Posts Tagged ‘win-win’

Do We Really Need To Negotiate If We’re Going To Be Partners?

Friday, March 5th, 2010
Image Credit Sure You’re In Love Now, But What About Later On?

Sure You’re In Love Now, But What About Later On?

Welcome To The Age Of Partnering

Remember when every business used to view themselves as an island? This made life pretty simple for anyone doing sales negotiations – it was always us vs. them. Well, it sure looks like someone farther up the corporate ladder has been reading those business self-help books and they’ve decided that there is a better way to go about doing things: partnering.

Why Does Becoming A Partner Make Life So Difficult?

So just what is a partner? In simple terms (and it can get a lot more complicated if you let it), a partner is another company with which your company has decided to form a special, deeper, relationship. For a sales negotiator, this new type of relationship can complicate our lives immensely.

Before partnering came along, you had a great deal more latitude in how you conducted a negotiation: simply put, you really didn’t care that much about the other side of the table – you just wanted the best deal for your company. Partnering changes all of this.

The key here is to view a partnership as a bonding of two companies together (dare I say “marriage”? ) This is much different from a simple long-term partnership where you treat the other firm nicely, but you know that it’s not going to last (perhaps “dating” would be the right word here).

What Role Does Win-Win Negotiating Play In A Partnership?

One of the biggest changes that a partnership brings about in the life of a sales negotiator is the arrival (with a “thud”) of win-win negotiating. Instead of having the latitude to walk away from a deal with a partner, you’re pretty much expected to be able to reach an agreement with them. After all, they are a partner, right?

What this means is that the clever sales negotiator (you) now needs to use win-win negotiating techniques to find more things to negotiate about. The more discussion points that you can put on the table, the better your chances are that you’ll be able to craft a deal with your partner.

One important point that often gets overlooked when sales negotiators start to use win-win techniques with partners is that this does not mean that everything gets shared equally. Instead, what it really means is that everyone walks away feeling satisfied – one side may get 60% and the other may get 40%, but everyone feels as though they got what they needed.

Oh Yeah, That Power Thing

Power is a big part of any negotiation – who has it, how much of it they have, and how you can get more of it. You need to realize that just as in the fact that win-win deals don’t mean that everything is shared, the balance of power will always be unequal.

How much power you have often flows from how much information you have about the other side (your partner), and how much information they have about you. Since it’s a partnership, both of you will know more about each other than most parties involved in a standard negotiation would.

Since you know that you will be negotiating with your partner, as a sales negotiator you have a responsibility to make sure that others in your company don’t end up giving all of your negotiating power away. Sure openness is a good thing, but let’s not take it too far.

What All Of This Means For You

The role of a sales negotiator has become more complicated with the arrival of business partnerships. What use to be a relatively simple process of going into a negotiation with the goal of only improving your company’s position has now been changed.

In order to look out for a partner’s wellness during a negotiation, win-win techniques need to be used. This brings up more complicated issues surrounding what makes a deal fair for both parties and just how to make sure that you retain your negotiating power.

Business partnering is not going away. Sales negotiators need to accept this fact and adjust how we go about negotiating with this new type of opponent / adversary / other side of the table. If we can find ways to create deals that fully benefit both sides of the table both today and tomorrow, then we will have come to terms with the brave new world of partnerships.

Question for you: Do you think that negotiating with a bsiness partner is easier or harder than any other type of sales negotiation?

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What We’ll Be Talking About Next Time

So there you are, all ready to start another sales negotiation. Hold on a minute, are you really ready? Maybe you’ve overlooked the most important point of all – setting your target for the negotiation.

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Why Win-Win Sales Negotiating Never Works And What To Do About It

Tuesday, October 13th, 2009
Win-Win Negotiating Is The Wrong Way To Go

Win-Win Negotiating Is The Wrong Way To Go

Quick: what’s the first thing that you think about when you picture your next negotiation in your mind? Unless you are Mother Teresa’s brother / sister I’ll bet that you saw yourself walking away from the bargaining table with the best deal in the world , you had gotten everything that you had wanted and more. Umm, what about the other side? That’s why win-win negotiating never works.

How Win-Win Negotiating Is Supposed To Work

Too many people have created in their minds a magical world where win-win negotiating (where lions lay down with lambs, money grows on trees, etc.) always works. Instead of worrying about things like price, delivery date, and quantities, you are expected to instead be worrying about how the other side “feels” and what kind of deal will make them “happy“. Balderdash.

I don’t know about you, but I am forced to live in the real world. Flat out I don’t have the time to spend trying to worry about how the other side of the table is feeling today. It may come as no surprise to you that in my experience the other side is not spending any time trying to decode what my lucky mood ring is telling them about my current feelings either.

