Term
| What are 3 practical strategies? |
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Definition
1. Reveal NO position
2. Reveal the optimistic position
3. Reveal optimistic position and then immediately offer the target position. |
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Term
| When do I use the "reveal no position strategy"? |
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Definition
1. When supplier is eager to reach agreement
2. When supply management lacks information and/or proposal.
3. When suppliers proposal is long and complicated.
You attempt to maneuver the supplier toward your position by probing the suppliers proposal point by point. |
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Term
| When do I use the "optimistic position" strategy? |
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Definition
Most common approach when org. has the suppliers proposal.
Approach establishes range for negotiation on each issue. Then they can discuss and resolve each issue. |
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Term
| When to use "revealing optimistic then offering target position"? |
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Definition
Use if you can sell the supplier on the merits of the offer.
Strategy can backfire if supplier refuses resulting closer to your pessimistic position. |
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Term
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Definition
| Tactics are the processes and maneuvers that you use to put the strategic plan into action. |
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Term
| What makes specific tactics vary? |
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Definition
1. parties negotiation philosophy (win-win, win-lose,etc)
2. relative power position of negotiators and personalities |
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Term
| Effective negotiators are able to? |
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Definition
1. Adapt their tactics to the situation
2. recognize tactics used by the other party |
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Term
| Tactics: Sequence or prioritize the issues using one of these 4 approaches.. |
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Definition
1. Cover major issues first
2. Cover most troublesome issues first
3. Cover least troublesome first to get a feel for suppliers position
4. Arrange issues so if one is settled, rest will fall into place. |
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Term
| Tactics: Why do we use questions wisely? |
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Definition
| Should be used to draw out information and phrased to question supplier position without attacking negotiator personally. |
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Term
| Tactics: Listen Effectively how? |
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Definition
| Pay attention to what is being said rather than thinking about your response. |
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Term
| What are the other 15 tactics you can use? |
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Definition
1. maintain initiative (probe suppliers justification in unclear areas)
2. Use solid data to back up your position
3. Use silence (makes other party nervous)
4. Avoid emotional reactions (moves negotiations from issues to personalities)
5. Make use of a caucus
6. Do not be afraid to say no.
7. Beware of deadlines - It is better to let a deadline pass than settle for less than you require.
8. Be aware of body language
9. Keep an open mind
10. Get it in writing
11. Make appropriate concessions
12. Use "missing person". Deliberate absence of persohn with final authority.
13. Use the take it or leave it. Do not use unless you mean it.
14. Use the bogey. Tell supplier you like product but X is all that you are willing to pay.
15. Schedule shorter negotiating sessions including time for rest, excersize, etc. Increases clear thinking and sound judgement. |
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Term
| What are special 5 considerations in conducting negotiations? |
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Definition
1. Fact finding sessions
2. Final proposal revisions
3. Negotiate w sole offeror versus entire competitive range
4. Documentation of negotiations
5. Negotiations as a consortium or cooperative
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Term
| Body Language: What does open arms mean? |
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Definition
| Indicate receptive to process |
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Term
| Body Language: What does crossing arms at chest level mean? |
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Definition
| Not receptive to latest offer. |
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Term
| True or False: Between body language and speech, body language always tells you the truth. |
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Definition
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Term
| What are the 7 tactics you can use when dealing with a monopolistic supplier? |
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Definition
1. Convey you may start making product in house.
2. Convey you may consider altering specs a to not need the component they make.
3. Considering substitute items
4. If supplier already supplying to buyer, advise supplier long range interest should be in keeping the buying org. rather than achieving a temp. price advantage.
5. Seek a win win situation where cost, risk, savings are shared.
6. If supplier has high inventory you can use as leverage.
7. If supplier has financial probelms you can use as leverage. |
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Term
| What are the 5 key elements that documentation of negotiations should have? SIPPN |
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Definition
1. Subject - supplier name, contract #, descrip. contract
2. Introductory Summary
3. Particulars
4. Procurement situation
5. Negotiation summary |
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Term
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Definition
| When several organizations combine their purchasing power for selected items to gain leverage in the marketplace and reduce costs. Usually cash neural. |
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Term
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Definition
| for-profit OR non-profit business that serves members in a single industry. Co op members play no role in management of co-op suppliers and administrative acivities. |
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