Suppose that Connie Connie customer asks Sam Supplier to do something. Sam agrees and begins performance. After Sam has finished 95% of the work, Connie finds out that she can’t pay Sam what they discussed.Â
How should Connie handle this situation? If you were in Sam’s shoes, how would you deal with this issue?
Technorati Tags: negotiation contracts agreement connie and sam businessGovernor Rick Perry is backing Robert Scott to replace Shirley Neeley at the Texas Education Agency (TEA). Currently, Mr. Scott is second in command. In the normal course of events, this would not attract very much attention.Â
This is an important issue for a variety of reasons. When contract decisions are made, state agencies spend your tax dollars. Now, maybe Mr. Scott did something wrong. Perhaps, his actions were appropriate. In light of the investigation and report, should the Governor be backing Mr. Scott at this point? Â
When the leaders act in questionable ways, it sets the standard for others in the organization.  I am wondering about consistency. Suppose a lower ranking employee engaged in the same conduct that Mr. Scott did. Would the person be getting the Governor’s support, or would the person be given a pink slip?Â
What is the message that people wishing to do business with the Texas Education Agency are hearing from this situation?Â
Technorati Tags:  ethics contracts government tea rick perry governor robert scott procurement businessSuppose that Mark Manufacturer produces a widget that Sam Supplier sells to Connie Customer. Can Mark’s contract with Sam specify the minimum price that Sam will charge Connie?
Until today, few people in Mark’s situation were willing to do so. Instead, people in Mark’s situation negotiated their price with Sam. Then, Sam and Connie negotiated the price between themselves.    Â
As a result of the Supreme Court’s ruling in LEEGIN CREATIVE LEATHER PRODUCTS v. PSKS dba KAY’S KLOSET, Mark may be able to negotiate with Sam regarding the price that Sam will charge Connie.  A balancing test will be used to decide if the price that Mark and Sam negotiate and the use of provision itself is reasonable. The Court said:
The rule of reason is designed and used to eliminate anticompetitive transactions from the market.
It may be sometime before people in Mark’s situation engage in large scale negotiations over minimum prices. Perhaps, it will be a situation where the restrictions occur in franchise and licensing situations. In such situations, the manufacturer often exercises more control than in other types of business relationships.
What do you see as the future of pricing? What will it mean for your business? What will it mean for you as a consumer?
Is this part of a general trend in the US Supreme Court? If so, what does this mean for you?
Technorati Tags: minimum price kay's kloset psks leegin supreme court court business negotiation contract minimum connie and samMany small business owners create a website and expect that website to work miracles. They have heard about the importance of Internet marketing and assume that having a website is enough. If a small business is in a hot area, having a website may be enough. For others, an Internet presence may be a part of the marketing puzzle. In some cases, an Internet presence is counter-productive.
In deciding if an internet presence is right for your business and how much of an investment to make in creating a website for your business, you may want to consider a variety of questions including those discussed in this posting. As this list illustrates, it is critical to think about issues, rather than to adopt an approach because “everyone” else seems to be doing so.Â
What can an Internet presence do? A website can attract people who do not know about your business. It may help people who know you think about you, if you have a good rating with search engines. (Which explains why there are so many specialists in search engine optimization.) A website can help people who know you learn about your business as well. The website may have little impact in terms of actual sales. Â
How do your customers select suppliers?  Often, in the business-to-business environment, people who visit the website may not be making decisions. Instead, they may be in support organizations, such as procurement or accounting. In many cases, the people who are doing searches on the Internet are may be seeking information which supports the purchasing decision that has already been made.Â
Will your website be visited by your customers? When the website will be visited by advocates, rather than customers, sales can occur if the site (1) convinces people that they need your offering and/or (2) educates potential advocates so that they are able to talk with others about your services or they think of your firm/industry when a need arises.
Are your customers online? If so, it is easier to justify a website because your customer might search for the products and services that you offer. If not, remember that adding layers rather than talking with firms yourself can increase costs, cause confusion, and, in many cases, requires more time in the sales cycle.
Will your customers value a relationship?  Many customers want to know their suppliers. If a customer is spending what it sees as a large sum or is buying something important, the relationship can be paramount. In such situations, the customer may base decisions on information that is provided as well as customer referrals, face-to-face meetings, and dialogue. Websites may be unimportant to customers who rely on such approaches as part of their decision process.
