Black Belt Negotiators: How to choose a single-source strategy
Purchasing's smartest negotiators move from conflict to collaboration fast. Match your wits against these pros. Guess their strategy. Then, read what they really did at purchasing.com/negotiations.
By Paul Teague -- Purchasing, 5/8/2008 2:00:00 AM
The national rural Electric Cooperative Association (NRECA) needed to acquire a software product that fulfilled a majority of NRECA's unique requirements. There really was only one vendor, and NRECA was faced with single-sourcing the deal. The question was, should NRECA approach the vendor as a single-source and attempt a “win-win” negotiation style to obtain a fair deal or should NRECA try a different tactic?
Problem: NRECA's vendor management office had worked with its internal customer and IT department to source the software product. The software was projected to cost hundreds of thousands of dollars, so the financial stakes were high. Stephen Guth, executive director of NRECA's vendor management office and author of the Contract Negotiation Handbook: An Indispensable Guide for Contract Professionals (available at http://www.lulu.com/content/1718685), was faced with choosing to attempt a single-source negotiation strategy and appealing to the vendor's sense of fairness to obtain a reasonable deal, find an inferior, less-functional product or accept whatever price the supplier quoted.
Possible Solutions: Approach the vendor and attempt to negotiate a win-win single-source deal or find an alternative software product that had less functionality.
Are you a black belt negotiator? Tell us about one of your negotiation successes, and we'll print it so others can learn from your experience. Send it to pteague@reedbusiness.com.
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