Internal Alignment: The Key to Successful Negotiations - Insights with David Feavearyear

Hello, my friend, and welcome to another exciting episode of Negotiate Anything. Thanks for joining us today. With over 10 million downloads and listeners from more than 180 different countries, it's dedicated listeners just like you who have made Negotiate Anything the number one negotiation podcast in the world. I'm your host, Kwame Christian. I'm a business lawyer, mediator, author, and the proud CEO of of the American Negotiation Institute. Now, before we get into today's insightful conversation, I have a golden opportunity for those of you who recognize the power of negotiation in your professional lives. Have you ever found yourself wishing that you could navigate those high stakes conversations with more confidence? Or perhaps you're looking to empower your team with the art of persuasion and conflict resolution? At the American Negotiation Institute, we've crafted specialized keynotes and workshops tailored for those very needs. We've transformed the negotiation skills of professionals worldwide and we're eager to do the same for you. We believe the best things in life are on the other side of difficult conversations. And our goal is to help you improve your lives and the lives of those around you, one difficult conversation at a time. Don't let another challenging conversation leave you second guessing. Click the link in the description to discover how we can help you find confidence in conflict, negotiate better deals, and have stronger relationships. Because in the world of business, every conversation counts. And now, without further ado, let's jump into the interview.

David, thanks for joining us today.

You're welcome. It's good to be here.

Yeah, it's great to have you, my friend. So how would you get us started? By telling us a little bit about yourself and what you do.

Yeah, sure. So my name's David Fethia. I'm the Chief Procurement Officer at Pearson. I've also recently inherited real estate and fm, which is kind of interesting because Future Workplace is pretty topical right now, so really interesting to be in the middle of that, particularly with return to office and all of that kind of good stuff. But my background is commercial and procurement, so I started my career as a commercial manager, commercial director. So I used to negotiate contracts that we were selling two clients. So systems integration, managed service, outsourcing type contracts. And I was asked by the chief exec at one point to go across and help create a fledgling global procurement function at the company I was at. And that's how I moved across the table to the dark side, depending on your perspective. So I took all of the lessons that I'd learned when I was selling and negotiating contracts. We were selling to customers and effectively reverse that position. So yeah. Poacher turned gamekeeper or gamekeeper turned poacher. Depends on your philosophy.

That's great. That is great. I know we have a lot of folks in procurement and in sales, and so that background is perfect for this show. I'm really excited about this episode, David, because you are speaking the language of a lot of our clients who are procurement professionals. We're going to talk about the tripartite process of negotiation for the listeners who are not in procurement. Do not leave here. Okay. This is something that you're going to need to deal with, too. And so David's going to talk about how it will apply on a large scale within a large company. But we're negotiating every day, as you all know. And so I want you to think about how this would apply to you. And so with that tripartite process of negotiation, we're going to cover what it means to negotiate with yourself through introspection, having that conversation internally, and then also from the procurement lens, negotiating with your internal team, so the people who are actually on your team, and then lastly, the external counterparty. This is really great. And before we get into any of the specifics, David, how about you just start off with what were you considering when you thought about picking this topic? And why do you think it's so important for us to address these three parts of the process?

