Honing your negotiation skills

HONING YOUR

NEGOTIATION SKILLS

NASIG Annual Conference

Nashville, Tennessee

June 8, 2012

Claire T. Dygert

Background Information…

Florida Center for Library Automation (FCLA): Supports the State University System (SUS) 11 institutions with a total FTE of 209,201 ranging in size from FTE

of 683 (NCF) to FTE of 36,665 (UCF)

College Center for Library Automation (CCLA): Supports the Florida College System (FCS) 28 community college and colleges (81 campuses) with an

approximate FTE of 300,000, ranging in size from FTE of 968 (Florida Keys CC) to FTE 58,738 (Miami Dade College)

[CCLA & FCLA → Florida Virtual Campus as of July 1, 2012]

Independent Colleges and Universities of Florida (ICUF): No central library organization 29 institutions with a total FTE of 123,984, ranging in size from FTE

of 153 (Beacon College) to 18,245 (Nova Southeastern)

Overview

The Importance of Good Negotiation Skills

The Planning Process

Putting together a Proposal

Negotiating the Deal

Building a Negotiation Support System

Learning from Your Mistakes

The importance of negotiation

“Only librarians, on the whole, complain about

the Big Deal, since their researchers are

mostly not aware of costs and cost increases.

And librarians have limited power. They also

have no strong track record when it comes to

negotiating, only in rare cases employing

professional negotiators, it seems. That is

their weakness, and the publishers’ strength”. Jan Velterop, quoted in Reed Elsevier NV: Feedback from

Meeting with Jan Velterop, FLASH NOTE, 6 February

2012, published by Cheuvreux Credit Agricole Group.

What does negotiation mean to you?

Winning or losing?

Arguing with the opposition?

Gaining or losing power?

Reaching agreement?

“Getting to Yes”: Principled vs. Positional Bargaining –

Separate the people from the problem or issue

Focus on interests, not positions

Create options for mutual gain

Insist on using objective criteria

What does negotiation mean to

you?

SCENARIO: MAJOR E-JOURNAL

CONTRACT COMING UP FOR

RENEGOTIATION

The Planning Process

Information Gathering

Assessment

Building Leverage

OUTCOME: Position yourself to develop an

informed proposal


Know the publisher’s business STM publishing is a high profit margin segment of the

Media industry, and maintained revenue growth despite the recession, with an average annual profit growth of around 10% p.a.

What is the profit growth of the publisher you are negotiating with?

Increased use of off-shoring and out-sourcing in order to reduce production and operation costs Half of Wiley STM’s 2011 profit growth stem from off-shoring

journal and book production as well as customer support and marketing functions

Wage cost per employee at Reed Elsevier down 1% in 2011, staff cost down -2.5% p.a. since 2009 as portion of off-shored staff increases


Know your university’s/library’s business

How have library and university budgets been

impacted over the past 3-5 years?

How has this effected you library’s buying power

over a specific period of time?

What impact have changes in curricular and

research needs had on your library?

What level of contribution have your own faculty

made to the publisher’s content?

Assessment

How is the collection being used?

Are there subscriptions held that are no longer

needed to support curricular and research

needs?

Does cost-per-use analysis identify content

more advantageously purchased on a per

transaction basis?

How does the cost compare to other publisher

contracts?

Building Leverage

Critical when dealing with sole source providers Are there other libraries you can partner with?

Springer Contract: 11 SUS + 8 ICUF + CCLA/FCS

Oxford University Press: 11 SUS + 6 ICUF + 2 FCS

Cambridge University Press: 11 SUS + 4 ICUF

SAGE: 11 SUS + CCLA/FCS

Wiley: ???

Taylor & Francis

Is there a new market you can help the publisher enter?

How much investment has your library made in the company across product lines (backfiles, reference works, etc.) that contributed to their success?

Do you have support (or at least awareness!) from your faculty?

Use the competiveness of the marketplace to your advantage

Putting together a proposal

Integrate everything learned in the information

gathering, assessment, and leverage building

process

May provide one or more (but not too many!)

options

Clearly articulate the terms the library wants

Content to be licensed

Pricing terms and fees

Treatment of transfer & new start titles

Discounts for print

Demonstrate mutual gain

PROPOSAL ELEMENTS

Examples

A recent article in the FDIC Quarterly ¹ characterized the current recession as

one of the “most severe U.S. recessions since World War II.” …The same article

points out that, while hardship is being experienced nationwide, the downturn is

“unfolding in unique ways across the various regional economies.” In other

words, some states are being hit harder than others. Florida is one of those

states.

