Category Archives: Life & Style

Notes from ISM2015: `The future demands us to innovate!`

phoenix convention center for ISM2015

This article is part of a series about Hugo’s visit to ISM2015 in Phoenix, Arizona. Here Hugo swaps sweeping desert for expansive conference floor…

First impressions? The Phoenix Convention Centre is spectacular, both on the inside and outside. Architecturally stunning like most of downtown Phoenix, the building looks like it could easily absorb ISM2015 three times over with room to spare, though I’m yet to see what it’s like with every delegate crowding into the building. The Exhibit Hall remained tantalisingly closed today while the exhibitors set up their displays, so I wandered around the accessible areas with my lanyard around my neck and showbag full of procurement-related goodies in my hand. I even stepped into the neighbouring performing arts centre to get a glimpse of the concert hall but was hustled out by security.

As a guest blogger, I have a ‘media’ badge attached to my lanyard, which I think is pretty cool. I’d like to stick it in the ribbon of my hat the way reporters wore their press IDs in old movies, but a) people might think I’m strange, and b) I don’t have a ribbon on my hat. I’ve been invited to the press room tomorrow morning, which I envision as filled with tobacco-smoke and weathered reporters tapping furiously on noisy typewriters (I know, I watch too many old movies). It’s more likely to be a plain room with PowerPoint capabilities and a handy Wi-Fi connection.

The crowd waiting for the first keynote speaker was buzzing with chatter, making me appreciate that aside from the huge line-up of events, perhaps the single most important aspect of this conference was the networking. ISM has put plenty of time aside to dedicate to networking – there’s a welcome reception tonight, two networking breakfasts, two “dessert receptions” over the lunch hour (I like the sound of that) and networking receptions in the exhibitor hall at the end of each day, for which I am the excited holder of two complimentary drink vouchers. Everyone in the crowd before me is chatting – and I mean everyone. No one is standing by themselves looking lost or awkward, which can be attributed either to the fact that everyone in procurement knows each other, or perhaps they’ve all been to ISM conferences in the past, or maybe it’s just the convivial American temperament that makes it so easy to meet new people. I can pick out a few different languages and accents in the crowd – a fair number of Chinese attendees, some UK accents, French and Spanish speakers and the full spectrum of regional accents from all over the States. I haven’t picked up any Aussie accents just yet, but I’ll keep my ears open tomorrow.

One of the most difficult parts of attending ISM2015 is the sheer volume of events that run concurrently. For example, if I attend a two-and-a-quarter-hour “Signature Session” tomorrow morning, I’ll be missing out on no fewer than twenty-four other sessions – just incredible. It demonstrates the sheer size of this event and makes selection a hand-wringing process, but ISM comes to attendees’ assistance by offering Learning Tracks and audience levels. The Learning Tracks create a clear pathway through the bewildering array of sessions that you can choose to follow, or to mix and match as I have done. The Tracks are:

  1. High Performing Value Chain Management
  2. Best Practices in Procurement
  3. Strategic Partnership
  4. Risk Management
  5. Leadership Strategies
  6. Delivering Financial Results
  7. Strategic Profitable Growth

Each event has a Learning Track listed against it and also a recommended audience level:

  • Essentials (for professionals new to supply chain management)
  • Experienced (next level up)
  • Leadership (professionals in executive and leadership positions with more than ten years of experience).

ISM has also created a handy App to select events, create a schedule, give feedback and other features. I’ll definitely need it tomorrow when I’m dashing from session to session all over the massive convention centre.

ISM in the spotlight

ISM knows how to put on a show. Even though the grand opening is tomorrow morning and the conference crowd is not yet at full size, this keynote speech is the first official event of the conference. The lights suddenly dim in the cavernous hall (massive, but not even the biggest in the building), the crowd falls silent and a single figure stands on stage in a spotlight. “The future demands us to innovate!” he begins, sharing a vision of the future for procurement. He is followed by five other illuminated figures, all beginning with the formula “the future demands”.

This is the theme of the conference. ISM turns 100 this year, but the CEO Thomas Derry tells us that the organisation is looking to the future. Derry introduces the crowd to the innovative snap poll system where we used our phones there and then to vote on a question put to the audience. As a researcher I was very impressed to see the bar graph on the big screen rapidly changing as responses flowed in to the question: “What global threats are most likely to disrupt your business or supply chains?” Results were:

  • Economic collapse abroad: 39%
  • War or terrorism: 5%
  • Direct or indirect cyber-attacks: 30%
  • Natural disasters: 20%
  • Other: 6%

The surprises for me here were the low score for terrorism and the high score for cyber-attacks – a flick through the program confirmed there’s an entire conference session devoted to protecting against cyber-attacks, so this is certainly front-of-mind in the procurement world.

