There’s a joke among engineers that new grads lament not taking more maths subjects during their degree but, as they progress, rue not improving their communication skills. Procurement professionals don’t have the luxury of hindsight. From day one, our ‘soft skills’ make or break us.
According to the Ikaros community, the top three procurement skills are:
Yes, all three are people skills. Hardly shocking, I know. At the end of the day, procurement is about people. If you want to be a procurement superstar, these skills must become your superpowers. Let’s take a deeper look at each of them.
What is Stakeholder Management?
So, what is a stakeholder? Quite simply, they are either those who are directly involved in the procurement process, or those who are affected by outcomes at any stage along the supply chain. Stakeholder management is about developing and maintaining productive relationships, which involves the systematic identification, analysis, planning and implementation of actions to engage with stakeholders. As any seasoned procurement professional knows, the tricky part is dealing with a number of stakeholders who have different, and sometimes conflicting, interests.
The Four Steps of Stakeholder Management
There are usually four steps involved in stakeholder management:
- Identify stakeholders
- Assess their interest and influence
- Develop communication management plans
- Engage and influence stakeholders
Communication and adaptation are the keys. You need to be able to identify the stakeholders involved and anticipate their desires in order to communicate with them effectively. It’s important to remember here that communication is a powerful tool, both for good and bad, and therefore one of the vital procurement skills.
Managing Competing Stakeholder Interests
No project has ever been undertaken that avoids competing interests. Prioritisation is your path through this murky swamp. You don’t need a medical degree, but you will need to do a little triage here and prioritise your stakeholders, especially those of equal influence but competing interests. This is tricky, and experience counts for a lot, but deliberate and careful planning will negate the more serious pitfalls.
Planning and Instinct
Of course, planning doesn’t mean rigid instruction. If you want to become that procurement superstar, you need to watch and learn, adapt to the idiosyncrasies of the stakeholders, and understand that one size does not fit all. Stakeholders are people, and different people require different approaches. A good chunk of productive communication comes down to instinct, which has to be honed. Plan, but be light on your feet.
Negotiation is not unlike walking a tightrope. Overconfidence can ruin you as surely as doubt and indecisiveness. ‘I am a great negotiator’, declares the person walking into the meeting room looking to charm the pants off the stakeholders. Your gut reaction to this particular individual is universal, hence their style of negotiation goes over like a lead balloon.
On the other hand, stakeholders can smell a lack of confidence a mile away; never walk into the meeting room thinking you’re doomed, or at a disadvantage. You’ll lose respect, and vital lines of communication.
Harvard’s Ten Skills of Negotiating
The good thing is that skilful negotiation can be learnt. Nobody is born a brilliant negotiator; the required skillset is taught and continually honed. The following are ten skills that Harvard Law School recommends learning if you want to become that superstar negotiator:
- Analyse and cultivate the best alternative to a negotiated agreement (BATNA). Power resides in knowing you can walk away and take another deal.
- Negotiate the process of negotiation. Don’t assume you’re already in agreement about when to meet, who’ll be present, what the agenda will be, and so on. Lay out the terms and smooth the way for more serious talk.
- Build rapport. This can be as simple as a short phone call, even if the majority of the communication will be done via email. This is a crucial skill. Small-talk is seriously underrated.
- Be an active listener. Don’t just think about what you’re going to say next; listen to what is being said now, and respond in a manner that demonstrates you’ve heard and understood.
- Ask good questions, and this means avoiding those that can be answered with ‘yes’ or ‘no’. Phrase questions in such a way that a more detailed response is required. Sometimes rephrasing the same question can help get to the heart of the matter.
- Search for smart trade-offs so that, if you become stuck, you can make concessions that do not materially damage your interests but allow the negotiation to move forward.
- Try to make the first offer/s, and create the anchoring bias. The first offer/s always exude a disproportionately large influence over a negotiation, so jump in quick. If you miss out, though, keep in mind your BATNA. This doesn’t mean you should have a dummy spit and walk out if they get in first; it means, keep in mind your viable alternatives.
- Present MESOs, or multiple equivalent offers simultaneously. This decreases the chance of an impasse and promotes more creative solutions.
- If you and the other party can’t agree on how a certain scenario will unfold over time, try a contingent contract. This basically means the other party will be penalised if their predictions prove to be erroneous. If they truly believe in their predictions, they shouldn’t have a problem with a contingent contract.
- Finally, place milestones and deadlines in your contract to keep things moving and make sure commitments are being met.
Learning Emotional Intelligence
The final superpower is emotional intelligence. Some would have you believe that you’re either born with this or you aren’t. Wrong.
Just like negotiation skills, emotional intelligence can be taught. After all, acting is all about emotional intelligence, and it’s a learned craft. This doesn’t mean you need to go all De Niro and start picking a fight with a mirror, but it does mean you should be aware of your emotions and be able to control and express them appropriately.
Five Components of Emotional Intelligence
According to the psychologist Daniel Goleman, Ph.D., author of the New York Times bestseller “Emotional Intelligence and Social Intelligence: The New Science of Human Relationships”, there are five components to emotional intelligence:
- Self-awareness, which allows you to recognise and control your moods.
- Self-regulation, which lends you control over your impulses and allows you to think before you act (just like mother always wanted). This also gives greater opportunity to express yourself appropriately.
- Motivation to self-improve, to monitor and regulate your actions.
- Empathy, which is the ability to understand other peoples’ emotions and behaviour.
- Social skills, so that you pick up on cultural cues such as humour and sarcasm.
Rest assured, all this can be taught and honed, just like stakeholder management and negotiation. These soft skills are at the heart of effective procurement, so the sooner you start to learn and exercise them, the closer you’ll be to superhero status.
How to Learn Procurement Soft Skills
Comprara can help. Visit our website Academy of Procurement, which isn’t just about the hard skills – we know the importance of the soft stuff too. We’ve partnered with negotiation experts who can take your people skills to the next level, so call us today!