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So often we find people telling us they want to sweat every penny out of their opposition and get the deal done right on the other party’s limit position. Sometimes they themselves want to gain their place in the company’s hall of fame, typically they have been delegated the impossible task.
How often can perfection be achieved?
Maybe I’m lazy, but when I sit down to prioritise my objectives as part of preparation… typically, achieving a quick deal so that I can move onto the next thing is more valuable than securing the perfect deal. Achieving the perfect deal requires too much effort, and that effort is often better spent elsewhere.
I’m not suggesting it is a good idea to leave vast amounts of value on the table. Rather, I’m suggesting that a good deal achieved quickly is more attractive than a perfect deal that took years.
You could argue, if you only have the one big deal on the horizon that you should chase perfection. If this is your scenario, ask yourself how important it is to get the deal? You may prefer a good deal over no deal at all, in which case I’d question being too overly-optimistic as that could disengage your counterparty all together.
How long can perfection last?
Interestingly, many of the difficult negotiations I’ve been brought into by clients are as a result of someone on the other side of the table achieving their perfect deal. When one side wins, invariably the other side struggles to make it work and spends the rest of the agreement trying to restore profit through variations, or worse, find a way to break the deal.
Just today, I was talking with a sales rep who was complaining about his predecessor who had often upset clients because he could. Their business was materials in the construction industry, and it had been booming. Because the builders were under pressure to deliver, the previous sales rep made them pay! The construction industry has slowed since, that sales rep has moved on, and the new rep is tasked with increasing the company’s share of wallet in a shrinking market. His problem is that people tend to remember if they have been treated unfairly, and many of his possible clients won’t even take calls from his company. The builders are making a point of exacting their revenge!
So how should we define perfection?
How you define winning is entirely up to you. Don’t leave it to chance. Let it be defined through a deliberate and rationale process of preparation that all your internal stakeholders sign off on. Be clear about what you want and be clear on the priorities of each of those objectives.
For me, it typically means doing deals on my side of the bargaining arena, while still leaving enough value in it for my counterparty so the deal can be done quickly, and I don’t get stabbed in the back later.