After a few more preliminaries, the audience bursts into applause as the familiar figure of Robert Gates, former Director of the CIA and US Secretary of Defence, steps onto the stage. It’s not often you get to hear from someone who has directly shaped the history of the modern world, and he didn’t disappoint.

ISM2015 Annual Conference: A near-death experience on Camelback Mountain

In the first of a series of articles, The Faculty’s Hugo Britt takes us on a journey to the Institute of Supply Management’s annual conference. But first he must contend with Camelback Mountain…

Camelback-Mountain

Today, in Phoenix Arizona, I climbed the stairwell of the Empire State Building. Well, not the Empire State itself, but rather its equivalent – the Echo Canyon Trail to the peak of Mount Camelback. That’s what the colourful sign at the trailhead told me, anyway, along with a dire warning (unheeded) about the difficulty of trail. But more on that later. I’m here in Phoenix to attend the ISM2015 Annual Conference, one of the premier events for procurement professionals internationally.

First off, I’d like to thank my hosts at ISM (for those not in the know, ISM is the Institute for Supply Management, one of the largest supply management associations in the world) for their generous invitation and my employer, The Faculty Management Consultants, for supporting my attendance.

Today was only a short day at ISM2015, with a keynote speaker and a single conference session, so for this initial entry I thought I’d set the scene with my experiences as a first-time visitor to the US (not counting Hawaii) and my near-death experience on Camelback. The conference’s grand opening is in fact tomorrow, which promises to be an action-packed day full of procurement gems that I’ll be sure to share with you.

To introduce myself, I’m a 30-something-year-old research consultant from Melbourne, Australia, who doesn’t do particularly well in the heat. I’m lucky to have landed in Arizona in spring, as a 30 o C day is much more bearable than Phoenix’s hottest-recorded summer high of 50o C. Even at 30 degrees, I’m dashing from shade patch to shade patch, wearing my battered old akubra that I thought may pass for the local cowboy hat (it doesn’t). As suggested by my job title, I’m a researcher specialising in procurement, but it’s early days yet – I only joined The Faculty in November 2014 and as such am in what I call “sponge mode”, soaking up everything I can on how procurement works with the long-term goal of becoming a procurement guru like my colleagues at the office. The sponge metaphor is actually quite apt, as my expectation that procurement would be a dry topic was very quickly overturned when I discovered the industry to be absolutely fascinating with boundless areas of investigation, a truly international outlook and incredibly passionate people.

I flew in on Saturday afternoon on a 50-seater jet out of Los Angeles. Bleary from the previous 13-hour leg from Melbourne, I was nodding off when a glance out the window jolted me into full wakefulness. The desert below me was just incredible – blinding white sands, abrupt rocky ranges, dried river systems spreading through the landscape like bronchioles, and patchwork clusters of irrigated farms around the two major waterways visible from the air, the Salton Sea and Colorado River. Phoenix itself swung into view and my first thought was how improbable its very existence seemed in such a hostile landscape. The sprawling suburbs hold 4.3 million people, with row upon row of identical terracotta-coloured rooftops and tiny pools glinting in backyards. The city centre itself (“downtown” in local parlance) seems very compact from the air and I strained in my seat to pick out the Phoenix Convention Centre, the venue for ISM2015.

downtown phoenix

Americanisms

Now, I know there’ll be some American readers of this blog who may be puzzled by my harping on certain parts of my experience, but some things seem so quintessentially “American” that I can’t resist including them here for non-US readers. Namely:

  • Tipping – so straightforward to Americans yet a minefield for foreigners like me. Who should I tip? Everyone that I make a monetary transaction with who isn’t a machine? How much? Have I offended by giving too little? Did I just give that waiter way too much?
  • American fare – my room service menu offers the following delights:
    • Jalapeno bacon and pistachio brittle
    • Tater tots
    • Sweet potato fries with marshmallow drizzle and candied pecans
    • Quico corn nut pie
    • Crispy chicken wings with blue cheese dressing
    • Fried whisky sour pickles with horseradish buttermilk dressing.
  • Super-friendliness – people from Phoenix (Phoenicians?) go out of their way to say hello to strangers – lovely!

