Techniques for successful negotiation


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Rick Burke, Donna LaFollette, Jason Price

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Techniques for successful negotiation

  1. 1. Negotiation techniques ER&L Austin, TX March 17 2014
  2. 2. What’s SCELC? The Statewide California Electronic Library Consortium We have 111 private academic and nonprofit research member libraries throughout the state, plus one in Nevada and six here in Texas We also have partnerships with hospital libraries in the Southwest and Hawaii; TexShare; Cal State Universities, and ATLA, for a total of >145 libraries licensing as SCELC Affiliates
  3. 3. What’s SCELC? Our primary activity has been negotiating offers for electronic resources and related services for our member libraries We are an opt-in consortium, which makes negotiation more tricky – we license over 3000 different products so we negotiate all the time… Plus we serve a very diverse set of libraries made up of many sub-groups, which is why we sometimes have to negotiate with our libraries
  4. 4. The Consortial Approach SCELC has a small staff yet offers a large number of products Success has come from dealing with our vendors honestly, fairly, and with an openness to understanding their position Having events such as our SCELC Vendor Day helps build strong relationships with our vendors SCELC Librarians vs. Vendors Bowling Tournament Inter-consortial collaborations and ICOLC meetings help
  5. 5. The Consortial Approach (2) In the SCELC strategic plan some of our core values are Partnering – working with vendors as partners in achieving a fair value and a fair return Inclusiveness – Soliciting the active involvement of our members by sharing expertise and best practices Collaboration – Involving members and other organizations in our dialogue and work
  6. 6. Negotiation 1. is a basic means for getting what you want from others 2. occurs when there are differences between the needs of the buyer and seller 3. is a “back and forth”, “give and take” process which often involves a “compromise” - a settlement in which each side gives something up in order to gain something else • Pricing negotiation seeks to reach equilibrium between what the vendor charges and what our libraries are willing to pay • License negotiation seeks to reach equilibrium between the ideal terms for the library and the ideal terms for the vendor
  7. 7. Inventory Your Negotiation Experience Frequency of vendor negotiation At least once a year At least once a quarter At least once a month Negotiation type Mostly licensing Mostly pricing About equal Self assessment of negotiation skill Above average Average Below average
  8. 8. Two common/contrasting styles War Room: ‘Win-Lose’ More common at the consortium level Especially among all or nothing consortia May lead to better prices in some cases More likely will burn bridges or cause bigger problems in the next round Not likely to lead to collaboration Scott Boras, New Yorker 29-Oct-07 Relationship-Based: ‘Win-Win’ More common at the library level Built on relationships and compromise Power of Nice : How to Negotiate So Everyone Wins – Especially You!, by Ronald Shapiro Getting to Yes, by Roger Fisher and William Ury, Harvard Negotiation Project
  9. 9. 1. Do your homework / Be prepared 2. (Shut up and) Listen 3. Aim high… Don’t be afraid to ask… 4. Don’t be in a hurry… Be patient a. Don’t make the first move b. Don’t accept the first offer c. Don’t negotiate against yourself! d. Focus on the other side’s point of view e. Seek transparency 5. Meet in the middle a. Don’t make unilateral concessions b. Defining the middle through discussion is the best part! c. Make sure both parties needs are satisfied 6. Be willing to walk away – have a plan B 7. Don’t take issues or other person’s behavior personally C O M M O N S E N S E A P P R O A C H E S and their UNCONVENTIONAL sides
  10. 10. Prepare Determine your objectives Set a timetable Assemble a team if you are working with others Develop a strategy Who takes the lead on the negotiation? What roles might other team members play?
  11. 11. The Unsustainable Models Debate Is it enough to start a negotiation by complaining to a vendor that the current models of subscription are not sustainable in the current library budget environment? A complaint is also a negotiation so long as you have an alternative in mind Think creatively of what models might work Talk to the right people in the hierarchy Be bold: Don’t be afraid to propose new ideas
  12. 12. Ask questions…
  13. 13. Used without permission… Don’t be afraid to ask…
  14. 14. Be Patient
  15. 15. Meet in the Middle
  16. 16. HUAjV1VXB- dZiSThyEWtmkzUIR_sJZG9IZKI1s0P8APHgoA nk_Mr0MA Be Willing to Walk Away
  17. 17. Don’t Take it Personally
  18. 18. Additional notes Humor is a crucial ingredient Use data! Find a mentor Look for opportunities to negotiate, they’re everywhere! Practice, Practice, Practice
  19. 19. Prime negotiation opportunities 1. Making the most of a budget crisis 2. Ongoing Subscription vs. One time Purchase 3. Access fees 4. Ebook archives 5. Intractable license negotiations
  20. 20. Primary source collections: subscription vs purchase Publisher A Publisher B Totalspent Use your knowledge of other deals to negotiate a better deal
  21. 21. Access fees *Access Fees: think about the long term costs access fee increase caps what are you paying for? Demand transparency What is the repurchase point At what point will access fees add up to another purchase? Suggest alternative pricing models
  22. 22. E-Book archives Know publisher Profit & Loss calculations 2 years after a book is published, the expected sales drop to zero Backfiles should be deeply discounted!
  23. 23. Intractable negotiations: Think outside the list Converting Elsevier’s Unique title list to a Shared title list Price JS. 2006. Making the most of a "big deal” Charleston conference proceedings, 2005
  24. 24. Some more general practical approaches Don’t pay until you have what you want Software under development Be willing to beta test only at a reduced or “free” rate Annual title access list updates License negotiations completed Use peer pressure - what do other companies do? Hold off for a better deal Wrong Model: Unreasonable minimums to obtain discounts Unsettled pricing: ebooks and simultaneous use restrictions
  25. 25. Sometimes NO is the only acceptable answer 3x price increase No ILL or other sharing allowed No remote access (hardly ever occurs anymore) Unmanagable Restricted list of authorized users …and other issues that depend on the context Insert your own examples here
  26. 26. Negotiation Principles Get to know your negotiating partner; establish rapport with them Listen carefully to what they have to say and take notes Focus on shared interests, and try to avoid hard position bargaining that obscures real goals Express your interests clearly and specifically while exploring & acknowledging their interests as well
  27. 27. Questions? Contact information: Rick Burke Executive Director, SCELC Donna LaFollette Director of Financial Operations, SCELC Jason Price Program Manager, SCELC