This kind of Pollyanna approach to negotiating does not work and the folks who go around writing books about it and teaching negotiating courses based on it have created a generation of negotiators who are, dare I say it?, ineffective.

Win-Win In The Real World

I like the part about “win-win” where I win in a negotiation; however, I’m a bit leery about the other side winning also , doesn’t that mean that I lost something? It sure does if I’m sitting at table with you and  a stack of 100 $1 bills and you and I are negotiating about how much of the stack each of us gets. Every $1 bill that you get is one that I don’t get , and I want ‘em all. I’ve been in negotiations like this and they basically suck.

In the real world you and I are sitting at a table on which is a pile of eggs, a chicken, and a pig. Now let’s start negotiating. Maybe I run a restaurant and you run a grocery store. On the surface things look the same as the stack of $1 bills example. However, this time around we’ve each got different needs. We actually might be able to find some common ground.

If I’m running a restaurant, then I’ve got dinners that I’ve got to cook tonight. If you’re running a grocery story then you’ve got to stock your shelves for this week , we’re both trying to solve time related supply issues. Long after the eggs, chicken, and the pig are gone I’ll still need to get supplies for my restaurant and you would love to sell those to me.

For creating my dinners, the chicken and the pig are more valuable to me, for stocking shelves for a week, the eggs and the chicken are more valuable to you. I’d might be willing to give up on the eggs if you’d give up on the pig. In fact when it comes to that pig, I’m interested in using the ham for a dinner and you might be interested in the bacon to go with the eggs that you’ll be selling to people buying breakfast food.

What you’re seeing here is how our self-interests start to overlap. No Pollyanna “I want to hold your hand” stuff, instead I’m still just thinking about myself; however, as more of my drivers are put on the table we’re finding out that you have many of the same drivers. Negotiating a deal that solves more of our common drivers is what’s going to create the best long-term solution.

Final Thoughts

Ever since that dang Getting to Yes book came out, negotiators have been pursuing a mythical unicorn-like type of negotiation , one where everyone gets what they wants and walks away from the table happy.

In the real world, this just simply doesn’t exist. Instead, we find ourselves in a situation where we need to work very hard to make sure that our side of the table’s needs are taken care of because nobody else is looking out for us.

Where there is some hope comes from taking a close look at our self-interests and finding out if there is any overlap with the other side’s. Where we are able to find common ground, we’ve got an opportunity to create a deal that will benefit both of us at the same time. As long as I get my chicken and my part of the pig, I’ll be happy.

Do you think that win-win negotiating has any place in real-world negotiations?

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

What We’ll Be Talking About Next Time

One situation that my students seem to struggle with over and over again is the case where it’s them and a whole bunch of other companies all trying to get the same deal. The other companies appear to be prettier, smarter, and all around better , what chance do any of us have against them?

http://www.theaccidentalnegotiator.com/

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Winning Sales Negotiations: The Pizza Secret

Tuesday, August 25th, 2009
Secrets To Making The Biggest Deal Pizza! <p> (c) - 2008 </p>

Secrets To Making The Biggest Deal Pizza! (c) - 2008

Recently I was talking with some friends of mine who are planning on using the current depressed real estate market to “trade up” and get a bigger / better house. They were lamenting the fact that this process was going to require them to negotiate with the sellers. They had come to me because they knew that I teach others how to use negotiation to quickly close bigger deals.

What they wanted to do was use that “win-win” technique that they had heard others talking about and they wanted me to teach them how. Sigh. Nothing in life is ever as easy as it seems, but from this experience I thought there were a few key points that you might be interested in…

The Negotiating Pizza

When I started talking with my friends about the house that they wanted to buy, I kicked off the conversation by asking them what they wanted to get out of the negotiations that they knew would be required. They said that price meant everything to them – they could only afford to spend so much money.

Dear reader, clearly we were starting off on the wrong foot. The problem is that my friends were looking at the negotiations for the house that they wanted as a pizza. Assuming that that pizza had been cut into 10 slices, they wanted to make sure that they came out of the negotiations with at least 6 pieces and not 4 pieces. This is not win-win negotiating.

In their quest to get the house that they wanted at the lowest possible price, my friends were approaching the negotiations as a contest – a contest that would have a clear winner and a clear loser. No wonder they were nervous!

A Better Negotiating Pizza

Win-win negotiating has everything to do with how both sides of the table feel after the negotiators are done. If somebody feels as though they’ve come away with less pizza than the other side, then it wasn’t a win-win discussion.

What you need to do is to make the pizza BIGGER. That way it doesn’t become a matter of who gets how many pieces, because both sides actually walk away with more pizza.

