NEGOTIATION STYLES FOR STRATEGIC SOURCING OF VENDORS, THE STYLE SLIDER, AND WHY YOU WANT TO “SLIDE RIGHT”.
Patrick Bohnenkamp
Chief Executive Officer
Welcome back to the Seprio blog! I’m Pat Bohnenkamp. Our last blog series centered on how to be a negotiating superhero. In that we covered “POWW” (Preparation, Objectivity, Win/Win), Seprio’s tenets of effective negotiating. While knowing and using POWW is critical to successful negotiations, one issue that is often overlooked is how your negotiating style impacts your negotiations. And that’s our topic for today: is there a ‘right’ negotiating style?
Many people who negotiate vendor agreements struggle to achieve the best possible result because they don’t invest time to shape and commit to a winning style. Knowing and using POWW won’t take you all the way to “best result” if you aren’t using the correct, corresponding style. Without clarity and commitment to your style, achieving “best result” will be akin to trying to scoop up a fumbled football.
An internet search on the styles of negotiation will basically lead you to four or five generally accepted negotiation “styles”, with the idea that each negotiator typically uses one or two of these. I’ve summed up each style, as I see them playing out in sourcing negotiations:
Competing (I win, you lose)
Avoiding (Nobody should lose, so let’s not negotiate)
Accommodating (You can win, I’m not important)
Compromising (We both win, and we both lose.)
Collaborating (Let’s both win)
Of these styles, there is only one that will deliver the true win-win result built into POWW: Collaborating. Having said that, negotiating style, at least for sourcing/procurement negotiations, can be simplified into a slider that runs between “Competing” or, as I call it, “Adversarial”, and “Collaborative”. If you look closely at the list, I don’t believe there’s any place for “avoiding” or “accommodating” in sourcing negotiations. I really like the idea of compromise, and you’ll see a lot of compromise built into my version of “collaboration”, but I use ‘collaboration” because it inherently involves working together, and it emphasizes win/win, and not win/lose. In my experience, sourcing negotiators fall somewhere on this slider between Adversarial and Collaborative, and the really good ones are able to slide around on that, as circumstances require. However, with that said, I feel strongly that starting on the ‘collaborative’ side of things is optimal. Here’s the slider:
As we experienced in the story from the last post, our style was deliberately collaborative. However, when faced with an unrelenting adversarial style, we did need to dig in our heels a bit to push the vendor to make concessions (which represented us sliding a bit more adversarial for a moment). While it was not our preferred approach to be adversarial, temporarily “sliding” that direction was an effective tactic within a collaborative context. In other words, we did indeed dig in, but we were nice about it, and we only did it after we had already agreed to concessions that represented ‘wins’ for the other side. So our message was “you’ve won, and now we need to win”, which is a very, very difficult thing to argue against. This is one version of the “adversarial slide”, which is making your style a bit more adversarial when the circumstances require. We also used the tactic of promoting what we didn’t change as being wins for the Vendor… remember, the more wins we “conceded” to them, the more we can reasonably ask for. Lastly, we employed the ever-famous good cop / bad cop, which really sealed the deal in the end. Each of these is a tool in the “Seprio Toolbox”, a collection of tactics a best-in-class negotiator might call on in any negotiation. More to come on the Seprio Toolbox in a future post.
Back to style... early in my career, I was an adversarial negotiator, and I viewed negotiations as a win/loss competition... one party had to lose so the other party (mine, preferably) could win. I worked for large corporations, so when we negotiated, we typically had a lot of leverage and I was able to win even when engaging in adversarial negotiations. Like the vendor attorney in the story above, I felt that, if I had the leverage, I should win and the vendor should lose. However, when my partners and I started Seprio, we began to negotiate for much smaller companies who had less leverage, generally speaking, and for much larger companies for whom every vendor represented a potential client or partner, so more diplomacy was required. I learned that, while being adversarial really only works well if you have all the leverage (and if you don’t care about the ongoing relationship), being collaborative works well in almost all scenarios. And the collaborative style allows you to be nice, and if we learned anything from the movie “Roadhouse”, is that’s it’s always better to be nice… at least until it’s time to not be nice. In all seriousness, though, most people are uncomfortable maintaining an aggressive and adversarial stance in the face of someone being collaborative and nice… and, as in our story, even when you negotiate against someone who is comfortable doing that (the lawyer), there may very well be someone else… someone higher up the chain… who is uncomfortable with it (the Sales VP), and that can work to your advantage.
An adversarial style isn’t sustainable over time in the context of strategic sourcing of vendors. The fact is, nobody is truly influenced or persuaded by someone who takes an adversarial approach, and a relationship can really suffer from an adversarial negotiation. A collaborative negotiation, on the other hand, where you engage in negotiations intended to benefit both parties, can bolster or reinforce a positive relationship, which could be the difference between you getting something from the vendor, in an emergency, and them not answering the phone when you call. And that’s where the “Win-Win” tenet of Seprio POWW was born.
This early experience allowed me to get clear on the right style, collaboration, and ultimately allowed us to build a business that delivered the best results for Clients. At my core, I value reasonableness and perspective above all else in my negotiations, both of which benefit the larger, long-term relationship that extends far beyond the negotiations.
Ok, so we’ve introduced the style slider and analyzed the adversarial style. We even took a peek into an example of when a temporary slide toward an adversarial style would apply. We also introduced some insight on the effectiveness of using a collaborative “master” style.
In the next post of this series, we will take a deeper dive into why a collaborative master style delivers the best results. And in the final post, come back to explore the many ways to be effectively collaborative using the Seprio Toolbox.
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