PurchTips - Edition # 227

 

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Join A Negotiation With Caution

By Charles Dominick, SPSM, SPSM2, SPSM3

Should A Manager Join A Negotiation In Late Stages?

Over lunch last week, a procurement colleague and I discovered a common thread in our early careers: the worst negotiation results we'd ever seen happened as a result of managers joining negotiations in late stages. While these managers all said similar things like "I'll jump in later and squeeze another 5% out of the supplier," the fact was that their actions resulted in our companies getting worse deals, not better.

So, if you are a manager or may become one in the future, how can you avoid doing more harm than good by joining a negotiation? Remember these things:

  1. Learn the obstacles to agreement from your team first. Some managers think that joining a negotiation will intimidate the supplier. Actually, the supplier may welcome another counterpart - that way they can play "divide and conquer" and get the manager to agree to concessions that the buyer would not. And there may be a good reason that the buyer was not agreeing to those concessions!
  2. Beware of conditioning your suppliers to withhold their best deals from buyers. If past history compels a supplier to predict that a manager will join a negotiation in its late stages, will the supplier ever give its best deal to the buyer? No - the supplier will withhold it so that it has something to offer the manager later. But what type of results will be achieved if competing priorities keep the manager from joining every negotiation?
  3. Realize that you don't have to join the negotiation at all. Joining a negotiation to "squeeze another 5% out of the supplier" implies that the manager has better negotiation skills than the buyer. A manager's job is to get peak performance out of his/her subordinates, not to do their work for them. If a manager has to negotiate for his/her buyers, that means that s/he has failed at the management responsibility of developing his/her subordinates. Coaching subordinates or enrolling them in negotiation training can produce a lifetime of positive results in the time that it takes to "squeeze 5% more" out of just one deal.

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Spotlight On Professional Development Opportunities

SPSM Certification

Are you tired of not getting enough opportunities, respect, and money out of your purchasing career? Well, guess what? Nothing will change unless you take action towards becoming a world-class purchasing professional.

You see, today's employers refuse to reward employees for yesterday's skills.They demand that purchasing professionals like you use the most modern skills and achieve unprecedented results. They want you to save more money, achieve better operational performance, and reduce risk.

Is lacking a purchasing certification keeping you from getting the results, opportunities, respect, and money that you want out of your career? Today's employers refuse to reward employees for yesterday's skills. They want you to save more money, achieve better operational performance, and reduce risk. They demand that purchasing professionals like you achieve unprecedented results and without the most modern skills that can be a challenging feat!

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Distinguishing yourself as an achiever in purchasing is key to sustaining a rewarding career, even in these difficult economic times. Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is to take if you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSM® Certification (and perhaps get an iPad) at:

Earning your SPSM® Certification by completing the Senior Professional in Supply Management® Program is the action to take if you want to bring the most modern purchasing practices  into your organization and achieve your career potential. And if you sign up for the Senior Professional in Supply Management® Program on or before May 31, 2008, SPSMSM Certification Program on or before 4/30/2007, you also get these and other bonuses valued at over $700:

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Earning your Senior Professional in Supply Management® (SPSM) Certification is the action to takeif you want to bring the most modern purchasing practices into your organization and achieve your career potential. Learn how to earn your SPSMSM Certification at:

Learn how to earn your SPSM® Certification at:

www.NextLevelPurchasing.com/spsm.html

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