Wednesday, March 2, 2011

Managing Supplier Questions

As negotiation is communication you need to be prepared for questions from Suppliers.
Part of preparing for the negotiation is to think about the likely questions a Supplier may have and be prepared with responses. Whenever possible your answers should focus on helping sell the Supplier on:
  1. What you need.
  2. Why you need it.
  3. Why its fair or reasonable
  4. Why its needed for the Supplier to be competitive, or
  5. The problem being created by their positions.

When a Supplier asks a question that you are unprepared for you need to do one of two things. If you choose to answer it at that moment, take the time to think about what they are asking, why they are asking it and how they will try to use it. Always probe to understand the question they are asking and why. Don’t assume that you know.  I’ve seen negotiators give far more away than they needed to because they assumed something and their assumption was wrong. Then take the time to respond accordingly. Alternatively you can delay or deflect the question to a later point in the negotiation.

To delay the question one of the easiest things to do is simply go through the process of both clarifying exactly what the question is and why they are asking it. Then you can say that:
  1. You don’t have the answer and will need to research it, or
  2. You need to check with your internal stakeholders before responding.

If you read books on tactics you will find that there are other approaches to deflecting questions such as answering only part of the question; answer something different, ignoring the question, or pretending you have no knowledge or limited knowledge.  When I start to see a Supplier try to use these tactics with me, I add the question to open issues on the action item list and have them give me a date when they will give me an answer.  I will also defer discussion on the point that I asked the question about until I get the answer.  This sends the message that they need to respond and can’t avoid the question.