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Selling Skills and Selling Strategies Objectives . .

To understand different buying and selling styles To understand and internalize the selling skills .' To comprehend the process of building effective communication skills To learn how to improve listening skills o To understand conflict management and resolution skills . To learn how to bargain and win in sales . To understand the negotiation and bargaining skills . To understand the problem solving skills INTRODUCTION Selling is one of the most challenging professions of the modern world. While a few people do very well in the world of selling many believe that selling is becoming an exceedingly difficultjob. Success in selling determines the fate of an organization. Business organizations are set up to generate profits by satisfying the needs and demands of customers. In the process of delivering goods and services, business organizations ut'lize the available resources including human resource, and develop business systems to continuously provide utilities to the customers. There is a risk involved in the future of any business, and business organizations take this risk arising out of the uncertainties of a dynamic business environment to generate profit. The objective here is not to explain how or why a business enterprise earrs profits, but to explain how salespeople contribute to achieving the goals of business orgarrizations. products and services can be delivered to potential customers in two ways. Indirect marketing involves a process of intermediation in which a third party takes the product and delivers it to the customers on behalf of the producer, with a share in the profits. However, in directmarketing organizations deliver products and services to the customers directly through salespeople. I I i Selling Skills and Selling Strategies 45 The salespeople represent the company to the customer. If the salespeople are'equipped with the required skills and have the desired aptitude for selling they contribute to the achievement of the higher organizational goals. Salespeople with proper selling skills not only close the sales and ut'li"e the selling time effectively but also are able to project a positive image of the company through their professional approach. E{fective selling skills also help an organization in achieving its longterm

business objectives. Research has identified that it costs less to sell products to existing customers than to new customers. So companies are looking to establish longterm relationships with their customers so that they can provide better and value added products to the customers over a long period of time. Similarly, when eflicient salespeople interact with customers, they understand their needs and problems better and provide feedback to the company so that the company can be proactively innovative in its products, processes, and service commitments, and the organization will be more adaptable to changes in the customer world. As we have already discussed, selling is a higtrly stressfi.rl job, where the salesperson often gets rejected and his self-esteem level is likely to below. If the salesperson has the adequate skills, he will be able to overcome these barriers and hold his head high. By achieving grcater sales for the organization, he will be more successfi-rl than his peers and carve a growth path for his life and career. One school of thought believes that selling skills come naturally to some people and they ' a"re the people who can call the shots in selling. Whereas the other school of thought is based on the scientific management principles of skill and value development, and believes that ordinary people can be groomed to be good salespersons. Success in selling does not depend on some inborn quality; rather it is based on application of certain skills and development of commitrnent and professionalism in selling. What makes a good salesperson? This question is haunting to researchers and practitioners and we are yet to find a satisfactory answer that would be applicable to every person involved in the world of selling. However, both research and practice suggest that salespeople can acquire selling skills and achieve exemplary success. This chapter identifies and e>iplains the essential selling skills that ma-ke a salesperson successfii in sales. The skills described here are a synthesis of what can be acquired tlrrough training and practice by salespeople. We will discuss the various b"y-g and selling strategies that both buyers and sellers follow in the market, and also reconsider the task of a sales . manager. We will also discuss the communication skills, listening skills, conflict resolution skilIs, negotiation skills, and problem-solving skills that are essential for successfirl selling, as also the various strategies for success in diflicult selling situations.

SELLING AND BUVNG STYTES All customers do not buy the products in the same way. The b"yttg styles vary depending upon the buyer's capabfity to pay, the quantity of purchase, the buyer's ability to take risk, .I Sales and Distribution Management the bargainingpower of the.buyer in the market, the competitive landscape in the industry _Tj-i"l,tther factors' Research has shown that the waypeople respond to vanes tn an innovation the marketplace. People who are adventurous and have high risk capital are the overniglrt buyers. These buyers are the innoaators in the marketplace, *ho *ortly buy on impulse and consider non- functional reasons for making a choice. This set of people'are followed by another group who accept new products and innovations after observing the innovators using it. Majority of such people takl time to make a buying decision. Ti.r" is anorher set of people who buy only after everybody has started using the product. These laguds stzrtbuying a product when another new product is on the doorstep. Similarly, the customer's personality traits also in{luence the pattern and style of buying. The risk-averse customers always take multiple variables into consideration before they ma-ke a final decision, whereas there are buyers who buy on impulse and do not bargain much whiie making a purchase. In business-to-business selling also the b,ry-g styles are different' Many government organizations always go for buying;e bwest-priced commodity irrespective of the quality revel, whereas quahty orfrnio,io^ may not give much importance to the price factor in buying solutions. In many organizations buying is centralized, whereas in many otheis brryrrg decisions are taken by a committee or a similar form of set-up. Market conditions in terms of the number of competitors in the market, the prevailing level of competition, the quantity of purchase by the buyer, the switching cost involvea in nrryirrg from a competitor's firm, etc. will decide the nature of buying. Higher the bargaining po*.r, more the seller has to get involved in negotiations. Alternatively, if substitutes are not available then the salesperson delivers products and services by charging a premium. He hardly ta-kes care of the customer,s interest' Figure 2' I explains the various tuyirrg and selling styles. The saleqperson needs to adapt himself to the brrytttg style of the customers. Hence, effective sellirg skill5 gs31 up the process of adaptation to the brry-g styres of customers in the marker Blake and Mouton distinguish various selling styles by analyzing a saleqperson,s concern for the sale and the customer. How much concern the salesperson has for selling his product, and what level of importance he gives to the customer are the two dimensions used for developing the matrix of selling styles. Typically, a salesperson who onlypushes his product without considering the buyer's needs has more concern for the sale. on the other hand, a salesperson who always responds to customers' needs and presents his product as the optimum solution to the customer's problem has higher.orr"..., for the .*ro*.r. Analysis of these two dimensions gives rise to a sales grid as shown in Figure 2.1. This classification shows the orientation of the salespeople while selling. prodrr"i. we have already explained in the introductory .hupi., that sales orientation basically looks at pushing the products and making customers buy it. sales,

profits, and market share are the typical goals pursued in sales orientation, where-as in customer orientation the whole organization including the salespeople is concerned about customers, problem. customer-oriented organizations identify the gap between customer expectation and the Selling Skills and Selling Strategies 47 performance of current products, and when they find a substantial gap between the two, they put forward their product as a solution to the customers' problem. Orientation not only determines how much customer-friendly the organization is, but also determines how much effort the frontline salespeople mal<e to solve customer problems. This also explains the kind of market situation in which a salesperson can show a typical behaviour. No single sales approach will be successfirl in all situations. Buying sryles are as varied as the selling sryles. Buyers also vary in their concern for the sale and the salesperson. In commodity selling, most of the time the sale is purely based on bargaining and the lowest price, whereas in fashion garments, people give less value to the price and higher value to the sensory evaluations of the items while buy-S. In the case of sale of desktop computers, most of the customers go for a hard bargain, where-as in case of IT solutions, the process of buying is largely focuses on the features and facilities that the products and service packages o{fer. When a woman goes to buy a saree in a saree showroom, mere display of the sarees wiII not satisfy her. The retail salesperson has to be more customerfriendly by offering to solve the problem of the customer. So the salesperson tries to take the customer's choice closer to her perceptual mirror. In high+ech selling it is always seen that sales presentations focus on the benefits the customer will get by using the product rather than the features of the product. This helps the custonier to translate the benefits into measurable and tangible forms and expedites the process of sales closure. Rogers propounded a theory of diflusion of new innovations in the society. His proposition is based on the assumption that innovations spread across the society in a pattern that is similar to a normal distribution curve. There are people called innovators, as explained in the preceding paragraphs, who accept any new product in the market as they are advenhrrous and have high risk capital. Contrary to this, there are also customers who :rre very conservative and buy only when they see everyone using the product. It is very easy to convince

the innovators for buying a product, whereas it is diflicult to close a sale in the case of laggards. This is called the tluory of difiLrinn. In the theory of diffusion, the innovators do not give much importance to the salesperson and make new purchases out of a habit of experimenting. There are some customers who are very defensive and always make a rational choice. They evaluate all the available information before making a choice. Some customers only listen'to people from well-known and reputed companies. Whenever a new fashion trend emerges, it is the young, aflluent class of people who tend to adopt these fashions sooner than others. Similarly, the middleclass males in India are found to be rational, delayed buyers of fashion garments. These people buy a new product after prolonged deliberations and always stick to industry standards. They only buy when everyone starts buying the same product. These people in the diflusion theory are called laggards. So a salesperson has to follow different selling strategies and approaches to sell to different kinds of customers. E{fective selling largely depends on matching of the seller's sryle with the buyer's style. This demands that salespeople are trained in all the possible approaches of selling so that they can handle any kind of customer in the marketplace. Hich {f, 5*, rd Distribution Management Figure 2.1 Selling and buying styles The above grid explains that the process of selling is dyadic in nature. The success of selling largely depends on the matching of buyer and seller characteristics as well as of b"ytt8 and selling styles. Customers have a tendency to buy from salespeople who are of a similar nature, at least in interests and outlook towards life. According to Franklin B. Evans, insurance companies should hire all types of people if they wish to penetrate deeper into the market. In Figure 2.1, the saleqpeople in position (l,l) believe in the physical display of the product and assume that customers will buy by it themselves if the logistics are managed. This is possible in a market where customers do not have many choices or in product categories in which customers do not place any importance to issues like product demonstration and briefing by the salespeople. Fast moving consumer goods are in this category where the advertising and other promotion programmes bring the customer to the retail counter (by a pull method) and the store presence and visibility make the brand sell itself.

Here the sales force has the least role to play as they do the business of physical transfer of the goods to the customer contact point. Similarly, in a market where the demand exceeds supply so much that the customer is bound to take what is being offered, this kind of selling will be very elfective as it involves very low cost due to non-use of advance selling techniques and few or no calls by the salespeople. Selling Skills and Selling Strategies 49 Salespeople in the (9, l) position are more product-oriented and they always try to push the product for sale. They try to sell the product without caring for the customer demand patterns. They feel that it is possible to sell any product. They do not consider the customer's b"y-g intention and do the hard sell by putting uI thg pressure to realize a sale. The salesperson in the (1, 9) position treats himself as a friend of the customer. This is predominantly the relationship domain and the salespeople are involved in relational selling where th.y try to understand the customer and respond to his feelings and interests so that the salesperson is able to establish a personal rapport with the customer and realize a sale. Salespeople (in the 9, 9 position) are the problem solvers. They consult with the customer so that they understand his situation and all his needs, and then suggest a product that can solve his problem. They work with the customer towards a sound purchase decision on his part that will help him get the desired results. This is basically consultative selling and is normally seen in the software and consultation selling industry where the salespeople take note of the customer's briefs and come with a solution that best fits the customer's problem. A salesperson in position (5, 5) is a professional who keeps balance between concern for the customer and concern for the product. Such salespeople use various sales techniques to do prospecting and sales presentation, and pitch for sales by applyng professional sales techniques. Their sales pitch is based on a blend of personality and product orientation. SELLING SIruAflONS A typical selling situation explains what kind of customers a salesperson is going to face and what kind of sales approach will help him in closing a sale in that situation. When a person makes a sales call to an individual customer for an insurance product or a mobile connection, he faces a situation where the customer either explains his status and intention

of buying or addresses his needs to the salesperson. When a person makes a sales call over telephone, the customer perceives this as an intrusion and generally explfis his displeasure to the caller. In organizational buying the customer represents a group interest such as the purchase departrnent of an organization, and buying patterns are based on rational decision making in which standard products and services are defined and the customer decides on the basis of set parameters. However, in service and solution selling the customer does not come with a specific set of parameters, and during the sales presentation the customer may unravel his problems, identifr his interests, and develop his criteria of choice. In a retail selling situation, the customer walks in to the counter with an intention to buy a product, whereas in cold calling and door-to-door selling, the salesperson looks for potential customers. In the case of pharmaceutical selling, the salesperson makes a sales presentation to a doctor who is not the original customer but customers' decision ma-king largely depends on what the doctor prescribes. In creative selling the salesperson tries to sell an abstract thought to the customer, e.g., zrn advertising campaign presentation. Sahs and Distribution Management The Sales Task and Function The salesperson has to undertake various tasks during the process of selling. We have classified the different kinds of salespeople in the introductory chapter on the basis of sales responsibilities and functions. Now we will define the sales task from the silting skill point of view. When a salesperson gives a sales presentation or makes a sales call, he communicates with the customer and basically performs the communication function. But the customer may have queries, doubts, and apprehensions, and he wishes the salesperson to give him a patient hearing. So the salesperson is involved in the listening function. By providing information about other existing products of the company and new products that are likely to come to the market, a salesperson also performs the information dissemination function. In non-standardized markets, where there is no list price irwolved in buying and selling, the salesperson needs to negotiate with customers and bargain wherever possible for the benefit of the organization, and thus he is involved in the negotiations and bargaining

function. As in case of solution selling, the customer has a problem and he expects the salesperson to solve his problem; here the salesperson performs the problemsolving function. Therefore, to be an effective salesperson, one needs to possess various skills arnong which the prominent ones are good communication skill, empathetic listening skill, good bargui"i"S skill, a high level of problem-solving skill. If the salesperson does not possess these skills, he will not be able to close a sale properh will lose in every bargain with the customers, and may find his job frustrating. The following discussion evaluates all forms of selling with regard to different marketing and situational factors as explained below. The forms of selling indude maintenance vs developmental selling contacts, technical expertise, and important personal characteristics. Maintenance Selling Typically, maintenance selling involves the art of servicing the existing accounts, securing promotional cooperation, counting inventory and taking replenishment orders, and delivering the products. In the advertising world, these kinds of salespeople are called client servicing executives who provide services to clients and also take the orders as and when required. There is no question of prospecting for this kind of salespeople as it is done with the existing customers. In the IT sectoq these salespeople are posted at the client site and are responsible for solving the client's problems. In high-tech product categories also we find service and maintenance salespeople. Developmental Selling Salespeople engaged in developmental selling are called business development sales executives as they try to contact the potential customers and build business for the firm. They are the real salespeople who try to do prospecting from the leads either available in the organization or collected by them, and then take the prospect through the whole process Selling Skills and Selling Strategies 51 of selling to realize a sale. In international selling the overseas sales agents also get involved in identifying prospective customers and then selling the products to them. Developmental selling involves locating and qualifying potential buyers, securing specilications and approvals for the purchase, and closing the sale by getting an actual order. In maintenance selling either there is an absence of dealing with the prospects while

tat<ing an order or the customer himself seeks for the placement of the order either by habit or on the basis of merchandising procedures. Getting orders is characteristic of developmental selling. Here the salesperson must seek for the potential customers and obtain their order. SELLING SKILI.]S \{hile it is very diflicult to find out a set of characteristics for guaranteed success in selling, sheer hard work, working smartly in business, the ability to set goals, the level of maturity, communicative ability, dependability, honesty, integrity, and possession of requisite selling skills can make a successfirl salesperson. In some instances, a salesperson may naturally possess these skills, but in the majority of situations these skills can be developed through training and practice. We started our discussion by asking the question 'Who is a successful seller?' at the beginning of this chapter; here we will try to elaborate the skills that make a successfirl salesperson. One of the prominent myths in selling is the idea that successlirl salespersons are born, and it is difficult to acquire skills that can turn zrn average salesperson into a successfirl one. Selling skills are a set of characteristics that are necessary for a salesperson to possess, failing which he may not be successful in selling. It is not correct to assume that successfirl salespersons are born. There are certain abilities if found in certain salespeople that make them successful but there cannot be an inherent quality which can ma-ke someone successful in selling. Some people can speak well and some can derive meaning faster than others by effective listening skills; similarly, some individuals are aggressive and some are unassuming; but success in selling largely depends on the application of certain qualities in a scientilic manner over a period of time. Since there are different kinds of sales jobs and sales situations, one kind of personality or quality may help in a certain selling or situation, but may not work in another selling situation. So a variety of selling skills may be acquired to have a successful selling career. The skills to communicate e{fectively, listen to the customer complaints, and negotiate with customers for a profitable deal are necessary for successfirlly implementing any sales plan' Following is a list of buyer's likes and dislikes about salespeople. Salespeople should try

