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What specific steps can you take to negotiate "inside out" effectively?
The following internal negotiation approaches will help you create the support you need to follow through on your deals.
1. Know the interests of your internal partners and acknowledge potential political ramifications of your solution.
Think about the components of a deal -- potential options for external agreement -- from all relevant internal points of view. Put yourself in their shoes. What might their interests be? What are their needs and concerns? Think about the external deal from internal points of view is the first step of a negotiation strategy. It is important to know when you are working across silos, and to recognize the ramifications of doing so.
This communication might sound like:
- Good: "As I see it, I think we need to do X."
- Better: "What do you think about this situation?"
- Best: "Here’s how I believe you might be impacted by this, and what your needs and concerns might be. Do I read the situation correctly? What am I missing?"
2. Communicate and build relationships.
Just as you want to provide solutions to your customer, you want to provide solutions to your internal network. What is the best way to ensure that your solution fits? Ask questions. Consistent intent and action on your part develops your reputation for honesty and integrity; people will support you. Make your intent transparent -- no hidden agendas! -- and you can control the impact of your internal negotiations. By sharing information this way you gain internal influence, the currency of decision-making.
- Good: "What can you do to help me get this deal?"
- etter: "We’re going to have to work together to implement this deal. Here’s what I need from you. How does this fit in with your priorities?"
- Best: "I believe this deal is coming down the pipe. What do you think the impact on you might be? What has been your experience with situations like this in the past? What would you like to see from this supplier? How can I best meet your needs as the deal evolves?"
This communication needs to be ongoing. It is not good enough to build support at the front end. Internal relationships must be nurtured with communication as the deal with your external partner evolves. These negotiations take time; they are dynamic. Remember: don’t surprise your internal allies.
3. Co-create options and help quantify the benefits and costs both to your company and the customer.
What will your internal partners would agree to -- more importantly what will they endorse -- as an outcome of your external deal? You can prime the pump with a few satisfactory options. Be ready for pushback on your ideas and additional options you did not think of. This is good. Pushback provides you with more clues about what your internal partners’ needs and concerns are; their ideas prove the adage that "two brains are better than one."
As you develop options internally, quantify the value propositions. What assumptions are you making? What methods will you choose to quantify the outcomes? How will the customer quantify the value? in other words, how will you measure success -- organizationally and individually? (e.g. EVA -- Economic Value Added -- you may not know about it now, but you’d better find out; e.g. return on committed capital) What are the key metrics that the organizations of individual being measured on?
It might sound like:
- Good: "Here is our option with this customer, here’s what she will demand."
- Better: "Here are some options this customer and I have talked about. What do you think? What would you add?"
- Best: "For this customer, what do you think our options could be? Which ones give you the most flexibility? Which one should we negotiate for and prioritize? How will we measure the success of the deal?"
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Copyright © 2002 Richard Morse
Copyright © 2002, The Negotiator Magazine