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Difficult people behave that way because it’s getthing them what they want

2012 May 16 by Mike

Dealing with Difficult Negotiators

People are often difficult because they’ve learned that their bad behavior gets them what they want. In some cases they’re difficult because they believe that you or your organization or your country has wronged them in some way.  And sometimes they’re just awful people.  It doesn’t matter; you should not adopt or contrast their style. When negotiating with these type of people, your job is to teach them that they will get nothing from you unless you get something from them. Decide what you want from them and put it in the form of  IF YOU . . . THEN I WILL . . . to get what you want – including a change in their behavior! You don’t have to shout, swear, intimidate, or behave in any fashion that would cause you embarrassment should the details of your behavior become public the next day.

Sales Executive to improve performance quickly

2011 June 27 by Mike

A sales executive’s guide to: Spotting an opportunity to improve performance quickly

The ability of a sales executive to differentiate between whether the organization has a selling problem or a negotiating problem can mean the difference between delivering the performance expected or not.

The truth is that a skilled negotiator (with the emphasis on “skilled”) will produce a good deal where a skilled sales person may not. And a skilled negotiator will do it without damaging the relationship. Negotiating skills are not “super” selling skills; there is a difference between the two that creates more ability to close good business. Negotiating skill is next lever to pull when the current approach isn’t working. Having skilled negotiators in your organization will improve performance measurably. For example, we know that the investment made in our workshop will produce a ten-times ROI in the first 90 days as a start. One client improved margins from 9% to 29%.

To diagnose whether or not your organization needs to improve their negotiating performance, look for some of the signs and symptoms:

SIGNS AND SYMPTOMS:

  1. Our salespeople don’t get enough back for what we give away to our customers. In some instances, our customers have come to expect that we give things away to
    them without getting any real value in return and we’re setting bad precedents in the marketplace.
  2. When our salespeople get resistance from the customer, they attempt to persuade the customer. If their ability to persuade fails, they react by lowering the price.
  3. Customers for whom we are “bending over backwards” to please, and meeting their demands, are becoming even more demanding and more difficult instead of showing their appreciation for what we have done.
  4. As a manager or executive, I am asked more frequently than I would like to become involved in a negotiation, or I feel like I need to be involved in the negotiations. This takes up more time than I would like devote because I have other competing priorities.
  5. When we run into trouble and the salesperson wants to give in to the customer, the excuses are either: 1) our “value proposition” isn’t strong enough, or 2) the
    customer is only focused on price, 3) a “difficult” personality on the other side that we need to “keep happy” and maintain a “good relationship”.
  6. Generally, our salespeople believe that they have little power and so their actions and recommendations reflect their belief.
  7. We don’t get access to the right influencers and stakeholders.
  8. Our negotiations take a too long to conclude which lengthens the sales cycle.
  9. Generally, the strategy that our salespeople take is focused on skillfully convincing the other side, perhaps with needs-based selling technique, and being prepared to
    address objections and defend the company’s position.
  10. We have a lot of salespeople that rely too heavily on “relationship selling”.
  11. It’s possible that our salespeople could do deals that were at least 5% more favorable to us and that would make a significant difference to our performance.
  12. Our salespeople tell us that it would help if the negotiating training that they receive was more realistic to their real world.

If any of the above statements are true in your organization, you have some need to improve negotiating performance. If more than one is true, the need is likely hindering your organization’s performance.

There are also systemic signs and symptoms that indicate that the organization needs to better understand how to support its negotiators. Here are some questions to ask:

  1. Is  there a common understanding across the organization of what effective  preparation looks like and what deliverable it produces? Or is it common
    to hear, “everyone has their own way of doing things”.  If it’s the latter, then it’s very  difficult to manage the quality of preparation across the organization or
    to be able to quickly review any particular preparation and discuss prior  to the meeting. Management must “hope” that salespeople are preparing  effectively. And, of course, they usually aren’t.
  2. Are  salespeople not using  preparation tools or methods because it takes too long?
  3. Do the  salespeople have approved list of “tradables” that they can use to  negotiate with the customer? Does it have at least thirty items on it? Are  they using them?
  4. Are  salespeople acquiring valued business objectives in exchange for any  concessions they make?
  5. Are  the salespeople confident of where the walk-away positions are for each  issue that they may have to negotiate?
  6. Have  all the internal parties involved in negotiating a customer contract  and/or approving any proposals or contracts been trained in the same  negotiating methodology? Does everyone speak the same negotiating  language?
  7. Has  the senior executive in Sales and his or her staff received the  appropriate levels of training to support salespeople; is there an internal  infrastructure (expert system) built around the negotiating process that’s  designed to cause good negotiating behaviors and decisions throughout the  entire organization?  Does the
    system allow negotiation to be managed at the corporate level?  Does the system provide for the whole  organization to learn and benefit when any one individual learns from  experience?
  8. Do  managers understand how to coach the skill and support the salesperson in  front line negotiations?
  9. Has  negotiating excellence been identified as a core competency for  salespeople?