Yeah, sure. I think when people tend to think about negotiation, they tend to think about negotiating with either a supplier if you're in procurement, or they think about negotiating with a potential customer if they're in sales. And so we tend to think about the thing that's external to the organization, and that seems to be where a lot of the focus is. And people tend to talk about being a great negotiator from that lens or from that perspective. But. But my experience actually is you have to start internally. So in order to negotiate anything effectively, you have to understand what it is you're trying to negotiate. And the great thing with negotiation is there's never an objective truth. Right? So it's never that you've got the perfect deal, because the perfect deal doesn't exist. So the perfect deal only really exists in the eyes of the people that you're seeking to serve, which is typically the stakeholder groups that you represent, as it were. So if you don't start the discussion internally with your stakeholders to understand what good looks like, to set the boundaries, to set the parameters, to understand what they're trying to achieve, and to bring them on that journey, then you could be the most brilliant negotiator on the planet. But when you are sat opposite the supplier or the customer and you bring that deal back internally, you will never land that deal in the way that you imagined you might. And so you do yourself a disservice, I guess, by not doing that prep. And it becomes much harder to get the deal across the table. It becomes much harder to get it signed because you've got that misalignment of expectations. And if you're not aligned internally, there's almost no chance of you being successful when you're negotiating externally with the supplier or the customer. And then I guess the third part of that is negotiating with yourself. And I see this happen all the time. I talk to teams that say, and we can't do that because now the best way of finding out whether you can do something is to try before you decide that it's way too hard. There's no way they're ever going to do that. Establish what the sensible parameters of that deal are and then in some questions, just test it. It's a pretty dynamic world at the moment. Things are changing at pace. Attitudes of suppliers and customers are changing all the time. And so if you've got a preconception as what somebody will or will not accept, you're probably going to leave stuff on the table that actually, if you just ask the question and being open minded and approach it in a slightly different way, you might actually be surprised at the answers. I guess you've got to be careful that you don't ask for really crazy, outlandish stuff. But I think stepping back and going through that process, so first and foremost agree and align internally about what it is you're trying to get done. What does good look like, what does excellent look like, and what does acceptable look like? So that you've got negotiation premises to go in with. And then make sure that as part of that you are being true to yourself in terms of giving yourself the best possible starting point to be able to lead that negotiation as opposed to defeating yourself before you even started. I think those things just really tee you up well, to be successful.

I agree 100%. Let's go through this process step by step. I want to start off with the one that I think most procurement people would say, don't tell me about this, I want to talk about the numbers. Let's talk about the negotiation with yourself. Because I think there is a hesitancy that people have when it comes to having those difficult conversations with yourself and engaging in a little bit of introspection and self reflection. First talk about, let's address that hesitancy. Where do you think that comes from?

I think it comes from a number of places, actually. I mean, it's difficult to ask for things that you think are going to get a negative reaction. It's why a lot of people don't like negotiating. It's equally why a lot of people love it. If you know that asking for something is going to be very tough. I mean, let's take a really simple example. Your suppliers come back and they've said it's a 10% uplift this year, right? You can go back and you can negotiate that from anywhere between 0 and 10% and you've achieved a good outcome. So where do you set that bar? And I think determining where you start that conversation is going to have a material impact on where you end. So if you go in and set the expectation that 8% is reasonable or even worse, you give a range and you say somewhere between 5 and 8%, for example, is where we'd want to land, well, guess what? You're always going to land at 8% in that instance. But equally, you've left somewhere between 0 and 5 on the table. So I think, you know, some of this is just about, you know, having the bravery, for want of a better word, to ask for the thing that you think is reasonable and to test your arm and not to defeat yourself before you started, I think is a big thing. And it, some of it's insecurity, you know, some of it's, you know, negotiation can bring out some of our, our own insecurities in terms of the baggage that we bring to the table. Some of it can be about the relationship that you have with somebody, particularly from a supplier perspective. That's what everyone's trying to do. They're trying to build a relationship. So it makes having those hard discussions that much harder. But if you can abstract yourself between the tasks that you need to get done, which is to deliver a good outcome for the company you work for from the relationship that you have. And if it's a relationship that's worth having, you'll be able to use that relationship to smooth your way through this process, not as a reason not to have that difficult discussion, if that makes sense.

Oh, it definitely does. And David, the thing that I love the most about your response is that you've addressed several things that could hold people back. It could be fear, could be insecurity. It could be potentially even just tricking themselves into believing that they don't have Time to dig deep within. Right? That's a convenient one. But the reality is we are all going to have different things that lead to our particular performance gap. There's something that's holding everybody back, and that's something I talked about in my first book, Finding Confidence in Conflict. You have to go through this process to figure out what it is for you because it might be situational. Just in this particular situation, there's something that holds you back. Or it might just be natural tendencies based on your personality type. For example, some people are more accommodating, some people are more disagreeable and competitive. So we have to recognize that there might be something that happened in your life. You had a bad negotiation for whatever reason, but whatever it is, you owe it to yourself and ultimately you owe it to your team to go through that process, figure out what's holding you back so you can work on yourself and perform at a much higher level.