to hone the skills and roles liked by the buyers and to minimize the effect of the attitudes and traits not liked by the buyers. The essential skills for successlirl selling are communitatinn skilb, Iistnting skilk, conflirt marngemmt and resolutinn sldlls, rugotintinn skills, and, problnn-solnirg skilk, as illustrated in Figure 2.2' 52 Sales and Distribution Management The Good rb Honest Loses a sale graciously Admits mistakes Possesses problem-solving capabilities Friendly but professional Dependable Adaptable Knows my business Wdl-prepared Patient Does not follorr-rry Wdk in without apprirlrmt Begins call by alhng spcts Puts down competitort' Fodf Has poor listening skills Makes too many phone cak Makes lousy presentatirxr Fails to ask about needs Lack product knowledge Wastes my time llre btAhcffirde Crt -& a eretheart 0re- bl Grspd Ibdlircgrdra{ng people ci btl:i ireligence UbE lb Sbddsnn ?lep c:orpry egeinst another Adr Fdf l*rhryfrre Figurc 2.2 Selling skills Communication Skills The ability and expertise to cornmunicate is necessary in sening frmctln The saleqpeople should possess a good vocabulary and express themselves inteilig,end', to the customer. The later element is necessary mostly in intelligent buying and seiling sinratbns, such as businesstobusiness selling. The ability to perceive and interpret the customer's verbal and non-verbal clues is also necessary as it will heh i" answering the customer's objections and finding out about their

purchase intention. Salespeople should also develop and hone their verbal skills as the quatity of voice is an essential element of the personality of a saleqperson and contributes to his success. The problem-solving skills also depend on the level of cultivation of interpersonal skills. Selling Skills and Selling Strategies 53 The entire business of modern-day sales rests on building a good relationship with customers. The relationship becomes long-term when it is built on mutual trust. Continuation of a relationship will largely depend on how this relationship is nurtured and managed by the salespeople and how much value the customer deriyes out of the relationship. Research has found out that trust between a buyer and a seller largely depends on five elements in the saleqperson's behaviour: l. Truth of words communicated by the salesperson 2. Predictability of action 3. Competency (ability/knowledge/resources) 4. Intent or empathy (placing the customer's interest on par with the seller's interest, a commiunent to solving the customer's problem, and responsive to the customer's cause) 5. Iikeability (It is an emotional issue and diflicult to clearly define, but can be understood as a perception of commonality by both the parties.) These five elements of trust revolve around the communication, both verbal and nonverbal communication. The truth of words is established by the words and follow-up actions a salesperson uses with the customer. The salesperson must demonstrate his technical command of products and applications to show his level of competence. Empathy or intent means the salesperson understands buyers' needs and equates them with his own needs. Likeability is validated with courtesy and politeness, corunonality of interest and positive emotional feelings. Unless the salespeople communicate superiority of theirproducts and services to potential customers, the products will not sell. To persuade potential customers about the superiority of their product, salespeople must be able to identify accurately the needs and wants of the customers. Therefore, salespeople must listen closely to what customers are saying, analyze their spoken words, and be attentive to their non-verbal expressions, such as body gestures, postures, vocal tonalities, and overall appearance to understand customer needs and desires.

Salespeople should communicate effectively by organizing their thoughts and presenting their products and services to the customers. The Gommunication Process A salesperson needs to understand the communication process before hedevelops his own strategies for successful selling. Communication is the exchange of idea and information between two parries. The communication process is defined as a set of activities and systems integrated for an exchange of ideas, concepts, information, and knowledge between a sender and a receiver through alternative channels. In this process the receiver decodes the message and sends feedback to the sender so that the sender can know the e{fectiveness and response of his communication inputs. Noise and disturbances are interspersed in the communication process, which hinder the effectiveness of reception. Sales and Distribution Management Sales communication can be bod pcrsrl d rpi- llnacnonaf communication means the use of mass media fr pulfgF-o' ilrnrin ro the consumers. Non-personal communication invohrs mrptr, tr-.d do rroqs media through which the sponsor sends messages about 6c pfu d ru:rfux rithout a scope of knowing the recipients. This non-personal nature 6f msdia somrim nfu & .*.cirrr!.ss of communication, and the ability of these media to persnde ttc cm- fo foffir,ed Ho1-eyer, the use of this kind of medium can be ven effecdrr iD fipil,tontug Fodrrct information to enhance the level of product awareness. Personal communication is sure to take cusomc-rs Fcnmt Lr{ m tbe nerr level of the decision process. Typically, the effectir.eness of sfo srfu fo high ar ir addresses the issues and objections of the customers on the Tot 2'yn puides irrnmrrliate response to the ir problems, and thus results can be evaluated br- 6c r- r ulfth Fospcrls are converted into end consumers. A typical communication process begins nith a sorrrc. r.hfoh foi ,*ri{ cesr is the salesperson himsell who provides the relevantproductandseni-i*rmln-Tbc -source has thoughts and ideas to communicate to the audience, rr*rich hrc o bc r'-oded in a presentable form by the sender. Sales presentations, sales literaturc *-r,r &uqh direct mail, telephone calls, and selling information over the Internet are xamdcr d crr'-'rrni:ation and information dissemination in the selling process. For this p'rporc, rhc r'rcge hai to be encoded into a presentable format that can be transmitted to rhc crrqrr*l Thfu imolr es translating ide as and thoughts into symbols, words, and pictures to meanindd crrnrnrurication patterns.

The words and symbols used by the source should commrmizrc dc same meaning to the receiver. The salesperson should avoid big confusing expressions or jargood and use words that carry some meaning to the customer. The active voice should be usrd ro eryress ideas and communicate with the audience. The message may be carrird tc, fte cusromer through voice communication, various forms of writing or elecuonic Eedia li\e 66mpu1ers and mobile phones. Non-verbal messages also carry some meaning in the personal mode of communication. The dress code, body movements, voice intonations, and of emotions like laughter and surprise also constitute part of the communication process. The accuracy of the reception of the message also depends on the level of araitable noise. Noise is the unnecessary factor that hinders the smooth transmission of mesose betrr-ecn the receiver and the sender. Chandrakant Sen is the sales manager at Usha Workhardt Corporation and he was St"i"S a presentation that a new product would deliver higher profis to the customer, Steel Authority of India Limited. When he was display how the orgarrization will be befitted, he touched a couple of keys in his laptop and ran a graphic program to show diagrams to the customer during the presentation that illustrated his data and proposition. Selling Skills and Selling Strategies 55 Sender's domain Figure 2.3 The communication process Receiver's domain This shows effective communication will help people in realizing a sale and handling customer objections successfiily if the salespeople have done their homework properly. Noise can be physical in nature like the noise emanating ftom the telephones or computers during the sales presentation; they can be psychological in the form of fantasies and daydreams and mental blocls of the receiver due to cultural, religious, and other reasons. Noise may also mean factual distractions, which may happen due to preoccupation with certain factors that deter the reception of the real message. Semantic noise occurs when a salesperson over-responds to an emotional statement. There are also personal factors like self-focus, defensiveness, experiential superioriry and egocentrism that alfect the reception of the message by the receiver.

Self-focus means a level of preoccupation with thoughts about oneself. Selfdefensiveness results when people are threatened about their positions due to negative feedback. People tend to continue thinking and working during a sales presentation, and due to this selffocus, their attention level is low when a sales presentation is going on. This is also a kind of noise which reduces the e{fectiveness of communication. People tend to make arguments and ignore the communication by being self-defensive. The feeling of experiential superiority is found in people who have gone through varied experiences. Egocentrism is a tendenry to view the self as the centre of everything. For an effective communication, the intended message should be decoded by the receiver in the same spirit as it is encoded by the sender. The receiver may not be in the same frame of mind as that of the sender due to the receiver's poor level of comprehension or other hctors discussed in the above paragraphs. The receiver may also get engaged in selective perception which as a result of a high level of distortion in the process of decoding the intended message. Selective attention also meairs people will pay more attention to information which is of value to them in the present situation rather than which has long-term relevance. People tend to interpret messages in terms of their own set of personal factors like beliefs, opinions, attitudes, and experiences. Hence, the salesperson should be attentive to this process of selective perception. 1,.t i 56 Sales and Distribution Management Kone Corporation Let us look at how sales communication happens in a company called KONE the wbrld,s largest manufacturer of escalators and auto walks and lndia's second largest and fastest growing vertical transportation solution provider. This is directly under KONE Corporation, a Finland_based com_ pany which has over 160 subsidiaries around the world with revenues of US$ 2.5 billion, 23,000 employees, and operations in some g00 locations across B0 countries. The parent com_ pany was established in 1910, and is listed in the Helsinki Stock Exchange, Finland. KONE supplies more than 20,000 new ele_ vators and escalators annually and services 5,00,000 elevators and escalators as well as 1,4O,OOO building doors. KONE is known for

being at the forefront of innovation in providing reliable elevators, escalators and auto walks. The lndian operations is based at 22 cities/branches across the country & throughout the last 2_3 years. lt has made tremendous growth in terms of market penetration. It competes mainly with OTIS, the other players in the market are Schindler from Cermany, ThyssenKrupp from Cermany, Mitsubishi from Japan, and other local players like Johnson of Chennai, etc. As Schindler and ThyssenKrupp are both relatively new in lndia, the main market share in the organized segment is divided be_ tween OTIS & KONE at 40 & 30yo, respectively. Kone's tumover b abqf lil)cqe and OTIS is about 250 croreThe communicdin rd $f p(rcess can be explained in the frbrig pagraphs. The process starts with led agsrin This job is presendy outsorred b rf*i M*t has people in its payroll to urorl b fOitr in the field to generate nery leads cr fhe tqk q1 ggographical separation. Tlee ld 6prts osect detailed information abon ay ld h a specific format and pass trern O te eCE$ Eilr fui initial contact is made bytfp*E Dwix}1 these leads, and then tlue re fecded_ Based on the client needs and * srdrions, a techno_ commercial oftr b f,irril b lhe dbnl As usual, follow-up b dnre br adf,ind orders and to check the curett sEr6 d ilre deal. A product presentation b giren b 6e dent based on its unique sellingfopo,fiorL Scrretimes, a site visit is also arranged frr fte dent A tough negoti_ ation is canied q1rlftfi,umalty runs for 2_3 week. Then theo?derbdcedard the mutually agreed term are put h agmenB. After this, ttre salespeople take over and proceed for orrder i?u[ rcgisfation, material readiness, payrnenr folilH+ Installation, com_ missioning after+ales service, etc- are main_ tained though the sann sdesperson for same point of contact communication can occur in many forms. It can be thorh pcrsmar visig telephone, e-mail, the web, and various written forms for a salesperson to iru*re proaua information to the customer. The process of sales communication is fluid because the fee&ack may not be same in the channel as the communication is from the seller. The seller may communicate by verbal means, but may get the order in written form, by e-mair, or over phone.

The understanding of communication lbr a szrles manager can be grouped as verbal and non-verbal communication. The most basic form of commirnication is non-verbal in nature. i. tI I ILr Selling Skills and Selling Strategies 57 Facial expressions, gestures, spatial relationships, and attitude towards time and people are included in non-verbal communication. Non-verbal communication is less structured and more dilficult to study for a salesperson. This is also different from verbal communication in intent and spontaneity. In a verbal communication, the customer chooses the words he speaks to the salesperson and thus regulates his response, but non-verbal communication is often unintentional; for example, the raising of eyebrow can be interpreted in many ways, such as an exPression of novelty, acceptance, or questioning the veracity of the presentation. Verbal communication is the most used means of communication, but its ability to communicate the sender's intended message is limited. To communicate past events, ideas, and abstractions, needs symbols thatstand for his thoughts. Verbal communication consists of words arranged in a meaning{irl pattern. Salespeople prefer oral communication channels to written ones. This is because talking to somebody is quicker and more effective than sending an information brochure. When a salesperson is talking to the customers or listening to them, he can pick up the implicit meaning of non-verbal cues and benefit from immediate feedback. In situations where the information provided is more complex, the information collected needs to be recorded for future references, the audience is large and geographically spread out, or immediate interaction with the audience is either unimportant or undesirable, written communication is preferred by the salespeople. Over the decades, there has been significant development in electronic communication in the form of voicemail, teleconferencing, e-mail, and computer netlvorks that has revolutionized the oral and written communication world. Managing Body language Salespeople can take care of their verbal and non-verbal communication while making sales presentations. The following will explain the strategy and tactics they should follow to manage body language to show that they are confident enough to handle a sales situation.

The non-verbal cues taken together are called the body language, or the 'visible code', the various elements of which have been deatt with in detail below. Personal appearance The first impact of any customer or potential buyer is created by the personal appearance of the salesperson. Even before the salesperson spea^ks the first word, the potential customer starts making perceptual inferences about the salesperson 21d'vi5salizes the way he is going to talk and do the sales presentation. One's appearance may put the audience in a hostile, friendly, or merely agreeable positionThis is the reason why salespeople have to take care of their dress and appearance in front of the customer. The customer takes cues about the individual's personality from his dress, hairstyle, and overall appearance. 5B Sales and Distribution Management Posture Posture conveys a wealth of meaning in many ways. It is an important part of the body language, and refers to the way one stands, sits, and walks. The mobility of the body and the position of hands, legs, and other parts of the body reveal an individual's personality. It is a sufficient indicator of whether the pirson is vibrang alive dynamic, nervous, jittery confident, or sel{lassured. A good salesperson stands tall, *ith his feet together, weight directly over the instep, and keeping his chin paralld to the floor or at a right angle to the backbone. A drooping shoulder and a protruding stomach indicate salesperson being discouraged, tired, and worn out. Similarly, the sitting posture rnay also exude an air of confidrnce or a sense of failure. While speaking there will be changes in posture, which h"* to bc cultivated. One must learn where to keep the hands and how to shift the weight of the body on legs while speaking. Gestures Gestures timed well can drive a point home faster rhzn arything else in interpersonal communications. From a gesture in response 1s 2 sales r-ll, a salesperson can find out the customer's likelihood of buying the product Ptaying with a rins twisting a key chain, or clasping one's hand tightly robs effectiveness of a saleryerson's presentations. Sometimes gestures do not accompany oral delivery and are uscd to communicate short messages like 'yes', 'no', 'come here', 'go there', 'be silent', etc OraI communications are also accompanied by gestures as gesures enhance the impact

and value of what has been said. It would be appropriate to practfoe in fr,ont of a mirror how to use different kinds of gestures to improve one's communication skills. Through a process of self-evaluation in the use of gestures, salespeople can achierrc greater success. Facial expressions The face is the most expressive part of the body. A srnile as a ryrnbol of friendliness, a frown as a symbol of discontent, raising of epbrows as zrn expression of disbelief, or tighteningof jaw muscles as a symbol of antagonism c:" add to the meaning conveyed through verbal means. A deadwood expression on the face may prejudice the listenerq whereas brightness in the eyes may keep their interest sustained and also evoke an enthusiastic nesponse from the customers. Exuding zeal when one is making a point, or a smile while erylaining the product features makes the job of the salesperson easy. Biting the lips, raising the eyebrows at regular intervals, or blinking the eyes too often can certainly mar the smoothest of sales presentations. Eye contact Eye contact with the customers is an important aspect of the body language. Eye is believed to be an extension of the brain and a window to the soul. Stress should be laid on continuous eye contact between the salesperson and the potential customer because it is an expression of sincerity of the seller and attentiveness of the customer. Conversation Habit Checklist Do I find it difficult to start a conversation? Am I unable to pick a topic for discussion? Am I unable to keep the conversation flowing smoothly? Do I always agree with what others say or always disagree what others saY? Do I frequently talk about myself and my family? . Have I a tendency to dominate any conversation with mY ideas? . Do I givb the other side a chance to speak? . ls any of my mannerism likely to annoy people? . Do I respect other people's time and interests? . Am I conscious about the language I use that includes the grammar, punctuations and articulations? Selling Skills and Selling Strategies 59 It is a means of obtaining feedback, and enabling the salesperson to alter, adjust, and reframe his sales message. In a majority of the instances this process is automatic, and the interaction through eyes between the salesperson and the customer takes place unconsciously'

