Archive for the ‘authority’ Category

Why The Standard Answer Can Help A Negotiator Close The Deal

Friday, December 2nd, 2011
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Standards Can Be A Negotiator's Best Friend

Standards Can Be A Negotiator's Best Friend

Magical mind control powers. That’s what every sales negotiator would like to have. The ability to bend the other side of the table’s mind to your way of thinking would be the set of negotiation styles or negotiating techniques that would make life so much easier. Sadly, I don’t believe that such powers exist. However, there is something that comes pretty close – standards.

What Standards Are And Where You Can Find Them

So right off the bat I guess we should tackle the big question: just what the heck is a “standard”? Standards are documented ways of going about doing something that were created by someone else. Note that I didn’t say that a standard is recognized as an official source by anyone in particular nor did I say that it was created by a person who is well regarded in a particular field. Don’t worry, using standards is still a part of conducting a principled negotiation!

A standard is simply that: documentation about something. The important thing from your point of view is that during a negotiation when you introduce a standard into the discussion that both sides start to treat the standard as the ultimate source of information. Using standards should almost be considered part of the negotiation definition.

If you are preparing for a negotiation and you find that there is no existing standard that will support your position, then it may be time for you to create your own standard. Even if you don’t create the standard, you can at least have someone within your company create it for you. Remember that who creates a standard doesn’t really matter, it’s just the simple fact that the standard exists that gives it its power.

How To Use Standards To Get Your Way In A Negotiation

Once you have the standards that you’re going to need in order to conduct a successful negotiation, you need to understand how to use them as part of the negotiation process. The real power from a standard comes from the fact that it now equips you with legitimacy.

During the negotiations you can refer to the standards and say things like “I’ve got to stay within these standards, that’s what my management has told me to do.” The other side of the table might not like this, but what can they do?

Just by having a standard, you can make it easier for the other side to agree to go along with the proposals that you are making. The standards provide you with an air of legitimacy and they help to guide the other side to reaching the decision that you really want them to make.

What All Of This Means For You

As a negotiator you are always looking for new ways to gain legitimacy in the eyes of the other side of the table. You really want to find ways to make your way of seeing the world their way too so that a negotiated deal is that much easier to reach.

Standards that you bring to the table can provide you with the support that you are looking for. These standards don’t have to be fancy internationally recognized standards. Standards that have been developed by your company (perhaps just for this negotiation!) often have as much weight. Simply by having a standard, you can reduce the amount of push-back that the other side will give to your proposals.

Take the time to plan your next negotiation. Look for ways to boost your position by the introduction of one or more standards. When the time is right, bring them to the table and defer to them. You may be amazed at just how powerful the right standard at the right time can be!

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: What do you have to do to make an internal standard be accepted as legitimate by the other side?

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P.S.: Free subscriptions to The Accidental Negotiator Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

Sales Negotiators Know That Authority Looks Different Around The World

Friday, July 22nd, 2011
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Authority To Negotiate Differs Depending On Where You Are

Authority To Negotiate Differs Depending On Where You Are

When you sit down to conduct a sales negotiation, you need to be assured that the people sitting on the other side of the table have been granted the authority by their company or organization to reach a deal with you. Under normal circumstances this can hard enough to do; however, when the other side is from another country, this gets even harder to determine.

The Difference Between The United States And Everywhere Else

Negotiating between parties that come from the United States and those who come from other parts of the globe can quickly become complicated. One of the reasons for these complications is because different cultures permit their negotiating representatives to have different amounts of negotiating authority.

An example of one style of negotiating authority comes in the form of representatives from the United States. For a wide variety of reasons based on both business structure and social norms, U.S. negotiators are often given a great deal of authority to negotiate and close deals. They don’t have to appeal to a higher authority to get approval for the deal and they are permitted to close deals by themselves.

This allows sales negotiations to move very quickly. Assuming that you can convince a U.S. negotiator to agree to a deal, you have the chance to walk away from the table with a signed deal that you can have confidence will be executed.

How It’s Done In Other Countries

When you start to invite representatives from other countries to the sales negotiating table, things can change quickly. I need to be clear here: not every negotiator from each country behaves exactly the same way. These observations are designed to paint a broad picture of what you can generally expect to encounter.

