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The ‘old school’ of sales and marketing leads us to believe that negotiating and closing a deal is a competitive activity where the style of approach is more confrontational rather than consensual and there are ‘winners’ and ‘losers’. The measure of success is whether you kick ass and get what you want.
“It’s a zero sum game, somebody wins, somebody loses. Money itself isn’t lost or made, it’s simply transferred from one perception to another,” said Gordon Gekko, played by Michael Douglas in the epic 1987 movie Wall Street.
But that kind of attitude isn’t sustainable in today’s global markets.
Social and economic factors have combined to create an interdependent world where its collaboration not competition that’s the name of the game.
And this requires sales and marketing professionals to have stronger negotiating skills than they may have acquired in the past, according to expert negotiator and lawyer Clive Rich who I had the pleasure of meeting last week who’s negotiated for and with the likes of Apple, SanDisk, SycoTV, Vodafone, Sony, Yahoo and many others.
“Good deals don’t happen by chance. Effective negotiators need to have a conscious blueprint for success. Deal making has never been more important yet negotiating is rarely taught or talked about. There’s never been a more important time for effective negotiation given the uncertain economic climate in which we live — we are all linked by technology, by international trade and by a common economic vulnerability,” he says.
The good news, according to new research by YouGov and the Centre for Economics and Business Research (CEBR) in the UK is that with better negotiation skills the average business can see an improvement in its profits by as much as 7 per cent.
Now that’s worth having, isn’t it?
Yet because of the ‘negotiation skills gap’ researchers estimate a country like the UK is losing around $26 billion a year through ineffective sales negotiation.
This is equivalent to $13.6m per working hour, $68m per working day and $340m per working week. Not to mention tax revenue that isn’t ending up in the coffers of Government.
The key to success, according to Clive Rich, is to re-wire our thinking when it comes to closing a deal. In short, we need to change our attitudes, behaviour and approach to ‘selling’ by adopting the mind-set of a professional negotiator, where at the heart of the approach is the ability to create a win-win outcome for all the parties.
Failure to change our mind set won’t just make us less successful in selling but will store up problems for us as an economy in the future.
For example, by 2017 China will have overtaken the US to become the world’s largest economy. India will have overtaken Japan, Russia will have overtaken Germany and Brazil will enter the top ten largest economies in the world at the expense of Italy.
“Despite all their individual differences, the BRICs are now seeking to strengthen their joint negotiating positions at a time when a future world system is being created. The growth rates in these countries represent an enormous opportunity for business. However, if emerging countries are getting stronger and potentially more united, then we have to negotiate more smartly — working with deal partners in these countries, not against them,” concludes Clive Rich.
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