Every Great Negotiation Starts with Research Mike Figliuolo, Ep #341
If you go into a negotiation without preparing,\xa0you've already lost. You need to understand the other side\u2019s objectives and know what your counters are. Doing so enables you to stay calm. Being overwhelmed by emotion is your enemy in any negotiation. The minute you get upset, you\u2019ve lost the advantage. Mike Figliuolo emphasizes that everything hinges on doing the proper research. Hear his thoughts on the matter in this episode of Sales Reinvented!\xa0
Outline of This Episode- [1:39] Why planning and preparation is an important step in negotiation
- [2:19] Complete extensive research to prepare for your negotiation
- [3:19] The attributes or characteristics that make a great negotiation planner
- [5:05] Tools and resources to improve your negotiation outcomes
- [6:27] Mike\u2019s top three negotiation planning dos and don\u2019ts
- [9:57] Preparation is the precursor to any successful negotiation
Do your research on your negotiating partner. You want to get to a solution that works for everyone. So you need to know what\u2019s going on in their business. Mike has a major client that\u2019s facing financial challenges and having to let people go. He knows they\u2019ll push back on price.
If someone pushed for a price decrease, what would you say? You should also know when you need to take a break. It\u2019s okay to leave the conversation, think about your response, and come back to it. Keep the emotion out of it.\xa0
The attributes or characteristics that make a great negotiation plannerA great salesperson can look at things from the other person\u2019s perspective. What are they going through, professionally and personally? You need to understand their business and personal objectives. If you\u2019re dealing with someone who\u2019s brand new, they\u2019re looking to make a mark. They need to gain credibility. They\u2019re going to press you hard in the negotiation to get an early win.\xa0
We always think people will fight for price concessions. But that\u2019s not always the objective. What goes beyond the financial metrics? Maybe they want a stable vendor relationship. When you can combine the objective's empathy for their position, you\u2019re in a good position entering that negotiation.\xa0
Mike\u2019s top three negotiation planning dos and don\u2019tsMike dropped some great advice:
- Do your research and understand the company and the individual.
- Understand where your boundaries are and plan them out. Where are you flexible? Where is your walkaway point?
- Be realistic about your outcomes. Walk in with realistic objectives written down in front of you. It helps you focus on what\u2019s important.\xa0
- Don\u2019t stick to a fixed position in your mind. If you\u2019ve decided you\xa0have\xa0to be at x dollars in a contract, it reduces the possible solutions you\u2019re willing to explore,
- Don\u2019t make it about you and your ego. You can\u2019t solely focus on winning, because it introduces emotions into the equation.\xa0
- Don\u2019t pressure yourself to get a deal done quickly. The ability to walk away and say \u201cI need to think about this\u201d can give you an advantage in the next conversation with your negotiating partner.\xa0
When we set an arbitrary time limit, it creates undue pressure. Mike points out that we\u2019ve all bought a car. Why do you think the salesperson says, \u201cWhat\u2019s it gonna take to put you in this vehicle today?\u201d They impose a timeline on you which reduces your freedom in the negotiation.\xa0
Preparation is the precursor to any successful negotiationMike had worked with a major client for a couple of years. She was a Senior Executive in the Learning & Development segment of her organization, who answered to the Chief Human Resources Officer (CHRO). She approached him to do some work and agreed on a dollar amount. But then the contract was kicked over to procurement.\xa0
Procurement started pushing Mike on price and asked for a discount. Mike wouldn\u2019t agree but the individual kept pushing him. At one point, the individual\xa0hung up\xa0on him. Mike was\xa0angry. He knew he was being baited to get emotionally involved. So Mike paused, called him back, and restated his position. Then he asked to get his contact involved.\xa0
Mike knew that procurement had no idea who she was. So Mike called his client and filled her in on the situation. She said, \u201cI\u2019ll call you back.\u201d Five minutes later, procurement called him back and said \u201cShould I email the contract or fax it?\u201d\xa0
His contact explained to procurement that this was her top initiative for the year and it was her top deliverable to the Chief Human Resources Officer. The CHRO had a reputation for bulldozing over anyone in her way. She told him if he delayed it further, he\u2019d need to call the CHRO directly and explain the situation.\xa0
If procurement had done his proper research and understood the key players in the conversation, he would\u2019ve known better. He didn\u2019t do any research, which caused an embarrassing moment for him. You need to know who\u2019s involved on both sides of the table.\xa0
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