Management consulting means helping companies and organizations improve performance, by making use of smart strategies and tactics to fix problems. The job of a business consultant is to attend negotiations and find sensible techniques to close deals without having to sacrifice the integrity of his client’s company. Every once in a while, consultants are obliged to make use of tricky negotiation methods to get things done. These strategies are not always the most ethical, because the goal is to sign a contract in your favor.
This does not entitle you to take advantage of your counterpart, but it gives you a white pass to make use of all possible schemes to get the best bargain. Every competent consultant should know his work field like the palm of his hand. Experience is equally important because the goal is not to settle on a win-win solution; the goal is to win the biggest piece of the pie.
Planning
The consulting business is more like a relationship. Clients must trust you and they must confide in your abilities. For that to happen, a professional and polished image works hand in hand with your strategies. Always remember that as a consultant you’re the brand. The tactics you’re about to implement on your clients must be connected on a human level; otherwise, you risk losing a valuable customer.
- The Strategy – always have a strategy in mind. A lot of people choose the consulting business because they want to exhibit their expertise independently. Sadly, it’s not enough to be talented and smart; a plan is required because it will help you focus on each and every step of your customer relationship.
- Define the ideal customer – you’re a consultant so you’re already aware that not everybody will need your services. Narrow your search and focus only on people that might have an interest in what you’re offering. Concentrate on a marketing strategy and make sure that your promotion and pricing strategy reflect the value you can bring to the table.
The Hot Potato – This tactic is may sound funny, but if you’re not paying attention you’ll face the consequences. The strategy involves taking someone’s problem and making it your problem. Here’s how it works: you’re looking to sell your home for $1.1 million but the other party says “I can qualify for a $1 million loan only”. It’s not your issue that they can’t get more money to buy the house. One smart way to counterattack this offer is to give back the ‘hot potato’ and compel the other party to make a decision. Your answer should be “Do we have a deal if we can find a bank to lend you $1.1 million?” Or you can try something like “I must sell the house for $1.1 million so I can pay for the college education of my kids”.
As far as the consulting business is concerned, the same principles of ‘the hot potato’ apply, only in different circumstances. If you’re trying to close a deal for $550,000 amount of money, but your opponent says he can only afford $500,000, you can always say “I have to sell this for $550,000 or my client won’t pay the commission”.
What’s your position at the negotiation table?
It’s very important to determine what you want and what you can obtain. Before starting to negotiate you must understand your position and then express your expectations and aims as clearly as possible. Be confident when you present your demands and try not to be intimidated by a tough competitor. During the discovery process learn how to ask all the right questions, try to find out more about your opponent and never improvise quick responses. If you act professionally and inspire poise, the other party will trust you and they will be more willing to agree with your conditions.
Have you thought of using higher authority? The tactic might seem old, but it still works. Mainly used to postpone signing a deal, the strategy is meant to convince the other party to drop the price. For example, if you’re looking to sign a contract for $10,000 but the amount seems a bit too high, you can always say “I doubt my client will agree, but let me give him a call.” You come back with the following statement “I’m really sorry but my client won’t go for this offer. I really thought we had this in the bag. They told me that they would consider $9,000, but unfortunately they believe $10,000 is too high”. Of course, remember it’s just a strategy, so you don’t have to actually have someone to tell you how to negotiate.
Ensure that you have a realistic position
Negotiating an important deal can be nerve-wracking, but you still need to keep your position as realistic as possible. If you develop a precise and accurate estimate for the project in question and your rating is supported by sensible arguments, you should have nothing to worry about. Don’t forget that your job as a consultant is to please your client. It’s good to be realistic about your offer, but this doesn’t mean you’re willing to accept the lowest offer.
Be ready to stop negotiating
You should never be reluctant when it comes to walking away from the negotiation table. In case you are convinced that a proposal deal is not right, you can reject it. Most consultants try to avoid conflicts, which is fine as long as you’re not pursued to sign anunfavorable deal. Saying “NO” may often work to your advantage. From the position of a business consultant, putting an end to a negotiation is called the ‘withdrawn offer’. It may or may not work.
The strategy involves a bluff; you’re basically taking away a deal that was already made. For instance, you say something like “Oh, my mistake! I thought I wrote down $25,000 not $20,000. My printer must have typed the wrong numbers” The other party will say “But the deal is almost done, you can’t back down now because of a typing mistake.” Eventually, if they really want to sign with you they’ll agree to the $25,000.
Don’t take unsuccessful negotiations personally
If you cannot reach a settlement because your client did not agree with your terms or because he didn’t like a particular aspect, you should simply learn from that experience and move on. You must never permit your conscience to judge your actions, but you should try to examine your failure carefully and avoid making the same mistakes again in the future.
Failures can result in future gains
The relationship between your and the other party will probably continue even though you didn’t manage to reach a convenient agreement from the very start. If you’re sincere and jovial you will manage to gain respect throughout the negotiation process. Consultants are known for their abilities to persuade people. Yet, sometimes it’s a lot better to give in. You can never know when the same client may need your services again.
For the average individual, a consultant is someone who sells something useless using extremely persuasive techniques. While that may be true for the average population, the job of a business consultant is a lot more complex. In order to get things done, please the client, and close a deal in your favor, you need skill. Proper planning, communication abilities, and tricky negotiation tactics, are required in the business consulting domain because they strengthen methods and boost efficacy.