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As a people manager there will be the requirement for you to negotiate and persuade others, probably on a frequent basis. For an engineer this may be with suppliers or customers, or in a bid to win resources. Alternatively, you may have to negotiate as part of a project team or whilst attempting to resolve technical problems. Ideally during negotiations both parties should come out feeling they have got what they want, or at least they have a solution that is acceptable to them – the classic win-win.
Maybe you may need to resolve conflicts where people have differing points of view. Too often negotiating can become aggressive and uncomfortable. Sadly it’s all too common for people to come out of discussions not only having not got anything like they initially planned, but also with animosity and bad-feeling between the two sides. Worst still, they may have to work together again in the future – the classic ‘lose-lose’. The good news is there are a number of useful tips and techniques you can employ to avoid some of these negative outcomes - and be a better negotiator as a result.
Engineering Negotiation and Persuasion: Doing the Background Work...
Depending on what’s at stake, it may be worth undertaking some preparation prior to starting your negotiation. Obviously for small issues this may not be the case, but for meatier topics where a poor result may have more significant implications, preparation is a good investment of your time. What are your objectives? What do you want to get out of this? Be clear on what is critical – your red lines – and what is desirable. With the latter you may be willing to compromise. Make a list so you are clear. Related to your aims are ‘what outcome are you expecting’, based on what you know about the other party? This is important as it will impact how you approach and structure the negotiations.
What are the options or alternatives? It’s worth thinking these through in advance, so you are in a stronger position, prior to your discussion. Consider any common ground you can state upfront and then build on. This is important for building rapport and agreement, before tackling trickier issues. Also consider likely consequences for both parties depending on the way the negotiation goes. What is the impact for you if fully successful or partially successful? What will it mean? Other thoughts include how well you know the other side, who possess authority and will the charisma of any of the negotiating parties influence events? Sounds a strange one, but it needs to be considered.
Preparing well for technical negotiations should also include swotting up on key facts and figures, or at least having them in front of you. Similarly, it may involve bringing background information you can refer to, as well as familiarising yourself with the context of what you are discussing. It may be possible to have other technical experts join you in support of your position. Their expert knowledge should strengthen your negotiating position. Preparation is all about having a sufficient game plan and being conscious of what you want and how to get it.
Engineering Negotiation and Persuasion: How to Win Friends and Influence People...
Persuading others is an important part of achieving your overall negotiating objectives. There are a number of things you can do, to more effectively convince others of your viewpoint.
Firstly demonstrate you are on their side. Do this by seeing things from their point of view and considering what it is like to be on the receiving end of your message. Use empathetic language. Objectively stick to the facts, rather than making assumptions.
Next, lead them over to your way of thinking. Start by demonstrating you understand the major issues. Convince them you understand their concerns. Follow this up by proposing options, with your preferred choice suggested at the end. Your options will have advantages for you so major on these whilst being respectful to their viewpoint. Anticipate their objections and reply in an understanding manner, stressing the advantages of your solutions for you both.
Try to make the other person feel comfortable. Always be polite and respectful. Try to remain positive throughout smiling and nodding on points of agreement when you have common ground. Consciously remain calm and in control even when emotions start to run high. A clear cool head is important. It will enable you to remain focussed and make the best decisions, articulating your points and sticking to your plan. Use appropriate open body language. Be aware of hand gestures and maintain plenty of eye contact. Articulate your argument in a sincere manner, remaining enthusiastic throughout. If you possess charisma use it, although be aware of patronising your opposite number.
Engineering Negotiation and Persuasion: Making Your Pitch...
You may have had to deliver a proposal to persuade others at some point at work. The 4 Ps method is a simple technique to help you structure the presentation.
Engineering Negotiation and Persuasion: Rounding Things Off...
At the end of your negotiations draw events to a natural comfortable conclusion. You’ll often start to sense when you have moved things on as far as you can go. Perhaps both your key aims will have been met, with maybe some compromise on a number of less important desirable objectives. Another factor which may help force the issue is the limited time you have to make any ‘deal’ happen. To formally draw the sessions to a close you can attempt to summarise everything agreed, together with any follow up actions. These may include who is to do what, by when. Address any areas of uncertainty by asking questions to confirm or explore your respective positions. Maintain a positive enthusiastic approach. Always end the meeting on a high. Leave the other party thinking you are approachable and someone they can do business with again in the future.
Daniel Glaser explains the negotiation framework, planning, the effect of power in negotiation, the role of concessions and compromise, negotiation tactics, win-win negotiation, and international negotiation
Ian Johnson's video outlines five purchasing and procurement strategies all geared towards lowering vendor prices and or reducing supply chain and inventory management costs.
These strategies are put forth from someone who has worked in sales and marketing for 20 years and wanted to combine the best strategies employed by the best purchasing negotiation teams. In essence, these strategies come from those purchasing and procurement agents I have negotiated with. They include the most successful strategies employed against me.
The first includes not tipping your hand and or broadcasting your needs too soon in the negotiation process with a salesperson. Instead, nail down your price and then use your requests, needs and or concession to reduce pricing. For instance, agree upon a final price and then ask for a discount or reduced price for 1) prepaying total or a portion of your purchase, 2) prompt payment incentives like net-10 day terms 1 to 2 percent discount or 3) increasing volumes or committing to long-term supply contracts or orders.
The second tip includes avoiding using veiled threats - which are simply threats you have no intention of following through on. When you threaten vendors too much without ever following through on a threat, then you are simply training them not to take your threats seriously.
Third, match a high-value concession for a high-value concession. In this case, come up with a list of requests and or "must-haves" as outcomes from the price negotiation. When the salesperson makes a request, make sure you counter with one of your own of equal value.
Fourth, when it comes to getting price reductions from a salesperson, you have to sometimes appeal to their better nature. In this case, add a little personal touch to your negotiations. Ask for a price reduction by outlining the pressures and demands that are placed upon you as a purchasing agent. In this case, you have to attain a certain inventory cost structure so ask your salesperson to help you attain that.
Finally, keep your vendor honest by constantly going out for competitive bids. Even the best of vendors can become complacent. However, if they know you know as much about pricing in the market as they do, then those vendors will be less likely to take advantage of you.
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