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I think that's right, Kwame. And I think there are techniques that you can employ to try and help with that. So it's very unusual for you to be in a circumstance where you're negotiating something that no one else has ever negotiated. So I think having a strong network of people that you can bounce ideas off using third party advisory firms where it makes sense to get a second opinion to what good looks like, all of those things can help you to inform your starting position. And so again, if you're the type of person that naturally takes a very conservative line, do a bit of research, help to establish a reasonable position and take that into the discussion because it'll just help to overcome some of those things you've just described in terms of natural inhibitors to success.

Agreed, Agreed. And I will say, I especially like the first thing that you said where you are perhaps testing your network and more specifically looking at a third party or advisory firm as a third party advisory firm. David, I endorse that wholeheartedly. But it reminds me, there's a funny saying in the law. They say the lawyer who represents themselves in court has a fool for an attorney. And for me as a lawyer, that resonates because it's funny. I go to my lawyer and I say, hey, can you review these contracts? And I talk to them and they give me advice that I have given my other clients when I was practicing. And I said, what's happening? What is happening? It's perspective. I'm too close to the deal. It's not necessarily that my lawyer has more business skills than me. They have a better perspective, which helps them to perform at a higher level in this moment. Again, I think it goes down to having the humility to ask people on your team, people outside of your organization, whoever it is, just to get another set of eyes on this, because their perspective will be different and you'll get value from that perspective.

I agree. And for your American listeners, there's a saying in the UK that I don't know if you have in the US called cobbler's children. So cobblers are people that make shoes. Typically, cobbler's children have the worst shoes. And it's exactly the same point as you're making about law. Sometimes you just too close to this stuff to actually benefit from the expertise or advice that you would typically dispense yourself.

Absolutely. No, this is great. Now let's use this as an opportunity to transition into the internal negotiations. And so I know this is something that within the company, to be more precise, and I know this is something that our audience in the procurement world will be very familiar with. But let's just first set the stage. What you mean by that for the audience who might not be as familiar with those dynamics?

Yeah, sure. So I mean, typically as a procurement function, you're really in an enabler or a supporting function, if you like. So it's very rare that we're buying things for procurement. It does happen. But for the large part, you're buying for and on behalf of the company. You're supporting stakeholders to procure goods and services, as it were. And so the starting point for that journey is typically you take receipt of a request. It could be a conversation, could be something else. But typically you're starting with the I need to buy this thing. And that's really when the negotiation starts. It's really when you start to understand what it is that they're trying to buy. And that understanding is really important because we talk about an influence curve, for example, within Procurement. If I come to you and I say I want you to go and buy me this exact pen, then you straight away eliminated most of my negotiation levers because it's very specific. Whereas if you came to me in an ideal situation and you said I need to write something, can you find me an implement to get that thing done? Then you start in with a much broader position where then you start to say, okay, well let's work out the requirements. Does it need to be in ink? Could it be in pencil? Does it have to be? You just run through the characteristics of the thing that you're looking to buy and that's really the start of the negotiation process. If you like, it's working out what it is you need. And the broader you can make those requirements, the more likely you are to be able to really impact the outcome of those negotiations, if that makes sense. And so a lot of what you're trying to do half the time is to unwind what somebody thinks they need. You know, I talk about moving from specification to requirement. For example, don't give me a specification, tell me what the requirements are and then be open minded about how we fulfill that. Because that's typically when you give yourself the most levers, is when you can drive the most competition, and it's typically when you achieve the best outcomes. So not all negotiations are created equally, but if you're starting from a relatively open perspective, that's one way of doing it. You have other scenarios where there's very limited choice in terms of where you can go to for the fulfillment of this thing. So if I come to you, for example, and say I need Oracle licenses, then that's a very different position. There's a very set thing that we need to buy. We probably already got a contract in place. There's already probably a precedent around the pricing that we have in place with that company. And so there you're starting to there. You need to have a subtly different dialogue with the stakeholder. And actually in some of those instances it might well be do we need to buy from Oracle or is there an alternative that we could look at? So don't assume just because you've already got something in place that you have to buy more of it. Start with that open question. If it is the case that it has to be with a particular supplier, particular partner, and you may have a precedent in place, then you can start to think about other levers. When do we need to get this thing done by? For example, can we use a year end or a quarter end? To drive the negotiation strategy so that it applies the pressure on the partner. Are there other reasons why we might need to move sooner? Are there other levers that we could pull? For example, would we prepare to act as a reference site? Do they want to use our brand name in their advertising and logo? There's a list of leaders that you can work your way down. But what you're really trying to do as a negotiator is to understand which levers you can agree with your stakeholders that you can then take into the negotiation. Once you're ready to have that external discussion and all the way that you're doing that, you're building up a relationship, you're establishing credibility, you're hopefully establishing trust that you know what you can do, that you can help your partner. And you're also starting to set the boundaries and the parameters of what good looks like. So you start to establish in the minds of the stakeholder you exist to serve. When you bring this thing back, what are they going to be happy with? What's going to cause them problems? The sooner you can do that, I think the better placed you are to then start to think about how you engage externally.

