Have you ever given any thought to just exactly what happens after you’ve used your negotiation styles and negotiating techniques to negotiate the other side of the table down to the lowest price possible? I mean sure, you walk away from the negotiating table with a sense of accomplishment, but what happens next?
The Power Of Changes
It’s human nature to assume that when something’s negotiated, then we won’t have to ever worry about it again. It turns out that when it comes to the negotiation process, this is not the case.
Every concession that you got from the other side of the table can be undone when it comes time to make changes to the agreement. In fact, the realization that there will be changes and that they will need to be negotiated may have been the reason that the other side agreed to the original concession – they knew that they could get back what they were giving up.
As a negotiator, what you need to realize is that when it comes to changes, the balance of power in the negotiations will shift to the seller because the buyer has already selected the seller – now the seller is able to hold performing changes hostage.
How To Defend Against Change Creep
One of the reasons that a seller has so much power when it comes to negotiating changes to an existing agreement is because all too often the buyer doesn’t exactly know what they want changed. Studies have shown that the more unclear the buyer is, the more they are going to end up paying to have changes made.
In order to prevent yourself from getting trapped by the other side when it comes to making changes to an existing agreement, there are a number of steps that you can take. The first is to spend the time during the negotiation of the original agreement and include in that agreement prices for work that you don’t want done but which you might change your mind and request later on.
Include the possible changes in the competitive bidding process. No, you’re not planning on paying for them right now, but you want that to be a consideration when you award the contract.
Finally, realize that the other side will be trying to raise their prices for every change that is discussed with them. Don’t let them get away with this. Negotiate hard on the price for every change that you discuss with them.
What All Of This Means For You
It can be all too easy as a negotiator to think that once a deal has been created that all of the work is done. It turns out that in the negotiation definition that we all have to live by, sometimes this means that the work is just starting – negotiating the cost of each change.
Negotiators need to be aware that sometimes even if you are trying to conduct a principled negotiation, the other side of the table will use change requests to win back items that have been negotiated away. Once you are aware of this, it’s going to be up to you to create a plan to resist the other side’s attempt to win the war by winning the battles that occur after the big negotiation is done.
Being aware of the other side’s plans is half of the battle. Understand that just because you won the negotiation doesn’t mean that you can’t lose the battle to manage changes to the deal.
– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™
Question For You: What can you do during a negotiation to plan for the change negotiations that you know will occur later on?
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What We’ll Be Talking About Next Time
Once you do deal with the other side of the table, you should have a pretty good read on them right? You feel that you know and understand their negotiation styles and negotiating techniques. As you move forward and do more deals with them you should have a good understanding of what to expect from them. Umm, not always. Sometimes when the other side of the table is too friendly, you can very quickly find yourself in hot water…