Steal Negotiation Objectives From Baseball
Can Baseball Objectives Really Help You Negotiate?
PurchTips Edition #373
By Charles Dominick, SPSM, SPSM2, SPSM3
Every time you bargain with suppliers, you must have negotiation objectives: Specific terms that you aim to agree upon. Because Major League Baseball started its season last week, it’s a great time to look at how you can adapt hitters’ objectives to your procurement negotiations. Here are four hitters’ objectives applied to procurement negotiation.
Hit A Home Run. The ideal result for any hitter in any situation is to hit a home run. But, in procurement negotiations like in baseball, sometimes the ideal result isn’t likely. And sometimes, there’s the risk of swinging too hard, striking out and ending up worse off than you started. So, only certain circumstances make “swinging for the fences” the right objective. Understand when the situation is ripe for trying to hit a negotiation home run and when a different objective is smarter.
Hit A Single. The best procurement deals don’t always get that way by a buyer asking for the perfect terms all at once. Sometimes, they are built by working with suppliers on one term (e.g., price, warranty, payment terms, etc.) at a time. Just like a baseball team will try to get a single and have the following batters try to get that runner to score, it can be best to set the objective of a negotiation session to achieve agreement on one term at a time in a particular sequence.
Hit A Sacrifice Fly. Sometimes baseball teams are happy to give up an out in order to score a run. Similarly, in procurement negotiation, sometimes the best objective is to give a concession on one term to a supplier as a trade for the supplier conceding on a term that is more important to you.
Avoid A Double Play. Imagine a below average hitter in a situation with a runner on first and third, one out, and the team’s best hitter on deck. The worst case – but quite likely – scenario is hitting into a double play. The inning will end and the run won’t score. You’d be happy to preserve what you have than risk getting into a worse situation. Sometimes, you’re in situations with suppliers where leverage and time are not on your side. In those situations, you have to identify the worst-case scenario and make sure it doesn’t come to fruition.
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