Do your customers want or need for you to have a website? Customers may not need for you to have a website. If they do not need a website to access, learn about, or purchase products from, they may be slow to use the website, even if it exists.Â
How often will the website be updated? If the website contains outdated information, it may reflect poorly on a business. Rather than attracting and retaining customers, it may drive customers away. Alternatively, it could result in requests for services that have lower margins or reflect a prior direction of your business, rather than its current vision.Â
Technorati Tags: internet website business customers visionA discussion with a friend from a major company this morning raised a discussion topic that warrants careful consideration on many different levels…Â
Today, public companies are under tremendous pressure to deliver financial results to their shareholders every quarter. In such an environment, it is very difficult to participate in effective long-term planning. It is difficult to commit scarce resources to major improvements and upgrades, unless the improvements and upgrades will lead to bottom-line results quite quickly.Â
Are public companies engaging in long-term planning on a short-term basis? What are the ramifications of the emphasis on quarterly results, rather than taking a longer-term focus? Is this trend going to improve, or only become more pronounced as time goes by?Â
Technorati Tags: business planning public companiesThe other day, some friends were talking about negotiation. One of the people said that it just wasn’t worth negotiating because he never won the concessions he was seeking. As the discussion continued, he said that he was negotiating to achieve his business objectives and that meant the other party had to agree to the concessions that he was seeking.Â
The friend asked for three simple steps that he could take today, and for me to explain those steps. Here is what I said…
When people go into a negotiation focusing on their position (what they need), it can be very difficult for the parties to reach an agreement. Often, they have selected a solution based on what they need. Other solutions and approaches have often been excluded or overlooked.
A better approach is to understand what is to be accomplished, why it matters, and the parameters to be satisfied (time, resource, cost, availability, size, color, compatibility, etc.). This makes it possible for people to look at other solutions that meet requirements. Often, this allows better options to be identified.Â
In many relationships, one party or another may forget an important piece of information. Sometimes, the item will not work as intended or key pieces of information will be overlooked. In other cases, one party wants something to work “just so.”Â
Think about what is really necessary to meet business objectives. If a particular solution or approach works for one party and not for the other, find out why. Then, see if solutions exist that may work for both parties.Â
Many negotiators compete against each other. Rather than competing with each other, work together to find options that address everyone’s concerns. If the people involved understand what is to be accomplished and are working together to solve an issue, they are more likely to solve the issue. And, by the way, negotiations becomes a dialogue.Â
At the end of a negotiation, the parties often have to work together. Is it difficult to conclude that, if the parties are working together during the negotiation, it is going to be easier for them to work together in moving forward when the negotiations are completed?Â
Technorati Tags: negotiation business communication planning tips resultsAt a friend’s suggestion, I’ve been reading Barbarians at the Gate about the leverage buyout of RJR Nabisco. My friend described it as a good way to understand what happens in the buyouts. Â
It seemed to me that this book is a good way to understand what happens in procurement/strategic sourcing/purchasing as well. The dollar values, item/service being acquired, and the cast changes. The games and issues remain the same.Â
Negotiations are an elaborate dance and a dialogue. They can be above board though. Hopefully, the postings in this blog will help you do so. That is why they were written.
A central precept in this blog is that every person makes a difference. The difference can change behavior, for better or for worse. The person can reinforce the status quo as well. Change is most likely and most sustainable when people:
Care about the result
Focus on factors within their control
Know what they are trying to accomplish
Hope for the best and prepared for the worstÂ
Go into the situation with their eyes wide open
Do their homework and invest the time to learn the subject matter
Every person can make a difference. If each of us does so, the impact is likely to go farther and last longer than any of us will see or realize.   Â
Is it okay to let people sit in the broken chair, have people sit with the sun in their eyes, use someone else’s office so that rapport is avoided, and to deliberately omit changes from the revised contract? If the goal is to build a relationship, such tactics have no place in the negotiations. That said, there are still negotiations classes that teach people to use these tactics. Such tactics and classes are for negotiation neandrathals. How will such tactics help people work together to meet business needs?  Â
How do you deal with games in negotiations? Do you align the parties interests so that it builds long-term relationships? Is the conflict in the negotiations constructive and bringing people together to solve problems, or is it a wedge that is driving them apart?  Â
Technorati Tags: negotiation barbarians business relationships ethics change sustainability
Hello and welcome to Practical Solutions to Business Puzzles. I am Coleen Davis. Through C Davis Consulting, Inc. and my other business interests, I help people develop their business skills and build business relationships.
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