I love this. I love this. I'm on board with everything. For the listeners, quick recap here for the procurement teams. They not only need to negotiate with the suppliers, the people who are trying to sell the big company things and negotiate that deal, they also have to negotiate internally with their internal business clients or the business units to figure out what it is they want, why they want it, and then align on a strategy that they can use when they have the external negotiation. Now, this is what's interesting before we get into the specifics of this, because in my experience training procurement teams, they often say that these internal negotiations with the people who are actually within the same company are the most challenging negotiations for them. So what is it about these negotiations that make them so difficult?

Well, I think it'll be different in every company. In some instances, it's just because you're dealing with particularly difficult stakeholders. Personality comes into negotiation. Ultimately, negotiation is a people to people discussion and therefore relationships. The way you build rapport and the there's that whole interaction with stakeholders can be challenging in itself. Equally, it can be an enabler. But effectively, a lot of people struggle just from a personal perspective not having the right interpersonal skills or knowing how to build that relationship in the first instance. Assuming you get past that, you're typically in a situation where you're supporting a stakeholder that knows more about the thing that they're looking to buy than you do. And therefore, to some degree, you're on the back foot. You have to earn your right at the table. You have to demonstrate how you're going to add value to this thing that the stakeholder probably thinks they can buy themselves. The reality is we all buy stuff every day, and therefore you'll never meet somebody that doesn't think they're a good negotiator. Most people think they can do this well, and I think, therefore, one of the things that you have to unpack and work your way through is overcoming that resistance and being able to demonstrate how applying the techniques and tools that you're going to bring to the negotiation strategy is going to help them achieve a better outcome. And that typically starts with having enough humility to accept the fact that they know more than you do about the thing that they're looking to buy, and hopefully getting them to the point where they have enough humility to accept the fact that you might be able to help them, however big or small that role may be. And if you can get to that point, that starts to. That starts to grease the wheels in terms of making this a little bit easier. But typically, it's that intransigence that makes it very difficult to start that discussion.

Oh, this is great. You're spot on. And I think one of the things that's so interesting about what you said was the necessity of humility and how, of course, humility is a virtue. We should all be humble. But also humility is a legitimate negotiation strategy and tool in this instance, because when you think about being a leader, not just leader of people, I like to think about it in terms of conversational leadership. So within these negotiations, we are leaders. Within the negotiation, we're showing people how they should comport themselves as we have this interaction. And I found it interesting, the sequencing of humility, because what you're saying, and correct me if I'm wrong here, David, what we're saying is we need to first recognize that they are the experts in their domain, and then that will trigger them to recognize that we, the procurement experts, are the experts when it comes to actually handling the actual negotiation. But we have to give that respect in order to get it. And it makes it a lot easier for the conversation to flow from there.

Absolutely. And I think it also just helps to set the parameters around. It's like any team, understanding what each person brings to the party is typically the way of making your team bigger than the sum of the parts. And ultimately that's what you're always trying to do. I think when you have any team, either virtual or actual, you're trying to drive that performance through the strengths of each of those team members 100%.

And now I think this is a good time to segue into the final component, which I think a lot of people would have assumed would have been the entirety of this conversation, which is the big, clear, obvious negotiation with the external party. So in this case, in the procurement world, it's the supplier. When you think about those negotiations with the suppliers, what are the key elements of that negotiation that procurement professionals need to keep in mind?

