Building a Dossier to Negotiate Better Next Time

When learning to negotiate with another party, it is important to discover their personal negotiating characteristics. At the same time the knowledgeable negotiator on the other side of the table is learning how to deal with us.

Even though we try to do business only with cooperative business partners, the old military admonition, "Know thy enemy." Certainly applies.

Here are a few characteristics that will be useful to understand your other party's approach to negotiation:

• What range to negotiate do they leave themselves? In other words, historically, is there a consistent pattern from where they open to where they close?


• Concession valuation: It was interesting to learn that not everyone values concessions the same way. Some count concessions, while others look at the total value of the concession.


• People who count concessions are bargainers who are very comfortable with the tit-for-tat approach. Dr. Karrass reminds us that if we must give a concession in return, make sure it is less costly than the one gained.


• How does the other party respond to deadline?


• Can we believe their deadline?


• How good is their planning?


• How is their team synergy?


• Do they use ploys like Good Guy-Bad Guy?


• Does the boss come in at the eleventh hour as the bad-guy?


• How much emotional content do they use in the negotiation process?


• Do they have non-verbals that signal a willingness to close?


• Is there someone on their team who talks too much?


• How well do they honor agreements once they have been made?

These are a few ideas on reviewing and recording at the end of this negotiation to learn how to negotiate with the same party next time.

Quote: "People tend to replicate behavior which has proved to be successful in the past." Chester Karrass

The Circle of Discovery

Most students of the negotiation process agree that the best negotiators will perform a thorough process of discovery prior to sitting down with the other party.

The process of discovery itself requires resolving some internal concerns, such as:

1. How much do I really need to know? (In the next article we'll discuss some of the characteristics of the other party it would be helpful to know.)

2. What is going to be the best approach to discovering each of these points of information?

3. When does it become too much to ask?

4. When should discovery start?

5. Who, in our organization should be assigned each of the points to discover?

6. How will we verify the information we do discover?

7. Who in the other party's organization will we use as a source?

8. How can we deal with our people's philosophy toward discovery?

Now, hold a mirror up to the above list and prepare your organization for the other party's discovery process:

1. What is safe and / or appropriate to share with the other party? Some of these issues must be made available to create the best agreement possible for both parties.

2. What is the best way to disclose?

3. Who is the most appropriate person to disclose vital information?

4. How do we train our vulnerable people to not disclose information we do not want disclosed?

I will never advocate lying, but it is imperative your folks have permission to not answer a question! Here are some ideas on how not to answer a question and still maintain our integrity:

· "Wow, great question, but that answer can only come from Penny in Engineering."

· "Why is that important to you?"

· "I am not authorized to answer that question."

· "You know, we used to provide that type of information to trusted folks, like yourselves, but then we realized that our friends changed jobs, and their replacement never seemed to have the same level of confidentiality as the first person. Pretty soon our propriety information became street knowledge. Now, after being burned a few too many times, no one in our organization is authorized to disclose this type of information."

Some relevant quotes for you:

Remember, a loose woodpecker inside of the ship may be a greater danger than all the storms on the outside.

"I have never been hurt by what I didn't disclose, but I have oft regretted what I did say."

"It is better to remain silence and be thought of as a fool, than to open your mouth and remove all doubt."

"Silence creates confidence in your position."

"Wise folks speak when they have something to say and fools talk when they have to say something."

Entrenchment---The Avenue to Face-Loss!

Everyone knows what Entrenchment is. It is the process of arguing the same logic so many times that you can't change your own mind.

It is similar to a couple beginning a driving trip with the wife asking her husband, "Do you want me to get out the map?" Of course, we men are descendents of the great explorers, so the answer has to be, "I don't need a map, I know exactly how to get there; indeed, I think I know a good short-cut." Several hours into our 30 minute trip, we have said "I know where I'm going and we are not going to stop for directions." 17 times. By now there is no face-saving approach to ask for directions.

When entrenchment happens in the negotiation process we shift from a discovery-oriented both-win negotiation to a contest. Matters of principle will now overcome the ideal of the best agreement.

There is no fancy remedy for entrenchment except awareness. If you catch yourself repeating the same argument over and over, stop it! Hard to do? Maybe, but we all have to be in charge of ourselves in our negotiations.

What if our other party is becoming entrenched? Confront it early and gracefully: "It seems to me we are revisiting the same arguments without making any progress: may I suggest.........."

Another approach would be to find something in the other person's arguments that could be acceptable to you and make a concession on that point only, in exchange for a concession on one of their points.

Give to get; keep it moving!

Jim Sauerwein

Good Suppliers Make Customers Better

In the July, 2007 issue of GLOBAL LOGISTICS & SUPPLY CHAIN STRATEGIES magazine, they report on their annual survey of the best suppliers in the transportation industry.

Out of the 1800 nominated suppliers they selected the best 100 and looked for what set them apart from their peers. The most common 10 qualities that users looked for in their vendors were:

Reliability (of course) --- "When a vendor has proved itself to be rock-solid, an enduring partnership is assured."

Repeatable excellence --- Good performance is expected routinely, but nearly a quarter of the finalists had a record of exceeding expectations on many occasions.

Value and cost savings --- This may be a good place to comment that you will not find in these top ten qualities any mention of lowest price, cheapest or lowest bid. The most important financial measure was creating value in increasing sales, production efficiency or other revenue related measurements.

Expertise and knowledge base --- Customers are looking to their suppliers to provide best practices specific to their market, product and industry.

Problem solving ability --- "Many of our nominations were based on companies that had experienced emergencies, but thanks to the supplier's response cost and delays were minimized."

Continuous improvement --- "Especially for technology vendors, companies want to see a plan for product development, so they know their needs will be met in the years ahead." Suppliers that help their customers be "first to market" will always be the least threatened in a competitive marketplace.

Support --- So many manufacturing and transport firms have experienced multiple rounds of downsizing that they now must rely on their vendors to do many of the functions they no longer have manpower to do. Winning suppliers now manage local and remote inventories, provide computer interfaces for the elimination of paperwork and quicker deliveries, assume maintenance functions……….

Positive culture --- The phrase most often mentioned in all of our nominations was "can do". "The greatest accolades were bestowed on those vendors that took on any challenge and found a way to accomplish a goal without complaints or excuses."

Global capabilities

Strong management --- Strong and long-term supplier leadership insures that no matter how many people in the selling functions leave and are replaced, agreements will be honored. In other words, there will be no erosion of commitment no matter who is managing the account.

I think these 10 winning characteristics provide a great checklist for self-evaluation, no matter where you are in the supply chain.

Remember, having all these positive characteristics does not matter much unless your other party is aware of them!

Skepticism Pays

A good negotiator must be skeptical.

Not because the other party may be trying to be deliberately unethical or dishonest (although that may happen on rare occasions) but because when you take a skeptical approach it gives you the opportunity to avoid misunderstandings. You often discover items or issues left out of the negotiation which may come back later and cause major problems between you and the other party.

Being skeptical will also help you avoid making wrong assumptions and give you more opportunity to find out what the other party really needs. This allows you to reach better, longer-lasting agreements. The approach to evaluating what you are told by the other party can be summed up in four principles:

Never take anything for granted.

Check everything – and don’t forget to validate all your assumptions.

Put everything into its proper context – size, time, importance, today, past, future, etc.

Draw a sharp line of demarcation between facts and the interpretation of facts – validate your interpretations.

As you conduct your negotiation use these principles. You will be better prepared to create a better agreement.