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Win-Win Negotiation: Becoming a Reality?

By Tim Cummins

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Business is at last waking up to the need for a more positive approach to contract negotiation. That is the encouraging news from IACCM’s review of market trends in 2013.

Over the last year, the approach to negotiation has started to change, with a growing number of executives pushing a more collaborative or partnering approach to their supply relationships. A variety of factors are driving the shift, but the important point is that negotiators are focusing more on the performance and governance criteria that drive positive results and outcomes. As a result, contracts and negotiations have the potential to become more effective at tackling risks at source, rather than dealing primarily with the consequences when things go wrong.

Behind this shift in attitude there is a steady awakening in some industries to the fact that many of today’s agreements must be more sustainable and also more flexible. The influences of a caveat-emptor world are diminishing, as the balance of contracts swings away from the purchase of direct materials and products and moves towards a growing volume of services and solutions (see chart below). These service and solution contracts require far more cooperation between the parties because value can only be gauged over time. ‘Success’ is not defined at the point of signature, but is determined by the eventual output or outcome that is achieved.

Win-Win Negotiation figure1

Win-Win Negotiation: Becoming a Reality?, By Tim Cummins


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The Negotiator Magazine  March 2014