I think the easiest way to negotiate is where you have competitive tension. Ideally, you want to leave your negotiation competitive for as long as you possibly can to eliminate as many of the believers as you can as you go through that process before you make a decision and you down select to whoever you're going to select. So the longer you can keep that competitive tension between two organizations or multiple organizations moving, the more likely you are to be able to drive a good outcome. And the reality is, if you've competed and you competed well, whatever price you end up with is the best price that you could achieve. And you know that because you competed it. It's slightly different where you have a unilateral negotiation. So where you've only got one party that you're negotiating with, that's where you don't have that competitive tension. That's where you don't know whether a 60% discount is good versus a 75% discount, for example. And so in those circumstances, using the external network we talked about is really important. So trying to understand what good looks like, what other people have achieved in this space, that helps. But equally, that's where the internal negotiation becomes really important as well. So what does good look like for us? What is it we need to achieve? Either because we need to hit a budget a timescale, we may have other limitations, we may have other things that we need. What does good look like for us? And knowing that going into the negotiation helps you to decide where you set your starting point, but equally where you want to finish. And I think it's probably worth talking about that starting point, because my view on things is really simple, which is I'd always sooner play a straight bat in a negotiation, and I'd like to think I'm known for it. So if I say I need something, it's because I need it. And if I ask for something, it's not because it's outrageous. It's because there's a reason and a rationale behind what I've asked for and that enables me to do a couple of things. A, it enables me to earn trust and respect with those partners over time because ultimately we want to work with these people, that's why we're doing business with them. And secondly, whilst people talk about a win win, which I think is probably a bit of a misnomer, what you don't want is a situation where somebody feels they've been screwed. If you're going to take a really aggressive hard line with somebody that's backed into a corner and they feel they're giving you something that is unnatural them that they don't want to give. I think you have to be really confident that you can answer affirmatively to two questions. One, you have to be confident that you're the smartest person in the room. And secondly, you have to be confident that you're never going to have to ask that person for a favour. And unless you can answer yes to both of those questions, you should not drive the negotiations to that point. And I can tell you, I've never met the person yet that can answer yes to both. You're much better off just negotiating a position that's fair and reasonable and playing a straight bat than you are trying to be overly clever and box someone into a corner.

I agree. But to me, one of the things that's so interesting is why is that so rare? Why is that such a rare thing? Because I think a lot of people over strategize out, think themselves and put themselves in a bad position and damage the relationship in the process. So what you talked about was making sure that the other person doesn't feel like you took advantage of them and being a straight shooter, not playing games, not trying to be Machiavellian or manipulative, just saying what I need and why, and then trying your best to get a good deal done. What is it about that simple strategy that is so difficult for people to implement on a consistent basis?

I actually think part of it comes down to both of the two things that we've talked about prior to that. One is an insecurity, this kind of fear that you've left something on the table that you could have done a better deal, that you're going to talk to somebody in a week's time and they're going to tell you about this deal they got that's infinitely better than yours. Part of it is an insecurity and a lack of confidence that you trust the process and you've got a good outcome. And the second is because you're under pressure from your stakeholders because they want this outcome that was never going to be achievable. And therefore you start asking for things that are either unrealistic or unachievable in the circumstances. And so this is why I think it's so important to think of it as a tripartite process, because that very last piece of your negotiation that determines success or failure is ultimately going to hinge on your ability to have negotiated with yourself effectively and to have negotiated and set the standards internally successfully.

Oh, this is great. Because we always talk about the importance of having alignment within your team, within your strategy, the strategy of the people that you're sitting, the people who are on your team you're negotiating with, and then your internal stakeholders who may or may not be at the table, but that. That internal side within yourself that's often overlooked. So we have to have layers upon layers of internal alignment. So internal alignment within ourselves as an individual person, internal alignment within our own organization in order for us to move in synchrony and approach this negotiation in a coordinated fashion. And again, very overlooked, but very fundamental. And I want to go back to one of the things that you talked about, where you talked about the necessity of competitive tension. And so let's assume people don't know what that means. Let's just break this down and talk about how that leads to more leverage at the negotiation table.