In working with my house buying friends, I asked them where they had some flexibility – what else could we add to the negotiations besides just price. It turns out that they were flexible on when they could take possession – they didn’t need to move in immediately. Also, my friends are handy fixer-uppers and so they were willing to make changes to the house – the current owners didn’t have to actually have the work done.

Final Thoughts

In the end, these two additional negotiating points were what allowed my friends to successfully close the deal. The current owners had not yet picked where they wanted to move to so having more time to get out of the house was very important to them. Additionally, they had a lot of fancy furniture that they didn’t want to have to worry about covering while the house was being painted, etc. My friends got the house for a fair price and everyone went away with more than enough pizza.

Sales negotiators who learn how to make the pizza bigger for both sides of the table will be able to close better deals and close them quicker.

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

What We’ll Be Talking About Next Time

The single  most important factor in determining how a negotiation is going to turn out centers on a single question: who has the most power? The big problem that most of us have is that we don’t think that we have enough of it. Turns out, we’re generally wrong about this…

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6 Ways To Break A Negotiation Deadlock (Plus One More)

Thursday, November 13th, 2008
When Negotiations Hit A Deadlock, Special Techniques Are Needed To Move Forward

When Negotiations Hit A Deadlock, Special Techniques Are Needed To Move Forward

So how many times has this happened to you: there you are happily negotiating along and then all of a sudden *bang* you run into an immovable deadlock. Some issue or some condition that neither you nor the other side of the table seem to be able to see eye-to-eye on just brings everything to a screeching halt. Hmm, what’s a negotiator to do? All too often negotiators bump heads for awhile trying to convince the other side to change their minds and then give up when this turns out to not be possible. There has got to be a better way of handling this! It turns out that there is…

Here are six (plus one) techniques that the folks over at the Karrass institute recommend for dealing with the deadlocks that occur in negotiations:

  1. Change The Setting: The negotiations up to this point have taking place at a specific location. If you now change the setting, then all of a sudden both sides will feel like they are starting a new round of negotiations. This means that all of the old assumptions about what would or would not work are (almost) thrown out the window. This fresh perspective might be just what both sides need to go back and revisit the issue that is causing the deadlock.
  2. Change The Negotiator(s): We are all so vain that we almost never consider this possibility, but it can be a powerful option. Sometimes we run into a deadlock because one or more of the negotiators who is involved in the discussions just can’t find a different way to look at the situation. This is often the case if the negotiations have gone on for a long time. If you switch out the negotiator, then you may find that the negotiations have taken a step back as the new negotiator works to establish a relationship with the other side of the table, but this might be just what is needed to move the discussions forward.
  3. Change Levels In The Organization: Often times a deadlock is a result of the negotiating parties not having the authority needed to be able to suggest an alternative. If this is the case, then a good way to deal with the problem is to kick it up to higher powers. They may be able to quickly find areas in which they can bend and that could get the whole discussion back on track quickly.
  4. Provide Additional Information: Each side of the table must have a reason for not being willing to budge on the deadlock issue. This reason is based on the information that they currently have. Sometimes bringing the information that you have based your position on and laying it out on the table before both parties can result in a change. The other side might point out that one of your assumptions is incorrect or they may be surprised to learn a fact that they didn’t know about. Either way, this might be just what is needed to get things moving again.
  5. Go “Off The Record”: Depending on the level of rapport that you have been able to build with the other side, this could be just what is needed. When you go off the record, you indicate to the other side that you are going to have a discussion with them about negotiating strategy that once completed will not be mentioned again. This is designed to show how much you trust the other side and to see if perhaps both sides of the table are trying to reach the same end point and are just getting tripped up by a minor issue. Careful with this one, you might be tipping your hand too much or too early in the negotiations.
  6. Say “Let’s Shift Into The Both Win Mode”: Although this doesn’t really mean anything by itself, it’s a great way to communicate to the other side that you would like to find a way to create a solution that works for both sides. Just by indicating that this is what you are working towards can often be the spark that causes the other side to start to consider more possible ways around your deadlock….and I promised you one more way to break a negotiation deadlock and so here it is:
  7. Take A Break: it sounds so simple that often we overlook it, but taking a break and stepping away from the table can often be the most powerful way to break a negotiation deadlock. We all have a tendency to get caught up in a negotiation when we are in the thick of it and our ability to think of creative ways to resolve deadlocks can decrease the longer that we’ve been negotiating. Taking a break might be just what the doctor ordered to get our creative juices flowing again.

Have you ever run into a deadlock while negotiating? How did you first try to resolve it? Did this work? How was the deadlock eventually resolved (or was it)? Leave a comment and let me know what you are thinking.

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