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Probing Pitfalls in Negotiations

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This is an excerpt from the book The Power of NICE by Ron Shapiro, Mark Jankowski and Jim Dale.

Here are three warnings – don’ts – to keep in mind when you are digging for information during a negotiation:

1. Don’t Mind-Read

Don’t assume you know what the other side is thinking and simply proceed on that premise. If you base your proposals on assumptions, you run a high risk of being wrong. You may assume your position is stronger than it is and make an aggressive but naive offer. You could also assume your position is weaker than it actually is and back yourself into a bad deal.

It is natural to make assumptions. It is even acceptable if you don’t act on those assumptions. Test them first – during the probing phase. Ask questions, explore, find out if your assumption is valid, close or off the mark.

2. Don’t Offend – Interview, Don’t Interrogate

Unless you are a prosecuting attorney – the other side is not compelled or obligated to cooperate and answer your questions. If you go after the other side with an aggressive attack, expect them to shut down. On the other hand, if you approach the probing process like an interview, there is almost no limit to what you can learn.

Show an interest in their side. Soften your inquiries with lead-ins such as “Tell me more about that…” and “Let me understand where you are coming from…” It is also important to let them answer when you ask a question – try hard not to interrupt. If they ask you a question, don’t evade it – embrace it and explore it by saying something along the lines of “I’m glad you asked that, because it makes me think about…”

3. Don’t Get Off Track

The other side may try to rush you through the (probing) process. They do not have the same agenda as you do. Make sure that you get the answers you need before moving into a proposal. Don’t hesitate to slow the process down by saying something like “Let’s hold off on that for a moment…” or “Can we go back to something you just said…”

Equally important is to stay disciplined and not let yourself rush through the process. Sometimes we can become impatient with the pace and try to take a short cut before we have all of the information we need. Impose the same “slow-down” techniques on yourself.

Negotiating the “Indirect” Sale Part III

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Let’s explore the art and science of preparing for the pharmaceutical sale at the Individual level. We believe that the clearest path from the waiting room to changing the prescribing habits of a physician (or physician’s assistant or nurse practitioner) is to:

1. Build credibility – in short, you have to know your stuff. Most physicians see upwards of 12 pharmaceutical reps a day, and those who do not know their product, the correct indications, the side effects, how the product interacts with others and the clinical data that supports all of these components…do not maintain access with a busy physician.

That being obvious, there are other aspects of credibility that relate to the character of the rep. These include:

  • delivering the message clearly and concisely;
  • admitting when you do not know an answer and following up with the right information;
  • adhering to the pharma guidelines;
  • being on the same page as your sales counterparts (in a team selling situation).

You can prepare for each of these – and thus, increase your credibility.

2. Build relationships – the long and short of selling is that people are much more likely to listen to, be influenced by and ultimately buy (or prescribe) from people they like. We do not suggest that physicians will not write a product that has clear clinical advantages simply because they dislike a rep, but that rep has a much bigger hurdle to clear in order to have their message heard in the first place.

From our research, physicians report that reps successfully build relationships by:

  • Respecting the front office personnel and patients
  • “Reading” the environment and adjusting their visit goal accordingly
  • Adhering to the practice protocol on rep visits
  • Acting professionally and mirroring the style of the physician

Some physicians like “educating” the reps while others expect to be educated. Seasoned reps figure this out pretty quickly and respond in kind – by asking questions of the “educators” and delivering precise messages to those who need information. All physicians report being more influenced by the reps who follow the rules, and who understand that when the waiting room is packed – there is no time to detail. Also, more and more offices are limiting the number of reps they will see by “closing the office” to reps on certain days or times. Doctors notice when pharmaceutical reps bend or break their rules.

When “preparing” to build a relationship with a physician, try to plan for multiple scenarios – who needs what and when is the best time to attempt to deliver it?

3. Build Value – Last but certainly not least – you have to bring something to the practice that differentiates your product and personal value. Pharmaceutical reps have always brought value to the physicians and practices on their target lists – luncheons, samples, honoraria for speaking, educational programs, branded office supplies, medical supplies and reference materials, etc… The challenge is that as of January 1, 2009, the pharma guidelines that regulate the marketing activities of pharmaceutical reps will tighten again, and many of these traditional “value” adds will be unavailable (for more information and reactions – see www.cafepharma.com).

So what will be left is terms of value that can be delivered? Many physiciams believe that this will separate the very best pharmaceutical reps from the masses….and preparing for this change will be the key! Some reps are already lining up their 2009 speaking programs, preparing memos to educate their physicians about the changes, and figuring out what non-branded (but memorable) marketing they will be allowed to use within the new guidelines.