Space distancing Each salesperson maintains a personal space around himself' He ,rormully does not allow others to invade this space unless the relationship is very friendly or they have previous acquaintances. Therefore a zone of 4-12 feet is maintained when it is a formal presentation. This is known as social distance. This term also includes the standing/seating position. Usually the senior-most person in the sales group stands and other members remain seated during sales presentation. Space distancing differs from culture to culture. The visual code is as relevant as the verbal code in communication. A sales manager has to take care of the use of the body language as well as the voice craft while ma'king a sales presentation . Face-to-face conversation is one of the.easiest modes of communication, but marry a time people fail in communicating properly in face-to-flace conversation. Conversation is an oral exchange of views, ideas, and product information' It is always better to analyze your own conversation habits and then try to bring modifications for greater e{fectiveness' Normal sales conversation should be of interest to the customers also and may begin with a typical customer problem with which the customer is comfortable. As it flows to new channels of discussion, the salesperson can put his views and convey relevant product information. Occasionally there should be spells of silence on the salesperson's part because these spells of silence will allow the salesperson to garner new points and ideas regarding customer reactions. - ':'' The salesperson should be alert to the attitude of the customers and should not be surprised by the changes in the customer's attitude during the conversation. If the situation 60 Sales and Distribution Management permits, it is good to call the customer by narne during a sales conversation, while being sensitive to the age and position of the customer, as this would h.lp i" generating more friendly feelings. The sales manager should take care of the h"gpug. and diction used in tlre conversation. The salesperson should always be courteous and cheerfirl and should show interest in what customers say.

Strong opinions and arguments may spoil the prospecr of closing a sale, but if you put them effectively, they can also help in showing your point of view. The salesperson should avoidjargons and pet words that may create confusion. An anatpis of your own presentation *ill h+ to bringmodifications and remove the use ofjargon and duringa sales conversation. One also needs to understand the situations where breakdowns in sales communication may occur, creating more problems for the saleqperson and obstruction in closing a sale. When salespeople communicate without proper groundwod they lack a6equate knowledge about the organization, the product, competitor producB, and the market situation. In a situation in which the customer is more knowledgeable than the salesperson, a com_ munication breakdown may happen. In order to achierrc sales and close a business dedl, many a time salespeople lie to the customers without realizingthatwords can never substitute actions. In these situations the communication channel it tft.ty to break. Ignoring the power of consumers' knowledge leads to improper prospecting and targeting. Mixing up business with friendship itt sales often invites conflict of interess and brings breakdowns in sales communications. M*y a time salespeople confuse processes with outcomes, and sufer from occupational stress from these sources, which a halt or termination to sales communications. Use of inappropriate forms of communication and wrong channels of customer contact also adversely affects the flow of sales communications. A salesperson should not ignore any errors of omission or commission that may lead to a breakdown of the communication processes. If a sales manager takes care of all the above threats to the flow of sales communication, the effectiveness of the salesperson will increase over a period of time. Listening Skills The sales manager has to be a very good listener and use his listening skills to lead towards sales realization. It is generally observed that salespeople spend more time in receiving communication and information than in transmitting it. . P,ryt listening 5kill5 pay make a sales manager miss subtle issues in customer interaction, and tLis may lead to non-resolution of customers' problems and thus a poor level of sales realization. Yet listening is one of the most underrated skills in the sales world.

Listening is an active search of meaning in the message received. Effective listening can be e><plained by the example of a doctor who is attending a patient. If the doctor does not listen properly to the symptoms of the patient, he may end up gi"S the wrong treatrnent, Selling Skills and Selling Strategies 61 which may lead to fatal results. In the business and sales world, the effect of poor listening is the same, though less attention is paid to enhancing the listening skill of the salespeople. A good listener welcomes new ideas, and stays informed, up-to-date, and out of danger in an organization. Good listening also enhances the impact of what the salesperson speaks to the customer, and increases the ability to negotiaie with customers. E{Iective listening supports effective relationships within an organization, enhances the efliciency of the salesperson in delivering the product, alerts the organization about the competing products in the market, and allows the company to know and manage the diverse customer requirements. Research suggests that people are only 25% efficient in their ability to listen. An average person remembers only about half of what is being told to him after 10 minutes, and forgets half of that within 48 hours. When people are asked to replaywhat has been told to them, they mix up various thitgt and preserrt the matter in a different order from the way was presented to them' E{Iective listening needs a conscious effort and a willing mind. Usually, people would prefer to talk about the products and services to listening about them in a real selling situation. There are three types of listening, namely content listening, critical listening, and empathetic listening. Diflerent kinds of situations call for different types of listening skills. The three types of listening not only di{fer in the purpose of listening but also on the degree of feedback or interaction required. When someone listens to a sales representative or a medical representative, he is engaged in content listening. The objective of content listening is to understand and retain the speaker's message. Here the information flows from the speaker to the receiver, i'e', from the salesperson to the potential customer. There is little scope for agreement or approval of the message; it is just the reception of the message by the receiver, who remains mostly inactive in this case. It is very difficult to know the feedback as there is no feedback involved

in this process. The objective of critical listening is to understand and evaluate the meaning of the speaker's message at several levels-the logical level of the argument, strength of the evidence, and validity of the conclusions; the implications of the message for the customer; the speaker's intentions and motives; and the omission of any relevant data' It involves interaction as the receiver tries to gauge the speaker's point of view. One alsc evaluates the speaker's orientation. r/Vhen the area sales manager presents sales plans and forecasts for the year, the divisional sales manager listens carefirlly and evaluates whether the assumptions and estimates are valid and what implications it will have for the division. The objective of active and empathetic listening is to understand the speaker's feelings, needs, and demands so that it can be appreciated by the listeners irrespective of the fact whether he likes it or not. By listening in an empathetic way, the listener allows the speaker to vent his emotions and thus avoids a dispassionate approach to the subject' Here the salesperson should avoid the temptation to give advice, and should try to judge the individual customer's feelings. 62 Sales and Distribution Management The Process of Ustening Understanding the normal process of listening rcdd cdain why messages are lost so often in the listening process. There are firrc r'datEd ".d-*.r $rhich *.,r, in sequence in the Iistening process. In the first stage, the customer physically re+od, j6r rhr mcssage and takes note of it. This reception can be blocked by noise, inartentirn" pqrchologi:al barriers, and impaired hearing. This stage is called the attmtionstage. The ;nuaFb 4cca& fs assigning meaning to sounds according the customer's own values, belicE.ry,.tr--l'-,.. roles, needs and wants, and ideas about himse$ products, and the wuld- Th eh+crsnt Fame of reference may be quite different from the customer's frane d ltrtocc r 6e olesperson needs to determine what customer really means. The next stage is the stage of runnnbrauerwhere 6c,reG,r rc stored for future use by the seller as well as the customer. As the customer lie_r, btlfcs note or draws a mental line about the product and service offered for sah. In ft ddn stage the customer applies his thinling skills to weh the buyer's rcmarb dqnir- Tbe saleqperson should separate facts from opinions, and evaluate the qnality d rhifuoens. The last stage is 'response action stage' in which one reryd&e-r-ing the receiver's

message' If the salesperson is communicati"s in a smallgrqrcror-n,oe conversation, the initial response is generally a verbal feedback. In laqe gq; i a be in the form of an applause, laughter, or silence. Later on the salesperson - ' - rhr he has heard. levels of Listening The best way to know your customers is to listen to thern Thc-trclmls of listening that the sales manager should understand: feedbac\ panphig,drilications, empathy, Figure 2.4 The listening process Selling Skills and Selling Strategies 63 and active listening. Feedbark is fundamentally the reaction of the customer to a sales call. After listening to the customer, the salesperson says something back to him, giving away his attitude towards or evaluation of what the customer said. In paraphrasing, a salesperson tries to paraphrase the question by mirroring the questioner's point. For example, the salesperson may say, 'So what you are saying is you think that I am just giving the company line, whereas what you really need is more help in financing and on-the-spot service.' The immediate response will be 'Yes.' So the salesperson may have him agreeing with him here onwards. Thus he can create a more receptive listener in his customer. The next level is the ckrlfuati.on of tlu issuzs.It involves working a little harder with the customer's words to identify his real concerns. To illustrate, the salesperson may say, 'So what I hear you saFng is that you have got two main problems you want help on, lack of enough fund to buy the solution and lack of technical people to manage the solution. The first is probably the more important. Is that right?' By doing this, the salesperson can establish a level of agreement with the questioner. The salesperson by clarifying the problems shows the customer that he is trying to sort out the vital issues in their conversation. Empatlutir listenaq, is the level in which the salesperson tries to show that he understands the feelings of the questioner (customer). The empathetic listener finds similar emotions in his or her own experience and shares them with the questioner (customer). For example, the salesperson may respond by saying 'You know we have been there, too. Don't forget we have also worked in a bad way in 1995, one that was strapped of people and drowning in the red during those formative years. I know what your company

is going through.' It shows the customer that the salesperson understands their situation, even though he cannot offer much help, and at least he has aligned himself with your customer. Figure 2.5 Levels of listening Sales and Distribution Management Actiae Listaingis the last stage, in which 6e itcntifies the emotions underlying the customer's words. This is potentially the md powrful Eqp'ring ftsponse, because it is usually the emotion behind the phrases tnat pnoryca 6e customcr's objections in the first place. When the salesperson responds to the real need d ttc gc*irncq he ges to the heart of the issue even if he can never provide arry concrE ansser To iilhrsrate his empathy he may say, 'It sounds like you feel really alone out thrc, wi6f,rt mnch zupport. You "are frustrated because you are putting in all this hard urut erd a[ I fcd is that we can be with you for achieving your goal. Is that it?' The ansrrer here will bc dffinitety Yes'. This means the salesperson has validated the aspects of the menal crtc of 6e customer. Barriers to Ustening There are various barriers to listening that indude p\nicat and mental barriers. Prejudgement is the most cornmon barrier to listening, as it is an aurnatic process. People cannot handle life without having some assumptions about o&ers e'd about pmducts and services in the society. These assumptions may be found to be incorrect in acnlal sinntlrns. Some people listen defensively assuming every communication as a personal rttacl on them or on their social position. Many listeners are also guilty of self-centeredness. When a salegerson attempts to discuss a problem, they start talking about their own problems fhey- 11'to prove that they have more problems than what the salesperson is trying to solve with the product and the product may not be able to solve their problems. No matter what product information is provided to them, they behave as if they know more than the Selective listening is also another common barrier to communication. Some customers indulge in selective listening, also known as out-listenhg- This happens when the customer is thinking about his children or family or some other matter during a sales presentation.

The customer continues to be absent-minded till he listens a wond or phrase that gets his attention once more. The problem with outJistening is that the receiver does not remember what was said by the salesperson but remembers what he thinls that the saleqperson probably said. The basic reason of this wandering of the mind is that we tend to think faster than we qPez}. While some salespeople can spealc about 100-150 words per minute, the mind has the ability to analyze around 800-900 words per minute. ths .lisparity between the speed of speech and the speed of thought allows the mind to wander. Some people use this time to prepare their argument. Salespeople can improve their listening skills by practising the effective listening tips mentioned in Table 2.1. Salespeople should take the following additional steps to improve their listening skills. They should try to depersonalize the listening so that they can decrease the emotional iryact of what is being said and will be able to receive the customer's questions and rebuttals Selling Skills and Selling Strategies 65 Table 2.1 Characteristics of a good and a bad listener Thie bad listener The good listener Effective listeni ng tips Tunes out dry subjects Behaves opportunely; asks, Find areas of interest. 'What's in it for me?' Tunes out if the speaker is Judges content; skips over Judge content and not delivery not as per his liking delivery errors Tends to start an argument Does not judge until comprehension Hold youi fire is not built up, interrupts for the purpose of clarification Listens for facts Listens for central and main theme Listen for ideas Takes extensive notes Takes a few useful notes Take selective notes only when desired Fakes attention Works very hard to understand what Work for listening the speaker is saying and exhibits positive body language ls distracted easily Avoids distractions, and knows Block out competing thoughts how to concentrate R.esists difficult expository Takes on difficult material as an Paraphrase the speaker's idea material exercise for the mind Reacts to emotional words lnterprets emotional words, Stay open-minded does not get hooked to them Tends to daydream while Listens between the lines, weighs Capitalize on the fact that thought listening to poor speakers the evidence, and summarizes moves faster than speech in mind

till he finishes his arguments. The salesperson can avoid distractions by closing the doors, and moving closer to the customer. They should listen to the customer's idea of the product and the price, and try to distinguish between facts and arguments by applyrng their own market knowledge. They should also try to stay ahead of the customer by anticipating what he is going to say next and by keeping a link with what has already been said by him. They should also remain alert to the unspoken messages expressed through the customer's body language. There should be an attempt to review the messages delivered in between presentations, and the salesperson should ask questions for clarifications wherever possible. They should not attempt to judge the customer's point of view. They should not try to interrupt the customer because the customer may think this to be an injury to his social image. It is always better to evaluate the content of the customer's feedback than the customer himself. Gonflict Management Skills Conflicts exist in every organization. Con{lict in sales organization is more evident than in any other organization. This is due to the fact that there is always conflict of interest among people at different levels as the goals are diflerent at each level of the organization. r Sales and Distribution Management A sales manager wants his salespeople to cover the territory as thoroughly as they can whereas the salesperson is interested in realizing the desired sales through a few loyal customers. The vice president (sales) is interested in getting better results from the same cost to show the board that resources are being used efficiendy. Conllict is a form of relating or interacting where the sales manager finds himself under some sort of perceived threat to his individual or collective goals. These goals are impersonal in nature. The process of identifying the nature of the con{lict and taking correctirre action so that the conflict will not emerge in a similar situation is termed as conllict manegernenL The perceived threats may be either real or imaginary This process begins when one party perceives that another party has negatively afiect@ or is about to negatively affect, something that the first party cares about. Conflict is a natural and inevitable outcome in any group. Conflict is not only a positive force in a grcup but it is absolutely necessary for

