Negociating & closing Bargains

Sale strategy & Marketing

W elcome to La P lagne Training session Negotiating & Closing Bargains July 7 & 8, 2008

Copyright Š PHMC GPE LLC 2001-2008 sqq All rights reserved

Sale strategy & Marketing

IMPORTANT NOTICE THE SEMINAR WILL BE HELD IN ENGLISH DO NOT HESITATE TO ALERT /STOP ME IN ANY CASE YOU MAY NEED CLARIFICATIONS AND/OR FOR ANY REASONS AS : •SPEECH SPEED •VOCABULARY PROBLEM •MISUNDERSTANDING •UNKNOWN WORD •ETC.

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Program - Table of Contents Day # 1 - AM

Day # 2 - AM

Sale strategy & Marketing

Welcoming participants Self-Introducing Trainer & Trainees

Day # 1 debriefing

Seminar introduction - Aims

Communication & Interaction

What is a Negotiation ?

Group works

BATNA – Group Works

Case & Document studies

TOP – Getting Past No

Day # 2 - PM Day # 1 - PM

Moment of Truth

TOP – Getting to YES

Group works

Exchanges of Customer Relationships

Case & Document studies

Group works

Seminar debriefing Copyright © PHMC GPE LLC 2001-2008 sqq All rights reserved

Preamble Sale strategy & Marketing

When engaged in sales negotiations where your skill as a negotiator may prevent losses and increase the gains for you and your organization, how can you significantly increase your capability to:

•prepare effectively •understand the needs & interest of all parties •dive in a multi/cross – cultural environment •conclude better agreements as a result of being creative •strike deals that deliver more value?

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Aims Sale strategy & Marketing

That training session is based on a combination of sound academic theory (20%) and significant practical business negotiation experience/exercises (80%) to provide you with a due diligence framework that will ensure that you are able to: •Move negotiations from claiming value to creating value; •Avoid leaving value on the table; •Turn challenging relationships into rewarding relationships; •Counter negotiation tactics; •Identify, pursue and successfully close opportunities; •Deploy proven tools to manage sales performance and skills development; •Learn the critical art of questioning to understand your prospect’s needs in detail; •Deploy framing to enhance your communications; •Understand the impact of your personal sales negotiation style.

Upon completion of the Training course you will: •Understand the reasons why sales negotiators fail •Be aware of and understand your own sales negotiation competencies and preferences enabling you to maximize your strengths and mitigate your weaknesses •Be able to thoroughly prepare for negotiations based upon an understanding of the key deal objectives of all participants to the negotiation •Be able to create a sales negotiation climate that will optimize your chances for a successful negotiation •Acquire the ability to use a concession strategy to ensure that your sales negotiations assume an exchange character rather than the ‘one way auction’ environment so many sales resources are subjected to •Have your own sales negotiation skills Personal Development Plan to assist you in further improving your capabilities..

Copyright © PHMC GPE LLC 2001-2008 sqq All rights reserved

Sale strategy & Marketing

Negotiation‌. Negotiation You said Negotiation is a dialogue intended to resolve disputes, to produce an agreement upon courses of action, to bargain for individual or collective advantage, or to craft outcomes to satisfy various interests.

It is the primary method of alternative dispute resolution.

Negotiation occurs in business, non-profit organizations, government branches, legal proceedings, among nations and in personal situations such as marriage, divorce, parenting, and everyday life.

Copyright Š PHMC GPE LLC 2001-2008 sqq All rights reserved

BATNA

What a strange word… isn’t it ?

Sale strategy & Marketing

In negotiation theory, the Best Alternative To a Negotiated Agreement (BATNA) is the course of action that will be taken by a party if the current negotiations fail and an agreement cannot be reached.

A party should generally never accept a worse resolution than its BATNA. Care should be taken, however, to ensure that deals are accurately valued, taking into account all considerations, such as relationship value, time value of money and the likelihood that the other party will live up to their side of the bargain.

These other considerations are often difficult to value, since they are frequently based on uncertain or qualitative considerations, rather than easily measurable and quantifiable factors.

Best Alternative To a Negotiated Agreement BATNA was developed by negotiation researchers Roger Fisher and Bill Ury of the Harvard Program on Negotiation (PON)

Copyright © PHMC GPE LLC 2001-2008 sqq All rights reserved

BATNA

Best Alternative To a Negotiated Agreement

Examples

Selling my old car

Sale strategy & Marketing

If I have a written offer from a dealer to buy my car for $100, then my BATNA when dealing with other potential purchasers would be $100, since I can get $100 for my car even without reaching an agreement with such alternative purchaser.

In this example, other offers that illustrate the difficulty of valuing qualitative factors might include: 1. An offer of $90 by a close relative (is the goodwill generated worth $10 or more?)

2. An offer of $125 in 45 days (what are the chances of this future commitment falling through, and would my prior BATNA ($100) still be available if it did?)

