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How To Negotiate Towards Success For Everyone

How To Negotiate Towards Success For Everyone

Contract negotiations are a game of give and take. Ostensibly, the parties have entered into negotiations because they believe that cooperation will benefit them; however, sometimes one or both parties will take on the role of a "dominator", attempting to get all they can from the counterparty while giving little in return. Besides the fact that this can damage relations between both parties, it can lead to a breakdown in negotiations. Thus, it's best to strive towards collaboration in negotiations.

Why Dominators Dominate

Dominators are not necessarily domineering out of a sense of hostility. It may simply be that they were trained to be as assertive as possible, as is often the case in contract guides. They may be domineering out of a sense of fear for what they might lose, or out of a desire to not disappoint their superiors. Or, a non-domineering party may become domineering if the counterparty is already behaving that way, creating a cascading escalation of demands that leads nowhere.

Steering Towards Cooperation

Cooperation leads to mutual benefit. Cooperating parties can create a contract that's beneficial to both sides, whereas non-cooperative parties may never even sign anything. This is akin to the Prisoner's Dilemma, wherein if one or both parties act purely out of their own self-interest, both end up in a worse position than if they had cooperated.

Thus, cooperation and mutual benefit should be the goal. Some strategies you can use for collaborating, and that can help to get a domineering party to cooperate in contract negotiations include:

  • Treating negotiations as a problem to be solved. Remove emotion from the negotiations. Identify the problems both parties need solved, and determine what measures can be taken to solve them. ?

  • Ask why, don't say no. Rather than shooting down a demand, ask the counterparty why they're introducing it, then discuss.

  • Offer and concede. When making a demand, always be prepared to give something fair in return. This shows respect to the counterparty and leads to continued negotiations.

  • Compartmentalize the negotiations. Domineering parties can often take an "all or nothing" approach where if even a single one of their demands aren't met, then they'll back out of the contract altogether. Instead, break the discussion up into distinct parts and agree on them sequentially until all have been dealt with. This helps build momentum, as parties will be reluctant to undo their work in negotiating previous items even if one poses an issue.

A Well-Designed Contract

Consider the value of how the contact is presented. All the work that went into putting it together might be for nothing if, when it comes time to present the contract, the counterparty doesn't believe it's a faithful representation of the discussion and agreements.

To present a good contract, ensure that a lawyer writes it and edits it, and collaborates with the other party to ensure their wishes are included accurately within it. Make sure to reduce PDF file size before sending to prevent the file from being too large to send.

Prosperity Is Achieved Through Cooperation

Remember that contract negotiations occur so that all parties benefit through giving something up to each other and gaining something in return. 

For assistance in contract negotiations, join your local chamber of commerce.

 

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