In my opinion one of the most important parts of the negotiation (and often the most overlooked) is the pre-negotiation preparation and planning phase. Understanding your priorities and the priorities of the other side, knowing what your constituents want, knowing your walkaways, identifying value creation opportunities, and having an overall strategy are keys to a successful negotiation. With that said, IACCM research shows that many negotiators fail to plan properly or plan at all. In 2009 we did a comprehensive negotiation benchmark study that showed 74% of the 124 companies benchmarked did not use any formal negotiation planning tools. You can imagine how much more successful you will be if you’ve done your homework before the negotiation begins, particularly if the other side hasn’t done their planning. The flipside would be that they’ve prepared and you haven’t. I’m sure you don’t want to find yourself in that situation.
A couple of other suggestions for you: If you aren’t already enrolled, you should consider signing up for the IACCM Managed Learning and Certification program. There are several modules in the curriculum that specifically address negotiation topics. IACCM also has a Negotiation Community of Interest you can join to seek help and advice from other IACCM members. You can also search the IACCM Library for articles, presentations, Ask the Expert recordings, templates, etc. related to the topic of negotiations.
• TECHNIP INDIA LIMITED
My experience shows what Katherine has told is one of the best approaches you have. Pl. get hold of IACCM expertise & for sure, you will succeed.
Thanks & Regards,
You need to anticipate the other sides's likely demands and to have a plan to deal with their demands. This includes consensus in your organization on what your desired position is and what your walk-away position is. Part of your plan will also be to decide who leads your team at what points and on what issues. You must appear united and knowledgable.
Another key issue is authority. You need to have the authority in your team to make decisions. But also make sure that the other side has authority, otherwise you are not really negotiating.
Look for trade-offs. You will have a negotiation agenda, but do not just operate point by point - that leads to compromise or impasse. Try to work on relative value items. For example, maybe you really want good payment terms; maybe the customer really wants extended warranty. Perhaps you can make a trade and both get what you want. But if you have not understood your own areas for their importance and have not gathered that data about the customer, you will miss opportunities.
There is so much more - but maybe these early tips will help you.
Firstly, leave your ego outside of the room. Do not be so attached to your own values. Focus on what the task in hand is, not what the agendas are (yours, or theirs). Do not be positional, for example do not get straight into a horsetrade based on what you think they want, as others suggest. Allow space for you, and for them. Try to ask open questions to explore and clarify what the task REALLY is about. Finally, keep an implementation mindset and ask "what if..." i.e. if we do X, then what happens (cause and effect).
If you can do all of these consistently you will be successful, and if you do then please let us all know!
One of the keys to success in Oil and Gas contract negotiations is the utilization of internal (and to the extent that internal is lacking) expertise. In some instances, one might become intimidated by all of the phrases and acronyms being said at the negotiation table. Keep in mind that information is power, and if the other side feels that they can gain concessions through the use of industry specific words and phrases...they will. Bring your experts to the table and this advantage will be neutralized, or even reversed. This set of comments is usually more relevant in positional negotiations.
Hence, strive for principle based negotiations and you might find the negotiation to be more productive and effective. The IACCM on-line learning modules, as well as many materials in the IACCM Library, cover these two negotiation approaches.
Phyllis we are delighted to know that you enjoyed Rod and Melissa's webinar. I hope that you are also enjoying the first of IACCM's TASK Topics which is all about Remote Work Environment and Balance. There are lots of resources available, podcasts and talks with people sharing their stories and expertise as well as training programs and coaching opportunities to help our members navigate their way through the coming months as we emerge from the immediate crisis.www.iaccm.com/task/remote-work-environment-balance/
Hi Steve, thank you for your question. Pricing trends for major equipment are not something we specialize in unfortunately and in the current circumstances, the answer would, I believe, vary enormously depending on the nature, type, and location of the acquisition.
• GMR Energy LImited
Believe there is no ready made global data base as of now. Each countries Govt. publishes data on whole sale price index/producer price index/purchasers price index( nomenclature varies) on each and every category of product including machinery, equipment etc. year on year and month on month. These data is generally publicly available and can be accessed and down loaded.
For example - there is Bureau of Labour Statistics in USA which pubishes all such data for the products manufactured in USA. In India its published in a bulletin every month by the central bank i.e Reserve Bank of India
Great question. You have certainly come to the right place for some expert advice. I hope others jump in as well. You can find an array of resources at your fingertips (including case studies).. if you go into the resource library (Resources > Resource Library) and search by category = Negotiation. I would particularly recommend:
IACCM Dubai Member Meeting April 2019 Presentations
Ask The Expert: Negotiating and Contracting in the Middle East
The Power of Intent Workshop - IACCM APAC Conference 2019
Do Procurement practices cause dishonesty?
Negotiating in a time of coronavirus
In Negotiations, Givers Are Smarter Than Takers
In addition, you may wish to consider our new Managing Contracts Virtually training program (which is currently included as a member benefit) .. Training > Managing Contracts Virtually.
If you need help accessing any of these materials, please contact me at firstname.lastname@example.org.
Greetings, thanks for the question. I look forward to the responses from other practitioners in this space too. In the meantime, I suggest you take a look at our contract standards clause library here: www.contractstandards.com/public/contracts/statement-of-work. While this provides a framework, the key is in the level of detail that you apply to the "Supplier Tasks and Responsibilities" section - the detail required is application-specific, so there are no hard and fast rules. I have used detailed project plans and, in some instances, references to operational collateral (handbooks, processes, and procedures, referenced but not included) to get to the level of detail necessary to define what is required. This works fine for transactional engagements but cannot cope with more complex requirements - where there is uncertainty in delivery or deliverable (or both!). Then, you'll need an agile approach to the SOW. Hope that helps.
