Win-Win Negotiating Part 3

From the book: ‘Turn Your Customers into Your Sales Force’ by Ross Reck

Importance of ‘Negotiation’ was made clear in the last article(Feb ’13). Also, to become a successful salesperson, you must become an effective negotiator. There are two basic philosophies people utilize to get what they want from other people. The first of these philosophies is the Win-Win Philosophy and the other is the Win-Lose Philosophy.

The Win-Win Philosophy: “I get what I want by helping others get what they want and vice versa”.  In a true Win-Win sales transaction, both parties come away feeling very good about the deal they have just concluded. Both are likely to follow through on their respective promises, look forward to doing business together again in the future, and to refer others.

Ross Reck illustrates this with an example, when a senior vice-president of a bank approached him with concern that some of the competing banks wanted to go after some of the large depositors of his bank. These banks were trying to lure these wealthy customers by offering them significantly higher interest rates. But countering this with higher rates was expensive and it would have caused a price war resulting in everybody ending up not making money. Ross Reck suggested that the bank has to give a reason to stay for the valuable customers. He suggested to the senior VP to treat these customer in a different way. Provide them special attention; arrange gala events like afternoon tea parties for targeted customers. Invite them with engraved initiations. Serve tea and snacks with fine china and silver. Along with this, make sure the president of the bank or one of the senior officers was on hand at each of these events to mingle with the guests. These tea parties were smashing success. Instead of losing any of these wealthy customers, the bank actually began to attract new customers as the result of referrals from people who had attended some of the parties. This was truly Win-Win in action: The customers got what they wanted – special treatment that appealed to their egos – and the senior vice-president got what he wanted, in that he was able to hang onto these customers without having to match the interest rates being offered by the competition.

The Win-Lose Philosophy: “I get what I want from you at your expense.” In other words, I win and you lose and you know it. This philosophy does not motivate other people to stand in line just for the privilege of doing you a favour.

This is illustrated with another example. Ross Reck went to a local dealership with his family to buy a new car. After numerous test drives, the whole family liked a particular model and decided to go for it. They were then put on to the finance person, who took long time to process their request and give them details regarding the finance plan and procedures. The finance person told that the approved interest rate is 15.11 percent.  But when Ross Reck had a meeting with bank’s vice-president, he found that the interest rate was 11.9 percent for new car loans. When this was informed to the finance person, he reluctantly gave him 11.9 percent. But this has created a bad image about the dealer in Ross Reck’s mind. In the next two years, nine of his friends bought cars similar to his car. Each of them asked him about where he bought the car, his experience, etc. Because of the bitter experience he had with the finance person, he strongly recommended to avoid this dealer. It is very clear, because of trying to have a Win-Lose transaction with one person, the dealership lost nine more sales.

General Motor’s survey in 1990 on consumer behaviour also reiterates the importance of Win-Win philosophy in this customer centric business environment – A dissatisfied customer tells his experience to 22 people as against a satisfied customer who shares it with only 8.

It should be obvious at this point that if you want to be really successful as a salesperson, you must adopt the Win-Win Philosophy.

In the concluding part next month, I will be explaining the PRAM model of the Win-Win Negotiation process.

To be continued…

The Negotiator - Part 2

From the book: Turn Your Customers into Your Sales Force by Ross Reck

Whenever Ross Reck used to say “the ability to negotiate is critical to success as a salesperson”, he was met with raised eyebrows. And the reason for this is that negotiation is probably the most misunderstood concept in the World. He elaborates his point of view with some illustrations like reaching a labour agreement between the trade union and the management involves negotiation, also getting their children to make their bed or clean their room involves negotiation. That is, nearly all human interactions involve some element of negotiation. Their success in any of these situations is directly related to their ability to negotiate with different people.

Ross Reck further explains that the root word of negotiation is the Latin word otio. Otio means that a human being is at a state of leisure. When you are on a vacation or otherwise relaxed and enjoying yourself, you are at otio. The opposite of otio in Latin is neg otio. That is “not leisure”, or to “conduct business”. It is interesting to note that “to conduct business” is the precise definition of negotiation that you will find in any dictionary. This analysis points out two very important aspects of negotiation.

First, negotiation does not mean a process whereby you try to manipulate, con, or intimidate someone into saying yes when they really want to say no. Second, negotiation is a people process. Companies do not negotiate with companies. For example, a company like IBM does not negotiate a sales transaction with a company like Exxon. For such a transaction to occur, someone or a group of people representing IBM would negotiate with someone or group of people representing Exxon.

As one very successful businessman said when he was addressing a roomful of branch managers from Bank of America, “You people have to remember that people don’t bank with banks, they bank with people.” He went on to say, “To the average consumer, banks all look the same. What makes one bank stand out from the others is the quality of the personal treatment you get from the people with whom you come into contact.”

Based on all these factors, Ross Reck has defined negotiation as a basic process of getting what you want from other people. As such, negotiation is the fundamental activity involved in the sales process. Thus, in order to achieve a high level of success as a salesperson, you must become an effective negotiator.

To be continued…

Positioning yourself for Success Part-1

1.From the book: Turn Your Customers into Your Sales Force by Ross Reck

This is not about people who are born rich or inherited their wealth or people who won lottery or a game show. This is about people like you and me who are responsible for their own success. We all have our own definition for success. In most cases, these highly successful people had something special magical quality called “it”. There are different answers when we search for what is “it” all about.

Shiv Khera wrote in his book ‘You Can Win’ –“Winners don't do different things. They do things differently.” What is that “different” way of doing things? Ross Reck started research to find out, everyone was pointing out that highly successful people possessed this quality, but no one could explain what “it” was. He interviewed more and more successful people and grouped the answers into three categories.

The first category was that these highly successful people have an amazing ability to draw other people to them – a magnetic personality. In other words, if these people were selling something, customers seemed to jump out just for a chance to buy from them. The next category was that these people have an unbelievable ability to get other people to get the extra mile on their behalf. The third category was that these highly successful people have a wonderful ability to get other people to stand in line just for the privilege of doing them a favour. The process highly successful people use to get people to enthusiastically go the extra mile on their behalf is called Win-Win Negotiation.

To be continued….