a group to perform effectively. Conflicts can be classified as functional conflicts, dffirnctional conllicts, task conflicts, relationship conflicts, and process conflicts. Functional conllict supports the goals of the group and improves its performance. Dysfunctional conllict hinders group performance. Task conflicts are disputes over the content and goals of the worh Relationship con{lict is tussle based on interpersonal relationships. Process conllict is fight over how work gets done. Models of Gonflict There are situations where a conflict seems to exist, but in reality it may not be so. For example, when a wrong party accuses another party of cover up, it may not be a conflict. In many instances, customers who do not know how to use products blame the salespeople for malfunctioning of the product. When a person in charge of a position is blamed for something that happened at the time of his predecessor, it may be a false source of conflict. Similarly, when members of a group are blamed due to stereotlping ('You sales guys are always late!'), and the two parties assume a disagreemenq a situation of lalse conflict is created. A proper conflict management procedure will be able to remove these false assumptions of con{lict in the organization. There are various models of conflict. The Dollard and Miller model explains three kinds of conflicts. They are approach-approach, approach-avoidance, and avoidanceavoidance conflicts. The approach-approach conflict arises when both options for resolving a situation are equally attractive but mutually exclusive. Only one option can be executed despite both having potential for execution. The approach-avoidance conllict arises where a person wants an outcome but must not have it for equally compelling reasons, i.e., wants to have something but avoid it at the same time. The avoidance-avoidance conflict arises when the one dislikes all the options equally but has to decide on one out of them. A salesperson has several products to sell to customers and often faces such conflicts when the customer switches between the product alternatives either for making a choice or for avoiding the. Selling Skills and Selling Strategies 67 Rummel,s model of conflict differentiates between conflict structures, conflict situations'

and manifest conflicts. In this model, conflict is seen as either latent, with an underlying potential for conflict, or an actual conflict. Conflict structure means interests that have a tendency to oppose each other, i.e., the failure of a seller to deliver the product to the buyer in time. Deu6ch has divided conflict depending on its underlying motives as underlying and overt or manifest conflict. The former is hidden, denied, or implicit, whereas the latter is expressed and open in nature. In sales situations, manifest conflict looks like a safe e*p.ession because the customer gives a denial to the salesperson and the salesperson assumes thatthesa]ecouldnotberea]izedforthereasonsknowntobothofthem. The conflict situation arises when opposite interests, attitudes, or powers are activated' i.e., the buyer threatens to withhold the payment of the seller or start legal action' Manifest conflict means specific behaviour or action by one party, e.g., demands and aggressions' Refusal to pay the buyer and take legal action is a manifest conflict' Gomponents of Conflict Frustration and aggression are the major reasons of conflict' In many instances' the salesperson gets frustrated by making large number of inconsequential calls, and it also increases the level of uggr.rrion of the customer' This leads to further conflicting situations in a sales process. M;; conflicts are embedded in the structural hierarchies of the two organizations in a business-to-business selling situation' Power, status' and level of hierarchy are the major sources of conflict in business organizations, which may mar the sales if the salesperson has not understood the interpersonal conflicts between various people involved in the buying decision in an organization' There are various components of conflict. They can be grouped into three broad categories of conflict: inte;ests, emotions, and values. Interests motivate people and are termedassilencemovers.Theyaresubjectiveaswellasobjectiveinnature. They not only depend on a particular individual's desires andlvishes, but also depend on their roles and statuses in an organization. Interest-based conflicts also arise due to differencesinpractices,rulesandpolicies,roles,needs,andlevelsofresourceuse. -The emotional component of conflict originates with the ever-present feeling that accompanies human interactions. It includes feelings such as anger, resentment' fear' rejection, anxietY, and loss' The value component of a conflict is often the most difficult part to resolve because

values are intangible. Values represent deeply rooted ideas and feelings about right and wrong, which govern and guide our behaviour. Though all these components exist in every conflict, the relative degree of presence of each component varies' The Gonflict Resolution Process The problem of conllict starts with the perception of conflict' This is where one or both of the parties experience a sense of unease oft.r, .hu'ucterized by a sense of feeling of Sales and Distribution Management frustration, nnger, and anxiety. It can also be a serxrc o{'.frri+inn and confusion as they may feel a discrepancy in the levels of interests, eg1i6, -d"o5e aientations. The following paragraplu oiplain the variety of wayn in u,hict corfirrr arn bc managed. The conflict management process can be one-to-one thrcWh,,or,olfir'.d.n and.r.foaiu,iorr, can be representational between the two parties, or c?n bc vir ffi party intervention Conllict between buyers and sellers in business-teh15ir* ",EB r-n gs solved though any of these methods . Various methods of handling 6sdnlr rhdirx ae erylained below. ffi@ffiEre Methods of Gonflict Resolution ' Following are various accepted and standard methods of conllh resclution: ' Competing: Each party pursues its own interests, rcgardss of the impact on the other party. ' Collaborating: Both parties in a conflict try to satiq fuIly the concems of both parties. ' Avoiding: one party withdraws from or suppresses the conni<r ' Accommodating: . One party agrees to place the opponent's interests above its own. Compromising: Both the parties agree to gtve up someth;g Ideally, the sales manager evaluates the situation and decides on his conllict resolution method' Avoidance works well when the conllict is trivial, emotions are running high, and time is needed to cool them down, or when a potential disruption frpm a more assertive action outweighs the benefits of a resolution. Competing worls well when we need a quick resolution on important issues where unpopular actions must be taken, or when commitrnent by others io o* solution is not Figure 2.6 The conflict management process Selling Skills and Selling Strategies 69 critical. We all have a preferred way of handling con{licts. When pushed against the wall, this is the way we tend to rely on. The output of the conflict handling process is reflected in the behaviour and performance of both the parties' Nader and Todd in their book Tlu Ditryut' g hocess J4u in Tm Sociztits have identified

eight procedures usually used to handle conflict: . Lumping . Avoidance ' Coercion . Mediation . Conciliation . Arbitration ' Adjudication ' Negotiation The term tumpngrefers to the failure of one party in a conflict to punue their complaint' The issue is simply ignored and the relationship with the offending party continues. In amifuiueor exit, the relationship is called off The decision to avoid conllict is usually based on the relative powerlessness of one party, or the social, economical, and emotional costs involved in the relationshiP. Concinnis imposition of the outcome by one party on the other' Here there is a level of threat and force involved, and such practices are widespread in business situations. Conciliation means btitgntg together both the parties in a conflict for the purpose of settling the dispute. The conciliator does not have to pay an active role, although he may do so by the request of one or both the parties during the negotiations. Medintinninvolves a third party who intervenes in a dispute to help the parties to reach at an agreement. The mediator may be appointed by the disputing parties or by another partywith adequate authority, like the government. The parties in the dispute agree to the mediator's intervention. In arbitration, both parties consent to the intervention of a third party whose judgement they must agree to accept beforehand' In adjudiration, the third parry has the authority to intervene to make a decision, and to enforce the decision on both the parties irrespective of the parties' wish' The judiciary is the best examPle of this. Negotiation refers to the mutual settlement of conflict by both the parties without intervention of any third party. Both the parties reach at a conclusion not because it is required by law, but because they wish to settle the dispute and work together' We will discuss the negotiation process in detail as it is very important for sales managers to be good at negotiations skills for success in business' Sales and Distribution Management Negotiation Skills

Negotiation occurs when someone else has what yur uru, e'rl yur are prepared to bargain for it and the vice versa. Successfirl negotiation b an artaoIt bry tm parties to achieve mutually acceptable solutions, which does not rgrh in a rirc and a lmer. The core skills required for successful negotiation includes the abfty o drfinc and prioritize a range of objectives, the ability to explore a wide range of opti-,t 6c ablir!- to prepare well; and interactive competence. Negotiations are very imprtanr in elEng because majority of selling is done without a list price. Even in case of repro&rctq where there is a list price available, sometimes the customer renegotiates &c de-l In hrdness-tobusiness selling and services selling the success of selling target', dfpcr& m bor- a good negotiator the salesperson is. Day-to-day managerial negotiations in .hrd. a1.qcmcnt of pay, terms of palrnent, and working conditions, and definingi$ 1016 and areas of rcsponsibilities in sales organizations. Commercial negotiations inchrdc nfimirga sp\- contract, scheduling the delivery of goods and services, agreements on qrnrity and picesr etcLet us take the example of a student Vinod Krmarrto & m t'Le up any job after graduating from a business school and wanted to dCIrchp. nar oonrputer game that he believed would be highly successfirl. However, it s,ould r'b l Lnt time to program it. He needed to earn for his living also. He met one of [fo rr---*- Slrr-L-', who had joined a large computer company after the business school Sbanlar Elcd 6c llea and agreed to put it through to his management. But Shankar's organizarincurldofier only Rs l;00,000. Vinod said it will take him ten months to develop the Fodrct r-t while Rs 1,00,000 will enable him to survive during this period, it was not enoqh as a rsrard- He zuggested that Rs 1,00,000 should be treated as an advance against fisrc 1lrofits and that he and the company share the profits in the ratio of 25:75. Evenurally trc deal rzs finalizcd at 20:80. The cbmputer game was launched in a big children fair and was a huge success. It brought great rewards to both the company and Vinod. This is an elarrdc of a rrin-win situation. The success of arry negotiation is based on the princip[e that long"term success of any negotiation is possible when it is satisfactory to both the partfos As we have mentioned earlie4 sale is an active process in which both the buyer and serkrarc imolved in an exchange

of, products and services and theit worth. These exchanges are classified as routinized exchange and negotiated exchange. Routinized exchange occurs when the terms of exchange are esablished \ administered price mechanism and distribution in the market. Most of the standard products on the retail counter have a predefined price tag and there is no scope for negotiation on price by any party. But the process of industrial selling and bulk selling involves negotiated exchange, where both parties oome to the negotiation table and arrive at a final price after negotiating on the terms and conditions. Here the prices and other terms are decided by a set of bargaining behaviours. It is observed that in a case of long-term and captive selling situations, more and more people and organizations are going for negotiated exchanges. These markets are moving Selling Skills and Selling Strategies 71 from being highly competitive towards being highly domesticated, where there is no scope for the competitor. Wall-Mart globally follows the strategy of negotiated exchange with its suppliers, and these are set for a long-term period. Indian automobile majors like TAIA and Maruti Udygg also follow the same strategy in dealing with the auto ancillary and equipment manufacturers. Traditionally, price has been the only element of negotiation, but modern-day business has seen the emergence of new elements of negotiation, such as time of contract completion, quality levels and norms for supply of products, volume of goods, responsibility of financing level and quantity of risk involved and who is responsible for what amount of risk, promotion and title, ownership of intellectual property rights, and level of safety and other norms of maintenance. Bmgainhgis defined as a process where at least two parties are involved, the parties have some or one con{iict of interest between them, they are at least temporarilyjoined together in a special kind of voluntary relationship, and the activity in the relationship concerns the division or exchange of one or more specific resources and/or resolution of one or more intangible issues among the parties. The activity usually involves the presentation of demands or proposals by one party and evaluation of those by the other, followed by concessions and counter-proposals. Bargaining skills and theories have gained attention in different disciplines like economics,

applied mathematics, industrial relations, social psychology, and international relations. According to von Neumann and Morgenstern, each actor in bargaining has an objective (either to minimize loss or to gain profits) and the outcome depends on the opponent's decisions. The major purpose of the game theory is to describe the decision rules by which rational actors chose the right strategy. Economists study the bargaining process through a concept called 'bilateral monopoly' in which every negotiation is the end result of o{fers and counter-o{fers from both the parties. They pay less attention to the manipulative tactics, power, and bargaining skill5 ef the participants. Social psychologists have studied the effects of independent variables on bargaining effectiveness. Rubin and Brown in their exhaustive review of social psychological studies on bargaining behaviour have discussed the impact of four variables, namely the structural context of bargaining the behavioural predisposition of bargaining, the interdependence of bargainers, and the use of social influence strategies on bargaining effectiveness. Bargaining effectiveness is measured in terms of the number of cooperative and competitive choices made throughout the process and/ or the magnitude of outcomes obtained by the bargainer. The behavioural approach focuses on the concepts of power balance, tactical action, and bargaining settlements. Situation and Timing for Negotiations This is the most important question in a negotiation: when a salesperson should go for negotiation? Many authors have addressed this issue in different ways.. ke and Dobler 72 Sales and Distribution Management have listed the following instances when negtr n riate for purchasing agents: ' When many variable . factors bear not only oft h & m quality and service When business risls involved cannot be acorrftFfr,nd ' When a long period of time is required to profu ft hr grcnased ' when production is interrupted frequently bo-rd m*rrrrrs change orders Oran Young has developed a bargainer's calculus wlftte-n;-ry- demonstrates the point atwhich bargainingis an appropriate methodof -rrlrr.*;,rob.jectives. Bargaining is appropriate whenever the five definitional conditi== -n d z zrlne of agreement exists' A zone of agreement can be considered as dE ?-fR d ecoepane outcomes that exists for all the bargaining parties. If traro parties are negotiating a price, each establi$ofr fu'*-u ralue that it needs. That is, the seller has a reservation price, s, which is tbefri h rill accept. Any final

contract value say, x, which is below s represents a prh h i wr dhan not reaching at an agreement at all. For any x)s, the seller receives a rr1l, Thc rilcr desires as large a surplus as possible while maintaining a good relation *if I buru Similarly, the buyer has a reservation price b, which is the maximum he will pq, Aryr$er fu above b represents a price that is worse than no agreement. For any x < b, 6c bF lccdrcs a surplus. If the seller's reservation price is below the buyer's price, that 4 53r ilr'r a zone of agreement exists and bargaining will determine where x will fall within 6c rrr There is an advantage in using the theories of probabfity in assessing the other pq-r rsration price, and in making one's own reservation price seem higher for a sclb ud lu.u for a buyer than it really is. However, the level of openness with which buyers and rdLcs rncal and use their reservation prices or otherwise practice strategic misrepresmrin fu often dictated by the personality of the bargaineq the circumstances of the negotiarin_ rnd the expectations of the future relations. Final contact x Flgure 2.7 The zone of agreement Selling Skills and Selling Strategies 73 Formulation of a Bargaining Strategy Once salespeople are clear about the objectives of negotiation and have analyzed the probable objectives, they should be ready to formulate a bargaining strategy for achieving the desired results. The salesperson should keep his rregotiation strateg'y simple and flexible. A bargaining strategy helps him to hide his negative emotions and frustrations while negotiating. He should prepare a written schedule for briefings and rehearsing tactics. Bargaining tactics are the moves that a salesperson uses during negotiations to close a deal to the benefit of both the parties. A bargaining strategy is an over all policy designed to achieve a number of specified objectives through the process of negotiation. Bargaining involves strategic decisions before the actual bargaining starts and tactical decisions <iuring the bargaining session. A bargaining strategy is an overall approach to achieving the negotiator's objectives. Some negotiators pursue a 'hard strategy', where they start with a rock bottom price idea with high level of rigidity regarding the price the settlement price is likely to be more

in line with the other party's proposition. In 'soft bargaining strategy' both the parties are considerate and the negotiation most often results in a situation where both the parties are comfortable with the decision. The Theory and Strategy of Principled Negotiations Fisher and Ury have proposed a bargaining strategy popularly known as principled negotiations. Companies follow the strategy of principled negotiations as an effective tool for closing sales. Fisher and Ury are of the opinion that the followers of this strategy will have a higher level of success despite the other party following any other bargaining strategy. The strategy of principled negotiations means to decide on issues on the basis of their merits rather than through haggling. It suggests that you look for mutual gains wherever possible, and that where your interests conflict, you should insist that the results be based on some fair standards independent of the will of the either side. The method of principled negotiations is hard on merits and soft on people. In a research project known as Harvard Negotiations Project, Roger Fisher and William Ury propounded four principles for conducting principled negotiations that have a high probability of succeeding in a negotiation as discussed below. Separate the people ftom the pnoblem It is natural that emotions will get entangled with the objective issue in a negotiation when the parties are involved in face-toface bargaining. So people involved in bargaining should be separated from the process of bargaining. Ineffective bargaining may occur when the main issues of negotiation are framed in terms of the personalities involved rather than the interests of both the parties. Instead of making a negotiation a process of joint problem solving when parties get involved in a contest of wills, the negotiation fails in a majority of situations. When people are separated from the process, appropriate perceptions emerge on both the sides. 74 Sales and Distribution Management Each party should understand empathetizlv &c qrrrb$hryrmt and try to feel the intensity of their feelings about it. Emodous bmngh num or e.wl,*mg our of negotiations should be made explicit and should be acknmic$el hgfuimre- -\ll open rriscussion on the emotions of both the parties while not ror-mrma,l otr6urst helps save negotiations from becoming personal fighc. We tend to confuse the matters of relationrh? !r & w de I rrith negotiations,

