Posts Tagged ‘negotiating’

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Sales Negotiators Say The Strangest Things

Tuesday, May 12th, 2009
Sales Negotiations Have To Be Documented In A Way That Both Sides Understand

Sales Negotiations Have To Be Documented In A Way That Both Sides Understand

Although I had intended to write this posting about how we need to be careful when we are documenting sales negotiations with people from other countries, I slowly realized that we need to be just as careful with folks who were brought up in the same country as us.

So what’s the big deal about words – can’t people just speak clearly and let it be that? As long as you don’t use long fancy words, won’t everyone understand what you mean? It turns out that the answer is no.

I think one of the best examples of this was set by the professional negotiators who brokered the 1979 peace accord between Israel and Egypt. After everyone had finally verbally agreed to all of the terms, the papers documenting the agreement were drawn up. However, there wasn’t just one set of papers. Rather, there were four.

All of the agreements were documented in four different languages: Egyptian, Hebrew, English, and French. Even more importantly, all of the parties involved agreed that if there was a dispute, then the French version would be the binding version. Words can have completely different meanings in different cultures.

The negotiating expert Dr. Chester Karrass has kept track of how different cultures attempt to communicate an idea and somehow end up making mistakes. My favorite one from his list is the sign that he saw in a hotel in Egypt that read “Patrons need have no anxiety about the water, it has been passed by management.”

In closing, just because you’ve reached the end of a sales negotiation with the other side of the table, you must still be on guard. Your verbal agreements now have to be documented and both parties need to read and interpret the words in the same way. Your work is by no means done, it is only just starting!

Have you ever negotiated with someone who spoke a different language than you did? Were you able to finally reach a verbal agreement with them? What language did you use to document your agreements in? Were there ever any interpretation issues that arose because of language differences? Leave me a comment and let me know what you are thinking.

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Tips From The Middle East For Sales Negotiators

Tuesday, May 5th, 2009
The People Of The Middle East Have Always Been Sales Negotiation Experts

The People Of The Middle East Have Always Been Sales Negotiation Experts

They say that the world is getting smaller every day. This may be true, but the people who live in this smaller world couldn’t be more different than they are! A case in point are the  sales negotiators who hail from the Middle East – Arabs if you will. Unlike us in the West who become uptight at the mere thought of entering into a negotiation, they actually look forward to negations – it’s fun!

There is a lot going on behind the scenes here. Not the least of which is that negotiating has been a key part of Arab culture since days in which the very first trade routes wound their way through the Middle East connecting Europe to the Orient. They’ve gotten to be quite good at this skill and it shows when you negotiate with them.

One thing that Westerners need to understand when entering into negotiations with Arabs is that bargaining is a very social activity for them. You’ll find that you will be greeted warmly and food and drink are often provided in generous quantities. This can throw a Western sales negotiator off because you’ll start to feel as though you are at a dinner party instead of a sales negotiation.

Arabs also have a different view of time than those from the West. In part because they enjoy the sales negotiation process nothing will be rushed. You’ll find that there are many breaks, many side discussions, and frequent interruptions.

These interruptions may include visits from people not involved in the sales negotiations. They may come and go multiple times. Just let it happen. You need to keep your calm and realize that you are playing the same sales negotiation game, just at a different table.

Finally, you need to realize that Arabs don’t really worry about deadlocks. They have no problems walking away from a sales negotiation and then coming back to it later on. They always hope to eventually do a deal, but they realize that sometimes this is not possible.

Have you ever had a chance to participate in a sales negotiation when the other side of the table was from the Middle East? Did they seem to enjoy the sales negotiation process? Was time a factor? Did you ever encounter a deadlock? Leave me a comment and let me know what you are thinking.

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Japanese Sales Negotiation Secrets

Tuesday, April 21st, 2009

Sales Negotiations With Japanese Partners Require New Skills

Sales Negotiations With Japanese Partners Require New Skills

All too often Americans (like me) think that we know everything. The reality is that our society has only been around for a bit over 200 years and we’re just getting started. That’s why it can be valuable for a sales negotiator to take a look at how societies that have been around for 1,000′s of years negotiate. Like, say, Japan…

The U.S. really started to take a look at how we dealt Japan in the 1980′s when trade between our countries exploded. What people quickly realized is that both sides of the table were fundamentally different. There for the first decade or so, U.S. sales negotiators were getting taken to the bank more often than not because the Japanese sales negotiators were doing a better job.

Over time HOW these negotiations were being conducted was closely studied. Three techniques quickly became apparent:

  1. Considered Response / Respectful Silence: when Japanese sales negotiators are on the other side of the table, be prepared to sit quietly. Western sales negotiators don’t know what to do when nobody is talking – and the Japanese know this. They can sit, work out math problems, draw in long breaths, etc. and say nothing for minutes at a time. This is all designed to get you to become flustered and give in on a point or say something that you shouldn’t say.
  2. KAN – “Seeking Heavenly Approval”: Western sales negotiators like to focus on the here and now. Japanese sales negotiators realize that this deal is just part of a much bigger relationship. After the details of the agreement have been worked out and it appears as though you are close to closing the deal, members of the Japanese team will pause. They will consider if they really want to do this deal with you – is it going to be worth it in the long run, or are you just going to be too much of a hassle to deal with? This moment is called KAN – reaching “heavenly approval”.
  3. Time & Money: the Japanese view the sales negotiation process differently than their Western partners do. We in the west see it as something to race through and quickly get done with. The Japanese view it as something to be nurtured. They set aside enough time to do it properly. They resist attempts to wrap it up quickly. They will revisit points over and over again in order to test your resolve. This is how Japanese sales negotiators turn time into money.

