The Commitment: Finalize Value, Negotiate and Close

Ultimately, the role of the SAM is to drive revenues for the firm and the role of the senior buyer is to source competitively. In co-creation, the negotiation and transaction aspects do not go away. In this chapter, we address the fourth stage of the relationship-building process, i.e., the moment where the partners finally agree on the definition of what value is being created, and negotiate how that value will be shared in a contract between supplier and customer in some form of price, quantity, revenue, or cost agreement. Many of the traditional principles of negotiation still apply. The main difference with the classic sales and procurement arm-wrestling is that all the work done by the SAM and senior buyer in the previous three phases of the relationship-building process have now led to a rich definition of the value being negotiated, with the number of decision-making or influencing parties larger and the role of data more integral than in classic selling and buying.