one principle will guide you to that approach. If not, this principle will help to focus you on doing what is necessary.

Why anchoring matters in negotiation

Welcome to the second article in a monthly series from John Viner-Smith.

Have you ever looked at all the perfectly good, almost brand new cars on the forecourt at a car dealership and wondered where they came from? If you haven’t noticed what I mean, let me give you an example. If you search a certain Prestige manufacturer’s website for an “Approved Used” example of their best-selling model you’ll find you can have a choice of around 200 cars, all under six months old with around five thousand miles up, priced 15-20 per cent lower than the cost of an identically specified brand new car. So who are all these people who buy brand new cars and return them before the first service is due? Someone has to be losing money here, right? Or is something else happening?

Negotiating a used car deal

A friend of mine used to work for a company that had a particularly odd company car policy. He had, at any given time, two brand new premium brand cars on his drive. He would keep them for three months or six thousand miles and, when either of those milestones was reached, drop the car off at the dealer and pick up another one. Coincidentally, my friend’s employer was a wholly owned subsidiary of the car manufacturer whose products he drove. See where this is going?

So here’s a question; why would a car manufacturer build cars to just to run them themselves for a few months and sell them at a big discount?

The answer, if you haven’t guessed, is to maximize the margins they can make on all the cars. The manufacturer makes a decent margin selling the car at the “nearly new” price. If they didn’t, they stop making so many cars. But they need to sell cars at the “brand new” price point for two reasons. Firstly, because there are people who will pay it (this is particularly perverse when you consider that those people typically have to wait for the car they ordered to be built rather than drive a car away from stock). Secondly, the existence of the “brand new” price point gives the “nearly new” buyer the satisfaction of feeling they got a great deal. If the narrative in the buyer’s head is something like “Wow! This car is basically brand new and I’m getting 17 per cent”, they will be satisfied. If that buyer doesn’t believe that they are getting a great deal, they will push harder for even deeper discounts. The price of the new car acts as an anchor – setting the expectation of the buyer and offering them the satisfaction of a deal if they secure a discount on that price.

Why does this matter to us procurement folk? Well, it turns out that anchoring is one of the oldest and most effective techniques in negotiation and the processes, technologies and strategies we have adopted have made us extremely vulnerable to it. To understand how, it helps to revisit the basics.

Even the simplest negotiation has a range of possible outcomes. The buyer comes to the table with a maximum price that they are prepared to pay. The seller comes to the table with a minimum price that they are prepared to accept. These are their respective walk away points. Be clear on this; your walk away point is your worst case scenario deal. You would do that deal, but it represents a bad day at the office. What you really want to do is get the best possible outcome, which, in a simple price negotiation is the deal as close as possible to the other person’s walk away point. Too many buyers lose sight of this, and one of the reasons for that is the extent to which they become anchored on the seller’s price. When that happens, the buyer stops thinking about how they are going to get to seller to accept the lowest possible price and starts thinking instead about how they are going to get the Seller to come down to a price they, the buyer, can live with. Instead of focusing on getting more, they’re relieved to get just enough.

Procurement’s reliance on the tender process makes us particularly vulnerable to this. We offer the seller the opportunity to put their price on the table first and they gladly accept it. When the proposals come in they’re typically more than the Buyer wants to or can pay. So the buyer’s goal becomes to secure the best supplier at a price they can live with.

Procurement people do a lot of benchmarking. Again, this process can be extremely damaging if you fall into the trap of benchmarking un-negotiated prices. If you assume that all bidders open with a price that is inflated to give themselves room to move and offer you “deal satisfaction”, then the “benchmark” price may merely be least ambitious opening position. I know plenty of buyers who have been happy with “saving” 5 per cent by getting the highest quality bidder to contract at the price of the lowest quality bidder. I’ve seen that change in price described as a cost avoidance saving of 5 per cent. But if, as is perfectly possible, the successful bidder’s walk away point was 10 per cent lower than their opening bid, then the truth is that the buyer overpaid.

How, then, do we combat this? Here are three simple steps;

  1. Get them anchored on YOUR price.

Put your price on the table first. You will get more from your negotiations if your vendor is lying awake at night wondering how they’re going to move you from a place where they can’t close the deal to a place where they’re getting just enough to do a deal.

Some buyers will feel that, by opening the negotiation and putting the lowest price they can imagine the seller taking on the table first they will make themselves vulnerable and they are right. If you open your negotiation at the lowest price you think the seller will accept, you will probably end up paying more. Firstly because your assumptions will probably be wrong. Typically, negotiators (on both sides of the table) underestimate how much room the other party has to move before they reach their walk away point. Go with your best guess and you’ll probably open at a price that is better for them than their walk away point, and any concession you make from that opening will move you closer to your walk away. The answer is to open your negotiation at a position you know they can’t do. But that’s another post.

2.  If they open first, don’t anchor on their price.

Their opening position typically has nothing to do with their walk away point. If they are any good; they have chosen their opening position based on their understanding of your walk away point. They should put a price on the table that they do not believe you can do, because they want you to be relieved when they offer you a deal that represents just enough for you. So ignore their first offer and make your extreme opening proposal. Anchor them on your best outcome.

3.  Play a different game.

Negotiation academics call this style of negotiation “positional” negotiation. In a single variable negotiation (e.g. when you’re only talking about price), the only strategy available to you is to negotiate this way. You have nothing to trade but the other party’s satisfaction. If you want to negotiate differently, accept that you will need to find other things to trade.