How I nearly died on Camelback Mountain

I only had one gap in my schedule to go on an outing, so on Sunday morning I took it. I was up bright and early to grab a hotel breakfast (Fruit Loops; don’t tell my wife), jumped in a cab and headed to Camelback via Paradise Valley. The aforementioned sign at the trailhead warned that the second half of the climb was rated “extremely difficult”, at which I scoffed merrily and started on up. Ten minutes later I was still scoffing about the overblown rating when the sun heaved itself above the range … and I was flattened. It was hot. Heat was beating down upon my hat, reflecting off the rock walls on either side of me, shimmering up from the rock face at my feet – awful. My steady trot slowed down to a sweaty crawl (literally a crawl in some sections that required hands as well as feet) and I cursed my hubris. But the heat wasn’t what nearly killed me. What nearly killed me was narrowly avoiding stepping on a Mohave Rattlesnake on the edge of the path. I’m pretty good at understanding American accents, but I wasn’t quick enough to interpret what the guy behind me was yelling. I thought he said something like “heaven’s sake”, but he was actually warning, “there’s a snake” just before my foot when down right next to its head and, thankfully, it darted under a rock rather than going for my ankle. I also saw two fat-bellied Chuckwallas (we call them goannas back home), the Saguaro Cactus (a local icon which grows up to 50 feet tall) and the squat Compass Barrel Cactus.

mohave rattlesnake

Standing on the top, I was rewarded with an incredible panorama of the city and surrounding peaks disappearing into the haze. Phoenix is greener than you’d expect, especially in the wealthier areas, and of course the city’s famous golf courses. I was looking down on a particularly beautiful course directly below Camelback, wondering if it was the location of the first event of the conference, the ISM2015 golf tournament. I’d chosen to climb a peak rather than play golf (I can imagine my golf-mad colleague Chris shaking his head in dismay as he reads this) but the rewarding view convinced me I’d made the right choice. Besides, I hadn’t packed my chequered knickerbockers (or whatever it is that golfers wear).

Gravitas skills are key to unlocking door to boardrooms for women

Less than 25 per cent of board members of FTSE 100 companies are women…

Getting women into the boardroom

Britain’s boardrooms would change from ‘male and pale’ if more would-be leaders learnt to develop the skill of gravitas, according to author and leadership communications coach, Antoinette Dale Henderson. 

Antoinette regularly speaks on leadership identity, influencing with integrity, building inner confidence and communication excellence. In 2007, she launched Zomi Communications to commit to that mission, working with people to identify their purpose and define their unique leadership voice.

“Women, younger people and people from ethnic minorities often face particular challenges in tackling misconceptions about gravitas needed for the boardroom and that needs to stop” – says Antoinette.

“Gravitas is not an inherent trait – but it is an essential skill for successful leaders. My aim is to turn the old-school image of gravitas on its head and demonstrate that it’s a skill that can be developed by anyone who wants to fulfil their potential as a manager or leader. This book will help anyone, no matter what level of experience to use their own individuality to command respect and make a lasting impression. “

Leading with Gravitas is based on research conducted with a broad range of leaders including politicians, business and community executives, small business owners and entrepreneurs.

Her book aims to demystify the concept of ‘gravitas’ through exploring what it means for Britain’s successful leaders. Using a six-key model, it explores what the reader can do to develop their own gravitas and leadership style through practical exercises and tools.

Developing your own gravitas and leadership style

There are a number of practical exercises and tools which will allow you to develop your own gravitas.

The following is encouraged:

•Gain a clear understanding of the vital components of gravitas by analysing how you currently perform and what you can do to improve
•Increase awareness of your unique expertise and qualities as an authentic leader
•Access a range of powerful techniques to help communicate and present with impact
•Enhance your confidence, influence and ability to inspire others and deliver results
•Harness your passion and individuality to maximise leadership presence and project your best self

More information about Antoinette and her learnings can be found at www.leadingwithgravitas.com

Top five ways mindfulness can help you in the workplace

Work-life stress is taking its toll on the nation

A new study has revealed that cases of anxiety and stress are on the rise and taking their toll on our careers – in fact, other than being poorly, stress and depression are listed as the top reason people take time off work with one in five respondents admitting to taking time off work due to stress.

Is work-life stress taking its toll?

The research, which questioned 1,000 respondents and was commissioned by Anamaya to examine the impact our stress levels have on both our work and home lives, also revealed that more than half of us (52 per cent) actually only feel fully relaxed for just a couple of hours each week.

So what’s the answer?

Almost a third (32 per cent) of people questioned acknowledged that they felt mind training and meditation could make a real difference to their day to day stress levels but a quarter were unsure how to integrate mind training into their busy schedules.

