Influence vs Authority – Measuring Your Negotiation Skills

by Omid Ghamami

This is probably the most important negotiation topic there is, and nobody really talks about it.  Let me give you some perspective for a moment.

Picture yourself as a child again.  Your parent tells you not to do something, and you ask “why?”, and they answer with “because I told you so.”   You didn’t like it then, and you probably have some people in your life who still do that in some form, and you don’t like it now either.

The reason you don’t like it is, authority is being used to accomplish a negotiation objective.  This is really important to understand.

In my 27 years of doing this, the most amazing thing to me is the following paradox I have uncovered. 

Read this twice:  The more money you spend for your company, the more revered you are industry as a heavy-weight negotiator, but the less likely you are to have developed your influence skills – the most important skill as a negotiator.

Don’t go past that too quickly.  It’s really critical to truly understand the message here.  But how could that be?  It doesn’t make any sense.

But it does make sense.  The more money you are spending, the more the MONEY is doing the work for you in negotiations, thus easing the pressure on you as the negotiator.  Of course you’ll have suppliers that agree to aggressive terms and pricing objectives more readily.  They want all that money. 

As your company spends more, these negotiations seemingly become easier for you, and surely you still get and deserve all the credit for the outcomes, which may truly be worthy of praise…. But it’s still the money doing most of the work.  You need very little influence to be successful in this scenario. 

All things being equal, a fortune 1000 negotiator is probably better than a Fortune 50 negotiator.

If you want to know how good of a negotiator you really are, quit your job and go work for a company that spends very little, and see just how hard the negotiations suddenly become. 

But there is one really good litmus test, in my mind the best test of all, to determine how good of an INFLUENCER you are.  Are you ready?

Pay attention.  Here is the test:  If you are able to effectively get suppliers to come on board with your procurement objectives, but you are struggling to get your internal end users and business units to do the same, then you have not developed your influence skills.

It’s that easy.  And why is that the case?  Because you don’t have your pockets full of money incentives when you are trying to influence internal end users and business units.  IT’S ALL ON YOU.  And at that point, authority is pointless and typically counterproductive, if present at all.  It’s all about influence. 

That’s why the vast majority of CEOs and country presidents are first born.  Parents task their oldest children to bring their younger siblings in line for many years (“make sure your sister gets ready for school”, “make sure all of you get your things packed”, etc), without granting them any authority at all.  First born children have to learn how to influence from the very beginning, and it serves them well their entire lives.  

So pull out a mirror and look at yourself really hard.  Are you having this struggle?  Have your influence skills been a major part of your negotiation development process?  Or has your company’s money or industry stature been doing the work for you, allowing you to take your foot off the gas pedal?

I define the difference between influence and authority as follows:

Influence means people come on board with your agenda because they WANT to.   Authority means people come on board with your agenda because they HAVE to.

The root of the problem is all negotiation training focuses on trying to meet your objectives, your agenda, your strategy.  And this doesn’t work in influence models.

Influence models only work when you start model with understanding what keeps the other party awake at night, and rearchitecting your strategy to address those needs and wants – which the other party may not even be aware of, while ensuring you meet and exceed your own objectives.

This ladies and gentlemen is the art and science of influence in negotiations. 

Now go off and do something wonderful.

Be your best! 

Omid G.

“THE Godfather of Negotiation Planning”

~ Intel Corp

P.S. almost 50% of the Fortune 100 have now invested in the CPSCM Certification – the only certification in the world where you can see the materials and hear your personal instructor’s voice throughout.  If you want to learn the end to end basic of procurement and negotiations, there are lots of certifications out there and you should pursue them.  If you want to do a deep dive on transforming your career and your procurement department, we are here for you.  Taking costs out of the supply chain, achieving 18% savings on average before negotiations ever start, rearchitecting your negotiation strategies to be away from the table instead of at the table, writing contracts for performance results instead of goods & services, and securing procurement with a hard seat at the table.  That’s what we do.  Join the revolution.  

https://tinyurl.com/procurementcertification

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