Do You Know the Difference Between Strategic Sourcing & Category Management?  Negotiation Skills are KEY!!! 

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Negotiating is something we do EVERY day.  Professionally, you may negotiate with a potential supplier or a key stakeholder or your employees or your executives.  Personally, you may negotiate with a realtor or a car dealer or your partner or your children.  Both types of negotiation have similar characteristics and keys to success.  Here are a few factors for a successful negotiation:

  • Sufficient time to prepare
  • Clear objectives
  • Information about the other party involved
  • A clear plan
  • All parties treating each other with respect
  • Effective communication (this includes listening)
  • Both parties willing to be open
  • Conflicts are handled constructively
  • Flexibility on both sides
  • Clear outcomes and agreement reached
  • Mutual gain

Believe it or not negotiating with a third party can be easier than negotiating internally (on the professional side) or with people you have a personal relationship with (on the personal side).  Some of the nuances associated with “internal” negotiations are:

  • There is NOT always a level playing field (e.g. your boss)
  • There is an assumption that goals are aligned
  • Must think of the negotiation as a journey – not an event
  • Requires planning just like third party negotiations
  • You MUST seek to find common ground – there is often no Plan B
  • You must Focus on preserving the relationship
  • There may be a failure to consider the other party’s interest
  • You may have preconceived long-term opinions about the other party

We are hearing from many, many of our clients that the “return to the office” later this year is causing quite a bit of discussion and consternation for both employers AND employees.  Some are ready to come back but MOST are not and so let the Negotiations begin!  I read a great article in HBR, “Are You Really Ready to Quit?” which discusses how to have a constructive conversation with your manager (an internal negotiation) before throwing in the towel.   As an employee you need to think about what you need AND how much leverage you have (key in any negotiation) and as a manager you need to think about what you need from the relationship, understand your leverage points as well AND be aware of how much flexibility you have to offer.

I don’t care what industry you are in, these conversations are going to happen, so as a manager you need to be prepared. We tell all of our clients – “you will never get more than you ask for – so ask”.  Whether you are the employee or the manager, you need to do some planning because careful planning will increase your chances of having a successful negotiation.  The article points out four areas that are likely to come up:

  • Work logistics – before COVID, employers were trying to determine the optimal “work from home” policy. Now that we have all done it, it’s a whole n ballgame.  Even new universal policies will have some wriggle room, so wriggle away
  • The work itself – if you need a change or want to build a new skill set, ask for it. A strong employee will have a good chance of easily having this need met
  • The people you work with – if you have a boss or co-worker that you simply don’t want to work with, ask to explore other opportunities within the company
  • $$$$$$$ – if you feel you are worth more than you are being paid then ask for it BUT be prepared to be asked to provide concrete examples or market information to support it

Your best people will most likely be the ones that come to you.  Likewise, if you are in an industry or discipline that is experiencing labor shortages, expect people to use that leverage to their advantage.  We often think of negotiations as conversations with third parties outside our company but it’s the internal ones that happen much more often and can be the most challenging.  Be ready and let the negotiations begin!      

 Let us know what you think and join in the conversation . . . . . . .

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Anne has been leading consulting and financial management organizations for over 25 years. She has extensive expertise in Strategic Sourcing, change management, contracting & contract management (both the buy side and sell side) organizational design and supply chain management. Anne has a passion for collaborating and educating her clients while helping them to uncover hidden value in their organizations. In addition, Anne has been named by Supply & Demand Chain Executive as a “Top 100 Provider Pro to Know” every year since 2007 and a 2013 Top Female Supply Chain executive.

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