One of the great skills of strong negotiators is to make the complex appear simple.
I was listening to the radio today, where a dog training expert was responding to listeners’ calls. She had a Yorkshire accent and quickly provided solutions to exasperated owners. I love dogs and though I no longer own one, I have plenty of relatives and friends who do, hence my interest. If I could summarise my observation of their animals, it is that they are completely untrained and cause much frustration and chaos as a result. Since when were dogs allowed to stand on dining tables? And given the prevalence of dogs in Bunnings, I’m curious as to why.
So, what’s this got to do with negotiation? One of the characteristic skills of good negotiators is that they are curious and seek to gain key insights from a variety of sources.
Back to the radio call in. A man rings and says that his Labrador refuses to come to him when called. No matter how hard he tries, the number of calls, the cajoling, the threats, the dog continues to ignore his instruction and carries on doing whatever it wants.
The expert’s first sentence told me all I needed to know.
She said, “From what you have told me, you’re training your dog to disobey you.” In one sentence she had described a common problem that occurs post deal - in the implementation stage of the agreed deal.
I was once involved in an engagement with a large beverage company whose supply agreements included the provision of a refrigerator complete with company signage. It was provided on the basis that it could only be used to display products from the company that supplied it. However, it had become a common experience for their sales representatives to find that rival’s products were now stocked in their space. My response was “Did you remove the fridges?” to which they replied, “Of course not, that would have destroyed the relationship.”
A further example is a company that provided free point-of-sale computers and software, on the condition that the retailer stock their brand exclusively. On visiting the stores, the sales reps again found that while the computers and software were being used, rival brands were also stocked in key categories. What happened as a consequence? Nothing.
Thirdly, a road building company won a contract which specified three deployments of their teams and equipment. In reality though, they mobilised eleven times during the course of the contract. No extra charges were levied, resulting in no profit for hundreds of thousands of dollars of work.
In all three instances, from the very start of the contract, one party has decided not to implement a key condition they previously agreed to. In all three situations, the lack of response to the breach was encouraging future breaches.
Like the dog owner on the radio, these companies were training their customers to disobey them.
They had forgotten that no money flows on the date an agreement is signed; the profit flows when the parties implement the agreement. What master negotiators avoid is the ‘death of a thousand cuts’ where a potentially profitable deal is turned into a loss with one party failing to implement as agreed.
Now some of you may be curious about the dog trainer’s solution (a long lead and operant conditioning) but put simply: failure to implement the agreement must have consequences.