Based on where the other side of the table is from, here’s what you may encounter when you are conducting a sales negotiation with them:

  • French: when French negotiators are sitting on the other side of the table, don’t expect them to have been given a great deal of authority. Instead, they’ll have to take any deal that you reach back to a central authority for approval.
  • British: British negotiators are often given the same amount of authority as U.S. negotiators and no approval from a higher authority is required.
  • German: once again, German business is fairly well distributed and so German sales negotiators are permitted to close most deals.
  • Chinese: Chinese negotiators have very little authority. To make things worse, they will often put on an appearance of having a great deal of authority; however, in the end they will always have to go back to a higher authority in order to get approval for even the smallest of deals.
  • Japanese: once again, Japanese negotiators have very little authority. The Japanese culture is built on reaching internal agreement and so you should expect the other side to have to go back to their management in order to get internal agreement on the deal that you have reached.

What All Of This Means For You

Successful negotiators have the ability to be aware of their surroundings at all times. It turns out that this needs to include understanding where the other side of the table comes from and how their culture approaches deal making.

The U.S. style of negotiating pushes most of the authority for closing a deal down to the negotiator who is sitting at the table. The British and German cultures operate in much the same way. However, the French, Chinese, and Japanese cultures give very little authority to their negotiating representatives and require all deals to be taken to higher powers in order to get approval.

Negotiators who are aware of how much authority the other side of the table brings with them will always be better prepared. Knowing what will happen after a deal is reached makes reaching that deal that much easier to do.

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: Do you think that it would ever be a good idea to insist that a real decision maker be a the table during an international negotiation?

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

P.S.: Free subscriptions to The Accidental Negotiator Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

One of the great myths of sales negotiating is that you always have to know everything about everything. It turns out that even the great negotiators can’t do this. There are a whole bunch of reasons why, but the important fact is that it’s not possible to always be on top of everything. It’s what you do when you find yourself in this situation that will distinguish you from other negotiators.

Prove It!: 5 Techniques For Determining How Much Authority The Other Side Really Has

Friday, July 15th, 2011
Image Credit When Negotiating, Sometimes You Have To Look Behind The Curtain…

When Negotiating, Sometimes You Have To Look Behind The Curtain…

What’s your most valuable resource? You might have said money, but I’m willing to bet that it’s really something else – time. You can always earn more money, but once you spend time on some task, it’s gone, gone, gone. That’s why when you are negotiating with someone it is critical that you quickly get an answer to the most important question: how much authority do they really have?

Why Authority Matters

The whole purpose of spending time negotiating with someone is so that you can reach a deal with them. So what is a deal? It’s a two-sided agreement: you promise to do something for the other side of the table and they promise to do something for you. Sounds simple enough, right?

However, as with all such things in life the reality is a bit trickier. That deal may require the other side to give up something or spend money or time doing something. This is all well and fine if the other side has the authority within their company to make this happen. You’ll run into problems if after the deal has been reached that you then find out that the other side does not have the internal authority to carry out their side of the deal.

Often times you’ll encounter this “lack of authority” problem when you are negotiating with salespeople. They may talk a good line, but when it comes down to it, deals can only be done by people who are higher up in their company.

In order to make the best use of your time, you are going to want to be able find a way to spot these folks who don’t have the authority to execute a deal that you’d reach with them. Your goal should be to bypass them and to try to deal only with people who can do what they promise during a negotiation.

5 Ways To Determine How Much Authority The Other Side Has

In a perfect world, every person that you started to negotiate with would be required to carry an “authority card” that they could show you in order to prove that yes, they had the authority to carry out any deal that was reached with you. We don’t live in a perfect world so we’re going to have to come up with a different approach.