Graham Doke, founder and narrator of the Anamaya app and ex-city lawyer, comments: “The majority of us have experienced how, at one point or another, the stress and strains of our work life can be brought back home with us on an evening. If not addressed, this stress can have a detrimental impact on our lives.

“When you look at the US and UK firms that have introduced mindfulness in the workplace, the results are overwhelming and show that simply taking 5-10 minutes out during your work day to focus on mindfulness, relaxation or to meditate, can have some truly remarkable results.”

Last year the US trend of focussing on mindfulness in the workplace began to take off in the UK, with firms such as the NHS and Transport For London introducing mindfulness and meditation sessions for their staff. 

The top five ways mindfulness can help you in the workplace:

1. Increased awareness of your emotions – office politics, rivalry, jealousy and competitiveness can all have a major impact on your work experience.  When executed properly, meditation and mindfulness training can increase awareness of emotions and the awareness of other’s emotion – helping you to control your reactions and be more aware when people are trying to provoke.

2. Manage anxiety levels – anxiety is proven to be an inhibiter of good performance, and it produces a self-feeding cycle of greater anxiety and stress. Awareness of your anxiety leaves you able to deal with the emotion itself, and clears the way to better performance.

3. Ease the pressure – People claim they ‘work best under pressure’, and managers often feel they get the best from their team by being aggressively demanding. However, neuroscience shows that stress, pressure, reaction to aggression all produces a negative reaction in our brains. Anyone who thinks they operating best under pressure is simply not thinking straight! Meditation reduces the activity of this part of the brain and means we can think clearer.

4. Problem solving – meditation can change the structure of the brain, particularly the pre-frontal cortex – this change is measurable with MRI scans and leaves the meditator able to modify their behaviour. One of the most empowering changes that mindfulness can bring is the ability to be less fearful and more willing to approach a problem than previously.

5. Work/life balance – In the modern environment of instant information, instant reaction, and 24/7 availability, it is difficult to achieve any kind of balance. In this ‘always on’ culture, where it has become increasingly difficult to switch off thanks to technology, employers are now much more obligated to ensure their employees’ health and wellbeing is maintained.

You can download the Anamaya app here via the iTunes store.

The need for speed: clothing ‘sweatshops’ in the UK

Garment workers getting paid £3 an hour, it’s a claim we’ve sadly become accustomed to over recent years. As our appetite for fast fashion and low prices continues to grow, clothing retailers continue their search for cheaper and faster ways to produce the clothes we wear.

Fast fashion

Although these disturbing headlines are becoming more frequent, we normally associate them with outsourced foreign workforces in the developing world, which makes a recent report from the University of Leicester quite unique.

The report titled, New Industry on a Skewed Playing Field: Supply Chain Relations and Working Conditions in UK Garment Manufacturing, claims that low wages, a lack of worker rights and poor safety standards are not reserved for garment workers in the developing world and are in fact present in the United Kingdom.

A growth industry

After a period of decline in the early 2000’s, driven largely by outsourcing to the developing world, the UK clothes manufacturing sector has seen a remarkable revival. It’s estimated that between 2008-2012, when most of the country’s economic activity was contracting, the garment manufacturing industry grew by almost 11 per cent.

A significant amount of this growth has been attributed to the proliferation of the ‘fast fashion’ business model, exemplified by firms like Zara and H&M. Fast fashion, dictates that clothes be produced in small batches and delivered to stores very quickly, if the items sell, the store will order more. The model is thought to be successful because it not only reduces the time taken to get fashion from the runway into stores, but also allows retailers to hold much lower inventory levels, maximising their cash flow.

Clearly, the need for speed in ‘fast fashion’ has meant that producing garments offshore has become less appealing and many firms are now looking to source much closer to home.

UK Garment Workers 

The report which focuses its efforts in Leicester, the traditional hub of British garment manufacturing, suggests that while ‘fast fashion’ has driven a revival in the British garment industry, the requirement for quick, cheap clothing has meant that British workers have been exposed to less than ideal working conditions.

Wages for the workers surveyed came in at around £3 and hour (less than half of the national minimum wage of £6.50), these wages were generally paid cash-in-hand and most employees held no contract of employment or workers rights. The report estimates that these underpaid wages would amount to roughly £1 million a week.

As well as inadequate wages, workers raised concerns over poor safety standards, verbal abuse, threats and health problems in the workplace.