disagreements, feelings of hurt, anger, and the hlel u,it rfi.flc d nrb,rance (numbers, dates, and terms and conditions). Failure to separaE 6c trc--fumc and relationshi5may lead us to fix relationship problems by making rrzild fu srd-lr.,r6*r concessions. Hurt feelings cannot be compensated by concessidrs an,r mrrr rrlmqm 1 sales manager can make up for a significant loss of money with a d-,pha]bg5 Fr-{.r 56 of issues needs to be negotiated on its own terms. The following rist sb.T fr. ddr"d*, . Substantive issues - Terms - Conditions - Prices - Dates - Numbers - Liabilities . Relationship issues - Balance of emotion and reason - Ease of communication - Degree of trust and reliability - Attitude of acceptance and rejection - Emphasis on persuasion or force - Degree of mutual understanding The use of 'I message' is a very creative way of separating pccple from the problem. Examples include: . I would appreciate if... . I would like to... . It would be helpful to me if... . I would certainly appreciate... 'I messages' can elicit help from the other party in a negotiation rather than make it take a defensive stand. People do not feel angry or bad and most people are happy in helping others if they have nothing to lose and everything to gain. 'I messages, help parties to concentrate on issues and leave personalities aside. Focus on interestsr not on positions The second criterion for principled negotiation is to focus on interests and not on positions. A position is a stance, and it is interest that i l I IL Selling Skills and Selling Strategies 75 created the position. The di{ference between position and interests is that one's position is something one decided upon, while one's intere st are what caused one to adopt that position. For instance, a bargaining position may be that a contract must provide for a stiff penalty

for late shipments, but the parties' interest here is to maintain an unbroken flow of raw materials. Reconciling positions with interests works better because for satisfying every interest there usually exist several possible positions. Making certain that interests are understood by all parties and the positions are flexible as to the means of achieving these interests, while negotiating firmly for the interests themselves, is an e{fective strategy. As Fisher and Ury state: Fighting hard on substantive issues increases the pressur for an e{fective solution, St"i"S support to the human beings on the other side tends to improve your relationship and to increase the likelihood of reaching agreement. It is the combination of support and attack which works, either alone is likely to be insu{Iicient. We assume that as the other side's position is opposite to ours, so must be their interests. If we have an interest in defending ourselves, then they must be eager to attack us. If it is in our interest to increase the prices, then the other party's interest mus,t le to reduce it. However, a close examination of the underlying interests often reveal the existence of many more interests that are shared or compatible than those that are opposed' Following are the cornmon sources of difference between two parties: Risk Some people hate taking risk. Others enjoy taking risk for higher gains. Large institutions are better prepared to handle risk than small institutions. Howeveq a sales manager should try to find out the nature of risk- aver,lon behaviour of the buyer at the bargaining table, and build strategies based on that. This would lay the foundation for success in negotiation. funing The sales manager should look for the possibility that what is impossible this month *uy b. porsible next month or what is unaffordable in this year's budget can be managed next year. Pernptinns To some people, the opinion of others is critical; for others it might matter little. The sales manager should look for ways the former can have a public victory if needed while the others satisfy their separate more valued interests. Marginalaalut When people own several instances of the same object, the value of the last on. i, l.r, compared to that of the preceding ones. Differences in the marginal value of the negotiated goods, services and terms create oppoffunitles to draft the final agreement.

A ,ul.rp.rron identifies the interests of the customer by exercising empathy' He puts himself in the customer's shoes and asks why he or she is taking a certain position. Directly asking questions about the customer's interest is perfectly legitimate, such as: Sales and Distribution Management Why are you not accepting a price more than a year or so? What benefits will it serve you as a company? Another popular rule is to be hard on the problem and soft on the people. The sales manager should listen to customers respect&rlly, be courtcous, express appreciation about their time and effort, and demonstrate concern for their interests while still defending his legitimate interest. The psychological principle of cognitira dissonance operates here. people dislike inconsistency in their attitudes. Howeveq if they like the personality of the salesperson, they will tend to accommodate his interests to reduce the inconsistency in their ,riews. Invent options for muhral gains By options we mean possble agreements or pieces of possible agreements. Inventing options for mutual gain inrDhres searching for a larger pie rather than arguing over the size of each piece. Derrcloping opnions requires innovative thinking and brainstorming sessions that help to identify sharcd interests. The buyer's interest may be revenue, quality, and reliability The options can be paymg a premium price for premium quality, paying a bonus for timely ddn.ry, or grani of a1 exclusive contract. Negotiators often quarrel over interess &at are common to both the parties. The common belief is that if we both value something the only w:ry we can both have it is by dividing it between us. The approach is 'more for me and less for you,. They key idea is to suspend criticism and allow space for identification of goals for mutual benefit. Insist on objective criteria When an opposing negotiator is ina:ansigent and argues over his position rather than his interests, a good strategy is to insist that the agreement must reflect some fair objective criteria independent of the pcition of either side. By discussing objective criteria rather than stubbornly held positions, neither party yields to the other, and both arrive at a fair solution. Such objectirrc criteria may be market value, depreciated book value, competitor prices, replacement and switching costs, wholesale price index, etc.

This approach worls best when each issue is resolved thmugh ajoint search for objective criteria and each party is open to reason as to the standards besr reflecting objectivity. Deviations from a fair and objective standard should be made only when a bett., one is offered, and not because the opposing party is applying pressure, threab, or other means of imposing his will. It is difficult to identify objective standards to reach at an agreement in all cases. Even with objective criteria to define the boundaries of an agreemeng the sales managers need a way to progress towards a final agreement on specifics. In such situations, one needs to spend some time and come out with a fair procedure for the deal. Howeveq no method can guarantee the success of a deal when the success depends on the other party. If a salesperson is representing small enterprise, how can h. grururrt.. success against a major concern like Tata or Reliance. If there are several alternatives to the product that the salesperson is selling or there is a high level of inventory in the warehouse, how can a salesperson negotiate with force to realize sales? t. Selling Skills and Selling Strategies 77 So in any negotiation process, the salesperson can gain power if his negotiations meet two criteria: if the salesperson is protected from making an agreement that should be rejected, and if the salesperson makes the most of his assets to satisfy his interests. In situations where the salesperson assumes that hg has spent much time and effort in a negotiation and the results are doubdul, he is likely to agree to accommodate the views of the other side more than what he would normally like to, and may end up with an agreement that he would have rejected in normal situations. The purpose of a negotiation is to produce better results than what one would have got without negotiating. This result is known as best alternative to a negotiated agreement (IIATNA). BATNA is the standard of comparison that can protect a salesperson from accepting unfavourable terms and rejecting favourable terms. It is a standard against which the proposed agreement should be measured. Recognition of BAfNA early in the business negotiation process helps the sales manager to be successfirl and gain more than the BATNA. 6t us look at the example of Sunderam Fastener's deal with theJapanese manufacturing

major Mitsubishi Corporation. In one of the supply deals, the Vice President, Sales, of Sunderam Fastener was on the negotiation table and although theJapanese major wanted the products, the deal was halted for some time for price reasons. During the meetings Mitsubishi declared that they are only interested in buying three specifically designed hot metal products at a price lower than the normal market price as the size of the order was very large. The VP, Sales, despite being close to clinching a million-dollar deal, did not surrender and whispered to his assistants during one of the tea breals to calculate how much they will earn if they do not get this deal and sell the same product in the international market. The message went to the other palty that Sunderam can yet make big bucks in the market without getting the deal from Mitsubishi. The VP, Sales, was able to clinch a profitable deal when he knew the value of BATNA, and the Japanese major agreed for the negotiated price as they were sure of the company's commitrnent to quality' Protecting oneself from a bad agreement is a defensive proposition, which helps the sales manager to benchmark the returns from a negotiation. But making the optimum from one's assets in order to produce a good agreement also depends on one's BATNA. Negotiation power is generally perceived to be the function of one's market powers, financial positions, political clout that one enjoys, and the list of one's friends. The relative power of two parties will depend on how attractive the option of not reaching an agreement is to each party. If it is a small or medium-sized enterprise negotiating *ith a bigger concern and there is another deal close by, it is in a position to do a better negotiation. If an agreement is not possible then the salesperson can walk out and develop alternatives by following three approaches, namely inventing a list of acceptable options if no agreement is possible, improving some of the better ideas and developing thdm into options, and selecting the better options from the list of new options. 78 Sales and Distribution Management This means prospecting for other .qlnP with a well-connected 6od qrq dEdophg a joint venture larger concern' -.rt at.#* b'riu firnds, or any other suitable alternative' The result is that *. .-r-i*- t. rrrlgr against which each alternative can be weighed to make a dmiin_

The more aYcdv: BATNA is, higho ir t pcEt, Jl-r.l_qm meking successful negotiations' It is easier for a salesperson ro t ".r"+b,6cn he has got another alternative' or the BATNA is moreatnactivc 6a ed;d- rur' 6c BArNAis worse, it is advisable to evaluate the deal from the 063,-*hb.c'. If the other party's BATNA to a deal. seems good ^'xl dcy c nnd n, -ori^te person should consider then the sales- what he or she can do o ,& ft rf,rNA cfect in their eyes. Negoriations at Akzo Nober coatings rnda fut -l Akzo Nobel coatings India Private Limited b pct d c d fu r''urxrc 500 companies with a global turnover of 5 billion euroq having; fuhlprcrac ir mtings, chemicals, and pharmaceuticals' They are the first i" il -qry-'at podrtbn in Inrria, and hold 35% tt *.|T{ft share in global martet h;a:+.y' Tbc Indan branch has a turnover of Rs 700 million, growin"g at 7 o/o per annr.rm- Td-p-y otfictive is to become one of the two preferred suppliers in the customet's product at the most affordable price; to retain the bc-s+ a L- t h &c6 cis br.a't rprc: stiob lree nsdeervr icteh,e/ best technical service; to have pioa,r.t" based on -"fr., Gq o be a partner rather than a Vendor; to present cost_benefit to th, term and lon g-term benents, . .*,' ;:',:"#:;fi ffi :'"ffi *.T: friendly products Akzo Nobel manufactures the entir ""vd p;;; the r,igl,,*-.-..o:TT#ffi ffiffiffi'J'ffiT Nobel' Holland' it needs to maintain a certain standard fcitspro&cc, as both the quality and the packaging of products have to U. ,rrrifo.*. The prospective customers for the marine division are . Ship owners ' Ship managers-who run the ships on behalf of tlre ship omcrs . Shipyards-that make ships and also repair Sipr. . Barge owners r r-. Fishing trawlers ship owners cante crassfied as big prayers, such as scl, The Great Eastern Shipping Essar shipping, Torani, and Mercatl, r-ii.r, "1a chowgule ;Jilr^ zuch as Gujarat Ambuja, steamships, and century. The kind of products'aniservices theyprodde include: ' sea store Paints, which are paints for maintenance and regular use on board. (IMe shall refer to this as SS paints.) t-Selling Skills and Selling Strategies 79 ' Dry Docking Paints, which are supplied once in 2.5-3 years, when the ships come to the dry docks for major repairs and the entire ship is painted from outside and sometimes internal works are also carried out ('\Ne shall refer to this is as DD paints.) The mode of purchase is through a rate contract'valid over a specified period of time. Most of the big customers have rate contracts for 2 years for SS paints. Very few of the customers go in for rate contracts for DD paints. DD paints are basically purchased on the basis of tenders. Some are based on spot quotations. Ship mnnagers manage the vessels on behalf of ship owners. This is basically like outsourcing, because the owners do not want increase their headcount and the regular day-to-day activities are done by the managers,

whereas the owners can concentrate on other important things like earnings and plan for expansion. Rate contracts for SS and DD paints are decided by ship owners. Shipyards are places where the new vessels are constructed or old vessels are repaired. The purchase is always through tenders, but sometimes when the owners nominate a supplier, then there is a single tender. Barge owners and fishing trawlers are small operators. Sometimes suppliers are nominated, but in this market, the prices have to be competitive as there is no fixed b"ytng pattern. Here we present the negotiations in the case of a ship owner. The salespeople find out from the Directorate General of Shipping or ShippingMaritime about various ship owners in and around the country They also take leads from the existing customers about new entrants in this industry which sometimes helps them. Sometimes they get leads from some magazines or some exhibitions where the prospects walk into the stall. Once the salespeople identify the customer, they approach them with the intention of firdi"g out the following information: . \Alhat is the kind of operations they are into? ' What type of vessels they operate? Whether they are operating bulk carriers, mini bulk carriers, tankers, or offshore vessels? . What is the size of the vessels in the industry based on tonnage capacity. ' Where the ship owners operate their vessel, in India o, abroad? Alro the location of operation, as to in which area the vessels operate. . Who are the present suppliers? . What is the mode of purchase? . Is there anything specific they are looking from a supplier? After the salespeople get this information, they give the customers a brief of the company set up and all they are dealing with in India. This generates some interest in them. Probably they have heard about the compnny and most of the time the salespeople get the feedback that the customer assumes that they are expensive, being an MNC ( a fact). Salespeople e:<plain to them about the service offer with a promise that they will call back with their prices and product data sheet. 80 Sales and Distribution Management Once the basic information is gathered, the salespeople tryto find out about the customer's credibfity in the market by talking to people from the industry like ship chandlers (who supply stores to the vessels), and sometimes competitors. Initial pricing decisions are taken

internally. The salespeople ensure that the prices offered to them are higher.than that for the regular key customers. Differential pricing is done on the basis of volume and payment terms. The company's key customers ftey accounts) get the best deal. Credit terms are very important in the organization. The maximum credit period is 90 days, failing which the company will walk out from the deal, unless the volume justifies a higher credit, but never beyond 120 dap. Competitors in the market are other MNCs who either operate through a liaison office in India or have a toll manufacturing facility in India. Those with a liaison office areJotun Paints of Norway, Hempels of Denmark, Chugoku of Japan, KCC of Korea. Sigma Coatings of Holland is the only company that has aJV with Coromandel Paints, Yizag. Other local companies are Shalimar Paints, Advance Paints, etc. These companies are a threat only with the small ship owners like Barge and Fishing trawlers. ff,e 5slling Process Mr Neeraj Sundar explains the selling process and negotiation skills used by them to arrive at a price point in following terrns. 'Let us assume that we are talking about DD paints (big volumes business). We need to find out the vessels area and the period of dry docking. We also find out the colour scheme for the vessels. Normally all vessels have to dry dock twice in 5 years (it is a rule for safety purpose). Once we get this information, we then prepare a scheme accordingly. Once we get the pulse of the customer, we give them the most economical scheme to start with. But at tfre same time, we also o{Ier a slightly premium scheme. The salespeople offen both kinds of schemes. They ensure that they meet the customers personally. They get the key decision makers involved and make some sort of presentation or discussion with them. They brief them about the performance expected if they go in with the economical scheme, and at the same time explain the benefits, if they go in for the premium, which is priced at a premium. They try and generate customer interest towards the premium scheme, gi"S them all the benefits and how they can save on the recurring costs over a period of time. During the course of the discussion, we try to find out how we are competing with others. Since we are well versed with their products, we ask probing questions like what $stem have they offered. If they give us this information, well and good, or else we tell

