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Are you really a negotiator?

October 7, 2019

Most business-to-business negotiations are destroying potential value. Rather than engendering trust, they sow the seeds for discord.

The problem

Ask any hostage negotiator about how to achieve success and they will tell you that it isn’t through intransigence, threats or deliberate tabling of unacceptable terms. Yet examine typical business negotiations and these are traits that frequently occur. The more powerful party tables one-sided terms and demands compliance. They typically claim ‘everyone else accepts these terms’ (I.e. if you don’t, we won’t do business); and in many cases, the counter-party responds by tabling their similarly one-sided terms.

This isn’t negotiation. In many ways, it is negotiation avoidance. It is based on a lack of trust and a fear of failure.

A different approach

If we want better results – and I hope we all do – there’s a need for a different approach. Here are three principles to consider:

  • Confront perceptions. It is clear that many negotiations are compromised by unspoken assumptions or beliefs. Unless these ‘elephants’ are addressed, there will not be trust and without trust, confrontation is inevitable.
  • Send negotiators, not roadblocks. Often, suggesting that negotiations are occurring is a bad joke. One or both parties frequently send people whose job is to enforce compliance. They lack authority and have no interest in showing empathy or acting as an advocate for the other side.
  • Build common ground. Ultimately, high performing relationships are built on shared principles and goals. Yet because the elephants aren’t addressed and because the negotiators have limited authority, it is very unlikely that common ground will be explored or established.

Ultimately, while organizations are responsible for performance, it is people who set the scene. Until these three principles are addressed, we can’t expect results to improve.

 

2 Comments
  1. Howard Richman permalink

    For ongoing commercial relationships these principles must ultimately abide; however, not everyone comes into negotiations with the same risk-reward metrics or measures or motivations, and there is always cycles of buyers market to sellers market and back again. Ultimately a contract is an agreement to risk sharing between 2 or more parties, and what needs to be determined is whether the same people you are dealing with will be the same people who need to resolve disputes when things go wrong. Trusting people is not enough- you need to trust the organization as well.

  2. rosettauk@aol.com permalink

    Good morning Tim, As someone who has been around the block a few times, I see that the nature of negotiations has changed considerably, mainly due to the fast pace of business today and the reduction of face to face negotiations – all mainly due to good business reasons.  Most people, whether buy or sell side, have huge workloads with a focus (and in some cases a measurement) on how fast they can bring a contract to closure so they can move onto the next. Quite often, negotiations consist of lengthy emails back and forth tediously going through copious mark-ups, each party insisting on their own one-sided terms sometimes citing ‘company policy’ as the reason, which is another way of stating that the topic is non-negotiable. Just yesterday, a customer stated in relation to a services contract that it was company policy not to accept a non-solicitation clause i.e. we want to buy your professional services but wish to be quite free to poach your staff with no come-back. The opportunity for establishing any relationship of trust or empathy is limited. In the early years of my career, I was able to establish personal relationships with customers and greatly enjoyed contract negotiations – all the research, strategy planning and then the fun and adrenaline-fuelled face to face negotiations – the best part of my job. I also greatly enjoyed getting to know my customers on a personal level. Today, negotiations are often as described in your post. Sometimes, a negotiating party even rejects telephone conferences to discuss the issues due to lack of time or ability to get the required stakeholders on the call at the same time. There are of course exceptions depending on the industry and contract size, complexity etc., but for most day-today transactions my experience is as above. Maybe if there were generally accepted contract templates covering the boilerplate clauses, leaving negotiators free to focus on their business specific and commercial topics, that might be a step forward, or a generally adopted negotiation process that includes a requirement to understand key elements of the other party’s position and offering. But with the focus on the importance of meeting sales and other targets, I fear that the long-term rewards referenced in your post are often sacrificed for short-term gains. Thank you to you and the IACCM for raising these topics and for continually seeking to promote change. Best Regards Rosetta Rosetta NicksonContracts Consultant07711 317022

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