It is vital to remember that negotiation is not a zero-sum game. Truly successful negotiation is when all parties feel they have achieved a “win-win” outcome. The most successful negotiators look to create value--positive items that benefit the other party--and claim value--items of benefit to them. This approach means that all parties feel they have [...]
Negotiation allows you to set and monitor expectations for quality standards, including the reduction of defects and maintenance and warranty agreements. Like negotiating to improve performance, establishing these terms and conditions upfront helps avoid problems down the road.
Negotiation allows both parties to agree upon expected performance level through clear, well-laid-out service level agreements (SLAs) and key performance indicators (KPIs). Negotiating terms and conditions in this manner helps mitigate future issues with project scope, timing, delivery and payment.
There is a difference between cost and value. We refer to this as knowing the cost of the drill and bits versus the value of the holes. Negotiation may not always result in lowered costs, but it can result in higher value to your organization through concessions such as reduced cycle times. [...]
Traditionally, lower costs have served as the holy grail for procurement professionals, and they remain an important goal today. Negotiation skills can help identify cost overruns and achieve overall price reductions.
The “zone of possible agreement” (ZOPA) is the range in which an agreement is satisfactory to both parties. Finding this common ground involves effectively trading concessions. Good negotiation planning allows you to identify what you can and cannot concede in order to reach the ZOPA while protecting and growing value for your organization. [...]
Frank and open discussion is the quickest way to identify and address problems. This is particularly important in cases where your organization has complex needs or an existing supplier is not meeting expectations in terms of performance or quality. Negotiation skills help you deal with problems collaboratively and reach a common understanding. [...]
A big part of why we negotiate in the first place is because there is no easy solution for both parties to minimize and manage conflict. This means that it is natural for disagreements to arise. Negotiation skills allow you to spot negotiation tactics--something a person says, does, or threatens to do that is [...]
Establishing understanding, trust and respect helps buyers and suppliers build relationships, it's the foundation for achieving your goals. It means being honest and no-nonsense in your own dealings, as well as evaluating, identifying and engaging with the right vendors--those who understand your needs and are willing to be your partner.
When it comes to negotiation skills in business and in life, communication is key. Open, direct, two-way communication means listening to and understanding the needs of the other party, as well as being able to clearly and concisely articulate your own position. This helps establish understanding, trust and respect.