In an interest-based or collaborative negotiation, you prepare by figuring out both parties’ interests in the deal and use this information to consider the full range of negotiable variables that could be brought to the table and traded. Identify the things you believe they value that cost you, comparatively, less. Identify the things you value highly that you believe cost them, comparatively, less. Finally, identify the things that are of equal cost and value to both parties. For example, if you know that your counterparty needs to book a big deal before their year-end, you may choose to make timely contract signature and (depending on how they choose to account for deals). Contract duration variables in the negotiation because they are things that cost you nothing, but are key to the deal meeting their interests.

Preparing and executing an interest-based negotiation is not something you can do ad hoc. If you believe that this is going to be the appropriate strategy to help you get the most from the deal, you need to consider how you position, open and leave room to trade on all the conceivable variables in your sourcing process. There are four distinct negotiating strategies available to you. The details of each, and the framework for assessing which is appropriate and when, will be the subject of a subsequent post.

Finally, what good is this going to do you next time you go shopping for a premium branded German automobile? Think about preparing differently.

Start by checking out the prices of almost new, ultra low mileage examples of the car you want to buy on the dealer forecourt and use those as the benchmark price for a new car. You may not get the new car at that price, but you will get more than you thought possible.

Negotiation is no game… but here’s how to win at it (anyway)

Welcome to the first blog in a monthly series from John Viner-Smith.

I have spent my career negotiating. I’m guessing that you have too. I’ve worked in procurement as a buyer, a manager and consultant for over ten years but it was only when I left procurement and worked as a consultant and trainer working with procurement and sales people and focused solely on negotiation that I really came to appreciate negotiation as the core commercial skill.

Children negotiating marbles
Negotiate hard (like these children – over marbles…)

People have some funny ideas about what negotiation is. Let’s start by talking about what it’s not;

1.    Negotiation is not the price discussion that happens at the end of a sourcing process.

  • The entire sourcing process is the negotiation. Every conceivable variable (what are we buying? To what spec? Under what terms? Delivered where? When? How? Etc.) is negotiable.
  • If you park all of those early and plan to negotiate the price at the end, you’re either going to sleepwalk into a very competitive haggle or (assuming you’re negotiating with someone who knows what they’re doing), maybe you’ll just get the deal they wanted to give you all along.

2.    Negotiation is not comfortable

  • Negotiation is a tool for resolving conflict. It is therefore rooted in conflict, which is inherently uncomfortable.
  • If you fail to acknowledge and embrace that discomfort, you may find it becomes a factor in the outcomes you achieve. Ever held back from pushing for a little more in a deal because you didn’t want to be that person? That was your discomfort. And your failure to manage it costs you. Macchiavelli said “Whosoever desires constant success must change his conduct with the times”. Become comfortable with assessing and doing what is necessary.
  • As buyers, we have developed techniques and technologies that serve to insulate us from the discomfort of direct, face-to-face confrontation. The assumption that this is a good thing is deeply flawed.

3.    Negotiation is not compromise

  • The task of every negotiator is to get the most they possibly can get from each negotiation for themselves and their employers.
  • Compromise is what happens in the absence of effective negotiation.
  • Your goal is not to give the counterparty anything. Gifts are a sign of generosity.
  • If you are perceived as being generous, your counterparties won’t reciprocate with gratitude. They will become greedy. They will want more from you the next time.
  • Instead of conditioning people to expect free gifts, condition them to expect positive outcomes only if they earn them.

4.    Negotiation is not about securing a win-win outcome

  • Negotiation is about you getting everything you can get, not to be fair to the other party.
  • Win-win is a myth. If you assume you negotiate with rational, competent people, you must further assume that they won’t do a deal that has zero or negative value to them.
  • Therefore, they won’t do deals where they “lose”.  If your counterparty criticizes you for acting in a “win-lose” fashion, they are trying to influence how you feel about the deal. They may be genuinely aggrieved, or they may want you to think they are (it’s a backhanded compliment, designed to make you feel good about your “prowess”). If you have genuinely taken everything they could give you well, they still did the deal. So they’re winning something.
  • Conversely when your counterparty exhorts you to do a deal because “It’s a win-win”, one thing is clear; they’re winning something and want to close the deal. You may be doing ok, but could you do better?

5. Money never gets left on the table

  • I have heard countless negotiators tell me about the times they left money on the table.
  • No money ever stays on the table. If you didn’t take it, the other person did.
  • If the value is there to be had, your job is to get it. In a simple, one dimensional negotiation (typically price), that means you take everything and leave them just enough to close the deal and leave the table. In a complex, multi-variable negotiation that means you identify every conceivable source of value to them and to you and ensure you trade them to create a deal that’s bigger than the sum of it’s parts.

6.    Negotiation is not a game and it is not optional.

  • I meet (and negotiate with) people who’ll say “I’m not going to play games with you, the price is X”
  • If you have all the power in the world, and the counterparty has zero option but to do the deal with you on those terms, they will do it. But they will devote time and energy to clawing back some satisfaction in the deal. If and when the balance of power swings their way, you will be punished.
  • What if you’re counterparty was willing to settle for a price of X – Y? You just overpaid by Y, at least. Chances are that the counterparty will get you to move on your price, so you’ll pay more than X.
  • Negotiation is a necessary and important ritual to help you gauge and attain the best possible outcome every time.
  • Fail to negotiate and you just fail. If you closed a deal without negotiation you either created a risk for yourself down the line, or you got exactly the deal they wanted to give you.

I consult for and train procurement teams and sales forces. Effective negotiation training is not cheap, but it is also essential and an investment in people that delivers great returns in short order.