them that they should mention a particular product against our produpt or else the comparison is not apple to apple. This gets the customer thinking and most of the times he bols into the competitor's oflers for his information. When he opens up a bit, and tells us rttat they have offered, we comparisons and try to educate him a bit. By this time, if he believes us, then we assume that he will get back to the competitors to o{fer similar poducts. This worls 60% of the time. If not, then we tell him that we shall offer a scheme Selling Skills and Selling Strategies 81 similar to the competitors, assuming that we are on the expensive side in the first scheme. We then leave it at that stage, stating that we shall get back to him. Or else, he might end up telling us that he shall ask for a similar o{fer from competitors. He then tells us to get back to him couple of days later. We then get back to our drawing table and plan how to tackle this issue. We collate various sources of information about our products used by other owners and then approach him. We then do our homework in our warehouse and factory so that when we approach the customer, we can assure him that we have stocls of all products available at a particular port of supply. One of the advantages we have is that as an MNC, we are the only company in India with a factory and strategically located stock points, which worfts very well to our advantage. Another disadvantage for others, which works to our advantage, is that paints are the last priority for a ship owner and the supplier is decided at the last moment. Ttu nzgotiatinn prucess Assuming that the customer is convinced about the o{fer, the negotiation starts. As mentioned earlier, our prices are most of the time higher than those of the competitors. This is due to various factors like higher overheads and maintenance of a certain standard for our products, for which we import a lot of raw materials. On the negotiation table, we normally start off with a small discount and try to delay the final discount to be offered. We tell the customer that we need to take management sanction, etc. We leave the customers office stating that we shall get back to him within 24 hours with our final o{fer. In certain cases, where there is a huge volume involved, we need to get back to our higher ups to get the approval for discounts. We also sometimes get our GM/MD down to

meet the customer, if the customers are strategic ones, even though the decision regarding the discount can be taken back by the Sales Manager. This makes the customer think that we are going out of our way to bag this order. During the course of our negotiation, we ensure that we convey to the customer the credit terms on which we operate. If he wants an extended credit, then we restrict our discount to a certain level. We inform the customer about the kind of services that we shall olfer if we get the order. Technical service plays a very important part for DD orders. If it is an out-of-station DD then we limit our services to a certain number of days, beyond which we need to charge our customer. But for key accounts, we try and avoid the limit as far as possible. Iike all customers, their request is for the maximum discount. But since we have a fair bit of idea about our competitors' pricing and products, we go up to a certain level of discount, which we feel will be good enough to secure the order. But since this is a buyer market, on request we try to accommodate the custor.ner's request (if we can afford to) *d close the deal. In our industry, most of the decisions are taken by the technical departrnent in co-ordination with the customer's purchase department. The purchase departrnent helps the customer's technical department in making price comparisons. Once the technical departrnent finalizes the supplier, it then briefs the purchase deparfrnent to place the order with a particular supplier. Sales and Distribution Management Follnw-up Once the order is secured, we follow-up with the factory and warehouses about the stock and inform them about the supply point. The technical service departrnent is informed about the dates and location of the services required. The salesperson then coordinates between the customer, warehouse, and the technical service tedm, and ensures that everything is handled smoothly., Bargaining Tactics Bargaining tactics are the maneuvers made by salespeople at qpecific points in the process of bargaining. The basic objective of using Uargaining tactics is to clinch the deal for the best solution for both the parties. A perfect salesperson heq (e rnaster the art and technique of tactical bargaining. Some of the commonly used tactics include W, btqfrfi, and Inst chnrce offers.

Fisher and Ury have given some tactical advices that are consistent with their strategy of principled negotiations. Their first piece of advice is on w-hat should be done when the other parry' is powerful. The best tactic is to know one's BATNA Identification of one's best alternative if a settlement is not reached sets a standard against which any o{fer can be measured. It protects one from being pressured into accepting unfarourable terms by a more powerlul negotiator. Another helpful tactic works well in situations wherc the opposite parry insists on his position rather than his interests and attacks your proposals o. p..rorrr. The normal tendency in an argument is to push back tr"oa *fr.o pushed against, but the better tactic is to deflect the attack from the person towards the problem. One should look at the interest of the opposite party's position and invent options that can satisfi mutual interests. Here you should invite the criticism of the opposite party and advice him to understand your situation (FIad you been in my position what should have been your decision?). There is a series of bargaining tactics used in responses to the opposition's tactics of deception, distortion, and in{luence to tilt the bargain to their undue-adrantage. In a situation where the other party shows an attitude of take it or leave it, or threatens the other party to quit, the sales manager should recognize the tactic, raise the issue explicitly, and question the legitimacy of the tactic itself by probing and questioning about its desirability. Regarding negotiation tactics, the principled negotiation procedure suggests questioning the tactic, asking for the reasons why the tactic was used, suggesting alternative courses of action to pursue' and suggesting the principle behind the tactic as a negotiation rule. The sales manager should resort to his BATNA if all other tactics fail, and terminate the negotiation until the other party ceases to employ unfair tactics. Tiackling such tactics by defending principles is more productive than counterattacking with similar tactics. Selling Skills and Selling Strategies 83 Tactical Considerations and Strategies There are some specific questions that one has to take into consideration for entering into any negotiation. The basic question is who should make the o{fer first. It is not always a

good idea to be the first to put the offer on the table. This should not be done without first discussing interests, options, and objectives because the other side may perceive this as a railroading activity. Once both the parties have outlined the problem, making the ofler looks more appropriate. Questions to Ask Oneself before Making an Offer . Should I give the first offer? . Should I start with a high offer? . Should my preparation lead to a strategy? . Should I sketch an agreement from the beginning? . Should I construct a framework for agreement? . Should I move towards the commitment gradually? The next important question is how high should a salesperson start. Manypeople measure the success of a negotiation in terms of how far they have given in to the competitor's pressures ir gi"S discounts or lowering the prices. Even if the first price quoted is a list price and not even parallel to the industry prices, the customer feels h"ppy when he is asked to pay less than what was quoted at the beginning of the deal. So the salesperson should start with a higher figure that can be reasonably justified and does not cause much embarrassment to the salesperson subsequently. Another alternative is to start with a high figure that a neuffal third party thinks as justified. The firmer you are at the beginning, the more you will loose credibility by discounting at a latter point of time. Strategy is a function of the relative readiness of the firm and the degree of preparation the salesperson has done before the negotiation. If the salesperson is well prepared, the strateg-y will automatically flow out from the preparation and prioritization.If the preparation is good and the priorities are well structured, then the salesperson knows which issues to discuss frst and which interest to put forward. If the salgsperson has identified the objective standards, he will know which standards to bring up and which ones to hold back. If the salesperson knows his BATNA, he knows when he has to talk. The salesperson at the beginning should try to figure out the outline of a successfirl agreement. This will help him to realize what issues to deal with and resolve during the negotiations. The salesperson should think of all the requirements to implement the agreement. Then he should work backwards by asking himself how the other party is going to justify nn agreement to its staleholders. There is a need to sale one's agreement to the other party; otherwise no agreement will be possible. One needs to consider if their people will'buy it'.

84 Sales and Distribution Management It is always prudent to initiate an agreement document while pu are progressing in a negotiation table because most of the successfirl negotiations end up with a written agreement. The framework agreement is an agreement document r,rith lot of blank spaces for each term to be resolved. In many instances, a standard headingwr.Il also serve for the agreement document. Working on the framework agreement will ensure that all important issues are discussed, serve as an agenda, keep the discussion focuse4 pronide a sense of progress, and keep a record of past discussions, reducing the chances of later misunderstandings and misquoting. Negotiations do not proceed in a sequential manner and 1ou should not stick to a single point as you may have to compromise on the same point in conjunction with other issues. If agreement cannot be achieved on one poinq the number of options can be narrowed down and the negotiation can move on. The salesperson should be prepared to go through the issues again and again to find strategic alternatives and condude with suitable options. Pushing hard on certain issues will have negative effect and may hamper the relationship developing between the two parties. Let the other party herrc it ia your orrn way The principled negotiation strategy allows the negotiator to follow the tactics mentioned aborre, but in many instances the other party may not be following the strategy of principled negotiations. In such situations, one needs to follow five principal steps to break the impasse. The whole idea of these five steps is to resort to indirect action rather than ta^king the other party head on. It is tlu art of baing tlu other par\ hnae it inlour oum ua). Visit the balcony In this case the salesperson imagines as if he was bargaining on a stage and then goes to the balcony to see the thi"Sr happening on the stage. This is a metaphor used for the mental attitude of detachment. Standing on the balcony, the sales mzrnager can evaluate the conflict as if he is a third parry who wants to setde the issue. The whole idea of visiting the balcony is to forestall an immediate reaction and to control the instinct of launching a counterattack. The sales manager should buy time to think over the problem, to determine the real situation, to evaluate his BATNA, and to decide about

continuing the negotiations. Let us take an example. Purandar worls for HCL Infosystems and he is meeting Ashok of Cydus Pharmaceuticals for negotiating a deal for the computer hardware. He has just finished a deal for selling hardware to Cydus worth one million rupees. \{hile srgning the deal, Ashok come asls for a free service contract. Now if Purandar reacts to the statement either by 'yes' or 'no', he may fall into a trap in which either the negotiation will be stalled or he has to offer the services free. So Purandar buys time and says, 'Hey Ashok, Hold on. I am not sure that I am following you. kt us go back for a minute and see how we arrived here. We started this deal four months ago, and at the beginning you said that we will negotiate the service contract separately from the purchase. Selling Skills and Selling Strategies 85 We reached at a final agreement day before yesterday.' In this case Ashok is puts forth a new demand but Purandar moves on to the 'balcony' and responds with an account of all the days of negotiation. Step to their side In many instances people do not negotiate rationally. It is sometimes worth trying by the salespeople also. To cope with the irrationality of the counterpart, the sales manager has to be all the more purposeful and rational. Dealing rationally with irrationality often evokes reciprocation from the other parly. It is also possible that a perfectly rational perception of the other party looks mista"kenly irrational to the salespeople. So before engaging in principled negotiation, a favourable climate should be developed, so that the other party's anger and fears are removed. The opposition always expects you to attack or resist, but if the salesperson does the opposite by listening to them and being empathetic to their views, it is easier to bring them to an agreement. It is a procedure of disarming them by stcppary t0 tluir sidr.The sales manager can begin by letting them know that he is listening to them attentively and agreeing with them wherever he can. He should maintain eye contact, nod, and express acceptance through his body language. He can reflect back and acknowledge their points by saying that the point is worth consideration. Even if the sales manager disagrees with 99o/o and agrees with only 10/o of what

was said, he should concentrate on that I %, saying 'Yes, I agree with you. . ..' To acknowledge that he respects them and is not attacking them, the sales manager may further preface the remark with a statement, such as 'You are the decider' and 'I respect your order'. Then, after saying yes, he can go on to present his views. For example, the sales manager may say, 'Yes, I agree with you that we charge a higher price than the competitors and you are absolutely right when you say that you buy superior quality, greater reliability, and better service'. Whatever language one uses, the argument should be in addition to the opinion of the other party rather in contradiction to that. As a salesperson expresses his views, he is less likely to appeal to the counterpart if he speaks about himself rather than the other party. The impact of the problem can be minimized by using sentences beginning with 'I feel that...' or 'I am not comfortable with...' f,,sfta'ning rather than rejection The next step is to focus on each party's interest. Instead of rejecting the other party's viewpoint outright, which makes them more stubborn with those ideas, the sales manager can direct their attention to the problem of satisfying each party's interests. Wherever they agree can be taken into account and can be reframed as an attempt to deal with the problem. The sales manager can ask problem-solving questions like 'What is that you want to...?' 'What are your concerns?' or 'What if we were to...?' or 'Why not do this way?' or 'What is wrong with this approach?' People who don't open up their points very fast are very comfortable with criticizing the opinion of others. 86 Sales and Distribution Management 'What if"'' kind of questions will bring possible solutions rather than provoking opponent' one the typical question is 'what would you do in this situation if you were in my place?' This makes them understand your concern and provides insight into your constraints. - If the opposition's point sounds illogrcal, one can start with u ,.rrt rr.. like, lyo' must be having good reasons for thinking that this is a fair solution to the deal; I would like to listen to that" '' The sales manager should try to ask the open-ended questions rather than closed ones' The opponent *ill fi"d it difficult to answer with 'No' to questions, such as ,What is the purpose of this policy/this statement?' It is better to preface questions with ,How,, 'Why', or 'Who'' While such problem-solving questions enable the sales manager to reframe the opponent's position in terms of options, interests, and standards, th. ,11., manager also needs to reframe their tactics and sffategies.

Iet them take onmership under this strategy, the sales manager constructs an agreement that the opponent can call a victory This is by involving the opponent in drafting the agreement, which satisfies more than their monetary needs. It is a process of augmenting their personal r..d, oi success, power, recognition, and autonomy It also helps the opponent to back away from their earlier stance *iLo't losing their face during and after the negotiations. Thus also helps the other party to present the case as a triumph to its constituents. It also means moving slowly to achieve victory with the counterpart rather than abruptly making the agreement acceptable to both the parties. when people get involved in the process, they start seeing things differently and start accepting ownership of the idea, which culminates in a negotiation. In this process they may like an idea that they had rejected at the initial stage of the negotiation. When ttr.y iorrt iuute ideas to it and a consensus builds up, they own the entire agreement rather than only the ideas promoted by them. The typical questions asked during this stage include: 'B,rildirrg on your idea, what if we...., or the sales manager may respond with statements such a-s: i{s a followup to our earlier discussion, it occurs to me that...'and 'I got this idea when I analyzedwhat you said earlier...' The sales manager can ask for the opponent's criticism and probe through problemsolving questions such as: 'Which interest of yours does this iaea fal to satisf,r?,',In what respect this is not fair?' 'How would you imgrove upon this proposal?, ,Is there any way we can make this proposal better for your side without making i *orr. fo, -y .o*p*yl, When alternatives are given to them and they chose one, it becomes their ideh and their alternative rather than yours. The sales manager should help the other parq, reahze that circumstances change and they also have to .f1s.-u1.ordingly. In such situations, where third parry intervenrion is necessary one should look for a neutral friend or an expert who can help in convincing the opponents about charrges in the environment and how they have alfected the business. A proposal muted fromone side and unacceptable to the othe, side ;;;;;"rl..ptuut. if routed through a third parry. Selling Skills and Selling Strategies 87 An agreement reached slowly through a step-by-step approach is more acceptable than an entire proposal done in one go. Too marry decisions taken in a short period may end up in an abrupt conclusion. It is a good idea to assure the other party that you are not looking for a commitment immediately and they can come out with an agreement and commitrnent at the end of the whole exercise. If the agreement is not acceptable to the opponent, make it as hard possible to say no to

you. This is possible by a cumulative summation of benefits over a period of time and tradeoffs of values during the negotiations. Educating them to senses If the buyer has a feeling that he can still win without the negotiations, the sales manager should educate the opponent by asking realitytesting questions and demonstrating his BATNA. The sales manager should exercise restraint and provide reassurance that mutual satisfaction and not the victory of one party should be the objective of any negotiation. The bargaining is to bring the opponent to their business senses rather than bringing them to their knees. Let the opponents ysalizs the consequences of not reaching an agreement by asking them questions such as: 'What do you think will happen if we don't agree?' 'What do you think I will do?' By asking the second question, you try to show them your BATNA and make them realize that you have satiSfactory alternatives. You can ask questions such as: 'What will you do?' 'How much will it cost you?' 'How will it satisfy your interest?' Also make them realize that their BATNA may not be satisfactory. You may ask a question such as 'Is it possible for you to get the material at short notice ftom the competitor if you do not negotiate with us?' The attempt should be to warn and not to threaten. A warning is respecdul and objective, whereas a threat is subjective and confrontational in nature. A threat is what you will do if they do not agree with you, whereas a warning is what will happen to them if an agreement is not reached. It is convenient to agree to an objective reality than to bow down to a threat. It is i process of making the opponent reafize that the previously formulated agreement is always a better bargain than the future uncertainties. Some of the popularly known and practised negotiation tactics are designed to back you up and corner your counterparts in a negotiation table. These are popularly known as 'dirty tricks'. There are three steps to counter these dirty tricks, recognize the tactic, raise the issue explicrtly, and question the legitimacy and desirability of the tactic. The sales manager needs to recognize the tactic before he can tackle it. Often the recognition of the tactic itself will destroy the ploy. After recognizing the ploy,'the sales manager should point it out to the other side. If the opponents care for the negotiation, they will cease to use it. Pointing out the tactic gives an opportunity to the sales manager to

