An article from a recent edition of IACCM’s Contracting Excellence on applying negotiation best practices and advances in personal productivity technology offered some suggestions for negotiation practitioners and supply management leaders that are worth a refresh.
Noting that the changing scope of business and technological advances dictates a need for new, or at least updated, negotiation skills and that every negotiator needs to
- know her objectives,
- know her organization’s requirements,
- know her, and her organization’s, competencies
- know the resources she has available, and
- know the targets she has to meet
the document outlines some best practices that will help her maximize the resources and competencies available to meet performance targets and negotiation objectives.
- Establish a Replicable Process
Repeatable processes save time and get better results. - Use Collaborative Tools
These days, supply management professionals need to lead cross-functional teams to insure they will get the best deal for everyone. Collaborative tools will help them work with individuals across the organization who are located in different geographies. - Increase Skills and Capabilities
Giving everyone basic training can significantly increase the benefits realized by the supply management organization. Certifying a department will go even further. - Mentor
Have your “A” Team mentor your “B” team, and keep your “A” team on the leading edge by sending them to seminars with negotiation leaders at least once a year. - Rehearse Negotiations
Get someone from sales with experience in the category you’re sourcing to play the role of vendor. Ask them to give you a rough time. This will not only help you understand how sales people think, and minimize the chance of being surprised in the face-to-face negotiations, but it will help you earn the respect of the sales department who might not value your contribution to the bottom line, which is five to twenty times more powerful than theirs. - Use supporting technology
e-RFX can greatly simplify the initial data collection. Data analysis software can help you analyze market indices and should cost modeling software can use this data to help you understand how much a product or service actually costs. There’s no weapon more powerful than knowing a supplier’s margin before going into a negotiation.