Although there is no “silver bullet” technique that will allow you to instantly determine if the other side has the authority to reach a deal with you, there are 5 techniques that can help you uncover situations in which the other side is not going to be able to carry out their side of the deal:

  1. No Vacations: A very common way of delaying a deal because the other side didn’t have the authority to strike it is to say that the senior management that needs to approve it is on vacation. Confirm that they aren’t before you start negotiating in order to eliminate this ruse.
  2. Get All Paperwork: As much as we may hate them, the world runs by having the correct forms filled out. Make sure that all required paperwork has been collected and is available before the negotiations start so that there are no delays.
  3. Be A Man Of Mystery: Or a woman of mystery for that matter. There’s no need to tip your hand to the other side if you don’t have to. Don’t brag to them about the limits of your authority unless they ask.
  4. Update the home team: It’s critical that you keep your team updated on how the negotiations are going. This will eliminate unneeded pressure being placed on you during the negotiations.
  5. Complain: Go to a higher authority at the other side’s company and tell them that you won’t negotiate with whomever they sent because they didn’t have enough authority. This is a sure fire way to ensure whomever finally gets sent will have enough authority to strike a deal with you.

What All Of This Means For You

As sales negotiators we all have an obligation to ourselves to make the best use of our limited time. One of the most effective ways to do this is to take the time to ensure that the person that we’re negotiating with has the authority to do a deal.

The other side of the table will often be coy about the amount of actual authority that they have. This means that you’re going to have to take action to find out. This may include asking them directly, researching their reputation, talking with the other side’s boss, or finding out how the other side makes decisions.

The time that you invest in determining just how much of a commitment the other side can make to you will go a long way in making the most of your time. It will also mean that when you reach a deal with the other side of the table, you’ll know that they’ll be able to honor their side of the deal…

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: What should you do if you find out that the other side does not have enough authority to do a deal with you?

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

P.S.: Free subscriptions to The Accidental Negotiator Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

When you sit down to conduct a sales negotiation, you need to be assured that the people sitting on the other side of the table have been granted the authority by their company or organization to reach a deal with you. Under normal circumstances this can hard enough to do; however, when the other side is from another country, this gets even harder to determine.

5 Ways To Determine How Much Authority The Other Side Really Has

Friday, June 24th, 2011
Image CreditWhen Negotiating, Sometimes You Have To Look Behind The Curtain…

When Negotiating, Sometimes You Have To Look Behind The Curtain…

What’s your most valuable resource? You might have said money, but I’m willing to bet that it’s really something else – time. You can always earn more money, but once you spend time on some task, it’s gone, gone, gone. That’s why when you are negotiating with someone it is critical that you quickly get an answer to the most important question: how much authority do they really have?

Why Authority Matters

The whole purpose of spending time negotiating with someone is so that you can reach a deal with them. So what is a deal? It’s a two-sided agreement: you promise to do something for the other side of the table and they promise to do something for you. Sounds simple enough, right?

However, as with all such things in life the reality is a bit trickier. That deal may require the other side to give up something or spend money or time doing something. This is all well and fine if the other side has the authority within their company to make this happen. You’ll run into problems if after the deal has been reached that you then find out that the other side does not have the internal authority to carry out their side of the deal.

Often times you’ll encounter this “lack of authority” problem when you are negotiating with salespeople. They may talk a good line, but when it comes down to it, deals can only be done by people who are higher up in their company.

In order to make the best use of your time, you are going to want to be able find a way to spot these folks who don’t have the authority to execute a deal that you’d reach with them. Your goal should be to bypass them and to try to deal only with people who can do what they promise during a negotiation.

5 Ways To Determine How Much Authority The Other Side Has

In a perfect world, every person that you started to negotiate with would be required to carry an “authority card” that they could show you in order to prove that yes, they had the authority to carry out any deal that was reached with you. We don’t live in a perfect world so we’re going to have to come up with a different approach.

Although there is no “silver bullet” technique that will allow you to instantly determine if the other side has the authority to reach a deal with you, there are 5 techniques that can help you uncover situations in which the other side is not going to be able to carry out their side of the deal:

    Ask: Although it sounds too simple, asking the other side if they have the authority to execute a deal is often the best way to determine their status. When you ask this question you need to carefully listen to their answer: are they vague or evasive? If so, ask more questions and find out just how much authority they have.

    Do Your Homework: The world in which we negotiate is actually very small. The person or persons that you are negotiating with have negotiated with others before. This means that you can find out how much real authority that they have simply by asking around. If they’ve over promised and under delivered in the past, then I’m sure that your peers will be more than willing to tell you about it.