Exploiting the vulnerable

The report suggests that the largest group of workers exposed to these poor conditions were women who have been living in the UK legally for more than 10 years, but possess a level of English insufficient to find other work opportunities. Also exposed to the employment law violations are groups of workers that don’t hold the requisite paperwork to legally work in the United Kingdom, these employees tend to work at an even lower rate of pay than the others survey in the study.

Structural change is required 

The report points to the fact the large retail organisations buying garments from these small factories need to take greater responsibility for the activities in their supply chains – this is a point I’ve argued often on Procurious. However, I do feel that in the case of ‘fast fashion’ operations, we as consumers need to take some the blame for these practices.

Our desire for ridiculously cheap, ‘fast fashion’ has created an fashion industry where margins are so low that supply chains must be as lean as possible in order for organisations to stay competitive. This rampant competition to the lowest price point is resulting in the exploitation of workers. Whether workers are located in Bangladesh or Leicester is irrelevant. As long as we, as consumers, continue to drive demand for £3 t-shirts and jeans, we are fuelling an industry that will inevitably focus on price above sustainability, both in the form of human rights and environmental protection.

Clearly, action is required from a legislative point of view in this case, wages need to pulled in line with national minimum standards and worker rights needs to be addressed, but as long clothing retailers continue to compete primarily on price, I can’t help but feel we’ll continue to see headlines like this.

You’ve got two ears and one mouth: why listening is critical in negotiation

How to be a better listener

Last week I kicked off a series of articles aimed at helping you to prepare for your next negotiation. You can read the first entry around strategising and preparing yourself to negotiate here.

Today we are going to address the other side of the equation as we look to understand the motivations of the person/people you are negotiating with.

Clearly some of your interests will be shared, however it’s likely that some interests will be opposing. By putting some time into understanding the motivations and limitations of person you will be negotiating with, you will begin to understand not only the balance of power in the relationship, but also the potential levers you have to move the discussion in a direction you are happy with.

Before the negotiation: Put yourself in their shoes

What do they want from you? Where do their pressures come from? What are their concerns?

If you enter a negotiation understanding the concerns of your counterpart, you have the opportunity to address these fears outright, thus proactively removing some of the obstacles to achieving a positive outcome.

Similarly, understanding the constraints of the other side can help you to frame your own argument. If financial constraints have forced your boss to let go of some staff, perhaps negotiating for more training or some flexibility to work from home is a better course of action than pushing for more dollars at the risk of shutting the whole conversation down.

If you are able to understand what the other side is looking to achieve, not just in this negotiation, but also more broadly as a business, you can begin to engage with them on a collaborative level.

By addressing the ways that you can help them to achieve high level aspirational goals, you move your conversation away from one of ‘what I want vs. what you want’ to something far more strategic that is more likely to be mutually beneficial.

Understand the other side’s BATNA

Last week I introduced the concept of BATNA (basically, your next best option if the negotiation fails to reach a conclusion). While understanding your own BATNA will help you establish a walk away point and will clarify your thoughts as to what constitutes a good result from the discussion, it also pays to hypothesise what the other sides BATNA may be.

By understanding the BATNA of you opposition, you go a long way determining the balance of power in the relationship. Do they need to strike a deal with you? If so, you can push a little harder in the negotiation. If they have other strong options, you clearly have less leverage in the discussion.

During the negotiation: Listen – It’s the most important skill there is

Obviously, any insight you have generated on your opposition prior to the negotiation is based on little more than your own assumptions and best guesses. The only way to test these assumptions is to prompt the other side to speak and to listen carefully to what they have to say.

When you get into the negotiation, leave your preconceptions at the door and listen actively. The best business advice I have ever received came from my father, he said: “You’ve got two ears and one mouth and you should use them in that proportion.”

Remember, you have to address what people actually say, not what you think they are going to say.

Creativity is critical

When you are in a negotiation (and trying to reach a mutually beneficial outcome) its important to think beyond financial motivations. Be creative, keep an open mind and address the full range of interests that the other side may hold, perhaps there is something else you can offer up other than dollars that would satisfy both your needs and those of the other side.

Suggesting collaborative projects, better payment terms, and commitment towards initiatives outside of your previous remit show that your are committed to the relationship and that you are bringing something more to the negotiation than a stubborn point of view on an acceptable savings or salary figure.

The art of negotiation

I’ll leave you with the following quote from Sun Tzu’s Art of War which I think sums up the importance of not only preparing yourself to negotiate but also preparing yourself for your opposition.

