Special thanks to Grupo Netshoes for this guest post

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The notion of negotiation is more and more prevalent in our daily lives and in a wide range of professions.  Given the nature of a globalized and increasingly faster world in which we live in, negotiating has become ubiquitous in all corporate roles/positions.

Due to these constant changes in the global scene and a step-up in challenging objectives within organizations, quick and sound decision making as well as conflict resolution through negotiation have been gaining ground and importance.

In order to ensure a successful agreement, the negotiator must possess in-depth knowledge of what is to be negotiated.  Moreover, he (or she) must study and understand the supplier/client, the closing date, the financial target and negotiation restrictions (should there be any).

A crucial characteristic of an effective negotiator is his/her interpersonal expertise.  He/she must possess his/her own particular style while refraining from becoming emotionally attached to the negotiation and/or its participants.

One who goes to a negotiating table/ meeting should not see the other part as an adversary, but as another “player” who’s trying to solve a similar problem.

In this context, flexibility becomes paramount in order to solve eventual stalemates.  In addition, the negotiator must display confidence and knowledge regarding all matters in question.  That way, the other part will tend to be more careful while making observations, raising objections and even when proposing financial targets, since misunderstandings and ambiguities can negatively affect their credibility in the negotiation.

A good negotiator must always consider these three points when formulating questions:  What he/she wants to know, how to ask and how to apply the information gained to his/her favor.

Besides carefully devising questions, there are four basic rules to positively begin a strategic negotiation:

  1. Always take the initiative

Commonly, the one who controls negotiations from the beginning tend to control their outcome.  If you let the supplier/client begin the negotiation you may end up relinquishing control, often without even realizing.

  1.  Formalize negotiations in writing

Many negotiators make the mistake of discussing the terms and conditions of an agreement or contract without committing themselves to signing a written document.  The negotiator must aim for a formal written agreement recording all terms in detail.

  1. Keep it cool

The negotiator must act calm and be in control of himself/herself at a negotiating table or meeting, regardless of stress, agendas, egos, emotions or priorities.  Great negotiators know how to keep a level head, providing solutions and remaining in the lead of any situation.

  1. Stay on your turf

Being in his/her office can be helpful and empowering to a negotiator, since people are generally more confident and at ease when on familiar ground.  Therefore, try scheduling negotiation meetings at your company.  (EDITOR’S NOTE:  While the “comfort of home” can be valuable for a beginning negotiator, the Next Level Purchasing Association recognizes advantages and disadvantages to both negotiating at a supplier’s facility and negotiating at your own.  For a more advanced-level comparison of these alternatives as well as plenty of other negotiating principles and techniques, see our online course “Powerful Negotiation For Successful Buying.”)

When those contexts are translated to the corporate world, we can safely affirm that knowing how to negotiate is currently the most required skill for a supply team.

A negotiation is not a competition where one wins and the other loses.  In order to ensure a healthy relationship between the negotiation and the other part it is imperative to always seek a beneficial agreement where both parts secure a satisfactory degree of success.

Negotiating is basically exchanging – if there’s no exchange there is no negotiation. When one of the parties makes a concession, the other will be expected to do so as well.

It is of utmost importance that the professional in charge of negotiations be prepared and know for sure what he/she is willing to give up.

At the end of a successful negotiation all participants should have the feeling of accomplishment or at least breaking-even.  This kind of perception only occurs when the negotiation takes place in a transitional matter, that is, with compromises and achievements.

The result of a negotiation is nothing more than meeting outlined goals.  During a standard negotiation/transaction, points of view are formulated and both converging and diverging aspects are listed and detailed.

In order to achieve a positive result, the negotiators must be willing to reach an agreement.

Fernando Mero

Fernando Méro is currently the Procurement Manager at Grupo Netshoes (Brazilian e-commerce company). He previously held several procurement positions in different industries: pharmaceutical, construction/real estate and aviation. He holds a Bachelor Degree in Business Administration from Mackenzie University and a specialization in Business Dynamics at INSPER-SP.

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