How can you determine the right level of authority for your negotiation team?

1 Your negotiation objectives

The first factor to consider is your negotiation objectives, which are the specific goals and outcomes you want to achieve from the negotiation. Your objectives should be SMART: specific, measurable, achievable, realistic, and time-bound. Depending on your objectives, you may need more or less authority to negotiate effectively. For example, if your objective is to reduce the price by 10%, you may need more authority to make concessions and trade-offs, or to walk away from the deal if necessary. On the other hand, if your objective is to maintain the current price and terms, you may need less authority to confirm the agreement and finalize the contract.

2 Your supplier relationship

The second factor to consider is your supplier relationship, which is the level of trust, cooperation, and interdependence between you and your supplier. Your supplier relationship can be classified into four types: transactional, collaborative, strategic, or adversarial. Depending on your relationship type, you may need more or less authority to negotiate effectively. For example, if you have a transactional relationship, where you exchange goods and services based on price and availability, you may need more authority to negotiate hard and seek the best deal. On the other hand, if you have a strategic relationship, where you share long-term goals and mutual benefits, you may need less authority to negotiate fairly and build rapport.

3 Your internal alignment

The third factor to consider is your internal alignment, which is the degree of agreement and support among your stakeholders and decision-makers. Your internal alignment can affect your authority in two ways: by influencing your mandate and by impacting your credibility. Your mandate is the range of options and limits that you have to negotiate with, based on your organization's policies, procedures, and expectations. Your credibility is the perception of your competence and confidence by your supplier and your organization. Depending on your internal alignment, you may need more or less authority to negotiate effectively. For example, if you have a clear and strong mandate, you may need more authority to execute it and deliver results. On the other hand, if you have a vague and weak mandate, you may need less authority to consult and seek approval.

4 Your negotiation style

The fourth factor to consider is your negotiation style, which is the way you approach and conduct the negotiation process. Your negotiation style can be influenced by your personality, preferences, and values. Your negotiation style can be categorized into five types: accommodating, avoiding, compromising, collaborating, or competing. Depending on your negotiation style, you may need more or less authority to negotiate effectively. For example, if you have an accommodating style, where you prioritize the relationship over the outcome, you may need more authority to make sacrifices and concessions. On the other hand, if you have a competing style, where you prioritize the outcome over the relationship, you may need less authority to assert your position and demands.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?