As IT executives acting as custodians of valuable company resources, it is incumbent upon us to ensure the appropriate application of negotiation strategies and tactics to achieve key company objectives. In this context, it is key to understand that there is a number of different negotiation engagement models available to us, depending on the objectives to hand.

Figure 2: Basic IT Purchasing Considerations

It would be unwise for us to engage in collaborative negotiations with a supplier that is providing products or services at a commodity level. Similarly, it would be equally unwise to engage in highly competitive negotiations with suppliers that are providing us with solutions that will have a significant strategic impact on our organisation.

We know that in negotiations, as in life, victims have a tendency to become aggressors. It therefore follows that if we are too competitive in our approach to negotiation, we can often leave suppliers feeling that they need to reclaim what they believe is rightfully theirs. We can recognise the symptoms of a deal that was negotiated too competitively by the issues that we pick up subsequent to closing the deal issues with service level agreements, escalations and so forth. If deals are not profitable for our suppliers, they will go to great lengths to cut corners so they can meet their profit objectives often to the detriment of their clients who drove too hard a bargain.

When we enter into negotiations with suppliers providing strategic solutions that have a high value to our organisation, it is important that we create a collaborative frame for the negotiations to ensure that we are able to extract maximum value from the proposed partnership.

Figure 3: 'Fit for Purpose' Negotiation Engagement Models

In conclusion, when negotiating in the IT environment, it is critical for practitioners to approach the entire negotiation process (preparation, engagement and debriefing) from a whole brain perspective and to apply the appropriate negotiation strategy in support of our organisational objectives.

Summary Box

- Define a negotiation strategy
- Answer the following questions:
- What group or groups of people should be capable to negotiate effectively in their vocational environments?
- What are the key negotiation characteristics of successful negotiators in your department?
- Should you be providing any free products or services to your clients or user community?
- Should you be providing any concessions to your negotiation counterparts without receiving a counter concession of equal or greater value in return?
- What are the drivers in your organisation for the implementation of leading practice negotiation skills?
- How will you measure success in the negotiation environment? (consider both leading and lagging indicators).
- What are the specific actions that you will need to take to implement an organisational negotiation strategy?

Implement a supporting negotiation process
The negotiation process must be robust and have a high utility value to its users. The single most important consideration in implementing a negotiation process is ensuring a consistent application of leading negotiation practice across the department or organisation. Additionally, this will result in a shared vocabulary and a common platform for the evaluation, refinement and improvement of negotiated outcomes. Build your negotiation process around the following key areas:

- Deal qualification
- Deal objectives identification (for all parties to the negotiation)
- Aspiration base
- Real base
- Contracting zone
- BATNA analysis (Best Alternative To a Negotiated Agreement)
- Negotiation role definition and team composition
- Deal specific negotiation strategy & tactics
- Framing
- Negotiating climate
- Negotiation debriefing

Implement a negotiation training programme

Once an organisational negotiation process has been defined, all participants in the negotiation process should be trained in its use and application.

Create a negotiation support environment

It is important for executives to create an environment that supports the development and application of an organisational negotiation capability. Some of the key enablers are:

- Creating an environment for negotiators to simulate negotiations on a regular basis (on a quarterly or bi-annual basis)
- Creating a negotiation reference database in its simplest form a log of resources with specific reference to the types of negotiation and relevant experience of organisational negotiators
- Automating the use of tools to support the negotiation process implementation
- Providing an individual coaching environment where resources can be coached in leading negotiation practice by managers
- The establishment of a corporate negotiation capability is no easy task and will require dedication and commitment at an organisational level. If approached circumspectly and applied wisely, the investment associated with the establishment of an organisational negotiation capability will deliver spectacular returns that will entrench competitive differentiation and superior stakeholder returns.
¹²3Ò³: ÉÏÒ»Ò³ [1] 2 [3] ÏÂÒ»Ò³