Who’s the boss? Engaging senior management

negotiations can lessen your stature
CHRISTINE McMAHON
For SBT
Question: When it is appropriate to engage senior management in negotiations?
Answer: Extending an invitation to a third party is a tricky decision. Each negotiating situation has its own unique characteristics and history, making a one-size-fits-all approach inappropriate. At the same time, it is critically important that you make the decision that is right for you.
As a rule of thumb, when the customer’s senior management is expecting to engage in strategic thinking/planning or when specific product knowledge or systems knowledge will be discussed, it is appropriate to engage your company senior management. For all other types of meeting agendas, we recommend that you be the one to interface directly with the customer.
A good question to ask yourself is, “What are the possible advantages or liabilities of inviting this senior manager to the bargaining table?
Many well-intentioned sales managers undermine the success of their sales team members by engaging negotiation discussions with customers. Since the customer naturally gravitates his/her attention to the person with the most authority, the sales person’s power and influence is relinquished.
In a recent negotiations training program, a very successful sales professional described her concerns about selling to an “old-line boys-club-type of guy.” From a cold call, she secured an appointment to meet with that prospective customer, but was feeling uncomfortable about whether she could make small talk and build rapport. To make sure she didn’t lose out on the opportunity, she invited her sales manager to the first appointment. You can guess the results.
The two men got along great. Unfortunately, the prospective customer directed the entire conversation to her boss, making it seem as if she was invisible. Although she made close to $400,000 last year in commissions, the customer viewed her as if her role was sales support.
This is one of the most common mistakes made when negotiating – underestimating your own power and influence. People give their power away and don’t even realize it. It is interestingly to me that over the phone, she had enough confidence to secure a face-to-face appointment with this prospect. Yet her insecurities got the best of her. By inviting her boss her own power and influence was negated disallowing any value to her comments.
We must be mindful that every interaction with a prospect/customer conditions that person how to negotiate with us. If you invite a senior manager to the bargaining table, you are in essence communicating to the customer that you do not have the authority to make the necessary decisions to conclude the deal. The impact is even more pervasive than just that one meeting. Down the road when you give the customer a different answer than the one he/she wants, he/she places a call to your senior manager hoping to negotiate a different response.
Being the front person requires a more significant upfront investment for both you and your manager. Fortunately, the outcomes are much more far-reaching and cost effective.
Begin by working with your manager and together, prepare for the upcoming negotiation. Determine what is most important to you about the outcome of this negotiation. Define what you want and what you need? Come to consensus about what your bottom line/walk away point needs to be? That will help you guide you when responding to demands. Talk about the types of concessions you will be willing to make and the ones you want to ask for, when demands are made.
This may not be an easy exercise for you or your manager. Many good negotiators have are unconsciously competent meaning they negotiate intuitively. They work it out in their heads and can do so at such a rapid rate, it is difficult to break down the different steps and decisions.
If that’s the case, you may want to try role-playing. Take the role of the customer and ask the senior manager to be the sales professional. Play out the first three anticipated meetings with the prospect. In your role as the customer, play out your toughest challenges/concerns. Be sure to listen to your manager’s words and positioning statements. Write them down. Study them. Based on your comfort level, develop your own positioning statements.
Prior to the actual meeting, play out the meeting in your mind. Consider the different possibilities and responses. The more you work through these, the more prepared you will be to handle even the toughest negotiating situation.
There are many good books on negotiating we recommend “Negotiating Rationally” by Max Bazerman; “Getting to Yes” and “Getting Past No” both by William Ury as a start. Read them. Put into practice some of their great strategies.
Good negotiating is a lifelong process. Be patient with yourself. And whenever possible, ask to be an observer when a complex or difficult negotiation is underway. It’s much more cost effective for you to learn how to fish than to have to rely on management for food. Senior management may need some help replicating their skills but the commitment to work through those rough spots will be well worth the time investment.
Christine McMahon is the owner of Christine McMahon & Associates, a training and coaching firm in Milwaukee. She can be reached at 414-290-3344. Small Business Times readers who would like a negotiating situation addressed in this column can send a fax to 414-290-3330, or e-mail her at: ccm@christinemcmahon.com. Her column appears in every other issue of SBT.
July 6, 2001 Small Business Times, Milwaukee