Effective Negotiation in Contract, Procurement and Supply Chain Management

Program Overview:

Negotiation is often described as both a science and art, essential to good practice yet a skill that requires honing over time in order to perfect it. In business, it is a core competence for effective Supply Chain management. Tracy (1995) defines negotiation as “a motivated process of information exchange between or among individuals, groups, organizations etc. with the aim or goal of reaching agreement about certain objectives, issues, points or reciprocal acts” Commercial negotiation is the process where parties come together to confer in a situation where there is some conflicting interest between them with an aim of coming up with a jointly acceptable agreement. It’s therefore important for procurement professionals to be on top with their negotiation’s skills.

This program is designed for participants to acquire skills needed to effectively negotiate with suppliers, contractors and other service providers for projects and production activities.

For whom:

This program is designed for Chief Executives, Executive Directors, Senior Managers, Managers, Supply Chain Executives, Purchasing Executives, Quality Managers, Operations Managers, Production Managers, Inventory/Store Managers, and Project Managers etc.

Learning objectives:

At the end of this program, participants will be able to:

• apply negotiation theories to achieve effective outcomes to the negotiation process;
• set objectives for negotiation;
• prepare and plan for effective negotiations;
• take an active part in negotiation meetings;
• employ a range of effective and persuasive negotiation techniques; and
• apply different approaches required when negotiating with customers including those based overseas.

Course outline:

Day 1: Negotiating in different setting.

• Defining negotiation
• Phases of negotiation
• Collaborative and distributive approaches to negotiation
• Understanding the supplier/buyer organizations
• Contract and Purchasing context for negotiation,
• Underpinning the negotiation,
• Porter’s five forces framework

Day 2: Preparing for a negotiation

• Risk assessment, SWOT,

Developing a negation strategy, ·

• The legal framework,
• Analyzing supplier tender/quotation,
• Pricing and total costs benchmark,
• The negotiation processes

Day 3: The bargaining position,

• Stages of the negotiation meeting / resourcing
• The meeting stage:
• Conducive environment,
• Persuasive techniques,
• -Tactics for negotiation
• Positions and interests, ethical roles,
• Finalizing the negotiation
• Ratifying negotiations,
• Evaluating negotiations,

Day 4: Effective communication in Negotiation Process

• Importance of communication in Negotiation
  • Developing questioning skills,
  • questions for developing trust
• Characteristics of successful negotiators
• Developing negotiation competencies,
• Cross-cultural negotiations,
• Telephone negotiations, ·
• E-negotiations
• Documentation for future and legal

implications of Negotiated Agreements

Day 5: Internal negotiations

• Negotiation mandates, ·Internal conflicts,
• Planning for internal negotiation
• Evaluating personal performance
• Evaluating outcomes, ·Relational outcomes,
• The value of reflection
• Documenting learning outcome for future uses

Training Methodology

Lectures, discussions, exercises, case studies, audio-visual aids will be used to reinforce these teaching/learning methods.