CREDIBILITY + RELATIONSHIP + VALUE

If you can establish a high level of credibility, a strong respectful relationship across the practice and deliver enough value to outweigh the risk of switching to your product, then you are on the road to successfully influencing your physicians. The risk of switching can be daunting to a physician – no one wants the phone to start ringing after a prescription is filled…many doctors are feeling the “pain” of products prescribed and pulled, or of the ever increasing propensity of the evening news to highlight yet another side effect of a popular drug. Doctors don’t like phone calls, especially from unhappy patients (or their attorneys!) You can overcome this risk by being upfront about the benefits and risks of your product and consistently offering the suggestions and recommendations of your brand marketing team.

This concludes our short series on preparing to negotiate the “indirect sale” as it applies to the pharmaceutical industry. For more information and resources on negotiations, please visit www.shapironegotiations.com.

Negotiating the “Indirect” Sale: Part II

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Preparing to Influence at the Practice Level

When getting ready to sell to a physician, the pharmaceutical sales professional has to take many things into account. Every rep knows what the physician is writing, what their share of the market is in whatever class of drug they are selling, and where they stand in regard to their sales goal. Most reps have this information at their fingertips thanks to todays technology.

More seasoned reps also think about who the players are in the practice, and they work to build credibility, value and relationships beyond the prescribing physician. We call this the Total Office Call approach, and it requires a more systematic and thorough approach to preparation.

Practice-Level Preparation

A standard S.W.O.T. analysis will help you develop a strategy for selling more effectively at the practice level. Understanding your strengths, such as your access, relationships and product’s clinical advantages, will give you more confidence in your message. Identifying your weaknesses (perhaps your product is not on formulary, or your competition is offering a generic) will prepare you for the most common objections. This is pretty fundamental stuff. The key to effective preparation at the practice level is to find your opportunities to grow your business and to identify the threats to your market share early enough to minimize the impact.

Opportunities

Based on our interviews with dozens of physicians over the years, we have learned that opportunities often emerge from objections. Physicians often see upwards of 15 pharma reps a day, and they have been conditioned over the years to politely listen to the clinical message and to move on with their day. When a physician is listening well enough to come up with an objection, the professional sales rep will recognize this as an opportunity to build credibility and start down the road to influencing the doctor. One example from a recent ride-along – The physician expressed a concern about the aftertaste side effect of a new drug. Instead of pitching possible solutions – such as using mouthwash, putting the pill in a dab of peanut butter, etc..- the rep had prepared for this objection and answered the physician’s objection with a question. The rep asked “That’s interesting. What else have your patients told you about my product?” The physician looked up from whatever he was reading, and said “Well, that it works.” Instead of “overcoming an objection” this rep was prepared with a question that put the focus back on the clinical advantages of their product. Of course, you cannot simply “duck” the concern, and the rep followed up by maximizing the opportunity. “I need to understand this patient’s situation better before I can recommend a solution – can you tell me more about this patient’s feedback?” A relatively long (for a pharma rep!) conversation ensued and the rep gained a lot of information that created the “bridge” to the next meeting with this doctor.

Threats

In an ever changing competitive and regulatory landscape, today’s pharmaceutical sales representative faces a broad array of threats to their market share. Ranging from FDA reviews, unfavorable study results, stricter ethical guidelines for marketing pharmaceuticals and increasing competition from generics – it can seem as though the pharmaceutical rep is fighting an uphill battle every day. Preparing for these threats at the practice level – such as knowing how you will position your product in the face of competitive threats or an unfavorable study that your competition is waving around – is an important influencing skill. Physicians report that how a rep responds in the face of a threat either increases or decreases the rep’s credibility for the long-term.

One rep that I know well had a popular product pulled from the shelves by her company several years ago when adverse side effects were discovered in a study. Her approach was to turn the threat into an opportunity – “I am proud of my company for pulling the product. We are in the business of helping people get well, so I hope that you see our commitment to that goal and will continue to support our other products.” Using that positive message (as opposed to a warning that other drugs in that class would have the same side effects or an apology for promoting a drug that was pulled) – this rep did not lose access or credibility with a single physician.

In the next post, we will explore a systematic way to prepare when influencing individuals within the practice – by examining barriers, credibility, relationship and most importantly – the value you deliver.

Negotiating the “Indirect” Sale: Part I

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We are often asked to work with companies and organizations that do not negotiate in the traditional sense of bartering over price (or terms). Some sales representatives do not have any control over pricing or terms due to organizational norms or the commoditization of their products or services. Other companies, such as pharmaceutical firms, are even more limited in their ability to negotiate due to regulations. For example, pharmaceutical sales representatives cannot “trade” services, samples or “extras” for prescriptions.

