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Negotiation Management

A negotiation is a dialogue between two or more parties to resolve a disputes or come to an agreement and Negotiation Management is the practice of managing your negotiation strategies, practices, and methodologies while keeping track of how well you doing with respect to identified best-in-class practices and results. In the context of the supply chain, a negotiation usually refers to a formal discussion between a buyer and one or more suppliers with the goal of securing the supply of raw materials, goods, and / or services and negotiation management refers to the process of managing the negotiation with the intent of getting the best possible result.

Negotiation skills are a fundamental building block of negotiation management, and in addition to the ability to ask questions, listen, and construct valid arguments based on market research, the following skills are often requirements of success in any negotiation:

  • The Ability to Define Success
    What would be a successful outcome of the negotiation?
  • The Ability to Define Priorities
    With respect to your goals, what is a "need" and what is a "want"?
  • An Understanding of Power
    Market conditions often convey an advantage to one or more parties in a negotiation. Good negotiation management involves selecting a strategy that recognizes the advantage, or disadvantage, that the party may be at.
  • The Ability to Gain Leverage
    Classic negotiation theory dictates that leverage can be key to obtaining a successful outcome.
  • The Ability to Deal with Deadlock
    Sometimes negotiations will come to a standstill. Those who know how to walk away, analyze the situation, and come back to the table with a different perspective that can move the negotiation forward will generally be more successful than those who cannot.

For more information on negotiation management in the supply chain, and strategies for success, please refer to the following posts:


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