The One Where Friends Taught Procurement How To Negotiate - Procurement News

Generation Procurement | by Cindy Rittel on 18/02/2020 09:22 | 4 comments |

The six main characters in Friends may have given us a lot of laughs over the years, but they can also teach procurement professionals a few things about the fine art of negotiation. 


In this article, we look back on seven episodes in which Rachel, Ross, Phoebe, Joey, Chandler and Monica showed procurement what to do and (more often than not) what not to do when negotiating with suppliers. 

1. Having a back-up plan (or two)

In The One With The Proposal, Phoebe reveals to Rachel that she has a pact with Joey to get married if they’re both still single at 40. When Rachel tries to secure Ross as her back-up, he reveals that he is also committed to Phoebe, who rightly points out ‘it’s good sense to back up your back-up!’

A single-source supply situation is a dangerous place for procurement professionals to find themselves. Firstly, it doesn’t account for any risk factors such as trade tariffs, political and economic instability or natural disasters that could gravely impact the efficiency of your supply chain. Secondly, no matter what your benchmarking data tells you about costing, having one supplier puts procurement in a vulnerable negotiating position, particularly when the time comes for contract renewals.

2. The importance of being realistic

In The One After Vegas, Rachel and Ross accidentally get married following a particularly big night out in Sin City. And Ross, desperate to avoid his third divorce in two years, embarks on a ludicrous campaign to convince Rachel to stay married to him. During their negotiation, he first points out the proximity of the ‘Mrs’ and ‘Miss’ checkboxes on forms, (‘How is this going to affect you? … It’s right next to it!’) and then proceeds to offer her all the gifts from the wedding registry.

Before entering into negotiations, procurement professionals must clearly define their strategy, be realistic about their expectations and treat their suppliers fairly. Pushing your suppliers too hard can be counterproductive and destroy the potential value to be gained in long-term strategic relationships.

3. Being flexible

In The One With Ross’s Denial, Monica and Chandler attempt to negotiate what to do with their spare bedroom. Monica dreams of a beautiful guest room whilst Chandler wants to create an old-school arcade. The discussion ultimately reveals Monica’s unwillingness to compromise on anything related to the apartment’s interior. 

Rigid supplier onboarding can be time-consuming and costly, particularly for SMEs. Similarly, inflexible payment terms might eliminate certain suppliers who depend on fast payments. For procurement to successfully engage with a diverse supplier base and drive innovation through their suppliers, processes need to be adaptable and accommodating.

4. Controlling your temper

In The One With Ross’s Wedding, Ross and Emily’s parents squabble over wedding costs, a conversation that eventually descends into a sparring match (‘I could kill you with my thumb’). Ross is forced to intervene and mediate the discussions, threatening both couples with ‘no grandchildren!’ if they cannot reach an understanding.

Focusing solely on costs during a negotiation is a recipe for conflict. In today’s world, procurement depends on long-lasting and meaningful relationships with suppliers to drive creativity, sustainability and efficiency. When tensions are running particularly high, it might be worth bringing in a mediator or involving senior leadership, but this is not a decision to be taken lightly by procurement – the basis of your supplier relationship will determine its future dynamic.

5. Doing your homework

In The One With The Embryos, Chandler and Joey agree to get rid of their pet chick and duck if they win the lightning round of Ross’s quiz. Rachel and Monica end up losing the game (and their apartment) simply because they don’t know Chandler’s job title (‘he’s a transponster!’)

It might be tempting to save yourself preparation time and come to a supplier meeting unprepared with the intention to ‘wing it’. But be warned, it will come back to bite you when you’re unable to answer key questions, stalling for time, and don’t have your BATNA (Best Alternative to a Negotiated Agreement) prepared. 

To guarantee the best outcome, it’s important to do your homework and understand the supplier’s aspirations, weaknesses and objectives. Negotiation expert Erich Rifenburgh recommends that your preparation time should be at least three times longer than the time spent in the negotiation itself. 

6. Being efficient

In The One With The Jellyfish, Ross reveals he never finished reading a letter from Rachel that outlined her reconciliation terms. ‘I was tired, and you had rambled on for eighteen pages . . . front and back!’ The letter’s complexity and ambiguity results in the couple breaking up (yet again). 

If you’ve reached the end of a negotiation and the terms are unclear, or some of the participants are dissatisfied, something’s gone wrong.

Ideally, both parties will walk away with complete clarity on the agreement in terms of costings, deliverables and timelines, which should all be reconfirmed at the end of a negotiation. Procurement professionals must also question whether the final agreement has longevity and be certain that no value has been left on the table.

7. Knowing your limits

 In The One With The Ring, Chandler identifies the perfect engagement ring for Monica and is determined to secure it at all costs. When another shopper snaps the ring up first, Chandler and Phoebe go to huge lengths to negotiate its return, unwilling to compromise on an unsuitable alternative. 

Being flexible doesn’t mean being a pushover, and it certainly doesn’t mean giving in to pressure or abandoning your company’s values or protocols for the sake of a quick negotiation win. To deliver top-quality products and services, procurement professionals must know their limits and stick by them, without compromising on maintaining supplier relationships. It’s a fine line to walk, but the payoff is worth it. You’ll earn respect from your suppliers, maintain integrity and keep your internal stakeholders happy.

Get in touch with UNA to discuss how a Group Purchasing Organisation can leverage the power of bulk purchasing to negotiate on your behalf. 


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Author

Cindy Rittel

Manager / Consultant

As a Senior Sourcing Advisor with the fastest-growing purchasing program in the country, I’m in the business of working with clients to build powerful supplier relationships to add money back to the bottom line. I’m able to leverage a combined $100 billion in buying power to aid in savings to both indirect and direct spend. As a member, I’ll help you with the following: - Take a consultative approach on your current spend for the premium products and services you use every day. - Help you select the supplier relationships that make the most sense and will add the most value for your business. - Increase your business savings on direct and indirect spend. - Become a true partner of yours that helps you do more than just save money. - Provide ongoing analysis for new and innovative ways to better your business. I’ve built my career around assisting businesses get access to the products and services they need to function at desirable costs. I’m experienced in assisting in business management activities including business analysis, management of product line life cycle, marketing, research, vendor management, and project management for industries such as the automotive aftermarket and consumer, industrial and agricultural essential commodities.


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