Skilled negotiating performance can mean the difference between exceeding goals and not meeting them; strong negotiating performances also help salespeople demonstrate that they make a real difference for the company in difficult times; that builds job satisfaction, morale and excitement in the group.  Having a common approach builds a sense of team and can be used to leverage talent across the team. When the approach is driving results, it builds commitment to the leader. For example,
one of our clients recently improved their profit margin from 4% to 19% in less than 12 months by applying our approach. The VP who diagnosed the problem and
provided the right support is now a company hero. She changed how business is done by the sales organization and has recently been promoted to EVP – Operations. So, if any of the signs or symptoms outlined above are there, providing the support necessary for salespeople to be effective negotiators is the right place to focus resources for fast performance improvement.
Mike Milich is Partner at Swift L.L.C. and can be reached at +1 913.851.4327, or, mike@swiftnegotia.com

Pharma – Diagnosing Poor Negotiating or Selling Performance

2011 June 22 by Mike

With millions of dollars at stake, many pharmaceutical companies  have sent their Account Managers through some sort of negotiating training. But buying negotiating training is a bit like going in for surgery; it’s hard to really assess the quality of what’s been done unless you have some expertise. The ability to differentiate as to whether there’s a selling problem or a negotiating problem can mean millions of dollars in swinging the organization’s performance one way or the other.

The truth is that a skilled negotiator (with the emphasis on “skilled”) will produce a good deal where a skilled sales person will fail. And a skilled negotiator will do it without damaging the relationship. Negotiating skills are not selling skills; many people don’t fully appreciate the difference. Most executives haven’t received practical negotiating training and don’t have enough experience in negotiating in the first place. But with today’s business environment (e.g. managed care and trade discounts), skilled negotiators create a competitive advantage and executives who run Account Management departments would do well to improve their ability to diagnose an organization with sub par negotiating performance.

What’s the best way to diagnose whether or not your organization needs to improve their negotiating performance? Here’s a list of signs and symptoms to look for?

SIGNS AND SYMPTOMS

  1. Customers for whom we are “bending over backwards” to please, and meeting their demands, are becoming even more demanding and more difficult instead of showing their appreciation for what we have done
  2. Our Account Managers don’t get enough back for what we give away to our customers. In some instances, our customers have come to expect that we give things away to them without getting any real value in return
  3. As a manager or executive, I am asked more frequently to become involved in a negotiation, or I feel like I need to be involved in the negotiations. This takes up more time than I would like to devote because I have competing priorities
  4. Our negotiations always seem to eventually boil down to price
  5. When we run into trouble and the Account Manager wants to give in to the customer, the excuses are either:
    • our “value proposition” isn’t strong enough,
    • a Director of Pharmacy that is only focusing on price, or
    • a “difficult” personality on the other side that we need to “keep happy” and have maintain a “good relationship”
  6. Generally, our Account Managers believe that the customer has more power and so their actions and recommendations reflect their belief
  7. We don’t get access to the Medical Directors or others whose focus is on issues outside of price; we’re blocked by our point of contact
  8. Our negotiations still take a too long to conclude which lengthens the sales cycle
  9. Generally, the strategy that our Account Managers take is focused on skillfully convincing the other side, perhaps with science-based arguments, and being prepared to address objections and defend the company’s position
  10. It’s possible that our Account Managers could do deals that were at least 5% more favorable to us and that would make a significant difference to our performance
  11. Our Account Managers tell us that it would help if the negotiating training that they receive was more realistic to their real world.

If any of the above statements are true in your organization, you have a need to improve negotiating performance.

Account Managers must now be skilled negotiators. That’s a change from the past. That means that the experience that top field representatives and sales managers bring with them into the Account Manager role isn’t enough by a long shot. The truth is that Account Managers are being asked to deliver results in markets where the products often have very little ability to differentiate themselves and the customers know it and use it. Customers are demanding more and more and Account Managers struggle with what to do. They think to themselves, do I give in and keep the customer happy or do I take a hard line and risk the relationship. The answer is neither; they should skillfully negotiate to the full extent of their organization’s power; which is considerable, they just don’t understand how to recognize it and use it.

What about systemic signs and symptoms that indicate that the organization needs to better understand how to support its negotiators. Here’s some questions to ask:

1. Do the Account Managers have approved list of “tradables” that they can use to negotiate with the customer?
2. Are they acquiring objectives in exchange for any movement they make?
3. Have all the internal parties involved in negotiating a customer contract and/or approving any proposals or contracts been trained in the same negotiating methodology? Does everyone speak the same negotiating language?
4. Has the senior executive in Account Management and staff received the training and adjusted internal processes to support the negotiating methodology?
5. Are there measures that have been put in place to create sustainability of the skill?
6. Do field managers understand how to coach the skill and support the front line negotiator?
7. Has negotiating excellence been identified as a core competency for Account Managers?

Skilled negotiating performance can mean the difference between exceeding goals and not meeting them; strong negotiating performances help Account Managers feel like they make a real difference for the company; that builds morale and excitement in the group. And having a common approach builds a sense of team. When the approach is driving results, it builds commitment to the leader. So providing the support necessary for an Account Manager to be an effective negotiator may be a good place to focus your attention.