Implementing strategy, transforming an organization or conducting day-to-day operations requires negotiations.

Negotiating agreements is omnipresent in the life of organizations (and individuals):

• With customers to develop business.
• With suppliers and partners to ensure a robust value chain.
• With stakeholders to ensure efficient execution.

Communication, influence and negotiation go hand in hand.

Negotiation is thought to be a power struggle, however.

This is completely wrong.

Value First

It is about establishing a relationship to exchange value!

From this perspective, it is necessary to:

• Properly identify what we want and the different dimensions of our needs.
• Properly identify who is able to meet this need in terms of cost, deadlines, price, etc.
• Understand the impact of value for all parties involved.

This requires analysis, tactics and, above all, empathy.

Analysis

Analysis allows you to focus on different aspects of needs, potential market alternatives, and potential options to optimize value. It also allows you to establish the basic position and what is desired.

Tactics

Tactics allow you to approach negotiations as such. How to solicit and engage in negotiations. Think about the objectives, the process, the ideal outcome (the most desired outcome), the minimum acceptable conditions (the least acceptable offer), and the best alternative to a negotiated agreement (BATNA).

Empathy

Empathy, on the other hand, allows you to understand what value represents for the other party. The "what's in it for me" WIIFM. You have to ask questions, understand the impact of the agreement and what creates value.

This element is essential.

Developing Successful Agreements

This understanding of value is key to a successful agreement.

Various books dealing with the negotiation process, business development, or those aimed at strategic sourcing are unanimous. Understanding value requires asking questions, listening and understanding the possible and desired impacts of the agreement to be negotiated.

• "SPIN Selling" (Neil Rackham): Understand the context and the problem BEFORE proposing a solution to customers.
• "Let’s Get Real or Let’s Not Play" (Mahan Khalsa): Understand the opportunity, problems, value, impacts, resources, selection criteria and impacts BEFORE engaging in negotiation with the client.
• "Getting to Yes" (Fisher, Ury & Patton): Understand the objectives pursued BEFORE negotiating.
• Strategic Sourcing (Methodology): Analyze needs and understand market dynamics BEFORE determining the supplier solicitation approach.

For many, however, negotiation is a power struggle where there is a winner and a loser.

Negotiation is not a zero-sum game. It is not about capturing all the value for yourself. It is about maximizing it. It must allow for the development of a beneficial exchange of value for the parties.

By adopting the value exchange perspective, we are better positioned to build a "deal", an agreement that is profitable for the parties.

Empathy is the key competency to master in order to develop this understanding of the interests, needs and objectives of the other party. It allows you to target key questions and ensure active listening. By putting ourselves in the other person's shoes, our understanding of the value to be created allows us to take a fresh look at the possibilities.

So… How do you approach negotiations?

Have a good week,