Negotiating Contracts: A Little Bit of Healthy Curiosity Goes a Long Way

By: Tammy Lenski, Ed.D
Submitted: 2007-01-17 15:28:08
Print this article | Tell a friend | For publisher | Social Bookmarking
Rating:
 

In the contracting meeting, the department head reviewed my proposal and slid the contract back across the table at me, shaking her head. “Too much,” she said. “I’ll give you 20% less.”

This was more than a decade ago, when I was just starting out in private practice, and one of my first big opportunities was to help a large department work through a long-standing state of unrest that was getting in the way of operations. Here I was, sitting with the head of the department, attempting to finalize the contract proposal I'd so carefully constructed.

Pleasantly, I explained that I hadn’t deliberately inflated my proposed fees to come in with a highball offer or play negotiating games. The proposed fee was a real number based on careful consideration. I further explained that while my hourly rate was not negotiable, perhaps she and I should revisit the scope of the work to be done to see if that could be scaled back to bring the cost down.

She shook her head again, this time rolling her eyes ever so slightly, as though she couldn’t quite believe she could be talking to such an imbecile. “Everything’s negotiable,” said she, “even hourly fees.”

Now, I had just finished a book cautioning new consultants not to negotiate their rates (assuming their rates were based on something real, like overhead, income needs, going rates in the field, etc. and not just pulled out of the air) because it became a slippery slope. At a loss for what else to do and fast realizing that my plum of a new contract was slipping from my grasp, I asked, “Why do you believe that everything’s negotiable?”

She sat back and said, “I don’t. But the head of finance does. He’ll ask me if I bargained you down and got a good deal.”

I stared in disbelief for a moment. Then I picked up my pen, crossed out the proposed fee, and wrote in a new fee about 25% higher than my original one. “Will this work?” I asked, sliding the paper back to her.

She pondered my figure for a moment, then said, “Well, I’ll have to offer you 20% less than that. I think I’ve already been clear about that”

“That sounds reasonable,” I said. And we had a deal.

This really did happen. I learned a few important lessons about negotiating that day, ones that are often key when I’m helping mediation parties negotiate or helping coach someone for an upcoming negotiation of their own.

I learned that pushing back and being firm in a position is often not a fruitful strategy. After all, had I refused to consider a new way to look at my fees, I wouldn’t have gotten the contract and I wouldn’t have this delightful story to tell.

I learned that asking even the simplest question in a real attempt to understand, then really listening to the answer, can unlock a negotiation.

I learned that knowing someone’s interests can make entirely new solutions visible. Learning that the department head had an interest in being able to tell the CFO she had bargained me down helped open up my thinking. And it helped me see her in a different light. No longer was she just unreasonable or stubborn.

And I learned that even the zaniest solutions sometimes work or lead to other ideas that do. Who ever would have dreamed that upping my contract price, right in front of her, could have lead to a deal after she’d already told me it was too high?

Copyright © 2005 by Tammy Lenski. All rights reserved.

Visit http://www.lenski.com for more tips and resources on talking things out in the work and home relationships that matter most.

Get your free copy of Talking It Out in Ten, a worksheet and guide to help you think and prepare for your difficult conversation, by visiting http://www.lenski.com and clicking on Free Guide. You'll also receive Tammy's monthly newsletter and be entered automatically into a bi-monthly drawing for coaching and consulting time with Tammy.

Dr. Tammy Lenski is the author of I Can't Say That!, a popular blog read by women all over the world. A professional mediator, conflict management coach and educator, Tammy works personally with women who want to keep their balance in conflict and step up to the conversations that really matter.

Article source: Expert Articles

Most Recent Articles in Negotiation category

  • The 2nd Secret That Negotiators Won't Tell You - Why They Object to Your Proposal - By: TK Chan
    Have you ever wondered why some people object to your proposal during the negotiating process and you are totally lost as to the reason why they do that? What if there is a truth in why most people behave that way and once the truth is unraveled, you would become much more effective in dealing with your negotiating parties in all situations?
  • Tips To Successful Business Negotiation - By: Nazeer Daud
    Successful business negotiation can be worth a great deal to your business. It can mean the difference between securing a contract and losing a contract, and has the potential to be worth untold amounts of money to your business.
  • The Mystic Art of Negotiation - By: Oscar Basurto
    IntroductionWhat is the reason, that we include a topic that may seem, completely materialistic? Because, life is also very materialistic but its foundations and principles are primarily, ethic and just. The negotiator, is not a merchant of the temple, because the things of the spirit, transcend any material value and cannot be bought.
  • If I Knew Being Brave Was So Scary I Never Would Have Tried It - By: Suzanne Freiberg
    I’m feeling really scared right now, not because I’m in a scary situation, but because I was brave and it was scary.In reality it was a little incident that brought me to this scary place; I had to assert my rights in a business dispute and request that someone else fulfill their obligations. Sounds reasonable enough.
  • Business Negotiation Tips For Small Business - By: Alexander Gordon
    Negotiations are things we do almost every day of our lives. However, many of these negotiations do not make much difference to us in the big picture, so we tend to take them lightly. However, when you are negotiating for the business as a small business owner, then it will be very useful if you follow the business negotiation tips for small businesses.
  • Persuasion Tactics in a Person-to-Person Setting - By: Michael Lee
    Persuasion is easier to apply during a conversation between two people, as opposed to communicating in front of a group. This is because in a person-to-person setting, the opportunity to better understand the point of view of the other party exists. You can nitpick and delve into every single detail, as opposed to speaking to an audience, where the interaction is usually one sided.
  • How to Read the Body Language of Buyers And Sellers - By: Michael Lee
    Nonverbal communication, otherwise known as body language, is just as important as the words that are being spoken in a conversation, particularly during a sales meeting or presentation. Professional buyers and sellers know this. They can tell when something is amiss or not right by studying the approach of the vendor or the client as he walks into a room and takes a seat.
  • Negotiation Occurs All the Time - By: Pj Germain
    By now you've been more aware of the times when you are in a negotiation with someone, whether it be a customer, co-worker, vendor, or someone at home. You've no doubt had one or two outcomes that were very different than what was available to you before the win/win training. You also probably had many negotiations that didn't result in win/wins, that went as they have in the past, or perhaps worse than usual as you tried new things.
  • 10 Points to Resist Rip Offs - By: Kurt Mortensen
    What might work wonderfully in one negotiation situation will not always be appropriate in another. The instant someone feels cheated, misled or taken advantage of, your opportunity to negotiate with her/him is over. Negotiation hazards tend to occur when you are taking a particular strategy too far.
  • What's the Difference Between a Negotiation, Arbitration, and Mediation? - By: Tristan Loo
    Negotiation. Involves two or more parties who are engaged in direct discussions with each other in a concerted effort of reaching an agreement. Both parties use persuasion and influence to get the other party to see things their way.