By Omar Sofradzija
Is business a zero-sum game? Whether it was in the past, it isn’t now. Nor will it be going forward.
“Management is becoming increasingly long-term focused or relationship-focused. It’s not that we’re getting soft and giving in to the other side, but we’re starting to recognize the value in viewing many business situations as partnerships as opposed to transactional kinds of relationships,” said Jennifer Dunn, a professor in the executive development program at the Eli Broad College of Business.
That’s because in today’s interconnected world, a weakened supplier can result in a weakened you.
“We still want a fair price, but we may not beat our supplier to the brink to get the absolute lowest price. Any unpredictable event that occurs can move them from barely making a profit to actually making a loss, and they can’t sustain that,” Dunn said. “We can’t become myopic about what the dollars are going to look like this quarter. We need to think about the bigger picture.”
There’s more recognition that there are benefits to that kind of perspective. “For the last 20 years, there’s been a move to try to talk more about interests and what it is we really care about, and thinking about those priorities over just talking about numbers and demands and positions that we might hold,” Dunn said. “We must think through the process — what precedents we’re setting, their impact on how we negotiate in the future, and the relationship we’re going to leave with at the end of this discussion.”
Why collaborate? To best manage change
Change is happening, and fast. “If we look at the speed of change and the global nature of a lot of businesses, many businesses have a lot more uncertainty about the future, and there are very few of us who feel like we really understand how everything works across the globe,” Dunn said. “With this uncertain future, having an underlying trust with suppliers and distributors that says, ‘whatever that future is, I know we can adjust and we’ll make it work’ is an assurance to being able to operate effectively.”
Professionals need the initiative and collaborative nature to involve people that need to be involved with long-term execution. “Don’t simply consider trying to make the deal on your own. Think about who else is going to be affected and how they can be brought into the negotiations, either as advice-givers or people actually at the table. They can contribute to making sure that whatever agreement is reached will work well going forward in the future,” Dunn said.
“We must make it more of a team effort than an individual one and have the skill to not just negotiate across the table, but also to negotiate internally so there is clarity on what our main objectives are, what counts as success for us, and how we’re going to go about getting that,” she said.
During Dunn’s Power, Influence and Negotiation two-day program scheduled for Nov. 7-8 at the James B. Henry Center for Executive Development in Lansing (you can register here), students do interactive exercises to practice these skills. “We walk through strategies for how you can create value in a negotiation, how you can signal value in the relationship, what things you should be thinking about to have this more long-term sustainable partnership kind of situation where it’s more of an implementation-minded approach,” she said.
“The exercises serve as the basis for that learning, but layered on that, we apply the experiences to these concepts of how do we collaborate, and how do we ensure we’re getting to the other side’s interests and what they care about?” Dunn said. “How do we frame the negotiation so that we start off in a collaborative way and we maintain the shared objectives as we get into the details of the negotiation?”
Collaboration must be external and internal
In our current business environment there’s an expectation for more collaboration internally. “Where within a corporation you might have had five aligned sandboxes, now there is one big sandbox and your goal is to build one castle, so you need to align and coordinate and figure out how to do that in the best way possible,” Dunn said.
“Twenty years ago you may have had well-defined job roles where you could say, ‘this is my job description and that’s not part of my job.’ The expectation now is we’re all focused on this problem, and we all need to work together to figure out how to get there,” Dunn said. “Those collaborative skills become really important in that situation, and we get a lot of people in the session wanting to learn how they could do better from that vantage point.”
How do we work in groups when there’s conflict about what we should do? How do we manage internal negotiations within a larger group? How do we get our own side on board and aligned before we meet across the table with the other side? That’s what students tackle at Broad, where many who attend negotiation sessions are mid-career professionals from across a broad array of organizational functions.
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