How to Negotiate When Yes Is Not Enough

By CIOinsight  |  Posted 09-17-2007
Negotiating a good deal means more than winning on price or other terms, say Danny Ertel and Mark Gordon, cofounders of negotiation and business relationship management specialists Vantage Partners, in their upcoming book, The Point of the Deal: How to Negotiate When Yes Is Not Enough (Harvard Business School Press, October 2007). When parties will be working together long term, it is imperative to plan for the continuing relationship, too. That's especially true in IT, where purchase decisions are often just the beginning of extended and complex interactions between vendors and customers. This excerpt discusses laying the groundwork for relationships that last long after the ink on the contract has dried.

If implementation matters, then the deal itself cannot be the end goal. We have seen myriad examples of clever procurement people losing sight of the real purpose in negotiating deals with a supplier, striking deals that looked good at the outset, but failing to accomplish what they needed.

When implementation matters, then usually the day after the deal is signed something is different. The parties have begun to design, build or operate something they are buying from or selling to each other or collaborating to create. Or the parties have started to work together to get things done more effectively. Whatever you are trying to achieve, if you really want to be well prepared for a negotiation in which what happens after the deal is signed is important, then "what will be different?" is a critical question to ask early and often. If your purpose is to do something with the other participants after you sign, then thinking about how you need to work with them is part and parcel of defi ning your purpose for the negotiation. We're not saying that you have to be "nice" or make lots of concessions during negotiation to be likable during implementation.

What we are stressing here is that if implementation matters, it implies a need for some kind of working relationship post signing, and preparing for that relationship cannot wait until negotiations are over.

Part of bringing an implementation mindset to your negotiations is to keep your focus on the end goal and all the things (including, but not limited to, an agreement) required to get there. Our best advice is not to be quiet and circumspect regarding implementation, but to be unabashedly explicit about your goals and concerns for that phase.

Wear your "day after" thinking on your sleeve and wear it proudly. When we encourage you to try some "backward thinking," we mean putting into practice the notion that the negotiation is a means to an end, by talking explicitly about the end goal and working backward from there. Take a blank sheet of paper, turn it sideways, and write your end goal at the far right-hand side.

Describe in a few words what that goal looks like when it is achieved. Then ask yourself, "What needs to happen the day before, for that goal to be achieved?" This often leads to an interesting conversation that unearths all sorts of unstated assumptions about the point of the negotiation. It also often helps identify issues that did not seem necessary to cover just to sign the deal but clearly need some discussion.

After you clarify what needs to happen right before you accomplish your goal, ask, "What must happen before those things can occur?" Continue to repeat the above step until you work your way backward to the negotiation itself.

When you can truly say that the only thing required is the agreement of the parties, you know you are on the same page regarding the point of the deal. That doesn't mean you don't still have a lot to do to make sure you can reach a workable agreement. But it does mean that if you get to "yes," you will also be on the path that will get you "beyond yes" to your real goal.

The more often you engage your counterpart in a discussion about what it will look like, and what it will really take, to achieve your purpose, the more likely you will be successful. The sooner you start working backward from that future outcome to where you are today, the more effective you are likely to be.

REPRINTED BY PERMISSION OF HARVARD BUSINESS SCHOOL PRESS. EXCERPTED FROM THE POINT OF THE DEAL: HOW TO NEGOTIATE WHEN YES IS NOT ENOUGH, BY DANNY ERTEL AND MARK GORDON. COPYRIGHT © 2007 VANTAGE PARTNERS LLC, ALL RIGHTS RESERVED.