Hi - thank you for raising this important point and sorry that you are missing out on active participation. In your user profile, you can actually make use of two email addresses - the primary one (that is used in the login process) and a secondary one, that is used if the primary one has issues. You can change these at any time, from your profile page: www.iaccm.com/members/, but clearly you will need to be able to log on to make the change. If you cannot log on for whatever reason, please contact the membership team (email@example.com) and we will happily make any changes for you, once we have verified your identity.
If you don't have a secondary email saved, perhaps now is the time to think about adding that. If you are currently associated with a Corporate membership and things have changed, you can always elect to leave the corporate membership and become an individual member. You can do that here: www.iaccm.com/members/. That way, you will continue to enjoy all the great benefits of IACCM membership.
I am in the situation where I am in between jobs, having finished in my last role at the end of March. The CoVID situation will most likely delay me getting new employment for some time. During this time I am focusing on catching up with IACCM events such as Webinars, AsktheExpert, etc, but find I am excluded from any Sponsors' webinar as I no longer have a work based email address.
Will this continue throughout the CoVID period? I feel it is a little short sighted of the Sponsors to exclude those not currently in employment from their webinars, it is exactly this time when I will have most opportunity to join and expand my knowledge and understanding of the marketplace.
Hi, Thank you for your response. Great to meet you - virtually that is.
I am very sorry to hear you are experiencing an issue registering for the IACCM sponsored webinars.
We continuously contact sponsors asking them to be sensitive to this issue. However, as the registrations are done on their websites, it is a challenge to get them to change their policies.
In any case, the webinar presentations and recordings are typically posted in the IACCM Member Library within 24 hours of all sponsored webinars, so they are available to you to review at your convenience.
Here is the link to the latest content on our resource library. www.iaccm.com/resources/contract-management-resources/
In the meantime, let us know if you need any additional information.
Jennifer Jarrard MEI SRMP
Director, Corporate Member Operations, IACCM Council and Networks
+61 (0)407 541 497 | firstname.lastname@example.org
Personally I don't know that this is the case... My personal email address is registered as my primary email address with IACCM; and I always use my personal email address to sign up to IACCM events.
• Vodafone UK
Hi, all internal IACCM events work fine with a personal email address, it was the external sponsored events that would not allow my participation, those where you register through the sponsor's website. This was a few months ago and I have not tried since so things may have changed.
I just tried to sign up for Malbek webinar on June 30 with gmail address, does not allow 'non-work' email - bummer
God day Sedef - well, again, I hate to see a good question like this sitting there all along unanswered, so here goes my contribution.
Firstly, if you get to create your own KPI's, I think that this is an awesome opportunity for you. It's a great opportunity for you to pick some criteria on which to have your performance judged by.
I think it's an opportunity though for you to think about whether or not you want these KPI's to relate to your performance alone, or contribute to or align directly with organisational performance. This could be a factor of where you feel you are as a team with procurement maturity, as well as your ability to influence the organisation's plans. Let me explain by way of example.
Four years ago, for our team, it was all about how quickly we could turn around tenders, time to contract, and the number of complaints (which thankfully were none) about the conduct of our tenders. So for us then, the KPI's were team focussed and didn't really track well into organisational plans.
Fast forward to the present day, the team has pushed back into the business to be engaging with them at a much earlier stage. The KPI's we are moving to are around developing category plans with the business and presenting them to the senior leadership team, monitoring and reporting on the significant contracts in their portfolio and working with the teams on meaningful social procurement outcomes that are relevant to their categories. As you can see, these are less about the team, and track really well into where we want to be as an organisation.
Oh, and like all KPI's, it perhaps goes without saying, but make sure that they're SMART (Specific, Measurable, Attainable, Relevant, and Time-Bound) or SMARTER (adding Explainable and Relative to the mix).
So Sedef, my advice would be to jump the opportunity to set your KPI's, and make them relevant to where you are and where you want to be. I think you are the best person to work that out, rather than me just telling you what you need based upon your one paragraph question.
Have fun with making them - and it would be great learning for others within the forum for you to tell everyone what you ended up with !
• Ngamuru Advisory
Following on from Darren's excellent points, I wanted to find out how you went? Did you find the missing one? I started my Performance Based Contracting (PBC) journey in 2004 designing, implementing and managing performance measures (not just KPIs!). Over this time I have seen many, many performance measure that can be used depending on what you are trying to achieve. Indeed, over the years we have actually formed the opinion that there are more than simply KPIs, since most humans can only handle 3 - 5. Therefore, having dashboards of 20 it too much information. So while there are a number of websites that can give you a variety of performance measures, can I suggest you have a look at why you want to measure; what is the outcome you are trying to achieve? Is it the standard project ones (scope, schedule and cost), or are there other things such as the health of the relationship, the culture of safety, etc. And if you think you can't measure the last ones, you can! Just takes a bit more work to set-up. So best to work that out first.
To help, as an IACCM Fellow I write on blog where I write about this (www.performancebasedcontracting.com), which sometimes become articles for IACCM (part of the role of an IACCM Fellow). Therefore, I'd suggest you have a look here and see if this helps. There is probably a lot of content (all free!), but hopefully it helps.
Anyway, I hope this helps you on your journey. And don't be afraid to ask for help!
Thanks, Phyllis, I am glad that you found the webinar helpful; it was certainly a great session to moderate, with some really good questions at the end. I agree - we often don't pay enough attention to the learning style and the impact that has on how information is absorbed. Paul Branch
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