Beyond manufacturing, the era of the service industry, form a professional negotiation team

최종 수정일: 2020년 2월 3일



[You can find Korean version below]


One of the reasons why Korean companies have a hard time moving from manufacturing to the service industry is due to the difficulty of negotiating in a more complex service industry structure from the previous relatively simple negotiations. One of the challenges that many companies face in the service business is the risk of the business and the negotiation work that is linked to it.


For example, in the case of overseas construction EPC business, engineering, procurement, and construction should be combined to complete all the necessary objects from design to construction. In my personal experience with the previous or present Korean construction companies had no internal professional negotiation team, which resulted in many difficulties from contract to negotiation of claims at the implementation stage, which represented a financial loss.


The service industry has to deal with a myriad of hardware suppliers, software providers, subcontractors and vendors for construction. One of the most important parts is that you have a contractual liability for the customer (owner) about the finished product without the finished product yet.


In the manufacturing industry, Korea's major industry, negotiating capacity was relatively less important because most business activities were completed by contracting and shipping through sales and sales activities to customers with finished goods or stock.



However, the service industry has different characteristics from the manufacturing industry.

  1. There is no final product visible or tangible at the contract stage. (In case of manufacturing business, the tangible products already exist.)

  2. You need to collaborate with a number of hardware vendors, software vendors, and delivery vendors who will organize services. (The manufacturing industry may have a large number of parts, but the business structure itself is simpler than the service industry.) One of steel company said that they don't need the high level of negotiation skill because there're very few things to be negotiated for the business done.

  3. There will be so many contracts changes and claims while contract execution proceeds. (In case of Manufacturing, Warranty / Warranty responsibility after contract implementation but simpler than service industry.)


SNRLAB provides professional negotiating team support services on an annual basis, including training, individual coaching, and practical preparation for negotiations. If you are interested in a professional negotiation team support service, please refer to the linked article.


Please contact SNRLAB through sdlee@snrlab.com for the professional support services for your negotiation team.

Without professional negotiation teams in these service industries, the following things are common:

  1. The contract stage neglects the value chain of the entire business and simply negotiates with the cournterparts about the contract terms and conditions.

  2. Inaccurate contracts and partnerships in contracts with companies to fulfill their contracts. For example, different warranty periods with different suppliers may cause additional loss or warranty liability difficulties with future customer relationships.

  3. Claim negotiations at contract performance, contract change negotiations can lead to significant financial losses and difficulties in breaking the relationship.



Many Korean companies have responded with litigation when problems arise in the manufacturing industry. However, in the service industry, litigation can also be difficult to settle with a counter-party, and it can be difficult to obtain the desired trial results. Moreover, in my experience, I see a lot of internal party shocks and hardships in the future when faced with the consequences of losing, since the parties of many companies have a vague expectation of winning in the problems of manufacturing. In other words, in the service industry, dispute settlement through negotiation between the companies becomes very important.


Negotiation is not simply about the price or part of the terms of the deal, it is about looking at the business risks and opportunities as a whole, which is essential to the success of the service industry.


For the same reason, IBM's reorganization from hardware-driven business to service-driven business has its own contracts and negotiations.

 

In order for the Korean economy to leap, development in the service industry is also essential, and one of the representative competencies is to focus on the preparation of the negotiation team and the professional negotiation capacity.


SNRLAB



SNRLAB provides professional negotiating team support services on an annual basis, including training, individual coaching, and practical preparation for negotiations. If you are interested in a professional negotiation team support service, please refer to the linked article.


Please contact SNRLAB through sdlee@snrlab.com for the professional support services for your negotiation team. If you need a proposal, please contact us.



For Korean version -


제조업을 넘어 서비스 산업의 시대, 전문 협상팀을 구성하라.


제조업에서 서비스 산업으로 - 사업 리스크와 협상 전략이 중요

한국의 기업들이 제조업에서 서비스 산업으로 이전하는데 어려움을 겪는 원인 중 하나가, 이전의 비교적 간단한 협상 업무에서 , 보다 복잡해진 서비스 산업 구조에서의 협상 업무가 어려워진 탓도 있다. 많은 기업들이 서비스 사업을 하면서 겪는 어려움 중 하나는 사업의 리스크와 이와 연동되는 협상 업무 이다.


예를 들어 해외 건설 EPC 사업의 경우, 엔지니어링, 구매, 시공이 합쳐져서 필요로 하는 대상을 설계 부터 시공 까지 모두 완성해야 한다. 이전의 한국 건설 업체들은 내부에 전문 협상팀이 없다보니 계약 부터, 계약 수행 단계의 클레임 협상까지 많은 어려움을 겪게 되었고 그러한 어려움은 재무적 손실로 나타 났다.


서비스 산업은 무수히 많은 하드웨어 공급자, 소프트웨어 공급자, 시공을 위한 하부계약자들을 상대해야 한다. 가장 중요한 부분 중 하나는 아직 완성물이 없는 상태에서 고객(발주자)에게 완성물에 대한 계약상의 법적 책임을 져