Continuing on the theme of Deal Coaching from my previous post, one of the key responsibilities of a manager should be to actively coach his or her team on their respective important deals. To be effective, coaching needs to done on a regular basis. Deal Coaching accelerates preparedness for the business negotiation and we know how important it is to be fully prepared to negotiate. As always discussed in our Strategic Negotiation workshops, the best time to start planning for the negotiation – is as early in the lifecycle of the deal as possible, when the focus is on sharing and validating information.
In the previous post, the coaching focus was on Consequences of No Agreement (CNA). In this blog post, the coaching focus is on the next concept of Strategic Negotiation – Trades. Trades is a 180 degree turn from CNA. In Trades, we need to be thinking about ‘What makes a good deal, for both sides?’ The approach is commonly considered to be ‘the give- get’ or an exchange. When the buyer asks for something, we should be prepared to ask for something in exchange. Preparation for the negotiation helps instill confidence to ask for the ‘get’ when giving. Once again, for your side of the deal, look to ensure that the sales person has based the analysis on the current view of the deal and its connection to the company’s internal strategy.
Trades help to expand the value in a deal before dividing that value in the negotiation. You will likely already know what would make a good deal for you. But to be fully prepared, it is critical to consider the other sides’ desired terms for a good deal for them.
Consider your side first and coach your team to think about:
- whether we have considered all of the desired terms that make this a great deal for us
- what trades do we have that are high value to one side, low cost to the other?
- does each trade have a value even if we are not charging for them?
- are the trades prioritized?
- has a range been defined for each item? (remember the internal negotiations)
- do we have agreement from all of our internal stakeholders?
Coaching on trades for the other side should include:
- have we defined all the desired terms that make this a great deal for the other side?
- have we anticipated how the other side might rank and prioritize their desired terms?
- what are the underlying interests for the key players in the negotiation?
- how might we achieve an underlying interest for them by Trading something that would give us equal or greater value in return?
- does the range for any trade greatly vary between your side and theirs?
Once you have coached on the terms that have been considered to expand the value in the deal reflecting what would make a good deal for both sides, now you are in a good position to coach your team to actions:
- is there any data that may be missing – this could include prioritization, metrics, and ranges?
- are there great differences in range for any trade, how will we mitigate this before the negotiation?
- is there anyone else on their side that we need to talk to and / or meet with?
- what questions should we ask them to validate the other side’s desired terms and trades?
- how should we test to ensure that any creative trades are of interest to the other side? who can we have validate the interest?
Coaching early in the lifecycle of the deal, examining the Trades analysis carefully, will result in a redoubling of focused effort to verify and validate our thinking and to manage any misperceptions. Some diplomatic education might be needed, too. When coaching is done early and done well, it can have a significant impact on the outcome of the deal.
Stay tuned to the next installment where coaching your sales team on the third concept of Strategic Negotiation, Preparing Value, will be reviewed.