Nogotiation Blog

Insights on Business and Sales Negotiation

Join us for insights on how to negotiate a winning balance, where where both sides understand and appreciate the value they receive. As a result, you are more likely to forge a long-lasting relationship that yields more and better opportunities in the future. This idea underpins K&R Negotiations’ Win Wisely™ approach and underlines the importance of using leverage wisely.


If better negotiating is about being better able to express your value, how good are people at expressing value?  Buyers pay for value, which is not to be confused with price.  If you heard, "this is a $40,000 car, but I will sell it to you for $32,000", what would you think?  You would most likely think it was a $32,000 (or less) car.  Since IBM just made its largest-ever acquisition, Cognos, we thought we'd look at how Cognos expresses their value.  One of their solution overview pages includes this language: 1. "Enables more effective rewards for your workforce, enhancing satisfaction and commitment. 2. Increases customer retention; win more new customers; improve productivity; and raise profits." There is a distinct difference between these two examples.  Number 2 follows a recognizable…

An RFP at Hyperactive Technologies

Is a Request For Proposal (RFP) a valuable offer to buy, or an attempt by the buyer to commoditize your offering?  An October New York Times article about artificial intelligence software for restaurant order flow management contained an interesting comment: "Just last week, [founder Joseph] Gagnon [said] the company received its first 'request for a proposal', an overture from a possible buyer of its products. 'That we got an RFP tells me I made it', he exults." How does a negotiator feel about it?  Mr. Gagnon is counting his chicken orders too soon.  In many commercial transactions, an RFP is a method of commoditizing buyers, so that all appear to provide the same function / feature / benefit / solution, and price is the only differentiator.  Unless Mr. Gagnon shaped the RFP specifically…

Joe Torre and the Yankees

When is an offer not an offer? Joe Torre, an extremely successful (and the highest-paid) baseball manager, failed to bring the Yankees to the Divisional Playoffs in the final year of his contract.  Yankees management made him a non-negotiable offer for next year of $5 million, with "earnable bonuses" of up to $3 million more.  Joe turned it down.  It is unlikely that this offer was expected to be acceptable.  Joe, coming off a 12-year run, shouldn't need the money. So what motivates him? As in many businesses, status, recognition and the appearance of success are key factors in the negotiation process.  If you want to close a deal, you should understand what the other side needs to get to be able to agree to that deal. The Yankees' management team knows Joe well.  They could accurately…

BEA and Oracle (Part 2)

Carl C. Icahn goes over the BEA management team's head. Hard on the heels of BEA's rejection of Oracle's $17/share buyout offer, BEA's largest shareholder Carl C. Icahn has sued BEA to force a shareholders' meeting to vote on the offer. The negotiations implications are interesting. BEA now has an internal conflict - Icahn arguably has similar (but not exactly aligned) motivations to those of BEA management. At the same time, his threat undercuts the strength of BEA's position that a price of $21 per share is the right one, and supports Oracle's position that $17 per share is fair. Interestingly, this would seem to work against Mr. Icahn. If $21 per share were possible, his benefit would be nearly 25% greater. What is BEA to do? Is this pressure (called Negotiations Leverage) real? Threatening…

BEA and Oracle (Part 1)

In recent articles, it was reported that BEA "spurned" a $6.7 billion offer from Oracle to purchase the company.  It amounted to $17 per share.  BEA countered with a statement that $21 per share would be a more reasonable figure.  These actions established a "Negotiation Success Range™" (NSR™).  Negotiation skill will determine at which end of the range the deal closes (if it does).  Beyond skill issues, BEA also may feel pressure to answer to stockholders who may find the offer attractive as a share price.  So BEA's counter-offer could have one of several meanings, including: A deal can be struck, probably at some intermediate price between $17 and $21.  The parties must find compelling arguments to make the other side move closer to closing. BEA may have no intention…

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Creating Value-Based Leverage

In this short video, learn why negotiation is really the art of finding agreement.

Mladen Kresic introduces the concept of value-based negotiations leverage and why it is a powerful tool for moving conversations to an agreement.

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