Play Your Position In Contract Negotiations
My son Matt is now 16. Back when he was eight, he began playing Pee Wee football. He loved playing, but he had one big problem — he couldn’t decide which position to play. He liked them all.
Even more, he liked how each position had a specific role to contribute. Unlike other team sports, in football, one star player (sadly, even the GOAT, Tom Brady) can’t carry the team forever. Football is very much a team game.
Negotiating and closing important contracts is also a team sport. And, like football, it only works well and over time if everyone knows their role and contributes accordingly. Technology-related contracts in particular — thanks to their often long lead times and complicated offerings — demand that every player on the field knows what’s expected of him or her.
Certainly, each technology company operates in its own way, but I’ve seen some patterns. Here’s an overview of how essential roles and responsibilities map to key positions on the gridiron:
Quarterback — Your Sales or Business Development Team
Throughout the negotiation, the sales organization needs to lead the team toward the goal line, staying on top of the transaction and coordinating moving parts. If customer concerns arise, it’s the sales team that should identify resources that will provide the necessary comfort.
In a recent transaction, the prospect questioned whether certain functionality would meet its unique needs and requirements. The sales representative not only brought in the sales engineer to demonstrate various capabilities, but also collaborated with the customer to find creative ways to meet its needs. This continuous leadership proved essential in completing the transaction.
Running Back — Your Legal Advisor
Your counsel — whether inside or outside the company — will carry the ball and do the brunt of the contract drafting. Legal counsel’s responsibility is to negotiate the specifics and assist the business folks in understanding potential risks and tradeoffs.
Of course, counsel must respond to demands and concerns of the other party’s counsel and procurement team. Attentiveness is as important as attention to detail. Delays due to missed commitments and lack of responsiveness can cause the deal to stall or unravel.
Receivers — Engineering, Support and Professional Services
Unlike salespeople, whose efforts start the ball moving, these folks can make big plays that lead to exceptional customer satisfaction. First, by developing products and services that meet customer needs. Second, by addressing customer concerns head-on and decisively.
During contract negotiations, this group must be prepared to respond to specific customer questions and requests. A thorough understanding of the vendor’s internal processes, as well as the customer’s critical concerns, is essential.
Recently, for example, one of my vendor clients was negotiating with a large health care provider. The provider questioned security practices regarding customer records and requested broad audit rights. We asked the engineering team to participate in our Zoom meeting, during which they described specific security protocols and shared independent, third-party audit results. As a result, the customer dropped its onerous audit request, and the transaction closed quickly.
Special Teams — Marketing and Investor Relations
On a day-to-day basis, through social media, traditional advertising, conference management, press and more, these groups provide visibility and a positive spin for your products, services, and business overall. All of these efforts smooth the way for sales.
Within the negotiation itself, these folks are instrumental in providing the extra push necessary to close the deal, as needed. That may mean sharing a white paper which demonstrates past success or, as happened during a recent negotiation in which my client’s potential customer had lingering concerns about 24/7 support, arranging a meeting with an existing client who could provide a strong testimonial based on firsthand experience.
Coaching Staff — Executive Team
In most negotiations, the executive team rarely steps on the field. Their availability and willingness to get involved as needed, however, can prove to be significant. Sometimes, a simple phone call between CEO’s or EVP’s provides the last bit of reassurance needed to close the transaction.
To the casual football fan, the player who catches the touchdown or kicks the winning field goal may seem like the hero of the game. Experienced observers understand, however, that many other positions are involved — both on and off the field — in contributing to that success.
Similarly, each member of your organization has a unique role and responsibility in negotiating and closing important transactions. By participating in the process and executing effectively, your team is well positioned to move the ball downfield and across the goal line!