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

How Generation Y is shaking up retail and digital marketing

It is expected that by 2026 the main consumers of luxury will be millennials (or generation Y). This is notable for two reasons… The ways in which we consume digital content is steadily changing, and our newfound reliance on social networks will also have a profound effect on our shopping habits.

Some Millennials, tomorrow.
Some millennials, tomorrow.

This is a guest blog post from fashion entrepreneur Daniela Cecilio, Founder and CEO of ASAP54 (and previously of Farfetch.com).

It’s a well known fact that the world’s population is ageing , but what are the consequences from a marketing point of view for brands and consumers? The teenagers and young adults of today, often referred to as millennials, are expected to be brands’ center of attention in the near future. While at the moment their contribution to brands’ profits is small, they will soon increase their consumption capabilities as they will have their own families and reach senior and managerial positions professionally.

By 2026, the main consumers of luxury goods are predicted to be digital natives i.e. people born between 1980 and 2000 who’ve had technology penetrate every aspect of their lives from a young age. .

The main challenge here for brands will be to understand and adapt to this generation. Luxury companies are known to be reluctant to develop their online presence as it is often seen in the business as harming the image of exclusivity – but these companies might not have a choice anymore.

Shopping codes and references are evolving, being deeply linked to digital innovations: the path-to-purchase is getting more complicated and dense as the number of potential touch-points increases with new social and technological innovation. Social media is playing a bigger role in people’s lives, with consumers expecting to be able to interact with brands in the same way, whether online or offline.

The consequence of a missed interaction can be devastating for brands, as word of mouth coupled with the speed of the Internet is enough to spread negative perceptions and sentiments.

With 1 billion active users on video platform Youtube and 420 million users on blogging and image-sharing platform Tumblr, for example, brands cannot stick to traditional touch-points anymore and are forced to leave their comfort zones and to experiment – often for the best.

By teaming with social platforms, brands are creating immersive shopping experiences, enabling shoppers to discover and buy products at any time, anywhere. This ‘World Wide Window shopping’ concept is pushing messaging in a seamless way, taking digital strategies beyond the retailers’ websites. The American clothing brand Gap recently developed its own Instagram micro-series with a Valentine’s Day hook to showcase its line of jeans in a new and more integrated format, while luxury brand Burberry is now seen as a digital leader, being one of the first to live stream its fashion shows.

That being said, 2015 should be all about mobile apps, which were the biggest growth area in the mobile world in 2014. Internet shopping via computers and laptops dropped from 78 to 63 per cent last year, whereas smartphone and tablet shopping nearly doubled; from 8 to 15 per cent and 5 to 10 per cent respectively.

In the near future, I expect to see a significant development in integrated shopping experiences, as the number of users of visual social channels such as Instagram is consistently growing. Recently, we chose to integrate a new update within our visual recognition-based fashion app ASAP54, allowing users to access all their Instagram photos as well as all pictures they liked on the platform, to use within the service without having to switch platforms. I wonder then, what could be next? 

Negotiations needn’t be tricky – how to best prepare

How to best prepare for negotiation

Negotiation is a critical skill, not just in business, but also in our personal lives. Whether it’s readjusting contract terms with a supplier, discussing your next pay raise or organising where to go on your upcoming family holiday, the way we negotiate has a direct impact on where we’re headed in life.

However, entering into a negotiation situation can be a daunting thought. For many of us, the word negotiation is closely linked with feelings of awkwardness, compromise and conflict. We feel often feel ill equipped to manage the unknown, especially when negotiating with someone more senior, more powerful or more stubborn than ourselves.

With this in mind, I’d like to share with you a series of articles and propose some steps that will help you to prepare for your next negotiation.

Over the coming weeks, I’ll address what you can do to better understand the person you are negotiating with and why you should always consider external interests when you are preparing for a negotiation. But today’s topic centres on how to personally prepare and position yourself for a successful negotiation.

By failing to prepare, you are preparing to fail

The most successful negotiators have a clear understanding of what they want to achieve during a negotiation. If you can’t succinctly sum up what you want out of a negotiation, how can you possible hope to achieve it?

One strategy that can help to focus your efforts in this phase is to make a list of what you want, but also why you want it and why you think it’s reasonable that should you get it. Doing this in advance of your negotiation will help you to clarify your thoughts and provide you with answers to some of the tough questions that are likely to surface during the discussion.

Move beyond the dollars

When you are establishing what it is you want from the negotiation, it’s important to keep an open mind and think beyond mere dollar figures.

