A recent study into business negotiations found that the top challenges faced by businesses and individuals are (a) the price/value trade off and (b) developing alternatives/generating options, respectively. A recent Fortune Magazine review in partnership with Miller Heiman (the complex selling methodology gurus) found that sales resources quoted price as the number one reason why they lost deals.
There has been much talk in the IT industry on both the buy- & sell side about 'partnering' to deliver solutions. Looking at the supporting data, it is doubtful whether this talk has translated into action.
Whilst most businesses would like to believe that they are interacting with both clients & suppliers in a 'solution based' format, the role of price still dominates the process. This is due in large part to the inability of individuals to see the 'big picture' or to engage in creative thinking. Our research & experience demonstrates that one of the vital features of successful business negotiators is the ability to be creative & flexible.
Whilst many IT organisations have built their reputations on the back of their innovative and creative technologies, it would seem that creativity is often limited to the design & engineering departments. One of the strongest drivers of human behaviour is the tendency to avoid potential deficits. When considering information about the future, managers are more interested in avoiding possible losses than realising the same gains. This means that during negotiations that support complex and high value IT agreements, the focus is more often on managing risk to avoid potential losses, rather than on discovering innovative and creative ways to create additional value for all stakeholders.
The more complex the transaction, the more vital it becomes to manage risk. Rather than just trying to avoid losses, we should concentrate on ways to create options for mutual benefit during negotiations.
To avoid falling into the price trap, ask yourself the following questions ahead of each negotiation and make this part of your negotiation strategy:
1. Vision
a. What are the key interests of all the parties to the transaction that will be satisfied by reaching a settlement?
b. How important will it be for each party to the transaction to act in a mutually beneficial mode?
2. Value
a. What are the specific objectives of all the parties to the transaction?
b. What are the limits associated with each of the objectives for all parties?
3. Process
a. What assumptions have you made that you could confirm through questioning during the negotiation?
b. How can you frame the negotiation so as to support a collaborative, partnership based approach rather than a price centred negotiation?
4. Relationships
a. Do all parties have the same desire for a lasting relationship?
b. How can you influence the 'climate' of the negotiation so as to support a collaborative approach? ('Climate' pertains to non-verbal, physical and cultural aspects.)
Once you have covered these basic elements of preparation you will have time left to be creative. Being creative is not something that comes easily to all of us but it is an important negotiation skill. Use one of the well known creativity methodologies such as De Bono's Six Thinking Hats, or the Disney Creativity Model to help you generate options.
If you want to truly embrace a partnership method that delivers optimal value, you should waste no time at all in getting the creative juices flowing.
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IT Project Management Benefits State Of The Art Tools
The major source for the standards and techniques of IT project management and all other project management methods is the Project Management Institute (PMI), the main certifying body for project management professionals and clearinghouse for training programs and information in the field.
Management Mentoring Provides Your Business A Leg-Up Over Your Competitors
Many companies fall into the mistake of hiring someone who has managed people before, and assuming that, since they're an experienced manager, they don't need any more help. Nothing could be further from the truth.
Management Lessons Offer Hands-On Education To Improve Career
Are you interested in entering the management field? Or perhaps you're already in the field, but are interested in learning about how to become the best at what you do so that you can eventually be at the top of your field. In either case, taking management classes might be an excellent idea.
Management Tools - An Effective Tool Package For Successful Project Execution
Management tools are very essential for project managers in order to control and manage the project effectively. Tools from the management toolbox cd set will help by providing an easy way of project monitoring.
Project Management Training: A Factual Management Topic That You Want
Project management training entails training the personnel to work on and manage each aspect of a project so that all resources can be applied to the maximum extent. To manage a project, project management tools can be used by the project manager.
Importance Of Management Coaching To Enhance Employee Performance - Factual Experience Needed
Many companies hire managers for no reason other than that they have managed people before, in some capacity at some point, and are therefore assumed to know what they're doing
There has been much talk in the IT industry on both the buy- & sell side about 'partnering' to deliver solutions. Looking at the supporting data, it is doubtful whether this talk has translated into action.
Whilst most businesses would like to believe that they are interacting with both clients & suppliers in a 'solution based' format, the role of price still dominates the process. This is due in large part to the inability of individuals to see the 'big picture' or to engage in creative thinking. Our research & experience demonstrates that one of the vital features of successful business negotiators is the ability to be creative & flexible.
Whilst many IT organisations have built their reputations on the back of their innovative and creative technologies, it would seem that creativity is often limited to the design & engineering departments. One of the strongest drivers of human behaviour is the tendency to avoid potential deficits. When considering information about the future, managers are more interested in avoiding possible losses than realising the same gains. This means that during negotiations that support complex and high value IT agreements, the focus is more often on managing risk to avoid potential losses, rather than on discovering innovative and creative ways to create additional value for all stakeholders.
The more complex the transaction, the more vital it becomes to manage risk. Rather than just trying to avoid losses, we should concentrate on ways to create options for mutual benefit during negotiations.
To avoid falling into the price trap, ask yourself the following questions ahead of each negotiation and make this part of your negotiation strategy:
1. Vision
a. What are the key interests of all the parties to the transaction that will be satisfied by reaching a settlement?
b. How important will it be for each party to the transaction to act in a mutually beneficial mode?
2. Value
a. What are the specific objectives of all the parties to the transaction?
b. What are the limits associated with each of the objectives for all parties?
3. Process
a. What assumptions have you made that you could confirm through questioning during the negotiation?
b. How can you frame the negotiation so as to support a collaborative, partnership based approach rather than a price centred negotiation?
4. Relationships
a. Do all parties have the same desire for a lasting relationship?
b. How can you influence the 'climate' of the negotiation so as to support a collaborative approach? ('Climate' pertains to non-verbal, physical and cultural aspects.)
Once you have covered these basic elements of preparation you will have time left to be creative. Being creative is not something that comes easily to all of us but it is an important negotiation skill. Use one of the well known creativity methodologies such as De Bono's Six Thinking Hats, or the Disney Creativity Model to help you generate options.
If you want to truly embrace a partnership method that delivers optimal value, you should waste no time at all in getting the creative juices flowing.
Management Coaching - An Excellent Way To Coach Your Manager To Make Him/Her More Capable
A good management coaching trains the manager in such a way that they become highly skilled to manage large number of people and business processes. It's like providing a management toolbox for every day management tasks.
IT Project Management Benefits State Of The Art Tools
The major source for the standards and techniques of IT project management and all other project management methods is the Project Management Institute (PMI), the main certifying body for project management professionals and clearinghouse for training programs and information in the field.
Management Mentoring Provides Your Business A Leg-Up Over Your Competitors
Many companies fall into the mistake of hiring someone who has managed people before, and assuming that, since they're an experienced manager, they don't need any more help. Nothing could be further from the truth.
Management Lessons Offer Hands-On Education To Improve Career
Are you interested in entering the management field? Or perhaps you're already in the field, but are interested in learning about how to become the best at what you do so that you can eventually be at the top of your field. In either case, taking management classes might be an excellent idea.
Management Tools - An Effective Tool Package For Successful Project Execution
Management tools are very essential for project managers in order to control and manage the project effectively. Tools from the management toolbox cd set will help by providing an easy way of project monitoring.
Project Management Training: A Factual Management Topic That You Want
Project management training entails training the personnel to work on and manage each aspect of a project so that all resources can be applied to the maximum extent. To manage a project, project management tools can be used by the project manager.
Importance Of Management Coaching To Enhance Employee Performance - Factual Experience Needed
Many companies hire managers for no reason other than that they have managed people before, in some capacity at some point, and are therefore assumed to know what they're doing
