In a research study done by Prof. Max Bazerman of Harvard University he discovered that almost all large companies had a clearly defined sales strategy and supporting sales process in place.
On the other hand, less than 1 in 5 companies had a clearly defined negotiation strategy or process in place.
You can bet your bottom dollar that in the case of small companies, probably very few have even ever thought about improving the way that they approach the negotiation process (contrary to popular belief, negotiation is not an event – it starts the 1st time you interact with your counterpart and it continues well beyond the time that you reach an agreement).
Based on my personal experience of delivering training consultancy assignments in 42 countries across almost all major industry sectors, almost all large companies have invested significant resources into optimising their supply chains through, amongst other things, the implementation of a robust sourcing process.
In addition, the results of our own on-going research study tells us that less than 50% of those working for medium and large companies have even read a book on negotiation or participated in any kind of negotiation skills development initiative.
Why is all of this important to know?
If you dont have a consistent, process driven approach to negotiation how do you make sure that your successes are repeated and your mistakes are not?
How do you make sure that you and/or your colleagues continually capture maximum value from your business negotiations?
How do you know your team doesnt make concessions when they dont have to?
If you have no structured negotiation process how do you ensure that you have a competitive advantage in negotiation?
Well, if you are looking for an opportunity to differentiate yourself it means that investing in developing your negotiation skills is far more likely to give you an edge than investing in developing your sales or purchasing specific skills as almost all of your competitors are doing exactly the same thing (investing in their sales and purchasing specific skill sets).
For example, some of the feedback that weve received from participants in our business negotiation skills programmes include:
a. Several individuals increasing their current or expected salaries by almost 50% as a result of applying some of the more than 50 strategies, tactics and techniques during the interview process.
b. A significant number of professional buyers exceeding targeted savings on procurement projects by more than 50% due to the application of the negotiation preparation check list.
c. Sales teams successfully maintaining their current margins on renewal of sales agreements in the face of increased price pressure from professional buyers by using the 6 principles of effective persuasion to move the discussion away from price to value.
Thats the exciting news.
The bad news is that simply acquiring a few tricks and tactics is not going to bring you any lasting improvement in your business results. Simply approaching negotiation tactically may deliver some short term results but it will not equip you with the ability to meet the ever more brutal demands of the marketplace.
Although you may view negotiation as a very personal skill, I can assure you that multimillion dollar transactions are seldom concluded by soft skills only. In fact, far more important than your personal skills is what you and your team do before you get to the negotiating table…
Here are 2 simple (and very safe) techniques that you can put into practice right away to get the competitive edge in your negotiations with suppliers or clients alike:
1. Ensure that you are as prepared as possible. Without a shadow of a doubt, the negotiation game is won or lost based on the quality of your preparation. If you are not preparing for an upcoming negotiation for at least as long as you are expecting to negotiate for, (1 hours preparation for a 1 hour negotiation) then you will be vulnerable and at serious risk of not achieving your objectives.
2. Try to understand the perspective of your counterpart or counterparts in the negotiation. The fact that you are able to defend your own argument only makes you average as we are all able to defend our own arguments. If you want to stand out, you should invest in understanding the world as seen from the perspective of others. This does not mean that you have to agree with your counterparts but if you can understand them better it will definitely help you to identify more opportunities for agreement.
Jan Potgieter is Founder CEO of Business Negotiation Solutions limited. For a FREE 5 day a href=http://www.negotiationeurope.comNegotiation Training /aeCourse, go to a href=http://wwww.negotiationeurope.comhttp://wwww.negotiationeurope.com/a