Emotional Intelligence in Negotiations by Tom DePaoli

 

Emotional Intelligence in Negotiations by Tom DePaoli

Purchasing and Supply Chain professionals must be aware of and strive to improve their emotional intelligence.   A definition of emotional intelligence is the capacity to be aware of, control, and express one's emotions, and to handle interpersonal relationships judiciously and empathetically. Some would say that emotional intelligence is the key to both personal and professional success.

Emotional intelligence is especially critical in negotiations. I classify three general types of negotiations and I will try to discuss the importance of emotional intelligence skills in each type.

The three types of negotiations that are generally recognized are:

1.     Adversarial or the win-lose approach

2.     Win-Win where both parties win on certain issues or concerns

3.     Information-Based Negotiations where a deep understanding is obtained by both parties and often a strategic partnership can evolve

 

The adversarial approach requires some emotional intelligence but often degenerates into a shouting contest with great histrionics, intimidation and a brutal battle of wills. Since both parties are often acting, exaggerating and pushing their own agenda, relationship building or empathy takes a back seat to just one party getting its way or out bullying the other. In summary, emotional intelligence skills required are very low or non-existent.

 

The Win-Win approach starts with a discussion of the respective parties wants and needs. The goal is a mutually satisfying agreement. People are separated from the problems; a variety of possibilities are created and the results are based on some objective standard. There is a fairly strong commitment to empathy and no blaming is allowed. Both parties are involved in problem solving and there is a focus on each parties’ interests. The focus is then redirected to mutual interests or common ground. The objective is to be trustworthy but not totally trusting. This approach does require a moderate level of emotional intelligence skills from the purchasing professional.

An information-based negotiation is a radically different approach to negotiations. (See Information-Based Negotiations: A Different Approach) It emphasizes deep knowledge of the supplier and their industry. It transgresses from some traditional approaches to negotiations but in information-based negotiations the purchasing professional gains a deep understanding of the supplier’s industry, their margins and their culture. In essence this is an immersion or empathy with the supplier and their competitive landscape. The best way to describe it is that the purchasing professional knows as much or more about the supplier and their industry as they do! Some would argue that this approach is highly analytical. Information drives decisions not emotions or one-upmanship.  However, the purchasing professional in essence becomes highly tuned emotionally with the supplier.  A deep mutual understanding of their competition, margins, challenges and constraints is mastered. Trust issues are quickly overcome and resolved. Trust becomes nearly total.  It requires the purchasing professional to become the resident expert on a market and an industry (just like the supplier). It tends to yield much more significant long term gains than adversarial or even win-win approaches. Using this approach is one of the best methodologies for transforming your supply chain and developing true mutual breakthroughs with your supplier. Below is my summary table:

 

Negotiation Tactic or Strategy	Degree of Emotional Intelligence Required
Adversarial	Little or none
Win-Win	Moderate
Information-Based	Deep

 

My conclusion is that a purchasing and supply chain professionals must not only work to develop their emotional intelligence skills, but realize its degree of usefulness and appropriateness in each different type of negotiations strategy.

 

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ

Can Appreciative Inquiry Work for Procurement? It Can Work for Everyone!

 

 

 

Can Appreciative Inquiry Work for Procurement? It Can Work for Everyone!

Dr. Tom DePaoli

 

Most procurement professionals have never heard of appreciative inquiry. It is a systematic discovery process to search for what is best or positive in an organization or its strengths. These strengths are then improved upon to create an even stronger and more dynamic organization. Implementing change remains positive and thus springs from an organization’s strengths, not its weaknesses, or deficiencies.

 All too often in my procurement career, I have experienced a new procurement leader or consultant, who comes from an outside company, then sweeps into a procurement department and castigates procurement professionals for, “doing everything wrong, unlike their former company, that did everything right.”  This negative reactive approach to change often results in people becoming even more resistant to change. Traditional reactive methods to implementing change emphasize fixing what is broken or weak in an organization. This approach almost never works and causes even more fear.

 One of the tools of appreciative inquiry is the sharing of stories about an organization. Employees are asked to describe a time when they were really engaged and excited about their work. Employees are asked to list what was great or memorable about the time. The themes or actions that the organization used are carefully studied and grouped. Common themes of these stories may evolve or confirm a major strength of an organization. These strengths then become skill springboards from which the organization needs to use and embellish.

 I have previously discussed the storytelling techniques on my website drtombooks.com.

