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Negotiations
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The Role of Emotional Intelligence in
Negotiations by Tom DePaoli
Procurement
and supply chain professionals must be aware of and strive to improve their
emotional intelligence. It has a key impact in negotiations. Soft skills are
becoming more important - even in the digital age. 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.
My Story
on One Method of Improving Your Emotional Intelligence
I improved my emotional intelligence
by interviewing thousands of people over my career. As a former human resource
professional, talent management is the key success factor. I strived to put
people at ease and understand their motivations, fears, and emotions during the
interview process. I tried to find some common interest or experience to
alleviate the tension. More often than not, this happened. Reading people is a great skill to help
improve collaboration and mutual goal setting. I strongly recommend procurement
and supply chain professionals increase their socializations and direct face to
face contact with colleagues, suppliers, and customers. It gives you the
advantage of observing body language and facial expressions. In our profession,
it is about relationship building. Unfortunately, the digital age limits this
type of contact, but I urge professionals to try to overcome this current state.
Emotional intelligence is especially critical
in negotiations. I classify three main types of negotiations and I will try to
discuss the importance of emotional intelligence skills in each type.
The three types of negotiations strategies 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. The 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 party’s interests. The focus is then redirected to mutual interests
or common ground. The objective is to be trustworthy but not totally trusting. This
approach requires a moderate level of emotional intelligence skills from the procurement
professional or negotiator.
An information-based negotiation is a radically
different approach. It emphasizes deep knowledge of the second party, usually
the supplier and their industry. It transgresses from some traditional
approaches to negotiations but in information-based negotiations the procurement
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 procurement 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 rather than emotions or
one-upmanship. However, the procurement
professional becomes highly tuned emotionally with the supplier. A deep and 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 procurement
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 the supply chain and developing true mutual
breakthroughs with your supplier. Below is a summary table:
Negotiation Tactic or Strategy
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Degree of Emotional Intelligence
Required
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Adversarial
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Little or
none
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Win-Win
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Moderate
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Information-Based
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Deep
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My conclusion is that procurement and supply chain
professionals must not only work to develop their emotional intelligence skills,
but also realize its degree of usefulness and appropriateness for each
different type of negotiations tactic or strategy.
Dr. Tom DePaoli, (Dr. Tom or Captain Tom), is currently an
independent management consultant, the CEO 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, organizational transformation, e-procurement, e-commerce, change
management, leadership training, creativity improvement, global sourcing and
negotiating, especially information-based negotiations. His industry experience
is in the chemical, paper, DOD, pharmaceutical, IT, startup, automotive,
government, consumer, equipment, business 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 and
writings
http://www.linkedin.com/pub/dr-thomas-depaoli/0/736/6b3/ = LinkedIn home page
https://apollosolutionsbooksandconsulting.blogspot.com/ = Dr. Tom’s blog
@DrTomDePaoli
= Twitter https://twitter.com/DrTomDePaoli
https://www.facebook.com/ApolloSolutionsConsulting = Facebook of Apollo Solutions
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