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Adversarial negotiation

April 11, 2013

It can be difficult to persuade an organization to give up on its traditional approach to negotiation. I am quite often asked to suggest how to transform adversarial attitudes towards suppliers.

Adversarial behavior tends to be self-reinforcing. It stems from a lack of trust, yet inevitably it causes those on the receiving end to lack loyalty and therefore to be untrustworthy. I recall an excellent example of this when I was researching the negotiation style of the major US car manufacturers. Before the financial collapse, they were famed for their domineering treatment of suppliers. I spoke with a few of those suppliers and their attitude was  “We hope the major US producers go out of business. Yes, we work with them, but our loyalty and investment is focused on their foreign competitors. People aren’t going to stop buying cars – and we will be pleased if they buy them from manufacturers who behave fairly and want partnership with their suppliers”.

Over time, adversarial behavior takes a toll on any business. It will most likely be starved of innovation. When times are tough, its suppliers will have little interest in helping out. Management time is far more likely to be spent fire-fighting than it is on creativity or process improvement. But all these things seem remote and distant, and the immediate benefits of more collaborative behavior are hard to define or illustrate when there is no baseline for comparison. Often, the behavior is also common to an industry so there may not even be external benchmarks.

IACCM’s study of the companies ‘Most Admired for Negotiation’ provides clear evidence of the benefits that flow from a less adversarial approach. This was reinforced by last year’s study of ‘The Future of Contracting’, in which there was almost universal belief that a more collaborative style is evolving, supported by today’s advanced technologies and analytics. But while these reports provide supporting data, they do not specifically answer the question “How do I go about getting my organization to change its approach?” So this week, with my colleague Paul Mallory, we recorded a short podcast offering our ‘Top Ten Tips’ on this topic. It can be accessed at

https://www.iaccm.com/members/library/?id=4752&src=contractingsrole

 

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