Editor’s Note: Here we are in 2016, and this post which was originally posted in the Procurement Insights blog in 2010, continues to be one of the most widely read articles I have ever written. So here is the question . . . have things changed in terms of our approach to negotiating with our suppliers?
A famous tag-line from the ads that almost always seem to find their way into airline magazines promoting the services of Dr. Chester L. Karrass’ firm is “You don’t get what you deserve, you get what you negotiate.”
Karrass, the author of four books on negotiation techniques including “The Negotiating Game’, ‘Give and Take’ and ‘In Business as in Life – You Don’t Get What You Deserve You Get What You Negotiate,” challenges the reader to take the bull by the horns and gain the upper hand in any situation.
Unfortunately, it is this adversarial state of mind coupled with a misguided view of transparency, that for so many years had – and to a certain degree still does – hinder the buyer and supplier relationship. So much so that it negatively impacts an organization’s ability to sustain positive results in the key areas of cost savings and quality performance.
As an increasing number of suppliers do not respond to RFPs , especially within the realms of the public sector tendering process, one would hope that this “better the person on the other side of the table mindset” will change. Let’s face it, people ultimately do business with someone they “know, like and trust.” Building the relationships that enable a supplier to legitimately and transparently compete, as opposed to becoming figurative notches on a buyer’s negotiating belt, must become the order of the day.
However, and despite the logic of pursuing a collaborative acquisition strategy – particularly with complex contracting, it would appear that old habits or ideas die hard.
A Zero Sum Game?
Greg Williams, from the firm The Master Negotiator, posed the following question to the membership of one LinkedIn purchasing group; “As a procurement professional, do you lie when negotiating? Do you know how to detect, defuse, and defend against lies during negotiations?”
He then goes on to write:
“When you negotiate, do you lie? Please, don’t even think about becoming indignant. Everybody lies when negotiating, for one reason or another. If you say you don’t lie, you’re lying!
Depending upon what someone is trying to achieve, some lie substantially more than others. Some people believe, when they’re negotiating, if they tell a ‘white’ lie, it’s OK. Some believe, a successful negotiation outcome justifies the mean, and thus they do what is necessary to accomplish the goal.
You can be more successful during negotiations, by being aware of what motivates people to lie.”
Not surprisingly, many of the 98 comments that were posted in response to Williams’ question/statement, did indeed become indignant at the suggestion that lying is an inherent part of the procurement process.
“No, I didn’t lie to you…the truth changed…” – LinkedIn Group Member Comment
All this being said, and beyond his efforts to promote his firm’s negotiating to win services, Williams’ question fans the flames of mistrust that undermines the procurement process and profession.
This is the same “old school” way of thinking that is similar to the Karrass conquer or be conquered approach to purchasing.
What is interesting, is that the “you don’t get what you deserve, you get what you negotiate” mantra reflects a certain laziness on the part of the buyer. The reason is that it encourages the use of cheap parlor room tricks as a means of driving a one-sided advantage.
Despite the prevalence of this conquer or be conquered mindset, it appears that the up and coming generation of procurement professionals are willing to forge a different path. Rather than taking the easy route of learning hard negotiating techniques, GenerationNext are more focused on building an informed exchange with what they view as partners in the buying process, as opposed to seeing suppliers as adversaries.
In the end, this is perhaps the biggest difference between a true procurement professional, and what one CPO Agenda Roundtable executive referred to as being a dime-a-dozen buyer. Specifically, the former’s focus on achieving a best-value result for ALL stakeholders.