In the information economy, raw materials are no longer the domain of every country. In order to survive in global competition, salespeople have adapted to varying degrees. Distinctive products and services create greater loyalty among end consumers – which leads to stricter requirements on the buyer side and a tighter supply base. Businesses are more complex and run over longer periods of time. Rather, they contain problems that cannot be fully addressed in the original conditions. The most successful companies look constantly – not only behind them, at established competitors, but also ahead, where the pioneers are on the move. Creative negotiators open up undisputed market space with a blue ocean strategy. You overtake the competition with transformative offers.
Only experienced and well-versed dealers can survive in the current environment. And only the brave and inventive will grow. At a time of profound uncertainty where companies have to adapt to stay in the game, creative negotiation can make all the difference. How else has negotiation changed? Let’s count the ways.
The price is no longer king
At a recent seminar with a leading metrology company (or the people who measure auto parts to very fine design tolerances) a salesperson told us, “We’re the most expensive company out there. If we go out and just sell our product, we’re dead – we don’t make sales. We have to sell solutions. ”Then there was the customer we had mistaken for a coal company until they corrected us:“ We are a provider of energy solutions. ”The best price is no longer a given. There is little point in getting a zero number on software if you end up paying for training and customization, as well as the must-have upgrade for the next year.
Almost everything is on the table
There’s a lot more room for both parties, more flexible pricing, and a lot more opportunities to grow a business. In the digital age, the cost curve for special products has collapsed. Which skills does the customer want to have optimized? How much technical support is included? When every contract is a la carte, there is much more potential for creative problem solving.
Cooperations are trendy
Newtonian physics seemed to be working fine until Rutherford and Einstein discovered subatomic particles: step into quantum mechanics. In today’s business world, the limits of haggling have become clearer as negotiators delve deeper into the finer points. It may seem paradoxical, but macro-competitive forces force the negotiators to work harder to work with the other side.
In 2007 Walmart changed its slogan from “Always low prices” to “Save money”. Live better.“ In 2017, it stopped its fabulous price adjustment program. Against the increasing competition from Amazon and eBay, Walmart realized that rejecting the sub-sale was no longer enough – for a brick and mortar giant it probably wasn’t even possible. The company turned to A Cent to ask manufacturers to help them stock up on quality products to better meet customer needs. To strengthen those alliances, a slightly kinder, gentler Walmart was forced to change the way they negotiated. Understandably, if you lose sight of the filling, your suppliers are generally less inclined to work together.
Disruption is the rule, not the exception
Nowadays companies worry less about a well-known competitor who underestimates them than about the next existential threat out of nowhere. An international company can show up with a similar product at half the price. New technology can make your Keystone product obsolete. Kodak never saw the smartphone coming, and neither did Blackberry. Uber and Airbnb have turned entire sectors upside down; ditto for the Toyota Prius and the Tesla. Companies either adapt or they leave the field.
As W. Edwards Deming once said: “It is not necessary to change; Survival is not essential. ”And Richard Branson can no longer agree:“ A company that stands still will soon be forgotten. ”A company doesn’t have to change, but to prove longevity, transformative decisions separate the successful from the crowd.
Courtesy of CREATIVE CONFLICT: A Practical Guide for Business Negotiators, published June 15, 2021, HBR Press, by Bill Sanders and Frank Mobus. Sanders is the CEO of Mobus Creative Negotiating, a company founded by the late Mobus. The nationally recognized experts from Mobus offer public seminars and private in-house training, coaching and consulting for Fortune 500 companies.