I recently ran a four-day negotiating skills conference in Australia for a group of senior marketing managers and representatives; the group were highly motivated. They were working in an interesting market, and they were keen to find creative ways to negotiate. The conference was as stimulating for me as it was for them.

During a break, one of the participants approached me “What you say is interesting,” he said, “but I have to ask something. Why do you bother to go on with a negotiation if the other side is stuck on price and won’t move?”

“Fair question,” I allowed. “Well, the conclusion I’ve come to over the years is that if they weren’t interested in your offer, they wouldn’t still be talking to you. They would have thrown you out long ago.”

“I guess there’s sense in that.” Apparently satisfied, he wandered off to get coffee.

He has not been the first to ask that sort of question. At the end of a long day of negotiations where the other side appears immovable on price, many of you would like nothing better than to throw up your hands, say: ‘forget it!’ and go home.

Doing something like that might relieve stress in the short-term. There’s a downside to such action, though.

Firstly, you’ll have a nagging sense of failure and frustration because you gave up.

Secondly, you could be throwing away the opportunity to look at the issues more creatively and come up with an alternative solution that suits everyone.

Play it right down to the wire. As long as they’re still talking, they’re still interested. Admittedly, it takes more work and commitment to look for the creative solution. Maybe a whack on the side of the head is what’s needed now and again to jolt tired brain cells into thinking of original solutions!

Part of an upcoming event at RMIT GBIC – Selling and Buying Value in B2B Markets is to unpack and almost deconstruct the notion of value in negotiations and business in general.

Value Creation Needs Decisive Action

You need bold and decisive action in the way you and your negotiating team deal with the creation and leveraging of value in negotiations.

You have entered a new phase, which I call the Era of Rapid Adaptability® (ERA).

In this phase, you need to make decisions quicker than ever before, balancing your intuitive self (the gut feeling) with a more robust analysis of the data. The key is a balance; both are critical to better decisions.

I had the extraordinary pleasure of being able to work with 3M for many years before starting my business. The central thread and training at 3M were always about knowing the best customers deeper than any competitor and involving them sooner and continuously in any innovation.

I left 3M and started Gordian Business, a specialist consulting firm that creates business opportunities with clients to execute their strategies to achieve breakthrough results. The key thread has and still is around value.

Most negotiations, whether it is B2B or what we see with Brexit and the trade tensions with the USA and China, focus on positions and not on value.

It is clear that when your best customer rings and says in these disruptive times, our market is tight and we need relief on your prices. It is easy just to get the calculator and start dropping.

My suggestion is to arrange a meeting to discuss what it is they are trying to achieve. I have never had anyone say drop the price so that we can compete with other price takers. The answer normally is around maintaining or growing market share and ensuring customers do not switch to a competitor.

The key to success is to steer the discussions to value creation and what it means for them and their customers. People don’t think in a value focus they think in a spreadsheet approach, I have yet to find any company in the world that has a column for value.

In tough negotiations, you need to decide do we take a position and fight on price or do we take decisive action and focus on value.