15 Nov. Should Negotiatiors Avoid the Word "Deal"?

Usually closing the deal is the final goal negotiators are striving for. But skilled negotiators know that everyone who is involved in a cooperation often benefits when dealmakers focus even well beyond the finish line.

Rather than simply trying to sign a contract on favorable terms and conditions, negotiators who discuss how those conditions might play out over the life of the contract are more likely to set the partnership up for mutual success.  When negotiators take a long-term perspective to deal-making, the outcome is typically a win-win. After all, when negotiators only focus on closing the deal in negotiations, they might miss the important step of planning what will come next.

Closing the Deal in Negotiations: Beyond the Finish Line

How could leaders encourage their negotiating team members to ensure that, after closing the deal in negotiations, an agreement will be achieved with benefits on a long-term perspective? The following guidelines can help:

Look beyond price

A single-minded focus on getting the best financial deal is typically the main wrongdoer behind short-term thinking. Experienced negotiators understand that adding numerous issues to the mix will not only improve deal implementation but improve everyone’s satisfaction. In his book Dealmaking: The New Strategy of Negotiauctions, Harvard Business School and Harvard Law School professor Guhan Subramanian explains that auctions often promote a narrow focus on price. When a seller announces an auction, consider asking if you can additionally negotiate privately with them instead of submitting a bid.

Give negotiators long-term incentives

Many organizations offer negotiators bonuses for closing a deal. Instead, they could link financial rewards to progress made in the early years of a deal’s implementation. Doing so will quite naturally focus negotiators on long-term concerns when figuring out how to close a deal successfully.

Keep negotiators involved in implementation

New partnerships often fall apart because the teams that constructed them are uninvolved with implementation. That’s a mistake, given that negotiators typically acquire a great deal of useful information about their organizations when crafting deals. For this reason, it can be wise to keep negotiators involved in a deal’s implementation.

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Author: Jutta Portner

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