As a review, here are some of the advantages of storytelling:

·       The brain stores information by stories.

·       Stories are humanizing and stimulate creativity.

·       Storytelling improves listening skills.

·       Storytelling builds a team culture.

·       It encourages collaboration.

Appreciative inquiry takes storytelling to the next level.  The memorable stories and positive results become the dynamic building blocks of an organization’s competitive edge. It makes the vision or mission become actualized or reach their full potential!

 Here is an example. One of the strengths of a procurement organization that I led was sourcing and the use of cross-functional teams. The vast majority of the team members felt good about the sourcing decision and the transition plan to the selected supplier. A systematic methodology was used and modified as needed. Team members were well equipped to defend the selection and present the reasoning to other non-team members. Most members could defend and justify the selection and did it consistently and with enthusiasm. To my surprise the non-procurement team members were even better and more positive at justifying the selection.  The metrics almost always supported the supplier selection.

 I, like many procurement professionals, was initially very skeptical of the appreciative inquiry approach. Who has the time for it? Procurement spends an inordinate amount of time fixing what is broken like expediting orders, handling bad quality parts, fixing bad suppliers, chasing down supply chain interruptions and overall upsets. These are all in the realm of fixing what is broke. The fact is that procurement spends too much time as a firefighter putting out fires. Living in this type of hectic atmosphere or culture does not encourage a different positive approach to change. In fact, it encourages skepticism and the avoiding of risk.

 In conclusion, appreciative inquiry can be a useful approach for positive change in procurement. The challenge to procurement is to make the time to discover the strengths of the procurement organization.  It requires patience and the gathering of memorable stories. Procurement should build on its strengths rather than tear down its image by constantly fixing what is “broke”.  In procurement you are what you are perceived.  Too often procurement is viewed, as the harried firefighter who can never put out all the fires. Appreciative inquiry is a good approach to start to change this negative traditional image.

 Dr. Tom DePaoli is the CEO of Apollo Solutions (www.apollosolutions.us) which does general business consulting in the supply chain, Lean Six Sigma and human resources areas. Recently he retired from the Navy Reserve after over 30 years of service. In other civilian careers, he was a supply chain and human resources executive with corporate procurement turnaround experience and Lean Six Sigma deployments. He is the author of eleven books. His Amazon author’s page is https://www.amazon.com/author/tomdepaoli

 https://www.linkedin.com/pulse/can-appreciative-inquiry-work-procurement-dr-tom-depaoli-depaoli

 

 Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ

Never Gain Any Industry or Competitor Knowledge

 

Never Gain Any Industry or Competitor Knowledge

By Dr. Tom DePaoli

 

More Boogeyman Leader stories see my book on Amazon, Boogeyman Leadership

 

Boogeyman leader tactic: Never gain any industry or competitor knowledge. Insist this is a waste of time and discourage any team members from getting more knowledgeable of your competition.

 

We had a boss who did not know any of our competitors or their competing products. He mocked them as second rate and not worth understanding or studying. Within a year we lost twenty percent of our market share and experienced major layoffs.

 

Dr. Tom DePaoli, (Dr. Tom) is currently an independent management consultant, the Principal of Apollo Solutions, which does general business consulting in the human resources, supply chain and lean six sigma areas. His organization was self-founded in 1995. He retired as a Captain from the Navy Reserve. In other civilian careers, he was a supply chain and human resources executive with corporate purchasing turnaround experience and lean six sigma deployments. He has worked for over ten major companies and consulted for over fifty organizations throughout his career. Some of his consulting projects include: information systems projects, re-engineering organizations, transformation, e-procurement, e-commerce, change management, global sourcing and negotiating. His industry experience is in the chemical, paper, pharmaceutical, IT, automotive, government, consumer, equipment, services and consulting industries. He has been published extensively in journals, magazines and books. He is the author of eleven books all available on Amazon.  He has instructed at six education facilities in numerous roles. He is active in supporting the YMCA, Wounded Warrior, and the prevention of the bullying of children.

https://www.amazon.com/author/tomdepaoli    = Dr. Tom’s Amazon author’s page

http://www.apollosolutions.us  = website of Apollo Solutions his business

drtombooks.com  = more information on Dr. Tom’s books

http://www.linkedin.com/pub/dr-thomas-depaoli/0/736/6b3/  = LinkedIn home page

 

https://www.linkedin.com/pulse/never-gain-any-industry-competitor-knowledge-dr-thomas-tom-depaoli

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