Vendor Negotiation Original Posted on CIOs From IDG
Negotiating deals with IT vendors is never easy, but it is a skill you can learn. Experts in the art of negotiating say it’s important to understand the vendor’s pain points, look out for hidden costs and keep your emotions in check.
Negotiating deals with IT vendors is never easy, but it is a skill you can learn. Experts in the art of negotiating say it’s important to understand the vendor’s pain points, look out for hidden costs and keep your emotions in check.For the CIO’s, the basic tenets of successful vendor negotiation have changed little over the years. Yet the process remains difficult to master and, for CIOs in particular, is getting more complex.
“A lot of the most effective strategies for negotiation are common-sense ideas, but people don’t execute them in the realities of a difficult negotiation,” says Daniel Shapiro, founder and director of the Harvard International Negotiation Program and author of Negotiating the Nonnegotiable: How to Resolve Your Most Emotionally Charged Conflicts. “Simple isn’t always easy to execute.” These words resonate deeply in the IT procurement world, where high stakes, conflicting priorities, and emotional undercurrents often dominate the negotiation table.
And for buyers of IT products and services, the negotiation of vendor contracts today is particularly charged. “They’re dealing with more vendors than ever before, for more niche services, in trying economic times, and — in some cases — being handed very boilerplate deals for commoditized services,” says Ed Brodow, creator of Negotiation Boot Camp seminars.
This shift in the negotiation environment places significant pressure on CIOs and their teams. They are no longer merely negotiating contracts but are also tasked with ensuring that each agreement aligns with their organization’s broader strategic goals. This requires a deep understanding of both the technical and financial aspects of vendor offerings, as well as the foresight to anticipate future needs.
Ultimately, CIOs must focus on more than just securing the best deal in vendor negotiations. They aim to create partnerships that deliver long-term value, mitigate risks, and position the organization for sustained success. As Brodow aptly puts it, “Negotiation today isn’t just a skill—it’s a survival tool in a rapidly changing IT environment.”
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