Hone your negotiation skills
Iain Ewing
Published: May 14, 2008
Let’s go back to basics – buyers need to be pro-negotiators. Iain Ewing gives an insight into why this most fundamental skill cannot be ignored, and how training can help you get your edge back.
Since my clients have included buyers in many large organizations, including hypermarkets, I can offer some practical advice on the kinds of training that you will need in order to ensure your career advancement. For example, one type of training you absolutely will need is negotiation skills. It is impossible to be in procurement, and not have to negotiate.
It would seem that it is only natural that human beings should be good at negotiating, and yet there are two fundamental attributes about humans that make it difficult for us to negotiate well.
First, if we are not exactly born liars, we learn to lie well from an early age. Just think back to the age at which your children started telling you lies. And it’s not just humans who lie. Crows are social animals. They fly around in flocks. When they find something tasty to eat, most of the flock will descend to the ground and start eating. However, one crow will always stay up in a tree to act as a lookout. And guess what? When he sees something especially tasty on the ground, he will give the alarm call. All the other crows will fly up into the trees, and he will then fly down to the ground to eat the tasty morsel. Since lying is a part of the way nature works on this planet, this means that when you are negotiating, you simply can never assume that the person with whom you are negotiating is telling you the truth. There is no such thing as “the best price”, and there is no such as “my last price”, and the best you can do is to look for what you think is a win-win deal.
Second, like crows, we are social animals. I want to like you, and I want you to like me. And if you are normal (and I assume you are), you want to like me, and you want me to like you. I guess you can see how this will create a problem when we are negotiating. I will have a tendency to give in too easily to you, because I want to be nice. You will have a tendency to give in too easily to me, because you want to be nice. So, what is the solution? Should I be as nasty and underhanded as I can? Should you be as nasty and underhanded as you can? But if we go down that road, we can both see where it will lead. We will hate each other, and it will be impossible for us to negotiate for a win-win outcome.
One solution is to get yourself trained. Since I have trained both buyers and sellers, I can say that I have seen both sides of the coin. I have come to the conclusion that, whether you are a buyer or a seller, you can use certain specific techniques to conclude negotiations more quickly – and successfully. One technique that I teach is called the “Mutual Concession Close”, and it can be used equally well by both buyers and sellers. You may already know it, and if you do, then you know it means that for every concession you ask from me, I must also ask for a concession from you. In my experience, if there is no mutual concession, it is human nature to wonder how much more you could have gained for yourself – if only you had tried! I created a training program for one of my hypermarket clients focused on this principal, and I am happy to tell you that the buyers I trained increased their buying margin by 1% as a result of the training.
Since my clients have included buyers in many large organizations, including hypermarkets, I can offer some practical advice on the kinds of training that you will need in order to ensure your career advancement. For example, one type of training you absolutely will need is negotiation skills. It is impossible to be in procurement, and not have to negotiate.
It would seem that it is only natural that human beings should be good at negotiating, and yet there are two fundamental attributes about humans that make it difficult for us to negotiate well.
First, if we are not exactly born liars, we learn to lie well from an early age. Just think back to the age at which your children started telling you lies. And it’s not just humans who lie. Crows are social animals. They fly around in flocks. When they find something tasty to eat, most of the flock will descend to the ground and start eating. However, one crow will always stay up in a tree to act as a lookout. And guess what? When he sees something especially tasty on the ground, he will give the alarm call. All the other crows will fly up into the trees, and he will then fly down to the ground to eat the tasty morsel. Since lying is a part of the way nature works on this planet, this means that when you are negotiating, you simply can never assume that the person with whom you are negotiating is telling you the truth. There is no such thing as “the best price”, and there is no such as “my last price”, and the best you can do is to look for what you think is a win-win deal.
Second, like crows, we are social animals. I want to like you, and I want you to like me. And if you are normal (and I assume you are), you want to like me, and you want me to like you. I guess you can see how this will create a problem when we are negotiating. I will have a tendency to give in too easily to you, because I want to be nice. You will have a tendency to give in too easily to me, because you want to be nice. So, what is the solution? Should I be as nasty and underhanded as I can? Should you be as nasty and underhanded as you can? But if we go down that road, we can both see where it will lead. We will hate each other, and it will be impossible for us to negotiate for a win-win outcome.
One solution is to get yourself trained. Since I have trained both buyers and sellers, I can say that I have seen both sides of the coin. I have come to the conclusion that, whether you are a buyer or a seller, you can use certain specific techniques to conclude negotiations more quickly – and successfully. One technique that I teach is called the “Mutual Concession Close”, and it can be used equally well by both buyers and sellers. You may already know it, and if you do, then you know it means that for every concession you ask from me, I must also ask for a concession from you. In my experience, if there is no mutual concession, it is human nature to wonder how much more you could have gained for yourself – if only you had tried! I created a training program for one of my hypermarket clients focused on this principal, and I am happy to tell you that the buyers I trained increased their buying margin by 1% as a result of the training.