While monetary benefits are undoubtedly important, they needn’t be the sole determinant of success in a negotiation. Ask yourself what would constitute a good outcome for you. Could working from home or having the flexibility to spend more time with your family provide a similar level of happiness to a higher salary? If so, introduce these points into the discussion.

It’s important to keep your financial goals in mind and to push for them; however, good negotiators understand there are a number of ways to arrive at a good outcome.

Understand there may be more than one good outcome

As is often said, there is more than one way to skin a cat. When preparing to negotiate, try to think of a number of outcomes that you would deem to be acceptable. If you want, you can rank these outcomes in order of preference, but by understanding that the negotiation could have a number of good potential outcomes, you increase your chances of reaching an agreement.

If you enter into a supplier negotiation with a single viewpoint of what you consider to be an acceptable outcome (20 per cent price discount for example), you close yourself off to finding other innovative, potentially more lucrative solutions. Furthermore, any result other than your single viewpoint will feel like a failure. Looking at your interests (and those of your company) more holistically will naturally give you more flexibility and increase your chances of reaching an agreement that fully satisfies both parties.

Understand your walk away point

While negotiating is meant to be about reaching agreement, sometimes it is best not to. Not reaching an agreement allows you to explore other, potentially more lucrative options.

To this end, it’s important to take some time to understand your walk away position and to be prepared to put it into practice.

In their best selling book ‘Getting to Yes’ Roger Fisher and William Ury put some structure around this process and introduce the concept of BATNA (best alternative to a negotiated agreement). Your BATNA essentially outlines what will happen if you fail to reach an agreement during the negotiation.

In order to fully understand your BATNA, you need to understand what your next best options are. This requires a good understanding of the external market. What would another employer pay you? What price and service level would a competing supplier offer this product or service for?

By understanding your BATNA and walk away position, you enable yourself to make an informed decision about what the other party is offering. This process goes a long way in determining the balance of power in the negotiation.

What other tips have you got for preparing for a negotiation? Share them below and stay tuned for next week, when we delve into the steps you can take to better understand the person you are negotiating with.

Jon Hansen on building your procurement social media footprint

Your social media footprint. Image Pixabay

Last week I received the following Tweet:

@piblogger1 Lots of #Procurement pros keen to build #socialmedia profile but not sure where to start. Any tips for #Twitter success?

The timing for the above query was notable because on the same day, I received a message in LinkedIn from an industry sales representative asking a similar question.  The sales rep – who works for one of the industry’s more dominant P2P providers – wanted to find a way to better expand her footprint in the world of social media.

Besides pointing out the obvious, such as using a proper photograph for your profile pic, at the end of the day I wrote back, you need to follow the 3Cs model.

Centered around the Know, Like and Trust edict for doing business, I directed her to read my post titled The 3Cs of Social Media Success.

For those unfamiliar with the Know, Like and Trust reference, it is based on the fact that people will ultimately work with or do business with someone they well . . . Know, Like and Trust.  In fact, in the purchasing world, the more complex or significant the expenditure, the more of a factor this becomes.  You simply have to listen to my interview with a former aide of Governor Cuomo’s , in which he states that more than 90 percent of all contract winners in the state are selected before the actual RFP is issued, to understand its actual importance.

The question is how do you get to this point in a relationship.  Especially given that fact that despite being more connected today through social media and the myriad of electronic devices, we actually seem to be communicating less?

This is where the 3Cs come into play.

We are all familiar with the three R’s associated with learning (Reading, wRiting, and aRithmetic).  Think of the 3Cs of social media in the same way.

In a world of increasing noise levels where it is becoming difficult to establish a distinguishable presence and brand, the three Cs are the foundation upon which to build a meaningful rapport within the virtual realms of the Internet.

So What Are The 3Cs?

Content: Your content is relevant with what is happening in the world right now

Context: You have something meaningful to share with the world

Contact: Your content is shared or cross-pollinated across traditional and electronic print mediums, radio and Internet TV, social networks and social network groups

There it is, I can stop writing this post now and wait to hear about your success.

Much to the chagrin of every Internet huckster peddling a service or product that proclaims to know the secret of your success (i.e. SEO), the formula for connecting with an audience or market is quite simple.  You have to take an interest in the world around you!

This is the inescapable starting point.  There are no techniques per say, nor hidden paths to establishing the kind of meaningful rapport that is necessary for you to increase your virtual presence.  We are not talking about the recipe for Coca Cola here, or the secret herbs and spices that go into making the Colonel’s world famous chicken.

