Negotiations can be a long and frustrating process, which can be made more efficient by using various tools, processes, and procedures. Being able to know when to begin and end the process, and especially knowing when to walk away from the table, is part of the overall process of negotiations. A bad deal can be something of a problem child, and you may end up in court to work through issues with a bad deal.
- Using Term Sheets, or Talking Points, to rough out the major points of a potential agreement can assist in finding middle ground.
- The more work done in the “getting to know you” phase of negotiations, the smoother the process can be.
- Finding appreciation for the other side’s position can assist as well. A mantra of “thank you for that clarification, which helps me understand your position and needs more fully” can be helpful.
- A realization that not all deals are a zero sum gain, but that synergies can make 1 + 1 > 2 can result in a more collaborative and productive environment and lead to a better result for each side and the overall agreement.
- If early on one or both sides note that “the elevators cannot overlap” or that the “floors and ceilings cannot overlap” then the deal may not be worthwhile. This can be a starting point using the information in the term sheets. Elevators overlapping refers to the high and low that each party is willing to agree to in the spectrum of possibilities, and much like elevator banks in large skyscrapers, if there is no overlap, then a passenger is disappointed and has to take the stairs. This analogy was provided by one of the best negotiators that I have met, and it does make sense to use this tool early on in negotiations to reach a GO / NO-GO point of moving forward or not.
- A realization that we all must make decisions based on imperfect or incomplete information is a bit of a must. No matter how much due diligence is performed, there will always be surprises.
- Some point out that a good deal is one where neither side is completely satisfied. You will not get everything you want, and need to be prepared to give some and take some territory along the way.
- Another sign of a good deal is that the completed agreement goes into the desk drawer and is not pulled out again and again to monitor performance or compliance by both sides.
Every deal is unique, even when using stock agreements, and every negotiator is different. May you find your style and blend of tools, and assistance along the way which will likely be needed, if only for moral support and bouncing ideas around. After all, sometimes it is the journey that matters more than the destination! Here, the more attention given to the journey of negotiations can result in a better deal for all that has less likelihood of future pathology.
June 12, 2018
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