Want to become a better negotiator? Think like an accountant.

Want to become a better negotiator? Think about learning more about your organization’s budget, balance sheet and profit and loss (P&L) statement.

I know, I know, most of us non-financial types would rather stick a fork in our eye than have to sit through training in this stuff. However, knowing how your company operates – the nuts and bolts, including finance – is never a bad thing, and can be a game changer when it comes to stronger negotiating skills.

I recently interviewed a Chief Human Resources Officer and asked her what book, class or resource she might recommend to aspiring leaders. Instead of making a specific recommendation, she advised future leaders to “Learn to speak the language of business, which is financial and accounting concepts.”

Here’s the upside: If you spend some time with your manager or a colleague from finance getting to understand how the finances work in your organization, I promise you’ll learn something interesting or valuable. In turn, this knowledge will empower you to know exactly what to ask for, who to ask, and when to ask for it – and, equally as important, know when not to ask.

To further clarify this point, here are three case studies where learning the company’s finances paid off big time in negotiating skills for the following potential leaders:

Case Study # 1: The Early Purchase Order Gets the Money!
Recently, I was leading a workshop for employees of a particular government agency. One of the senior scientists told the class that she always keeps a fully completed purchase order requisition form close at hand.

Although the agency’s budgets were being squeezed, there would occasionally be small amounts of “use-it-or-lose-it” money available at the end of a financial cycle. She had discovered that the first person to produce a correctly filled-out purchase order was likely to get their request approved.

Case Study # 2: The Inside Scoop
At a technology company, one project manager spoke about having a good friend in finance who helped her identify the best category for each expenditure she proposed. For example, the budget line item for full-time hires was notoriously scarce, so if you needed additional staff, and could use a contractor, it was much easier as there was a lot more flexibility with that budget line item.

And although travel budgets were being scrutinized, money for training was plentiful, so if you needed to take a business trip and could show what you’d learn, it was more likely to be approved. This knowledge gave her an “inside scoop” when it came time to go to leadership about her own needs.

Case Study # 3: Timing is Everything
In this case, a friend of mine asked for a raise and got laughed at, because she asked one week after the big meeting where the department heads got together to haggle over raises and promotions.

If she had asked four weeks sooner, she would have been right in the “sweet spot” and gotten what she wanted. So she put a reminder on her calendar to check in five months later, before the next departmental meeting. As a result, she got what much of she was asking for.

They say timing is everything, and they’re usually right!

The Bottom Line
If you want to become a better negotiator, get to know how budgets and finances work in your organization. That way, the next time you need to ask for resources, whether it be office equipment, professional development or a new hire, you’ll be much more likely to get what you’re seeking.

Jo Miller

Jo Miller is a globally renowned authority on women’s leadership. She’s dedicated two decades to helping women advance into positions of influence by leveraging their leadership strengths. Based on her work with hundreds of thousands of women, she developed a pragmatic and powerful roadmap that guides women to become the leaders they aspire to be. Jo shares this proven process in her book Woman of Influence: 9 Steps to Build Your Brand, Establish Your Legacy, and Thrive (McGraw Hill, 2019.)

Jo is CEO of leadership development, consulting and research firm Be Leaderly. Learn more about her speaking engagements at www.JoMiller.com and follow @Jo_Miller on Twitter.

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