End-2-end negotiation process
We have developed a complete and long-term approach to negotiation that achieves the maximum in a given situation, both rationally and emotionally, from strategic preparation to its final implementation at the negotiation table. Our success continues to prompt us to work with our clients to apply our approach to their projects and inspire them to do the same in the future.
The right approach for your negotiation
There is no such thing as one process for all types of negotiations. Depending on the situation at hand, the use of different methods is necessary. We have summarised the different processes in our System of Negotiations. It covers the entire spectrum of negotiation scenarios and offers the ideal solution for every negotiation situation.
Confidentiality
Mutual trust is a must when it comes to consulting: We guarantee confidentiality in our handling of data and customer information, and rule out all conflicts of interest.
What you always wanted to know about negotiation
What exactly is the System of Negotiations?
Our System of Negotiations is a flexible approach that provides optimal support, adapted to each specific situation. We distinguish between tendering with competition and bilateral negotiations, which can be with or without alternatives (monopolists). We determine the most suitable approach for the client on the basis of a screening process.
The implementation itself is flexible and depends on the environment. We can provide full support or coaching, in-person or online.
We use our negotiation expertise wherever negotiations take place – from procurement to sales, from M&A to union negotiations. We are able to provide valuable support in any negotiation and on all sides.
What do we do differently? What sets us apart from other consultants?
It goes without saying that we are committed to the virtues of consulting, which include structure, professionalism and thoroughness. In contrast to the “typical consultant”, however, we view ourselves as problem-solvers who work closely with the client team as equals. In doing so, we challenge familiar ways of doing things and entrench our method of thinking in the project team, ensuring long-term added value.
We implement our approach and ideas in collaboration with you and your staff as a team with clear monetary results as the measure of our success. Project success is always joint project success.
Our experts have the relevant academic background and industry experience. We all share an enthusiasm for negotiation that has evolved over many years. It is our intrinsic motivation to stay on top of the game with concepts that prove themselves in the real world, not just on the whiteboard of a consultant.
Do you use the game theory approach for every negotiation?
Yes and no. A game theory-based approach means analysing the situation in its entirety, identifying all possible options for decision-making and rendering them comparable. This makes it possible to discern which participant wants to achieve which goals in the negotiation. Based on this, it is possible to define one’s own optimal strategy.
However, if one tries to approach negotiations exclusively from a “game theory” perspective, there is a risk of the solution being too theoretical, too remote. This is because one assumption of game theory does not always apply to the real world: the rational, unemotional behaviour of all participants in keeping with their factual interests.
Game theory is only a useful tool. We complement our negotiation strategy with elements of behavioural economics and psychology, which provide important insights on explaining human behaviour.
What kind of results do you deliver on average, and what is the cost-benefit ratio of the project?
Every project begins with a thorough analysis of the potential, during which we create a forecast of the outcome. We only accept project assignments when we are sure of a clear positive business case for our client. Our project proposals show an average return on investment of 30. Our internal statistics show that our negotiation approach yields an average profit contribution of 10.6 percent for our customers.
PRODUCTS
With this product, first we conduct interviews with the responsible managers with a focus on the upcoming negotiations and compile a detailed macroeconomic and microeconomic analysis. We also analyse the market environment and the competitive and negotiation situation. As a next step, we identify possible negotiation projects and risks, and develop initial solutions based on this. In the end, you will receive a clear assessment of the potential if the project is implemented.
For negotiations with smaller volumes but considerable competition, we have developed an efficient process that guarantees the systematic optimisation of competition despite the low effort needed. You can read more about this under Data.
Here we make all of the alternatives available in the negotiation financially comparable by using the “Total Value of Ownership” approach. As an additional prerequisite, we obtain the commitment of the entire organisation to the decision-making system so that we can develop maximum competitive pressure. We then implement this through the use of a negotiation mechanism optimised in terms of incentives, based on game and auction theory.
We start by identifying the alternatives, courses of action, and dependencies for both our side and the other side. Then we do a monetary evaluation of the possible scenarios under the “Total Value of Ownership” approach and define goals, demands and consequences (in case of non-fulfilment), based on the scenarios created. The negotiation process is then precisely fine-tuned, emotionally and rationally, based on behavioural economics and game theory.
Aspects of behavioural psychology play a very important role here. The first step is to change one’s own mindset with the aim of disempowering the monopolist. The next steps are the monetary evaluation of all possible negotiation outcomes (scenarios) under the “Total Value of Ownership” approach and the identification of a target scenario and the scope of the negotiation. We then develop a detailed script including a storyline and the demands and consequences with respect to the monopolist. To demonstrate the seriousness of this approach to the monopolist, we first obtain authorisation from the company’s top management (commitment) for the negotiation script and conclusion within the approved scope of negotiation.
Sometimes a company is stuck between the supplier and the end customer in negotiations and has little ability to negotiate. In this case, it is necessary to synchronise the interaction of all parties (procurement and sales) with the negotiating partners and to align them with the overall goals of the company. We design the negotiation process using game theory and mechanism design in such a way that the end customer has an intrinsic incentive to follow our recommendations for action, minimising dependencies on the supplier.