How to negotiate like a pro: 4 secrets to success

Whether you’re looking to cut a good deal with suppliers or convince colleagues of the benefits of your new idea, great negotiations are crucial to being a successful professional.

Harvard Business School suggests investing time and energy in developing negotiation skills can help maximize your value at the bargaining table.

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So, how can professionals learn to haggle without squabbling? Four business leaders share their best-practice negotiation techniques.

1. Be willing to walk away

Chris Kronenthal, president and CTO at FreedomPay, said a successful negotiation starts from a strong bargaining position.

“If you’re not willing to value your product, you’re not in a position to negotiate — you’re in a position to beg. So, the first thing you have to do is be willing to walk.”

Kronenthal told ZDNET that holding a strong line in negotiations doesn’t have to mean being rude.

“Some people take an aggressive position. But there’s a different way to negotiate,” he said.

“There’s a way that says, ‘Here’s my business. This is how much it costs us to run it. This is the type of profit and gross margin that we need to be successful, and these are the prices we need to charge for that provision.'”

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During his 16 years with FreedomPay, Kronenthal has watched the company grow from 18 to over 600 employees in 88 countries. These experiences have taught him that knowing the value of your product is crucial to success.

“I’ve seen companies win deals, but the tax of winning those deals was way too high,” he said. “When you engage with another party, you want to enter negotiations with a strong hand. You don’t want to enter a discussion thinking, ‘I have to win your business.'”

Kronenthal estimated that believing strongly in your value proposition accounts for 80% of a successful business dialogue.

“You want to look someone in the eye, have confidence in your product, and say, ‘Yeah, our product might cost more than another organization, but you’re going to get great service. You’re going to get great focus. You’re going to get a best-in-class product. That’s what it costs to do this work well. And if you don’t want that service, there are other options.'”

2. Prove the business benefits

Tobias Sammereyer, team lead for performance engineering at XXXLutz, said it can sometimes feel like you’re the internal salesperson for an IT company when you try to sell the benefits of a new technology solution to your business.

He said the key to a successful negotiation is correctly addressing your audience and proving that technology is more than a collection of bits and bytes.

“Whether you’re working with a business person or a techie, you need to get that ‘aha effect’ so they say, ‘Oh, that’s how it helps me. That’s how it’s beneficial,'” he said. “If you force technology on people, it doesn’t work.”

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Sammereyer referred to his company’s deployment of Dynatrace’s observability platform, saying he demonstrated to business professionals how the technology provides IT insurance for his company.

“I explain how it would be stupid not to invest in a software license that helps keep us stable,” he said.

Sammereyer told ZDNET he also works with IT developers and shows them how Dynatrace is a ready-to-use solution that helps them focus on the value-adding areas of their work they enjoy rather than repetitive tasks.

“I demonstrate how you can just install one agent and stuff happens. I sit next to them and show them how to click things to get the information they want,” he said.

“I say, ‘Hey guys, you are brilliant coders. So, do what you’re here for, and don’t do any custom monitoring. For those things, we have a turnkey solution that’s a script you install on your host and everything’s sorted.'”

3. Build an ecosystem of partners

Stephen Mason, advanced digital technologies manager for global industrial operations at Jaguar Land Rover, said successful negotiations have helped him build an ecosystem of suppliers.

“I want more vendors, but I want a connectivity vendor that’s a partner of the hardware vendor, who’s a partner of the software vendor, and so on,” he said.

Mason told ZDNET that great negotiations mean suppliers can work to create turnkey solutions.

“We don’t have the internal capacity for all the innovation and transformation we want to deliver,” he said.

“If all of our vendors can work together and offer a solution, between the cloud provider, hardware vendor, and more, then that’s the winning combination.”

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He gave the example of his negotiations with Ericsson for a private 5G network.

“Ericsson is a partner with Litmus, who we’re using to do the data ingestion, and a partner of Dell, who provide the end devices for the bulk of our work,” he said.

Mason said these tech companies worked together to certify the Dell device on the Ericsson hardware, which wasn’t straightforward. Building an ecosystem approach meant technological challenges were overcome.

“The partnership meant we didn’t have to worry about how to configure the 5G settings. What showed up on the network was a device with software that integrated seamlessly onto the network,” he said.

“Negotiating that joined-up approach is key, especially when it comes to innovative technology because typically the people in your organization are delivering the here and now and don’t necessarily have a deep technical knowledge of 5G and AI. Leveraging the power of vendors and working together is crucial to success.”

4. Gain knowledge beyond your domain

Jeff Palmiero, technical vice president at Raymond James, said his site reliability engineering (SRE) team ensures it learns the language of different IT and business departments.

“For example, we try to understand, from a networking perspective, what’s an aggregation switch, what’s a core router, and what circuits we use to reach out to the internet. When you learn their language, you gain that group’s respect.”

Palmiero told ZDNET his SRE team employs a similar strategy when working with storage professionals. They recognize how issues in virtualization platforms will trigger related concerns for other operating systems.

“Once you have respect from other departments, and they have yours, then, at that point, you can get into an intelligent conversation,” he said.

“You can say, ‘I respect you. I respect your intelligence. You respect me. And if you make a compelling argument, I won’t disagree. I’m never going to know your world as well as you do.'”

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Palmiero also said it’s important to recognize that once people trust you and your advice, they will believe you can suggest a better solution.

“One of the great things about SRE is we always impress these other groups. They’ll say, ‘I didn’t know you could do that.’ And that new awareness gains their respect,” he said.

“If I have a compelling reason to win an argument, the other people in the discussion might give in. So, first and foremost, you must respect each other and recognize your strengths, and then, at that point, you’ll find the best way to resolve the problem.”