decide on the rules of the game. It is worth mentioning during this stage that the objective of the negotiation is to bring benefit and respect to both the parties and not to give advantage to one party over the other. 88 Sales and Distribution Management Negotiation Tactics Following are a list of tactics including the 'dirty tricks' used during negotiations, and various strategies to counter them. Acting c'razy The sales manager should put up a good show by visibly demonstrating his emotional commitrnent to the deal This increases his credibftty and may give the opponent a justification to accept his terms. Auctioning The buyer in this case negotiates with more than one seller simultaneously, and lets each of them know that he is bargaining with other parties. The salesperson who is confident of his o{fer should stick to his terms as if there:rne no other sellers. The strategy is to reveal the buyer's bias, which can be treated as a indication about how to proceed. When the buyer finds that this tactic is not working he will stop using it. When the buyer calls all the vendors to a meeting, the salesperson shifts his attention to reading a newspaper or a novel, and when the buyer goes for a long telephone call, the salesperson can ignore the tactic by shifting his attention to somerhing else. TLe good guy-bad guy routine This is typically seen in Hindi movies when a police officer is interrogating a criminal. The lirst officer starts abusing the criminal, beating and torturing him, and then he takes a break. Here the good guy enters and saves the criminal from further abuse. He gives the criminal water and assures him that his interest will be taken care of. The first o{ficer may be tamed by the second one if the criminal cooperates, and ultimately the criminal gives in to the good guy. This also happens in negotiations. Two people from the buyer's side may stage a quarrel in which one will take a tough uncompromising stand on price, whereas the other behaves considerately and offers certain additional provisions for a price reduction. In the absence of the tough bargainer, the other guy comes with a statement that the prices of the seller are right but the tough guy in the team will not agree and hence some compromise has to be made. There are two ways in which such a problem can be tackled. The smart negotiator may

directly ask for the real reasons for which price reduction is demanded. Another way is to let them know that you have recognized their tactics, which is not going to work. Big pot The sales manager should leave himself a lot of room to negotiate. He should make a high demand at the beginning so that even after making concessions he will still end up with a large payoff than if he had started with a very low demand. Budget bogey The customer says that he has a fixed budget beyond which he cannot go. The seller who accepts this fixed budget constraints ends up with a low price. So the salesperson should not accept this concept without crosschecking the sources of funds. Most budgets are flexible and have scope to adjust the market variations. If the salesperson rejects the price as nonnegotiable, budgetary provisions can be made in companies from other sources. Selling Skills and Selling Strategies 89 Get a prestigious ally The sales manager should select an ally. The ally can be a person or a project that is prestigious to the opponent. Thus the sales manager tries to get the opponent to accept the deal because a person or object involved in is considered 'prestigious'. Escalation This happens when two parties have iorne to a conclusion and one party raises its demand with an objective of wearing down the resolution. They may raise an issue which the other party must have assumed to be resolved. The tendency in this case is to settle the issue quickly before the other party decides to escalate opposition to the negotiation. A wise negotiator will identify this tactic, point it out to the opponent and refuse to go along. He may call for a break while they consider whether or not to continue the negotiation. This prevents an impulsive reaction and gives time for both the parties to ponder over the situation. The well is dry In this tactic, the sales manager ta-kes a stand and tells the opponent that he has no more concessions to make. Limited authority The sales manager may negotiate in good faith with the opponent, and when they are to ready to sign the deal, the sales manager may say, 'I have to check with my boss.' This is basically done to get a"nother opportunity for negotiation. The other party may also make a similar claim by saylng that he needs approval from the financial authority.

The best way to handle such a situation is to establish how much negotiating power the other party has. If there is some ambigurty, the sales manager may ask for talking directly to the person from whom final approval is sought. He may also say that, 'Are you suggesting that the negotiation is to be reopened again?' If the answer to this question is 'No'then the sales manager should stick to the agreement made in the negotiation. If the answer to the question is 'Yes' then the sales manager should say that the agreement is a joint draft to which neither side has committed. 'You check with yo'ur boss and I will check with mine and let us meet again to discuss the possible changes'. It means if the other party wants something extra, you should also get something in return. Whipsaw/auction The sales manager should let several competitors know that he is negotiating with all of them at the same time . He should schedule the competitors' appointments with him or his boss at the same time and keep them all waiting to see him. Divide and conquer If the sales manager is negotiating with a tearn on the opponent's side, he tries to sell the proposal to one member of the team and that person helps him to sell it to the other members of the team. Reunion If one of the negotiators can guess where the other negotiator stands on the issues of negotiation, he can take a stand somewhat away from the negotiator. Then he allows the other person to convince him of the rightfblness of his stand and then accepts his stand. 90 Sales and Distribution Management There are two advantages to this tactics Thc ncaahr b-ccningly to made a concession the other party, which calls for reciprocal gtnrin It fo also likely to lower the expectation of the counterpart. In this proG'!* the * mga may ask for the objective standards that justify their proposal, so that tbcy ca 6:r e rLrrnr fa the future movemenrs of the counterpart when negotiations arc txr. Deadline M-y agreements are reachedin6chEit-d6edeadline, which is used as a good maneuver. People often accept fte dr,"Erp d fu o6er party as their own despite the fact that the deadline often farmrrs 6c & prty, one should never accepr the other party's deadline without questioning ls rrinfu one can also turn the opponent's deadline to one,s own advantage. sticks and stones Some buyers have a habit of mrhgfu d 6c salespeople or making statements that are derogatory to the sales prr*rrin i m bfrrld".lr. Th.y -.y ,uy, 'Hey, you look so down, zlre you not doing gpod sd6 ilr.r denr or they may ridicule the proposal saying that they have heard sirnilar 36tr frm otbcr salespeople also. The assumption is that by insulting the seller, the bupr a $or drrn as inferior and force him to comply with his demands.

The humfiation may be other than verbal also hFr EEtrr humiliate salespeople by letting others interrupt their presentation, rnat ing;.ph calb during a meeting, or continuing to read or work when the salespe.r"" is tafu, rhb ndies that the salesperson is ignored and has low value for the customer. The salesperson can respond to such a situation in tno wayr IIe c"r, reframe the attack on the personal front to the problem p *t"s ycr ma1. harrc a point but how do you improve the proposal to make it acceptable.'i'"tri"gdithcmysnlbeharrc as aprofessional by saying that he has apparently called the buyer ri " "n*g,i* and he was there to share some important information with the buyer. Fie may aho i r* "ooa.r time when he can visit and make a presentation Get lost/stdl for ti-e The sales m:rnager may leare 6e ncgotiation table for a while, and come back to negotiate when the things are be6er - Thc break may be long (say, you are going out of town) or short (you go to the bathmom to d,;nk)Take it or leave it The buyer sticks to a price and cl-irm rhat fos cannot give more and the seller has to either take it or leave it. The salesperson should test the buyer,s seriousness when this tactic is used. He may keep talking about the problem as if he has not heard what the buyer said, or the context of the ,rrb3..t may be changed- If the buyer is serious about the threat, the message will be repeated, and if so, the salesperson should let them teartze what they will lose if the agreement is not made. Then he should look for a face saving way such as a change in circumstances for the btrlar to come out of their previous stand. Selling Skills and Selling Strategies 91 Wet noodle The sales manager does not grve any emotional or verbal response to the opponent's tactics. He does not respond to the opponent's pressure. He just sits at the negotiation table like wet noodle and keeps a poker face. Veiled threat Here the buyer lets the salesperson know how much power he enjoys. He starts like this: 'Last year we had to drop a seller because we found that he was charging 4% more than what the competitors were offering in the industry. Of course, I know the reputation of your company in the business.' Threats are the most abused tactics in negotiations. A threat is easier to make than a legitimate offer. However, it may stall a healthy negotiation process and destroy a relationship. In such a situation, the salesperson should play to their feelings of superiority. Behaving subserviendy towards them increases their feeling of superiority.

On the other hand, after considering his BATNA, the salesperson may say that he only negotiates on merit and his reputation is built on not responding to threats. Let's split the dilTerence The negotiator who first Suggests this has the least to lose because he shows proactive behaviour to remove the deadlock in the negotiation. Ptay the Devilts advocate The sales manager argues against the opponent's proposals by saying 'Before I say yes or no, let's look at all the bad things that may possibly happen if we did what you want.' This lets the sales manager show the opponent his better way of achieving their objectives without directly opposing the opponents viewpoints. Trial balloon The sales mrmager releases his decision through a so-called reliable source before the decision is actually made. This enables him to test the opponent's reaction to such a decision. Surprises The sales manager tries to keep the opponent off balance by drastic, dramatic, and sudden shift in his tactics in general. He shows completely unpredictable behaviour and thus prevents the opponent from anticipating his future moves. What's the rock bottom price The buyer in this case claims pauclty of time and asks directly about the least price. The salesperson should not go immediately to the bottom with a price that has nothing to negotiate. The salesperson with a stable price structure in the industry has the advantage of saying, 'How many will you need?' If there is some pricing flexibility with the volume of the order, responding with a negotiable price is appropriate. Adversarial negotiating tactics In this situation, the buyer pursues four negotiating tactics. They are: 92 Sales and Distribution Management ' Extreme initial positions; They start with nn extreme low o{fer designed to lower other the side's expectations. M*y a time the customer presents a price far below the current prlce to negotiate harder with the seller. ' Emotipnal tofiits:They create the impresion ttrat they are angry with the oppositiongetting red faced, raising their voices, and often *"king o,it of u -..tirg in a huff. Adversary concessions are viewed as wea.knesses. If they receive a concessiin, they do not reciprocate it, something that every body expects as a part of fair play. ' Sti"gl in thtir conusioas: They delay making .ny .orr".ssion and *hen they finally do, it is negligible. ' Ignore deadlines: They tend to be patient, as if time is of little significance to thern. However, one should be aware of the preconditions for such tactics, which include the following:

' Discontinuation of retation:hip: sooner or latter the other party wiu come to know that they have been cheated and they will be smarter next time. ' No rernorse {tentards: one must not feel guilty for playrng unfair. ' unawareruss fu ttu uictim: The potential victim must be naive, innocent, and unaware of what is going on. There are three alternatives when the other side has adopted adversarial tactics. They are walking away if other alternatives are available ; taking time, exercising patience, and practis- ing the strategy.of principled negotiations to get th; to argue on the basis of merit; and beating the devil at his own game by practising identicar tactics. Negotiation difrers from a typical buying-selling relationship. In a typical buyingselling relationship, the prices, promotional terms, and distribution schedules are already identified, whereas in negotiations they are to be decided upon through bargaining and negotiations between the buyer and the seller. Problem-solving Skills Besides the negotiation skills described above, one also needs problem-solving skills for effective selling' The relational and consultative selling approach suggests that a salesperson should not be a mere order taker; he should rather actas a problem-solver and a consultant to the customer. These roles are more significant for higi+ech ,.[t"; ;;il.irt.rr-,obusiness selling. Most of the real-world sales problems have many solutions. The objective is to pick up the best solution for the customer and organizational problems so that the salesperson becomes an engine for growth of the enterprise ,athe. than only a person in charge of transfer of ownership of products and services. If we can apply our problem-solving skills betteq the solutions will be more effective for the orgunirutiorr. Selling Skills and Selling Strategies 93 Table 2.2 characteristics of ineffective/effective problem-solver Characteristics lneffective problem'solver Effective problem-solver Attitude Actions Accuracy Solutions procedures Thinks nothing can be done; gives up easily. Lies back and exPects that a solution will come naturallY; unable to re-describe the problem;.iumps to conclusions very fast Does not check Does not break the Problem, lets it be as it is. Does not know where to start from; fails to identifY keY concepts; relies on guess; does not use any sPecial Plan; quits or

withdraws Believes the problem can be solved Revaluates the problem several times to look at the issue from different angles; Redescribes the problem; asks himself questions; creates a mental picture, draws sketches, and writes equations Checks and rechecks Breaks the problem into smaller problems leading to the larger problem; starts at a point where he understands better; uses a few fundamental concepts as building block; uses decision heuristics; perseveres when held up or struck; uses quantitative formula and equations to solve the problems; keeps a track of changes and Progress problem definition is a common but difficult task because what is normally observed rs the effect of the problem and not the true problem. The true problem is so complex that it is linked to multiple sources. These are also disguised in many forms' A true problem solver will analyze the situation and extract the real problem from an ocean of information and facts. Ill-defined or poorly posed problems may lead the problem-solver to a series of impossible and improper solutions. Treating the effects or symptoms can give a quick-fix.solution, but finding and solving the real problem is important to minimize the use of time, money, and eflorts for the customer as we[ as the sales orgalization. Implementing real solutions to real problems requires discipline to avoid being pressured into accepting a less desired, quick-fix solution due to time constraints. An understanding of the systematic approach that helps guide the salesperson through the solution process and generate alternatives solutions for the customer makes the salesperson more successful in establishing a relationship with customers' Eflective problem-solvers develop mindsets and habits that help them in handling diflicult problems. Stephen Covey in his famous book Tfu Seuen Habits of Highu Efectiue Peoplthsts seven habits that make people more effective problem-solvers. These habits include the habit of being proactirr", b"gitttting with an end in mind, putting first things first, always thinking win-win, seeking first to understand and then be understood, synergizing, and renewal. Habit I Be proadiue. Take an initiative and make things happen' Aggressively tttk.ttt*

ideas and innovations. Do not let a negative environment a{fect your behaviour and decision 94 Sales and Distribution Management making' work on things that you can change. If you make a learn mistake, acknowledge and from it. Habit 2 Begin uith an md in mind. you take are in the right direction. Fi.rkst", y where you are going and make sure all the steps determine trr" rig;t things to accomplish and then how to accomplish them best. write a personal mission statement describing where you want to go, what you want to be, and how to accomplish these things Habit 3 Putfrst thingsfirct. List your top priorities each day for the upcoming week, and schedule your time to work on them. continually review and prioritize your goals. say no to doing unimportant tasks. Focus on the important tasls, the ones that will have the desired . impact if carefirlly thought out and planned. Habit 4 Think win-win' wn-win is the frame of mind that seeks mutual benefits for all the people involved in a solution and agreement. Identi& the key issues and results that would constitute a fully acceptable solution to all. Make a]l involved in a decision feel good about the decision and committed to a plan of action. Habit 5 sakfrst tn understand, thm to be undnstnod, karn as much as you can about the situation' Try to see the problem from the other person's point of view. Be willing to be adaptable in seeking to be understood. Present ,hi"; t;..un not emotionally Be credible, empathetic, and logical. Habit 6 sInngize' Make the whole greater than the sum of its parts. value the differences in the people you work with. Foster open and honest communication. Help everyone bring out the best in everyone else. Habit 7 Renewal' Renew four dimensions of your nature. The frst dimension is physical, which can be improved by exercise, nutrition, and stress management. rrrrr..."i ar-ension is mental, which can be renewed by r:"ds,;t*;:trr*rtn planning, and writing. The third dimension is spiritual, which can be by value clarifications and commitrnents, study, and meditation. The social and emotional dimensions can be enhanced by service, empathy, self_esteem, and synergy Problem Solving and the paradigm pioneers As we have mentioned earlier, problem solving is a scientific process, and we can suggest a heuristic for sales managers to follow to solve problems for themselves, their organizations, and customers. The problem-solvers always take risks in life. Risks are actions with less chance of being successful' but if they succeed, then they bring great benefits to the organization. rnnovative solutions making a significant difference to life and orgurri"utior,-i.l^;;;l*i, ura u Selling Skills and Selling Strategies 95 higtrly effective person can bring such initiatives to the organizations. Problemsolvers always bring paradigm shifb and establish new patterns in society. A paradigm is a model or pattern based on a set of rules that defines boundaries and specifies how to be successfirl at and within these boundaries. Success is measured by the problems you solve using these rules. Paradigm shifts can occur in an evolutionary or revolutionary process. They move us from seeing the world from one specific way to another new way. \{Ihen new rules are set in a new paradigm, the old rulers and decision-mal<ers fade

