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Measuring “win-win” outcomes in business negotiations

adminbmt November 8, 2013

If you can’t measure it, it’s not worth doing.

If you know the “before” as well as the “after” you will be able to measure the difference and then decide to either put the champagne on ice or start filing your papers or whatever!

For many business decisions it is possible to know the “delta” and plan accordingly.  For some it is not.  Like in the case of negotiated outcomes.  It may be possible to quickly calculate the amounts conceded, the extent to which the terms and conditions were diluted as well as the premiums realized  but to really ascertain the impact the negotiated agreement would have on your future business is another thing all together.  It cannot be calculated.

So how do you measure or even assess the outcome of a business negotiation?  There is one thumb rule.  If you and your customer “feel good” after signing up then you could conclude that you did drive a win-win negotiation.

Win-win is a feeling.  Let me explain…

Imagine an athlete who can equal the world record for a 100 mtr sprint.  In some of his practice sessions he has even bettered it.  Lets say he enters a competition and wins.  But this time his time is not as good as it was during his training.  While the world cheers him as a winner, how do you think he feels about his performance?  Chances are, that while he is putting up a cheerful façade, in reality, he is weeping inside.  While “data” available indicates that he is a winner, he doesn’t feel any better than a loser.  Not exactly a winner!

It’s almost similar in business.  While you may have done your home work, decided upon the objectives of the negotiations, drawn up the negotiable issues with corresponding best-target-worst case scenarios, planned your strategies to the T, also hogged the limelight at the negotiation table to come out with resounding success what needs to be seen if whether your agreements fit in with your organisations mandates (remember, your organisation needs to implement the agreement), and how does your customer “feel” about the deal.  Finally, will this agreement help build stronger business relationships in future?

Irrespective of what data indicates in this case, the answers to these questions will decide whether you actually did conclude a win-win negotiation or not.

Sometimes if may be necessary to force a win-lose or even a lose-win outcome.  If you planned it and if it fits in to your business and negotiation strategy, then so be it!  Largely however, in a B2B environment, it’s cheaper, on all counts, to retain an existing customer and continue to do business with him.  Scouting for new ones, is expensive, on all counts and hence undesirable.

Well, if your existing customer has exhausted all his needs for your products and services and if he “feels good” about past business dealings with you, you’ve got a great coach on your side.  Just think how you could leverage on the relationship and what it could do to your business.

Therefore, negotiation outcomes, win-win or otherwise, any time, anywhere, should preferably also result in “good feelings” on both the sides of the table.

The impact of such negotiation outcomes may not be immediate measurable  but will definitely be visible in your next years sales reports. It does make better business sense!

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Contributed By:

Rakesh Marwaha

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