During the negotiations themselves, I proposed nothing. Instead, posing as a consultant from a company seeking to expand its supply market, I asked the assistant for advice on the manufacturer of the security system they were using. Of course, she started to open up – and reader, let me tell you, it’s been a long time since I’ve heard so many uncomplimentary words. With every complaint she voiced, my position became stronger.
When I felt that my importance to her was at its peak, I went on the offensive.
‘Maria Stepanova, why don’t you change your equipment for a superior system? I mean, I would be happy to do you a quote – if that’s of interest, of course.’
If you’ve fallen into the ‘supermarket’ category, then to all intents and purposes you are simply one of many identical products on the shelf; your opponent might not notice you, or they might not even stop to look at the shelf at all.
If an employee wants to ask for a raise, then before going to the manager, it’s worth them thinking about what category they fall into in their employer’s eyes. If they fall into the ‘supermarket’ category, then what will negotiations actually achieve? Now, I’m not saying that you should ever refuse to negotiate – certainly not. I’m simply saying that what you need is a manoeuvre, one that will either ‘inflate’ your significance (on the ‘importance’ vector), or highlight just how unique you are (on the ‘irreplaceability’ vector). Only after that should you begin to fight for the benefit.
Opportunity
You are pretty unique, but as it stands your opponent has little interest in you. What should you do? Enter combat, or manoeuvre?
Let’s look at an example.
A company producing metal hangars has developed and marketed a hangar with a particular shape that makes it cheaper to construct and maintain than traditional hangars. Having taken its home market by storm, this company now has its sights set on neighbouring markets. Its managers all set out to woo potential buyers, but things don’t quite go to plan. Yes, the hangar is innovative, the potential buyers all agree, but who uses them? None of their potential clients agree to ‘do themselves a favour’ and get on board.
Once again, this was all down to an inaccurate forecast. Because they had marketed an innovative solution, these innovators assumed they would automatically fall into the ‘opportunity’ category, which is to say they gave themselves a high rating on the ‘irreplaceability’ vector and decided that that would be enough for success. However, they didn’t take into account the fact that, no matter how unique they were, in their prospective partners’ eyes they simply weren’t important.
Hence it follows that this category also demands an initial manoeuvre. First you need to create value for your potential clients, then you can outline your benefit.
Here I should note:
Value is something your opponent is willing to pay you for.
I would advise a company like this to build a demo hangar, which would serve as a first important step: it ensures the market has at least heard of them.
Lever
By its very name, this category implies there may be pressure on you. If there is interest in what you have to offer but you face a lot of competition, then I recommend boldly stepping into negotiations and revealing your benefit.
‘What, straight into combat, without any manoeuvring?’ you might ask. This I can understand: to all appearances, this category hardly differs from ‘opportunity’. Only the vector has changed: here, rather than ‘irreplaceability’, the high rating is for ‘importance’. However, the two do differ in quite marked ways.
While prior preparation for negotiations is still essential, in this category there is some room for bargaining off the bat. Naturally, your opponent will try to put pressure on you by emphasising that there are other options available to them, they have companies queueing up to work with them and the like. But if you prepare your negotiations and arm yourself well (we’ll look at techniques, plays and negotiation preparations in more detail later), then success awaits. In this category, you have all three components of success in your hands.
Once again, I would like to note that combat is not a ‘tough’ position: it is simply the stage of negotiations that begins when both parties understand the benefit the other side seeks. The negotiations themselves can be as tough or as gentle as you want: that is down to you and your opponent.
If you’re a valued employee who meets targets and whom the company has an interest in retaining, you can boldly ask for a raise. Your employer will negotiate with you, whether they have a potential replacement for you or not. This is in contrast to the previous two categories, where there was no scope for bargaining.
Partner
There is interest in you, and you are hard to replace.
Now, in this category it might appear that success is in the bag, but you can’t relax just yet. Yes, go into combat; yes, go out there with all guns blazing to declare your benefit. But be careful: your opponent won’t be dozing. For purchasing agents, for example, suppliers who fall into this category are a big danger. Managers of ‘stars’ face this headache all the time. This is because once we reach the top right-hand corner of the matrix, we often start behaving not as a partner but as a counter-lever. We lean in to our position, throw our weight around more.
You can be certain that the other party – be they a purchasing agent or an employer – will always be on the lookout for a replacement. So you need to be aware that even if you’ve won the battle, you can still lose the war. Don’t forget the relationship aspect of negotiations; here it’s more important than ever.
And so we can see that, even in this category, it is practically impossible to get by without some form of manoeuvring. Yes, go into combat; yes, reveal your benefit, but in later negotiations you will need to manoeuvre to encourage trust in you. And for this, you need to foster the three most important components of trusting relationships. They are:
1. Attentiveness to the opponent and their values.
2. An ability to listen.
3. Professionalism.
At the start of the 2000s, we were supplied by a well-known factory in Moldova. In the early days our partner made every effort to accommodate our wishes, and we grew together. Supply volumes continued to increase, and by the mid-2000s these were quite considerable (around seven million bottles per year). At this point our partner, realising how dependent we were on them, started imposing their own rules. They introduced unfounded price increases of quite a significant margin, as well as minimum sample sizes. As a result, we started to lose trust in them, and, naturally enough, we made the strategic decision to transfer 30 per cent of our supply to another producer. Our new producer was, of course, delighted with the situation. And our old partner very quickly started fussing over us and making their excuses. But it was already too late.
If you fall into the ‘supermarket’ or ‘opportunity’ category, forget combat for a while and focus on manoeuvres. Combat (bargaining) is possible only when your opponent feels you are important.
Before beginning negotiations, make sure you possess the three most important negotiation components: strength, means and resources.
Make a forecast using the forecast matrix, and only then decide whether to make a manoeuvre (arm yourself and improve your position) or to head straight into