3. An offer from another dealer to offset $150 against the price of a new car (do I want to buy a new car right now, the offered car in particular? Also, is the probably minuscule reduction in monthly payments worth $100 to me today?)

Purchasing Consider the following situation: Facts : • Your Company one can choose to buy from companies two, three or four • But companies two, three and four can only sell to company one.

Strategy : Company one can use their powerful BATNA position to leverage a better deal by playing companies two, three and four against each other.

This is a common practice among purchasing and procurement managers in the business world.

Copyright © PHMC GPE LLC 2001-2008 sqq All rights reserved

Sale strategy & Marketing

TOP

‌ a must have !

T urning O pponent into

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Getting Past NO * Have the joint problem-solving mentality together * Break the 5 barriers to cooperation: your reaction, their emotion, their position, their dissatisfaction, their power.

Sale strategy & Marketing

* Prepare, prepare, prepare yourself by identifying/developing:

o Interests of each side o Options o Standards o BATNA - Best Alternative To a Negotiated Agreement o What do you aspire to? What would you be content with? What could you live with?

Don't react: Go to the balcony How to stop a confrontation based on the way of thinking that it needs 2 people to entangle a discussion and only one to unlock it.

"Speak when you are angry and you will make the best speech you will ever regret“

Don't argue: Step to their side A wise behavior is described as stepping to the other side and try to look the problem their way to better understand their needs and eventually solve the negotiation efficiently in a win/win manner.

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…Getting Past NO

Sale strategy & Marketing

Don't reject: Reframe Based upon psychologic empathic listening technique: rejecting an idea might lead the human who created the idea to feel invalidated himself, it’s recommended to reframe and build the deal upon the other side's ideas if possible.

A deal takes 2 people's point of view to generate 1 solution, it works better if both people are involved and agreed.

Don't push: Build them a golden bridge A good negotiation is achieved by 2 negotiators meeting their needs- never one more skilled that overpowers the deal. Because if done so the deal itself is weakened as the loser might not recognize his involvement and his interests in the deal.

"Build your opponent a golden bridge to retreat across“

Don't escalate: Use power to educate Although all the previous topics was designed to explain the "good behavior" a negotiator might follow to cool himself down or the other negotiator, it’s presented here the authorized more aggressive techniques that a negotiator could draw legitimately in case of closed situation.

"The best general is the one who never fights" (Sun Tzu)

Copyright © PHMC GPE LLC 2001-2008 sqq All rights reserved

Getting to YES

Sale strategy & Marketing

Don't bargain over positions !!!

That concept explains how positions are part of human beings and their integrity. They are not negotiable unless one of the two negotiators folds and accepts losing, but as no one negotiates to lose there is no point in bargaining over positions. * Arguing over position produces unwise agreements. o As more attention is paid to positions, less attention is devoted to meeting the underlying concerns of the parties. Agreement less likely.

* Arguing over position is inefficient. * Arguing over position endangers an ongoing relationship. * When there are many parties, positional bargaining is even worse. * Being nice and giving in is no answer.

Separate people from the problem It's pretty easy to entangle the problem and the negotiator; thus, it is important to keep in mind that the negotiator is a human being with emotions and is not the problem, but the one who will help to solve the real problem. * Negotiators are people first. * Every negotiator has two kinds of interests: in the substance and in the relationship. * Separate relationship from the substance; deal directly with the people problem. o Perception o Emotion o Communication * Prevention works best.

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‌Getting to YES‌

Sale strategy & Marketing

Focus on interests, not positions Interests are the objectives of a negotiation.

Each negotiator must seek to fulfill his interests and needs, there is no point in trying to change the other side's position. * For a wise solution reconcile interests, not positions. o Interests define the problem. * Behind opposed positions lie shared and compatible interests, as well as conflicting ones. * How do you identify interests? o Ask "Why?" Ask "Why not?" Think about their choice. o Realize that each side has multiple interests. o The most powerful interests are basic human needs: * Talking about interests o Make your interests come alive. o Acknowledge their interests as part of the problem. o Put the problem before your answer. o Look forward not back. o Be concrete but flexible. o Be hard on the problem, soft on the people.

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‌Getting to YES

Sale strategy & Marketing

Invent options for mutual gain A good behavior in negotiation : creative & open-minded. the negotiator should seek to invent new options that might satisfy both parties' needs. It is also wise to take the other side's needs in account when making new proposals. * Don't assume there is a fixed pie and only one answer. * Don't think solving their problem is their problem, help them. * Separate inventing from deciding: brainstorming process. * Broaden your options. * Look through the eyes of different experts. * Invent agreement of different strengths. * Identify shared interests. * Ask for their preferences. * Make their decision easy.

Insist on using objective criteria * Principled negotiation produces wise agreements amicably and efficiently. * Use fair standards, fair procedures. * Never yield to pressure. * Use a 3rd party as referee. * Consider the one text procedure. Create one solutions based text that both parties can try to amend and agree upon together.

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