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24. May 2010
IACCM
©2010 MarketWatch Centre for Negotiation A/S
2©2008 MarketWatch Management A/S
We write what inspires the others…
Management
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in 14 languages
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The new agenda…After the financial crisis, scandals and recession
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The world seems to be turned upside down…
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Issues
Topics
Mega trends
Back to basicsBack to basics
RecessionRecession
ResponsibilityResponsibilityResponsibility
Cash flowCash flowClimateClimate RegulationRegulation
CredibilityCredibilityCredibility
Financial responsibility
Financial responsibility
IT Factory
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NEGOTIATION
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IRRATIONALITY
NEGOTIATION
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TRUSTIRRATIONALITY
NEGOTIATION
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The lost trust
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©2010 MarketWatch Management A/S 14 14
SellerSeller
PurchaserPurchaser
UnutilisedUnutilised
1/3 of all negotiations fails!
The difficult art of negotiation
©2008 MarketWatch Management A/S 15 15
The true potential - Denmark
€€65.000.000.000.65.000.000.000.--
©2010 MarketWatch Management A/S 16
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Annual negotiations
The price must bereduced from
33 dkk. to 25 dkk!
I can maintain the priceat 33 dkk. per board!
©2010 MarketWatch Management A/S 17
Annual negotiations
What is your total costand how do you use the
board? This is not important!
©2010 MarketWatch Management A/S 18
An installed plaster board costs totally 180 dkk.
The customer knows that the price is 30 dkk.
He does not know how the 150,- are used.
Process
©2010 MarketWatch Management A/S 19
PriceAn installed plaster board costs DKK 180
WasteLarge number of boards are ruined by handling - 40% waste
Working hoursIt demands two workmen to move the boards
HandlingSize makes it more difficult to move them
©2010 MarketWatch Management A/S 20
Board construction in smaller size
Now one worker can handle the board
Solution
Logistic and planning are optimized
Savings pr. board Dkk. 50,00
©2010 MarketWatch Management A/S 21
Buyers max 150.000,-NBA or budget
The sales reps limit 120.000,-
The traditionalNegotiation space
The real negotiation space is veryoften bigger and consists of thetraditional space plus all the added value.
Ca. 42% remainsunused
Identify the real negotiation space
30.000,-
©2010 MarketWatch Management A/S 22
22Den nye rolle som kommunikator, showmaster og leder©2004 MarketWatch Management A/S
”Poor negotiations skills are probably the biggest single cause of major costs and lost
opportunities to any organisation.
And what´s more – most companies do not even see it!”
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Up to 42 % is lost in negotiations due to lack of trust and bad communications!
6 billion € – is the cost of lacking trust between management and employees – annually just in DK!
Agreements based on trust providea 20-40% better income!*
65 billion € are potentially lost every year due to among others lacking trust!
Mistrust doubles the costs by doing business!
Higher trust provides lower unemployment
*Columbias Business School
Cash settlement
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The NaiveThe Naive The confusedThe confused
The AnalysingThe Analysing The SuspiciousThe Suspicious
4 types of trust
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Warning:Be aware of the submissive supplier
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Be humble
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PricebergWhere the true value is hidden
The creation of the potentiel 42 % occurs ”under the surface”
Visible
Invisible
Cost of extra specs
Purchasingadmin.
Specifications
Damaged goods/warranties
Inventory carrying costs
Guarantee and bonds
Renewal
Purchase price
Impact on productivity
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Integrate and implementation
Create the learning culture in the organisation
Secure succesIdentify challenges and posibilities
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BE POSI IVE
”No pessimists ever discovered the secret of the stars, or sailed to an unchartered land, or opened a new heaven to the human spirit”
Helen Keller