How to Handle “Extreme” Negotiations with Suppliers
When negotiating in high-stakes, high-risk (“extreme”) situations with suppliers, the tendency is to act quickly and forcefully. Yet acting in haste to take charge and look in control often leads to disappointing, even dangerous, results. A better approach: slow down the pace of the negotiation, understand the other side’s position, and work toward a more collaborative negotiation process.
In 2010, Jeff Weiss and Jonathan Hughes, together with Major Aram Donigian, published an article in the Harvard Business Review entitled “Extreme Negotiations.” That article explored lessons from the U.S. military about negotiating in high-stakes, high-pressure situations—lessons with potential relevance to complex negotiations in the business world. A key insight underlying the ideas from the article is that negotiation behaviors tend to be deeply ingrained and are often reactive rather than deliberate, especially under conditions of significant stress. By carefully analyzing how military officers in theater were often able to defuse dangerous situations, five replicable strategies emerged. Although these strategies differ from most people’s default reactions to stressful negotiating situations, the ability to implement them can indeed be learned.
This article is a companion to the Harvard Business Review piece, and addresses how the same approaches can be employed in especially challenging negotiations with suppliers. Over the past several years, we have helped sourcing and supply chain executives and professionals employ these strategies when traditional forms of leverage seemed unavailable (for example, with single and sole source suppliers), and/or when business-critical suppliers seemed to be engaging in opportunistic or even adversarial negotiation tactics. These strategies are not only useful at the bargaining table, but can (and should) also serve to reshape planning and positioning far in advance of formal negotiations.
Strategy 1: Broaden your field of vision, question assumptions, and re-think objectives.
Start by identifying key assumptions and subject them to scrutiny; use negotiation planning and execution to continually gather new information and revise strategies accordingly.
This complete article is available to subscribers
only. Click on Log In Now at the top of this article for full access. Or, Start your PLUS+ subscription for instant access. |
Not ready to subscribe, but need this article?
Buy the complete article now. Only $20.00. Instant PDF Download.
Access the complete issue of Supply Chain Management Review magazine featuring
this article including every word, chart and table exactly as it appeared in the magazine.
Latest News
Port of Baltimore May Not Reopen Until Summer Sales & Operations Planning (S&OP) Mastery A New Priority Greets Procurement Professionals in 2024 Cargo Shipping Remains on Hold in Baltimore Following Bridge Collapse Maximizing the Bottom Line: The Power of Procurement More NewsLatest Resource
Sales & Operations Planning (S&OP) Mastery In this Special Digital Edition of Supply Chain Management Review, you will find insights on the importance of sales and operations planning (S&OP) to an organization’s bottom line.All Resources
Download Article PDF |
In 2010, Jeff Weiss and Jonathan Hughes, together with Major Aram Donigian, published an article in the Harvard Business Review entitled “Extreme Negotiations.” That article explored lessons from the U.S. military about negotiating in high-stakes, high-pressure situations—lessons with potential relevance to complex negotiations in the business world. A key insight underlying the ideas from the article is that negotiation behaviors tend to be deeply ingrained and are often reactive rather than deliberate, especially under conditions of significant stress. By carefully analyzing how military officers in theater were often able to defuse dangerous situations, five replicable strategies emerged. Although these strategies differ from most people’s default reactions to stressful negotiating situations, the ability to implement them can indeed be learned.
This article is a companion to the Harvard Business Review piece, and addresses how the same approaches can be employed in especially challenging negotiations with suppliers. Over the past several years, we have helped sourcing and supply chain executives and professionals employ these strategies when traditional forms of leverage seemed unavailable (for example, with single and sole source suppliers), and/or when business-critical suppliers seemed to be engaging in opportunistic or even adversarial negotiation tactics. These strategies are not only useful at the bargaining table, but can (and should) also serve to reshape planning and positioning far in advance of formal negotiations.
Strategy 1: Broaden your field of vision, question assumptions, and re-think objectives.
Start by identifying key assumptions and subject them to scrutiny; use negotiation planning and execution to continually gather new information and revise strategies accordingly.
SUBSCRIBERS: Click here to download PDF of the full article. |
Subscribe to Supply Chain Management Review Magazine!
Subscribe today. Don't Miss Out!Get in-depth coverage from industry experts with proven techniques for cutting supply chain costs and case studies in supply chain best practices.
Start Your Subscription Today!
It’s high time to go beyond visibility Driving supply chain flexibility in an uncertain and volatile world View More From this Issue