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Chapter 13: Tough or Effective?

Characteristics of Effective Negotiators

Being tough is not the same as being effective. Often, being tough leads to immovable positions that create negative feelings and more frequently lead to negotiations that are deadlocked. The source of the toughness usually lies in incompetence or insecurity. Applying some of the keys we have shared together will build your competence.

Effective negotiators will have the following attributes:

They know their ideal and work patiently and consistently for it.
They can be tough if - and only if - that would be productive.
They are very slow and rather mean in giving concessions .
They are not frightened by the thought of deadlock.
They never make it seem they have 'won' a point.
They always prepare their information and think through the possible obstacles.
They always rehearse the approach.

Effective Negotiators Look at Buying and Selling in the Same Deal

One of my clients sells PCs and software. They recently negotiated the biggest deal ever in their 14-year history. The contract was to supply PCs and services across Europe. First they looked for a way to earn authority by choosing to take on a small deal worth just a few thousand pounds . They saw the potential not in the job but in the customer. Price was stated to be a key issue, so they enhanced their credibility by going back through the supply chain. The customer wanted extra discount; my client insisted that for an increased discount of 1.5 per cent the order should be increased from 45 to 70 units. The discount didn't cost him; it actually gained him more profit on the whole deal. Because of the discount the customer then discovered some unused end-of-year budget and placed a further & pound ;100,000 worth of orders.

My client asked for payment on delivery and got it! In turn , they negotiated 60 days' payment terms from their supplier. They now had the additional benefit of several hundred thousand pounds earning interest for 60 days.

In the purchasing process they went first to distributors and evaluated the distributors on the basis of a similar quote for 40 machines. They tested on interest shown, speed of response, and hunger.

Having decided which distributor they preferred, they then went direct to the manufacturer and negotiated a few extra percentage points. They discussed other ways in which they could improve their margins. The end result was a pleased customer, a happy distributor, a willing and cooperative manufacturer, and a much richer client. They looked at both sides of the negotiating equation.

Effective Negotiators Balance Their Team Carefully

There may well be occasional , or more frequent, times when the negotiation requires more than one person on your team. It may be superiors. It may be technical experts. Whoever is involved there must be clear ground rules:

You are responsible.
That means you have the authority on the day. Your MD or manager must make that clear and be there in a supporting role.
Other team members know that they defer to you. You have set clear parameters of what they can and cannot say, and when they can say it.
They know that they only contribute when drawn in by you.
You summarise at every stage of agreement.
You agree the final deal - after which they shut up!

If you are wise, you will have rehearsed the possible outcomes with your team. Let them know where their danger points occur. Your counterpart should not have more people than you, nor should they have experts present in fields that you do not.