away and the market is talen over by new problem-solvers. Paradigm paralysis can be illustrated with an organization that has frozen with the idea that what was successfii in the past will continue to be successful in the future. Paradigm pioneers are people who have the courage to escape a paradigm paralysis by breaking existing rules when success is not guaranteed. They have the realization that there is no shortcut in the journey of life, and there is no easy road in uncharted territories. They have to cut paths and make it easier for others to follow. They have a htgh level of intuition to carry out new ideas, and courage to leapfrog the conventional wisdom and create new patterns. Paradigm pioneers always seek for opportunities to initiate a paradigm shift to improve the set processes. They have an eye on the future, and are able to see the way things ought to be as opposed to the way they are at present. It also includes a master plan to achieve these goals. This attitude of paradigm pioneers may be appropriately expressed in George Bernard Shaw's words: 'Some people see things and say wh1t,l see thirgr that never were and say uhy noP' Elfective problem-solvers are paradigm pioneers with a vision and an action plan to arrive at that goal. Problemsolving Pnocess The problem-solving process brings logicality into decision maling though certain decisions taken on the basis of intuitions may also work. Figure 2.6 shows a problem-solving heuristic, which helps sales managers in finding alternative solutions to a problem. This was developed by McMaster, and is poputarly known as McMaster five-point strategy. The problem definition stage can come at any stage of the problem-solving process because implied problems can emerge when we are evaluating various alternative solutions during the process of problem solving. At the beginning you should collect and analyze data, and talk to people familiar with problems of similar nature. With the same problem recurring in the organization, if possible, the sales manager should view the problem and confirm all the firdi"gr. The problemsolver should list every detail that he can use to explain the problem. He should determine what information is missing and what information is extraneous in nature. Using all such details, he should draw a sketch of the situation or problem. 96 Sales and Distribution Management

Figure 2.8 The problem-solving process McMaster FivePoint Strategy 1. Define (a) ldentify the unknown or stated objective. (b) lsolate the system and identify the knowns and the unknowns, such as inputs, Iaws, assumptions, criteria, and constraints, stated in the problem (c) List the inferred constraints and the inferred criteria. (d) ldentify the stated criteria. 2. Explore (a) ldentify tentative pertinent relationships among inputs, outputs, and unknowns. (b) Recall past related problems or experiences, pertinent theories, and fundamentals. (c) Hypothesize, visualize, idealize, and generalize. (d) Discover the real problem and the real constraints. (e) Consider both short-term and long-term implications. (f) ldentify meaningful criteria. (g) Chose a basis or a set of conditions for reference. (h) Collect missing information, resources, and data. (i) Cuess the answer or the result. f) Simplify the problem to obtain an order of magnitude result. (k) lf you cannot solve the proposed problem, first solve some related problems or solve part of the problem. 3. Plan (a) ldentifo the problem type and select the heuristics (b) Cenerate alternative ways to achieve the objective. (c) Map out the solution procedure to be used. (d) Assemble the resources needed. 4. Act (a) Follow the procedure developed in the plan phase, use the resources available. (b) Evaluate and compare the alternatives. (c) Elirninate alternatives that do not meet all the objectives or address all the constraints. (d) Select the best alternative from the remaining. 5. Reflect (a) Check that the solution is blunder free. (b) Check the reasonableness of results. (c) Check the procedure and logic of your arguments. (d) Communicate results.

Selling Skills and Selling Strategies 97 He should analyze the data to find trends, errors, and other meaningful information. Then he should ask exploratory questions to people who have experience or who are conversant with similar problems by evaluating the past, challenging the basic premise of their problem dcfinition, and asking for clarifications when the issues are not clear. The sales manager should not rely on the experienced people's opinion or interpretations; rather he should make it his first-hand problem definition by confirming all those findings and cross-checking all the data, information, and trends available. Define the Problem After this preliminary exercise, the sales manager should go on to define the problem. First, he should find out where the problem came from, who posed the problem statement in the first place, i.e., did it arise at the level of the sales representative, the sales officer, or the customer himself. Then the sales manager should make an attempt to validate the reasoning to arrive at the problem statement. This can be done by asking the concerned person whether he has considered the problem from all angles. The next step is to explore the problem. This technique can be used for both illdefined problems and new problem formulation situations. Problem exploration can be done by identifying all the available information, learning the fundamental theories involved in the business, collecting the missing information, generating hlpothesis, collecting any missing information, and then defining the real problem. The next step is to look at the present Figure 2.9 Techniques of problem definition Sales and Distribution Management state and identify the desired state' This technique helps us to learn whether the solution goals are as per the current needs of the organization or not. The fourth step in defining a problem is to use Dunker's diagram. It helps to obtain solutions that satis$r the criteria set up by the stating the desired state and the present state. The uniqueness of the diagram is that it points or*h. ways to solve a problem by making it OK not to arrive at a desired solution. The fifth step is called statement-restatement technique. It was developed by parnes. Here one loolcs at the fuzzy or unclear problem situation and writes a statement regarding the challenge to be addressed. Figure 2.10 Dunker,s diagram

The problem is then restated in di{ferent forms a number of times. Each time the problem is restated, one tries to generalize it further in order to arrive at the broadest form of the problem statement. In restating the problem, it is important to inject new ideas rather than merely changing the words. The evaluation of the problem statement is a technique by which we can crosscheck the problem definition, whether it is in the right direction or not. Then the sales manger should decide whether the problem needs to be solved, continues to collect more information, develops simple hypothesis, and brainstorms potential causes and alternative solutions. Generate Solutions After gathering sufficient information and defining the problem, the next task is to generate alternative solutions. Brainstorming is one of the poprlu, techniques used for generating solutions' It helps in expanding thinking as to whatis possible and what is not possible. The other methods include analogies and blockbusting. Selling Skills and Selling Strategies 99 Figure 2.1 1 Statement-restatement technique The problem may seem to have a single solution due to mental blockings. The mental blocls can be from multiple sources, such as the narrow definition of the problem and attack on the syrnptoms rather than on the problem itself, which leads to symptom-related solutions, the attitude of getting hooked to the first solution that comes to mind, chances of distraction due to irrelevant information called mental dazzle, and a high level of ambiguity in defining the problem. The mental blocks can be of perceptual blocLs, emotional blocks, cultural blochs, environmental blocks, intellectual blocls, and expressive blocls. The perceptual blocls may happen due to the inability of the problem-solver to clearly perceive the information or the problem. This may be due to the stereotyping attitude, which limits the problem unnecessarily, or due to saturation and information overload. The emotional blocls can be due to the fear of taking risk by the problem-solver, the lack of appetite for the chaos that the problem may create, inclination tojudge than generate ideas, lack of potential challenge in the work environment, and inability to incubate the problem by rushing to solve the problem just to get it off from the mind. The cultural bloc}s are acquired by exposure to a given set of cultural patterns, and

environmental blocks are imposed by our immediate social and physical environment. Distractions like telephone calls and intrusions, which inhibit deep and prolonged concentration, create blocfts in creative problem solving. Similarly a work environment that lacls emotional, physical, and social motivation also has the potential to create environmental blocks. The intellectual blocks arise out of inflexible and inadequate use of problemsolving techniques. Lack of intellectual capability sometimes inhibits the problem-solving skills. 100 Sales and Distribution Management Table 2.3 Coman,s blockbusters Blocks Blockbusters Negative attitude Focusing attention on the negative aspects of the problem and possible unsatisfactory outcomes hampers creativity. Fear of failure One of the greatest inhibitors of creativity is the fear of failure and the inability to take risk. Following the rules Some rules are necessary while other rules hinder innovation. Over-reliance on logic Relegate imagination to the background because of a need to proceed in i step_by_ step fashion. Your are not creative Believing that you are not creative can be a serious hindrance to generating creative solutions. Believing that you cannot do something is a self-fulfilling prophecy. List the positive aspects and outcomes of theproblem. Realize. that.with every problem, there is not only a danger of failure but also an opportunity for success. Risk taking Outline what the risk is, why it is important, what is the worst possible outcome, what your options are with the worst possible outcomes, and how would you deal with future. Breaking the rules Practise trying new things. Take a different route to work, try a new food, go somewhere you have never gone. lnternal creative climate Turn the situation over to your imagination, your feelings, your sense of humor. play with insights and possibilities. Creative beliefs Encourage your creativity by asking ,what if, questions, daydream, invent metaphors and analogies. Try different ways of explaining your creativity and problem-solving ability. Attitude adjustment Expressive blocls are the inabilities to communicate your ideas to others in either verbal or

in written form. Blockbusting techniques are used to remove these kinds of blocls. Goman has developed a structured technique for blockbusting as shown in Table 2.3. There are other methods for creative thinking anJgenerating solutions. Brainstorming is one such method, in which an initial association of ideas i, *J. to find a solution to the problem' A list of possible solutions is generated either at the group level or the individual level, and solutions are evaluated. This triggering of ideas is dolne with a positive attitude in mind and no negative or critical evaluation of solutions generated by others is done. Methods like analogies, in which metaphors are used u, u rnod. of expression, of the problem is a popular method to generate solutions. Decide the Course of Action The next step is to decide upon the course of action amongst the solutions generated during the preceding stage. rngical analysis of each alternative h"elps in arriving at i solution. The decision involves prioritizing the problems, selecting the best course of action, and deciding on how to success{Llly implement the solution. Figure 2.10 shows the kind of decisions that are to be taken for each alternative to arrive aia solution This model was developed by Kepner and Tregoe. This model helps us to decide which problem is to work on first and what is to be done *ittr the problem..In situation analysis, the problem-solver classifies the problem into one of these analysis groups. Selling Skills and Selling Strategies 101 Figure 2.12 Components of a decision on the future course of action In problem analysis, the cause of the problem is not known, which the problemsolver tries to find out. The events, trends, and programs of the past that have given birth to the current problem are anaJyzed. The problem-solvet' must juggle priorities at all the time . In methods like Pareto analysis, the problem-solver finds out the relative importance of each problem to other problems in a given situation. In decision analysis the cause of the problem is found, and the problem-solver has to decide what actions have to be taken. The decision at the present time is to correct the cause of the problem. In potential problem analysis, the problem-solver wants to ensure the success of the decision, and anticipate and prevent future problems from occurrence. In this case the problem-solver identifies all the potential problems that could occur and the consequences of each occurrence.

He should be alert towards potential problems when the deadlines are nearing, when something new and complex is being tried out, and when the solver is trying to assign responsibilities and is following a critical sequence. The problem-solver lists all the causes of each problem and develops preventive actions for each cause. He also develops a contingent action plan to be undertaken if the preventive action fails to prevent the occurrence of the problem. Establishment of early warning signals can help in triggering the contingency plan. lmplementthe Solution After deciding which alternative course of action to take, the next difficult task is to implement the decision. The problem-solver plans the activity to solve the problem. He uses a number of techniques to allocate time and resources to implement the solution figure 2.13). The first step in implementing a solution is to get the organization's approval for the chosen solution so that necessary resources can be allocated to complete the project. The process starts with preparing the plan document about what the problem-solver intends to do, the reasons thereof, what procedure the solver wants to follow to implement this, and what benefits the organization will have after implementing the solution. The most important stage in implementation is the planning stage, in which time and human resource are allocated along with financial resources. In this stage the problemsolver tries to sketch the entire pathway to the final solution. Gantt and deployment charts 102 Sales and Distribution Management Figure 2.13 The solution implementation process are made, critical path management is employed through the application of CpM and PERI and allocation of necessary resources are clone in this stage to implement a new solution in the organization. The carry through stage involves obtaining and maintaining cooperation from other people in the organizationfor smooth implementation of the solution. Follow-up is necessary to monitor the progress of the solution on the basis of time allocated for eachpart and the time available so that processes and resources can be organized to complete the implementation. Evaluate the Solution The last step is the evaluation of the solution by measuring up its performance against the

implementation plan and its ability to solve the organizational problem. This is an ongoing process, in which at each stage of the implementation quantitative and qualitative methods are used to judge the extent to which materials and methods satisry the external and internal criteria for the solution. Here the problem-solver checks whether the real problem is solved or not) whether the solution he has arrived at is the best available solution at that situation, and whether the solution was innovative and effective enough so that the same problem or a similar problem will not crop up in future. The problem-solver also evaluates the problem from the point of view of ethicaliry environmentally friendliness and safety of the people in the organization and user of the products and services or not. Selling Skills and Selling Strategies 103 The problem-solving technique explained above is an attempt to develop a systematic procedure so that sales managers can attempt to solve the organizational problems while facing the market and solving consumer problems. Log.ul flow of ideas and strategies will help managers to solve organizational problems, 4nd make them more responsive to customer problems. Summary A successfirl salesperson is an asset to the organization, particularly in the context of customer's switching rapidly from one firm to another for small benefits due to the availability of multiple choices. It is also observedthat the attrition rate in the sales world is quite high and people frequently change their jobs. Proper training of salespeople in selling skills and sales processes will have significant positive impact on their image in front of others, the general attitude towards the nature of their work, their self-esteem, and their relevance to the work organization. A business organization's success largely depends on the success of its salespeople, as they are the first customer contact points. It is important not only to acquire adequate selling aptitude and knowledge about products of the organization and its competitors, but also to acquire various selling skills like communication skills, negotiation skills, conflict resolution skills, listening skills, and problem-solving skills. Mere acquisition of the skills will also not bring success to salespeople; they have to apply these skills to understand the customers and close the sales rn different selling and buying situations. The selling skills are honed by a process of continuous application

in the world of selling. Such enrichment will help a salesperson to stick to a company for long as more success in selling will bring more rewards, and the longer they stay in an organization, the better the strategies of relational selling can be executed in that organ:uzation. Selling skills help the salesperson and the sales manager to effectively utilize the selling time, to understand the customer betteq and generate higher returns to the organization. He needs to have conceptual skills, which refer to the cognitive ability to see the organization as a whole and the relationships between the parts. This skill involves the manager's thinking and planning abilities. People skills involve the manager's ability to work with and through other people, and to work eflectively as a group member. The necessary technical skills include the ability to perform a specialized task that involves certain methods and processes. KeyTerms Selling skills These are the sum total of aptitudes and skills such as communication skills, listening skills, conflict resolution skills, problemsolving skills, and negotiation skills. Communication It is the exchange of ideas and information between two parties. Content listening It is the understanding and retention of the speaker's message. Here the information flows from the speaker to the receiver, i.e., from the salesperson to potential customers. There is no question of any agreement or approval of the message. Critical listening It is to understand and evaluate the meaning of the speaker's message at several