How to Negotiate When You’ve Lost Control

When you negotiate and lose control of the direction you’d like the negotiation to go in, how do you recover? What steps should you take to regain control?

Recently, business associates of mine sought and won a contract valued at $2.5 million. They were ecstatic, but they quickly realized they had one major problem. They did not have the core competency needed to address the contract in-house. In addition, they had a little over 7 weeks to produce the results the client was seeking. So, they outsourced by turning to another company that supposedly had the skills that were needed to complete the client’s requirements. My business associates checked the one reference the other company gave to validate their past performance, which came back glowing, and they were ‘off to the races’.

My associates incurred the expense to have a team of consultants fly in from the other company to meet with their client and quickly found themselves in a quagmire. Although the associates had laid out the ground rules by which the consultants would engage their client, there was no written agreement in place outlining the rules of engagement. This oversight led to bigger problems. In the initial meeting with the client and my associates, the consultants talked about the scope of the project and the costs associated with completing the assignment. The fee the consultants proposed to complete the project was exceedingly higher than what the associates had originally quoted to the client.

In the meeting with all parties present, the consultants talked about how the expansion of the project would enhance the clients overall environment. My associates squirmed as they saw the situation getting more out of hand. The client’s interest was in sticking with the initial scope of the project and they stated such in no uncertain terms. After several meetings of what turned out to be very time consuming, in the form of negotiation sessions between all parties involved, the contract became jeopardized. My associates felt their client becoming alienated by the consultants and asked for my advice as to where they went awry and what their next step should be.

I offered the following suggestions…

    No matter how much of a rush you’re in, create a document (contract or MOU (memorandum of understanding) outlining the scope of work that’s expected to be delivered. Negotiate, so as to have all parties involved, understand the scope of the project (In the absence of such a formal document, my associates opened themselves to potential liabilities and misunderstandings). I told them the document would have also served as a negotiation tool, which in and of itself would have become their written position of how the proceeding would progress.
    Even though interactions had already commenced, I suggested my associates put the rules of engagement in writing, outlining the fee structure that had already been agreed upon.

Note: Up to that point, the consultants were addressing the client as though the client was theirs, not my associates. When everyone understands the mission of a project or goal, as the result of being able to read the same message, people are more apt to be on the ‘same page’.

There are times when the written word will carry more weight in a negotiation than the spoken word. During a negotiation, the spoken word(s), once agreed to by all parties involved, can be binding, but it becomes more difficult to prove intent if arbitration is required. To protect yourself, always have some form of a written document, signed by all interested parties, to substantiate your position … and everything will be right with the world.

The negotiation lessons are …

  • When you negotiate, state your position and seek the understanding and buy-in from those with whom you are negotiating.
  • If you encounter a critical point whereby you cannot reach consensus, use the ‘take away’ strategy. The ‘take away’ strategy might consist of you saying something like, ‘Well, I guess if we can’t come to an agreement on this point, the deal will not happen.’ After making such a statement, take very careful note of the body language of the other party. Even if you’re speaking on the phone, listen for the emotional change in the other person’s tone and speech patterns. By doing so, you will gain insight into how effective you are in influencing them.
  • Never place yourself into a position where the only way to achieve your goals and/or wants are through the person/people you are negotiating with. Nor should you let time restrict your options. Have an alternate source whereby you can acquire what you are after.