    Take An X-Ray: During a negotiation it’s always important to remember that you’re not just negotiating with the person who is sitting on the other side of the table. Instead, you’re really negotiating with that person’s entire management structure. If you want to know how much authority they have, then you need to understand what this structure looks like and where they fit in it.

    Go Over Their Head: Instead of trusting the other side to tell you how much authority they really have, take the initiative and ask their boss how much authority they have been given. Often times their boss will be more direct with you – they’ve got nothing to hide and no face to save.

    Get A Map: Just what does it take for the other side of the table to get a deal approved within their organization? The more authority that they have, the shorter the post-deal approval time should be. If it appears as though a large number of people or a great deal of time will be involved in getting final approval for the deal that you reach, then you’re going to have to assume that whom you are getting ready to talk with doesn’t have very much authority.

What All Of This Means For You

As sales negotiators we all have an obligation to ourselves to make the best use of our limited time. One of the most effective ways to do this is to take the time to ensure that the person that we’re negotiating with has the authority to do a deal.

The other side of the table will often be coy about the amount of actual authority that they have. This means that you’re going to have to take action to find out. This may include asking them directly, researching their reputation, talking with the other side’s boss, or finding out how the other side makes decisions.

The time that you invest in determining just how much of a commitment the other side can make to you will go a long way in making the most of your time. It will also mean that when you reach a deal with the other side of the table, you’ll know that they’ll be able to honor their side of the deal…

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: What should you do if you find out that the other side does not have enough authority to do a deal with you?

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

P.S.: Free subscriptions to The Accidental Negotiator Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!

4 Ways That Less Is More In A Sales Negotiation

Friday, May 20th, 2011
Image Credit Sometimes The Half-Empty Glass Is Fuller Than You Might Think

Sometimes The Half-Empty Glass Is Fuller Than You Might Think

Power, power, power – sales negotiations are all about who has the most power, right? Well, no – sometimes it’s about who doesn’t have the power. A case in point is when you find yourself in a situation where you have limited authority – your hands are tied. It turns out that that there are four ways that you can both be limited in your authority while at the same time gaining more power in the negotiations. I’m going to tell you how to do this…

Organizational Limits

Organization limits are the most common type of limits that people encounter in a sales negotiation. How many times have you heard “I will have to talk to my boss” while working on a deal? This kind of limit can be a great way for you to get more time to consider the offer that is on the table before you.

Structural Limits

Structural limits have to do with restrictions on your negotiation power that have been placed on you by virtue of the job that you have, the company that you work for, or other type of limits that come with your job. The power of these types of limits is that the other side of the table rarely questions them. Once you say that your hands are tied due to a structural limit, the other side will almost immediately start to find other issues that can be worked without probing to find out why you have this limit.

Financial Limits

Financial limits rarely require much explanation – they just are. When you state that your ability to deal with the other side’s offer is limited due to financial restrictions, then your statement is given instant credibility. If the other side of the table knows that you have a financial limit, then you’ll be amazed at how often they are able to present you with a deal that comes in just under that limit in order to get you to approve it on the spot!

Legal Limits

One of the most powerful limits that you can bring to the table is a government restriction. Master negotiators often suggest that if it is possible that you bring a printed copy of the government regulations to the table just as a show of force. The other side will quickly accept that this is a limit that can’t be moved and will shift to negotiating on other topics.

What All Of This Means For You

When your ability to agree to proposals that the other side of the table is making is limited, you would think that you’d be limited in what you could accomplish during a sales negotiation. However, limits on your authority can sometimes result in you actually having more power in a sales negotiation.

We’ve discussed four different ways to limit your authority: organizational limits, structural limits, financial limits, and legal limits. Every sales negotiating situation will require that you carefully study the situation and decide which approach best meets your needs.

By placing limits on your authority during a negotiating session, you equip yourself with a way to say “no” to the other side of the table. Additionally, you provide yourself with a way to explore just how far the other side is willing to go in order to create a deal. It turns out that sometimes limits can be a good thing!

- Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: Under what circumstances do you think it would be a good idea to enter a negotiation with your authority limited?

Click here to get automatic updates when The Accidental Negotiator Blog is updated.

What We’ll Be Talking About Next Time