We struggled at first to apply the usual negotiating lessons and techniques to the “indirect sale” until we realized that a tactical approach to sales would be less effective than a strategic influencing approach.

Let’s use the pharmaceutical sale as the example. A pharmaceutical sales representative spends their day detailing physicians about their products in a very limited amount of time, perhaps as little as 30 seconds while the doctor signs for their samples. Some busy physicians see as many as 15 different sales reps in a day. Most pharmaceutical reps see upwards of 10 physicians a day (often with a variety of products in their “bag”). The message has to be clear and concise and yet the “call to action” has to be more subtle than a direct sale – “Will you try Product X on patients who present the following indications…?” is about as direct as you can be within the pharma guidelines. The best “close” a pharmaceutical rep can hope for is a promise that the physician is willing to try the product at some point in the future.

The pharmaceutical sales rep has no direct control over the “sale”. The physician makes the prescribing decision on their own in the examination room after the sales representative has left the office. The doctor has built a prescribing habit over time and it is very dfficult to change the habits of a highly trained, intelligent and busy physician.

We believe that the key to successfully changing a physician’s prescribing habits is based a sales representative’s ability to develop three critical components of INFLUENCE:

1. The Credibility of the sales representative when educating the doctor about their products;

2. The Relationship that the physician enjoys with the sales representative; and

3. The Value that the sales rep delivers to the practice.

If the sales rep can build enough credibility, and the relationship with the practice and the value delivered to the physician outweigh the RISK of switching the prescription (the efficacy, safety and patient economic impact of the new product), the sales representative has started to influence the physician successfully.

In the next post, I will show you how the systematic approach to negotiating can be applied to influence physicians more successfully.

John Buelow

John is the Chief Learning Officer at Shapiro Negotiations Institute (SNI), a training and consulting firm based in Baltimore MD. SNI has trained over 300,000 professionals around the world since 1995 helping people to close more deals, faster at higher margins.

Welcome to the SNI DealCoach Daily!

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Hello and welcome to The SNI DealCoach Daily – a community of experienced negotiators, sales consultants and everyday dealmakers who want to maximize your results in today’s turbulent times.

As the economy tightens, effective negotiation skills become more important than ever. It is imperative to commit yourself and your organization to achieving “win-win” deals. Though overused and often misused “win-win” simply means: “the best way to get what you want, is to help them get what they want.” The simplicity of this phrase, however, is belied by the difficulty many people have in executing on it, particularly in challenging economic times.

To survive in the short term, it may be tempting to take advantage of the other guy. You may convince yourself that tough times call for tough tactics, and that the end justifies the means, but how will you feel when your ‘partner’ can’t or won’t fulfill their end of the bargain? One-sided agreements are often broken because players will either find a better deal or will be unable to keep their own doors open.

Using an upper hand to strike an unfair deal might seem like a good idea initially, but this approach fails to take into account the enormous cost associated with replacing a ‘partner’ or ‘vendor’ that is no longer able to perform. Not only do costs increase, but the problems can impact your own clients or customers…missed deadlines and reduced quality. Ultimately these “win-lose” deals impact on profits due to higher costs, or the increased concessions and higher discounts you must offer your customers in order to retain them.

One aspect that many people tend to overlook is that relationships built during challenging economic times are the ones that tend to last a lifetime (and beyond). One famous example is McDonalds and Coca-Cola. The story has oft been told of a struggling Ray Kroc trying to obtain a soft drink vendor. Kroc did not have the money to pay for the equipment as he quickly expanded the hamburger chain. Coca-Cola saw an opportunity and struck a deal that deferred equipment payments. Other soft drink vendors had the opportunity to make this deal, but they were unwilling to take the risk. Coca-Cola saw the opportunity and forged a partnership that has lasted decades

You must start by completely understanding what your customer is trying to accomplish and then deliver your service or product in a way that will help them accomplish that goal. Recently we consulted with a software company that was trying to negotiate a deal with a chain of bookstores. We asked them: “What is your goal?” It was a simple question, but we received 12 different responses, ranging from: “close the deal” to “get all of their budget” to “prevent our competitor from bidding”. No one in the group provided the answer we were looking for, i.e. that their goal was to find a way that they could help this bookstore chain sell more books! If they find a way to do this, all of those other goals will fall into place.

For more information on negotiations, sales optimization or influencing, please visit www.shapironegotiations.com.