Yeah, I mean, I can give you a. I can give you a personal example, actually. So we went on holiday to Marrakech a few years back and I was desperately trying to buy T shirts. And if you've ever negotiated in Morocco, you'll know that it's a. It's a dark art. And, you know, the street hawkers, etc, are very, very good at it. So they start high. You feel like you got a good deal because you got 20% off. But I remember negotiating really hard in one particular shop and every time I got to a point where I said, that's it, I'll look elsewhere, the shop owner would come after me, drag me back into the shop and tell me, have another cup of tea and we'll talk about it a bit more, I knew I had the best deal at the point where he let me walk out the shop. Competitive tension is all about understanding that you can buy something from somewhere else. And you really want to use that process to understand what the best price is for you in the circumstances, given the thing that you're Looking to buy. And you can only really do that where you've got got multiple options. And I think that it's something that people overlook. Too often they close their options too early in their negotiation cycle before they've closed out all these parameters and before they really understand what good looks like. At that point, you're stuffed. In that instance, I buy my T shirt in the shop, I think I've got a good deal because I've got 20% off. I'm sat at the bar later that night and someone else has got 55% off because they negotiated harder and better than I did. And that's buyer's remorse. Right, and that's your question earlier about why do people drive these hard positions? Sometimes it's just they're poorly informed and they just haven't trusted the process to arrive at the outcome.

Oh, this is so good. This is so good. And it shows the benefit of keeping your options open. Keeping your options open because there are several places where power can come from, leverage can come from. Sometimes it's time, sometimes it's relational advantages. But one of the key elements to analyze is what are the options on the table? What options do we have? And how can I approach this negotiation in a way that keeps as many options open for as long as possible before I give them that big tell, hey, you're the one I'm going with. Because that's when the leverage shifts ever so slightly. But it does shift in a significant way. And it also shows again, why it's so important to have that alignment. Because what ends up happening a lot of times is that your client, your internal client, the person that you're buying for, they have fallen in love with a supplier. No, David, you do not understand. I only get pencils from this company. Nobody else makes pencils in the world. And so you have to have a negotiation with them to have them comfortable with even opening it up and considering other options. Again, if you don't have that internal alignment, then you put yourself in a bad position actually during the negotiation. So I think that story does a really great job of tying everything together. David, I feel like I could talk to you about negotiation forever. This has been a lot of fun. Before you go, I want to challenge you. If you could give the listeners just one more piece of information, a tip, a negotiation tip that they can take on the road that we haven't discussed yet on the show, what would that piece of advice be?

I think it would probably be something around and being curious and open minded. So I think Being open to different ways of solving a challenge is probably one of the best ways of solving for it. So I think when you get too close to a problem, sometimes you imagine that there's only one possible way of solving the challenge that you're looking at. And oftentimes there are other ways of thinking about it, but it takes stepping back, it takes a bit of introspection and it takes a bit of thinking about. And again to the point about humility. Sometimes it's okay to ask an open question. You don't have to pose the solution in the thing that you're asking for. Sometimes you can just say, I have this challenge. I don't know how we're going to fix for it because at the moment I can't see a path forward and let the other side be a bit creative. Negotiation requires trust. At the end of the day, it's something that builds as you go through a process in a successful negotiation. And the better you know somebody, the better they understand what you're actually trying to get done, the better place they are to help you. So I think if there were one piece of advice, it would be before you become too entrenched in a position, before you become too dogmatic about the thing that you're absolutely going to die in a ditch over, make sure that you've explored all the alternatives. There's no other creative way of getting around this solution. And make sure you've asked the open question. This is the challenge I've got. How can you help me fix it?

I love it. I love it. The listeners will really appreciate that approach because it's something that's critical to have in your negotiations. I think if you consider everything that we've talked about today, if you go about doing exactly what you suggested in this negotiation process, but you're not curious and you're not open, it is going to be difficult, dare I say impossible, to reach those same levels of success without that mindset and that skill set. So, David, really appreciate it, my friend. Before you go, let the listeners know again, remember, remind them about who you are, what you do and how they can get in touch with you.

Yeah, sure. So my name is David Fethiot. I am the Chief Procurement Officer at Pearson. You can find me on LinkedIn. I'm a massive advocate and fan of commercial and procurement. So I'm always open to meeting like minded people and I think we have a responsibility as leaders to help shape the next generation of people coming through the functions, as it were. So by all means, drop me an email, and if there's something I can do to help, then I'd be more than happy to love it.

David, thanks again for joining us. Really appreciate it.

Thank you.

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