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When we survey organizations, the majority claim they would prefer collaborative relationships. Over 80% of negotiators say they believe in win-win negotiations. Indeed, a similar percentage believe they indulge in a win-win approach - it is (according to them) the other side that derails their intent. So what goes wrong?

The important issues seem to be a combination of time, timing and power.

1. Time: many negotiations are undertaken under tight time pressures. Whether the urgency is real or imagined, the parties often believe that collaboration takes more time. So rather than engage, they confront. Either the more powerful seeks to impose their terms, or they start a 'battle of the forms'. There is little substantive discussion at a business level.
2. Timing: this is more about who gets involved and when. One of the key complaints by negotiators is that they are 'involved too late'. Often they are either seeking to recover from ill-considered commitments, or they find much of the ground has been given away, or they are under strong pressures to close 'because everything is agreed except the contract'. This approach pretty much guarantees that terms and conditions become contentious as each side focuses on risk allocation to protect itself from the uncertainties of the preceding discussions.
3. Power: in principle, maybe we want to collaborate. In practice, the more powerful party tends to say: 'Here are my terms. Trust me, we will collaborate later'. Of course, one of the key problems with this approach is that it curtails discussion. Requirements are not properly analyzed; capabilities are not adequately aligned; risks are not sufficiently assessed or mitigated.

Establishing A Framework

In truth, collaborative negotiations often take less time than confrontation. But they do require greater investment and to be efficient, they need a methodology. But the key point is this. When we discuss collaboration with our members, it is typically the less powerful organizations that plead for less confrontation. However, they are not in a position to drive the change. The only people who can make this new world a reality are the organizations with power.

What might this mean? When I was leading IBM sales negotiation staff in Europe, I could see that many customer negotiations were sub-optimizing results. Not only did the imposition of standard terms sour relationships, it also meant that critical conversations and opportunities were missed. If we wanted to sell true value-add solutions, we had to take time with the customer to discuss their goals and align them with our capabilities. So with a colleague from Marketing, and drawing on the disciplines of a project definition workshop, we developed what we called a "Market Planning Workshop" that could be used as a framework for collaborative negotiation. All the negotiators where then trained in this methodology.

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Copyright © 2007 Tim Cummins