Nearly all of the libraries of the eleven State Universities suffered budget cuts in

the past two fiscal year cycles… Representative is the Florida State University

(FSU) library, which underwent a cut of 6% to library operations in FY2007-08,

followed by an 8% cut to the library materials budget in FY2008-2009… The FSU

cuts…resulted in the cancellation of over 30 databases. Due to similar budget

cuts, the University of West Florida has nearly ceased buying books, and other

libraries have drawn back their book approval plans considerably, dropping

whole subject areas from their purchasing plans. Hours of operations have been

reduced, and positions frozen and unfilled. Now the libraries of the Florida State

University System are reporting that, on average, they are being asked to plan

for additional 10% budget cuts in FY2009-2010. Something has got to give.

¹The 2009 Economic Landscape: How the Recession is Unfolding across Four U.S.

Regions, 2009, V. 3, No. 1.

In a February 20, 2009 Times Online article, …chief

executive of …, reported a “21 per cent increase in adjusted

full year pre-tax profits.” … also predicted “that 80 per cent

of the business would enjoy growth during 2009, despite the

grim economic backdrop.” The article concludes by noting

that shares “have risen by 25 per cent during …'s tenure” –

roughly the same time period during which the Florida SUS

have themselves so heavily invested in … content. We

highly value the content we receive from …, and hope to

continue to contribute to your success. In return, we ask

that … work with us during these difficult economic times so

that we may avoid laying off highly valued and much

needed staff, and to ensure that we do not fail in serving our

user community.

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Florida SUS Proposal

Publisher Proposed Fees

SUL Buying Power

SUL Proposal

Participating Libraries

In addition to the eleven universities in the Florida SUS, six of the

institutions in the Independent Colleges and Universities of Florida

(ICUF) and four of the colleges in the Florida College System (FCS)

have indicated that they are likely to become participants of an SUS

held … Full Collection contract if the terms were in keeping with

those above.

Benefits of additional library participation to [The Publisher]:

•Initial calculations indicate that the additional revenue from the

ICUF and FCS libraries would increase the amount under contract

by approximately 20%.

•FCLA will handle negotiations with … on behalf of all participating

libraries. This gain would come at no expenditure of … staff or

travel time.

•The extension of the deal to the Florida College System, which is

comprised of 28 institutions across the state of Florida, exposes …

to a new and relatively untapped market for e-journals.

Proposals and Principled

Negotiation

Separates the people from the issues

The proposal details the issues, not the people

Focuses on interests, not positions

Interest is on finding terms that both sides can

agree on

Creates options for mutual gain

Provides new opportunities for publisher while

meeting needs of library

Uses objective criteria

Bargaining is based upon verifiable facts


Identify and negotiate with the decision maker from the

beginning.

Make sure all your constituents are on the same page.

Meet in person if at all possible.

Set the agenda and tone for the meeting.

Set your expectations high.

Know where your points of compromise are.

Retain the right to keep information confidential.

Be prepared to answer (or not answer) difficult questions.

Personal integrity is of the utmost importance. Never lie or

promise something you can’t deliver.


Listen. Hard.

Probe for information.

Allow for silences.

Take a break if tempers get flared.

Use the publisher’s terminology as appropriate.

Summarize points of agreement and understanding periodically and document them.

Be yourself, but know your strengths and weaknesses.

Building a Negotiation Support

System

Develop a network of support on your campus Purchasing Office

Office of General Counsel

Business Librarian

Develop Licensing Guidelines to serve as objective criteria for contracts (See FCLA’s at:

<http://fclaweb.fcla.edu/uploads/FCLA Licensing Guidelines Version II 6_18_2012.pdf>

MOU for libraries outside your system

Consider using a negotiation team

Attend a corporate negotiation seminar

Learn from your mistakes and

successes

No one was born an expert negotiator!

Assess each negotiation experience

What went right, what went wrong?

What could I have done better?

How did I feel emotionally?

Continue to experiment and adjust your

negotiation style as you learn and grow

Recommended Reading

Getting to Yes: Negotiating Agreement Without

Giving In, by Roger Fisher and William Ury.

Bargaining for Advantage: Negotiation

Strategies for Reasonable People, by G.

Richard Shell.

Questions?

Contact me:

Claire T. Dygert

Florida Center for Library Automation

(Florida Virtual Campus as of 7/1/12)

352-392-9020 x307

[email protected]

Education

Honing your negotiation skills