Brian Dietmeyer: "Business Negotiation Redefined -how to create joint value and divide it...

business negotiation,

redefined

myth vs reality

myth negotiators are born “soft” skills ad hoc events complex individual skill sales tactical personality driven

reality negotiators are made analytical process 80% anticipated simple organization competency cross functional strategic data focused

no dialogue among bidders €1 increments can’t be first and second bidder high bidder gets the €20 for what

they bid 2nd highest pays and gets nothing

€20 auction

global negotiation peer benchmarking

external market forces market more professional buyers 92% increasing focus on price 91% increasing competitor irrationality 80% customer/competitor consolidation 90%/85% length of relationship longer term 89%

global negotiation peer benchmarking

internal strategy and tactics market extremely proactive planning for negotiation 11% informal or no negotiation strategy 83% centralized negotiation decision making 71% informal or no negotiation process 85% sales and negotiation integration 38% increased internal negotiation 81% not a high level of internal alignment 55% well defined competitive negotiation plan 9% not trading effectively for client demands 79% highly effective at negotiation 6.9%

redefining tactical negotiation

three things required to blueprint negotiation:

consequences of no agreementtradesanchors

blueprinting negotiation, a start

agreement zone

seller CNA

buyer CNA

common CNA tactics

“competition is better, faster,

cheaper…”

“you are way out of line with the

market”

what is being negotiated?

seller desire

d terms

buyer desire

d terms

common trade tactics

“i only want to talk about price”

“we need you to give us that option for free”

“sharpen your pencil”

blueprinting negotiation

seller CNA

buyer CNA

seller desire

d terms

buyer desire

d terms

tie it all together

seller CNA

buyer CNA

seller desire

d terms

buyer desire

d terms

anchor

seller CNA

buyer CNA

create joint value and divide it given concerns for the ongoing relationship

multiple equal offers (MEO)

we’re prepared to accept each titled to be meaningful to the customer

(CNA gap) custom built based on CNA/trades for

this deal result in a sensitivity analysis of their

interests

two or more bundled offers, approximately equal in value to us, but we believe they represent different value propositions to the other side

negotiation problem to be solved…

“I can get the same thing… from your competitor cheaper”

negotiation problem to be solved…

most negotiation problems are caused by one or both sides taking 1-2 aspects of

a very complicated business to business negotiation and focusing on them out of context

negotiation problem resolution

getting all aspects/facts of the deal on the table simultaneously

so more rational business decisions can be made

tactic process

negotiation tactics

rational response

anchor

CNA trade

the two key questions

what are the consequences to each

side if we do not reach agreement?

what items are likely to be included if

we do reach agreement?

key question #1

what are the consequences to each side if we do not reach agreement?

how we benefit… systematically take pressure of price compete rationally…value to value rational diagnosis of power fact based analysis

key question #2

how we benefit… systematically take pressure of price compete rationally…value to value trade vs. concede fact based analysis

what items are likely to be included for both sides if we do reach agreement?

redefining negotiation – tactics

three things required to blueprint negotiation:

consequences of no agreementtradesanchor on MEO

redefining negotiation - strategy

negotiation strategy:- what negotiation success looks like- what leads to negotiation success- trades and guardrails

world class negotiation standards

strategy and tactics target

extremely proactive planning for negotiation 75% formal negotiation strategy 75% centralized negotiation decision making 25% formal negotiation process 75% sales and negotiation integration 75% level of internal negotiation 25% high level of internal alignment 75% well defined competitive negotiation plan 75% trading effectively for client demands 75% highly effective at negotiation 75%

strategic negotiation alignment

strategic negotiation alignment

strategic negotiation alignment

strategic negotiation alignment

ryder align x-functionally on negotiation guidelines & outcome communicate to negotiators and use common process (+) (-) on key leading indicators measure lagging indicators

livingston align x-functionally on negotiation guidelines & outcome communicate to negotiators and use common process (+) (-) on key leading indicators measure lagging indicators

results

tie it all together

seller CNA

buyer CNA

seller desire

d terms

buyer desire

d terms

anchor

create joint value and divide it given concerns for the ongoing relationship