To be part of the conversation, you have to join the conversation, and in the process add value that is unique to your view of the world.  It is the only way for people to really get to know you, like you, and trust you to the point of actually wanting to make a meaningful connection with you.

To get to that stage however, you have to say something worth hearing before people will listen to you. And if they listen to you, they will get to know you and, as is often times the case, to know you is to like you.  From there, trusting you is just a short walk down the street.

Now for those out there who simply cannot believe or accept that building a strong social media presence is this simple, it is.

To start, ask yourself these three basic questions; 1. what is it I have to say that is meaningful to the world, 2. how does it relate to what is both interesting and important to the world and, 3. what are the venues through which I can best connect with the world around me?

While there are certainly demographic considerations with each venue – LinkedIn is more business oriented catering to the 35 to 55 age group, while Facebook is more personal focusing on the younger generation – the answers to the above questions are applicable across the board.

In short, what value are you bringing to the relationship?  Are you providing real knowledge and useful insight, or are you just trying to reach as many people as possible in an effort to make a sale.  There is a world of difference between the two.

In a future post I will talk about social media in terms of the procurement process itself, and how you can use the various platforms to become more strategic.  In the meantime, start building your personal footprint using the 3Cs and watch both your presence and influence grow.

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What can basketball teach us about hiring decisions?

Would you a hire generalist over someone who specialises?

What can basketball teach us about the hiring process?

While flying last week, I listened to a HBR podcast that discussed Google’s approach to talent selection and management. One of the first topics of discussion was Google’s preference for hiring ‘generalists’ over ‘specialists’.

Google’s partiality for generalists stems from the fast changing nature of its business. The company sits at the forefront of innovation, both within its traditional realm of Internet search and but also with it’s seemingly outrageous side projects like its efforts to produce self driving cars.

The podcast suggests that Google tends to hire generalists because they believe these ‘learning animals’ are more flexible and bring an open mind to problem solving and this suits Google. I guess when you are doing something that’s never been done before past experience is a little less relevant.

The podcast also states that specialists tend to bring a certain bias to problem solving. This sentiment is perhaps summed up by this quote from Abraham Maslow (he of ‘ the hierarchy of needs’ fame):

“I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.”

The one thing I took away from this podcast was that while hiring generalists may work for Google, I’m not sure this logic applies across the board.

The age of the procurement specialist

In procurement for example, I believe there is a strong case for hiring specialists. As the procurement landscape continues to become more complex geographically, technologically and legally, I believe the role of sourcing specialists with niche skill sets will increase in prominence.

IT is a great example of a category that has got infinitely more complex to understand, let alone manage, over the last decade (ironically, thanks in part to the generalists at Google). Firms have become more reliant on their IT operations as a source of competitive advantage – therefore doesn’t it follow that someone with an intricate knowledge of this area becomes more valuable?

Clearly, the generalist vs. specialist argument is an oversimplification of a complex matter. Successful teams undoubtedly need a balance of both. But how can procurement teams ensure they get the balance right?

What’s basketball got to do with it?

Studies by Dr Long Wang of City University of Hong Kong have addressed the issue of balancing generalists and specialists both in the workplace and on the basketball court.

Wang suggests that we as managers (or basketball coaches) have a troubling tendency to compare generalists to specialists in isolation. This tendency, he argues, is counter productive.

Wang suggests we should be analysing both the worth of employees and basketball players in the context of a team. While a basketball all-rounder may out perform a specialist three point shooter in a one-on-one match up, this is not a fair indication of their effectiveness as part of a team. Moreover basketball, like business, is about achieving team results not individual accolades.

Have you got the guts to pick a three-point shooter?

Wang postulates that our bias towards generalists has a lot to do with our aversion to risk. Generalists are more defendable to managers than specialists are.

“If I was the general manager of a basketball team” Wang said, “it would be easy for me to justify hiring one great athlete after the next because you can [justify] their individual statistics really well,”

While comparing a three-point specialist to a more rounded basketball star may appear unfair at first glance, (three-point shooters tend to be less athletic, post fewer recordable stats and are generally less captivating) their impact on the team’s overall performance is huge. Ultimately it’s the team performance we are interested in anyway.

“Do you want five superior athletes, or one clunky, non jumping, great-shooting three-point shooter and four great athletes? In fact, the five great ones, on average, might each be better than this guy, but as a team you do better when you have a role player who can do something special.” Said Wang.

There is no hard and fast rule to follow when it comes to selecting generalists over specialists or vice versa. But, I think it’s important that we remember to evaluate candidates based on how they perform as part of a larger team and not just what they are capable of in isolation.