It is entirely possible to enter into sales negotiations with Japanese partners on the other side of the table and come out with an agreement that you feel good about. However, you need to fully understand how they see the world and adjust your sales negotiating style to this situation.

Have you ever had a chance to negotiate with a Japanese team? Were there long, uncomfortable periods of silence? Did they seem to slow things down and do more thinking as the end of the negotiations approached? Did you remember to budget enough time for the negotiation or did they budget more time than you had? Leave me a comment and let me know what you are thinking.

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The Chinese Guide To Sales Negotiation

Tuesday, April 14th, 2009

Sales Negotiators Need To Learn How To Negotiate With The Chinese

Sales Negotiators Need To Learn How To Negotiate With The Chinese

Pity the poor American salesperson who goes out into the world of business and tries to negotiate. Sure, he/she is probably well equipped to negotiate with his / her American born-and-breed peers. I mean, after all, we share the same vocabulary, culture, and were brought up pretty much the same way. However, what happens when we encounter someone from a different (dare I say foreign?) culture? Like say, China…?

The world is constantly becoming a smaller and smaller place. Current economic conditions not withstanding, this is only going to speed up over time. That means that somehow we need to find a way to quickly come up to speed on how to deal with sales negotiators who come from different cultures. They think and act completely differently than we do and we are the ones who need to learn to adjust in order to make our sales negotiations successful.

Dr. Charles Karrass has spent a lot of time studying not only negotiations but also how cross-cultural negations do or don’t work. When it comes to dealing with folks from China, he’s got some suggestions for us:

  • Get Some Quanxi: Quanxi is the Chinese term for the construction of close family relations, or a joined network of relationships with the emphasis on the individual and informal groups rather than formal organizations. Building guanxi means building relationships. In sales negotiations, this means that by entering into a negotiated relationship, you are actually taking on a lot of responsibility. If things change during the contract, the other side can ask for changes and you are expected to be accommodating.
  • Watch Those Words: In negotiations with Chinese, what a word means is critically important. All too often, what a word means to you may not be what it means to the other side. Both before and during a negotiation, it would be worth your while to take the time to carefully define key words and make sure that both of you are using it the same way.
  • Persistence Pays: All too often in Western culture, we take a “no” as really meaning “no”. To a Chinese negotiator, your “no” just means “no for now” and they will feel free to revisit it over and over again to see if you’ve changed your mind. Many western negotiators have commented on this by saying that Chinese negotiators appear to grind away until they end up getting most of what they want. Chinese negotiators have both consistency and persistence – be prepared!

Yes, a sales negotiator can successfully conduct business with Chinese negotiators. However, you need to be aware that they view the world differently than you do and YOU are the one that is going to have to adjust in order to have these negotiations turn out successfully.

Have you ever had an opportunity to negotiate a business deal with a Chinese negotiator? Did they keep coming back over and over again to issues that you thought were already closed? Were there any misunderstandings over vocabulary words? Did you end up building a quanxi relationship? Leave me a comment and let me know what you are thinking.

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Sales Negotiators Should Always Have Limited Authority – Or Else!

Tuesday, February 24th, 2009

Sales Negotiators Who Have Authority Limits Can Use This To Their Advantage

Sales Negotiators Who Have Authority Limits Can Use This To Their Advantage

Do you run the world yet? I’m going to guess that the answer is no (if it isn’t, then we need to talk). When we talk about being successful in a sales negotiation, we often spend a lot of time trying to figure out how we can get more negotiating power on our side. However, sometimes NOT having negotiating power can work to our benefit…

If you are in charge, then the other side can always pressure you to make a decision because they know that you are the ultimate decision making authority. However, if you don’t have the ability to make the final decision, if you instead have limited authority, then there can be a number of benefits:

  1. Gives you the ability to say no gracefully if needed.
  2. Gives you room to back off and assess your position.
  3. Give you the ability to go check with experts.
  4. Give you the right to review the evidence.
  5. Give you the ability to take the time to look for mistakes.
  6. Gives you the time that you need to read the fine print.
  7. Gives you the ability to bring up undefined questions.
  8. Gives you the ability to write a better argument.
  9. Gives you the right to coordinate the decision.
  10. Gives you the ability to move the negotiation away from an unacceptable position.

As you can see from this list, what some would see as disadvantages during a negotiation can also be seen as advantages. Keep in mind that it’s really how you make use of something that determines if it is an advantage or a disadvantage.

The negotiation experts are often split when it comes to what types of limits on authority are more valuable than others. However, Dr. Karrass believes that  the best kind of limits on your authority are statutory or administrative limits. The other side will quickly understand that you are faced with these types of limits and in fact may enter the negations with the expectations that you have these limits.

Next in line comes dollar limits (managers can sign off on so much, Directors so much more, and VPs even more). The other side may be least receptive to hearing that you are dealing with people limits because these often seem to be things that you should be able to work through.

One thing that you are going to have to keep in mind is just how willing the other side is going to be to deal with you despite the limits on your authority. You may find that corporate policy limits are the ones that cause the most problems during a negotiation because they can be the most difficult limits to either change or circumvent.

There are a great number of different types of authority limits that you may be faced with during any given negotiation. The specific details of the negotiation will define the limits that are placed on you. No matter what limits are present, they can generally be placed in one or more common “buckets”:

  • Money limits
  • Term limits
  • Policy limits
  • Legal limits
  • Design limits
  • Group approval limits

In the end, when you find yourself in a negotiation with a number of limits placed on you, take a moment to understand how you can use these limits to boost your negotiating power.

Have you entered a sales negotiation with limits on your authority? Did you see this as a disadvantage or as an advantage? How did that negotiation turn out? Leave me a comment and let me know what you are thinking.

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