Blogmatic

In very simplistic terms there are essentially two starting positions when you enter negotiations; high – low and fair. High-low negotiations takes sort of an adversarial approach, basically ask for the absolute most you can and your negotiatee asks for the absolute least they can. The starting positions are very far apart but eventually you come to an agreement. The fair approach is much different where you start with something “reasonable” and expect a counter offer that is close to your starting position.

High-low negotiations is, as mentioned, adversarial and both parties are trying to wring whatever concessions they can out of the other party. The starting positions are far apart and your goal is to have the outcome as close to your starting position as possible. There is usually a winner and loser in high-low negotiations and it is less about finding common ground and more about being the winner. As you can probably tell I am not a big fan of this style of negotiation.

Fair negotiations is more about coming to a reasonable agreement that suites the needs of both parties. The starting positions are relatively close and it is more about finding common ground and less about winners and losers. Generally speaking if you start an arrangement based on a fair negotiation style this forms fertile ground for the future relationship.

It is important (and usually obvious) which style of negotiations your potential partner, service provider or customer has chosen. Keep this in mind as negotiations progress and be sure to counter with the same negotiating position. If the person you are negotiating with is a customer then the high-low style is understandable; however, if the person you are negotiating is a potential partner and they open with high-low beware. How you start your relationship with someone in business is often an indicator of the sort of ongoing relationship you will have.

High-low or fair, know your style and that of the prospect and be sure to counter in the same way.

Cheers,
Ian Graham

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There is a saying that “God gave you to ears and one mouth for a reason.” That reason would be you should spend twice as much time listening as you do talking. This is particularly important early on in the relationship process. I had blogged about this before and as fate will have it I’ll probably blog about it again. Anyway, … here we go.

I was approached by someone to discuss how we might work together and I am always open to such discussions. So we start the meeting and this person immediately pulls out their marketing collateral and proceeds to explain all of the wonderful things that they do and how great they are. This continues for most of the meeting and my only input is a nod, a yes and the odd um hmm. Not much of a chance to get a word in edge wise. After the feature spew stops and I start to speak the person listens for about a minute and then indicates that time is up and they have to move on to their next meeting.

How motivated do you think I am to do business with this person? (Not very)

What sort of agreement is possible if they have absolutely no clue how we can come to some common ground and only have a one sided understanding of the relationship? (Low probability)

Here are some suggestions for a productive start to that first meeting.

1) Exchange some pleasantries first. Talk about normal stuff to see if you have some common interests. When in doubt and in Canada, the weather is always a great conversation starter.

2) Ask questions:

a. Tell me about your company.
b. What is your role at the company?
c. What sort of agreement would interest you and your company?
d. How do you see our two companies working together?

3) Listen.

4) Then respond.

5) Repeat steps 2, 3 and 4 as necessary.

There is a great saying by that master of the metaphor Stephen Covey “First seek to understand, then seek to be understood.”

Cheers,
Ian Graham

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In my world a handshake is worth just as much as a written agreement. Ottawa is a small town and invariably everyone knows someone you know, particularly in tech. Therefore if you have a handshake agreement with someone it is your reputation that is on the line. Basically once you have came to an agreement and shaken hands you have a binding agreement.

In building my partner network for theCodeFactory every single agreement was sealed with a handshake. For some of my partners that is the extent of the agreement we have in place coupled with a mutual understanding of the terms. For other agreements that are a bit more complex we do ink a formal contract afterwards to make sure everything is clearly understood. Bottom line is in a small town you need to honour the terms of your agreement whether that be with a handshake or taking a bit of extra time to ink a formal deal to make sure everything is clearly understood.

Your hand shake should be your bond. With trust as the essential ingredient in inter-personal relations it is important that you continue to build your reputation as someone that is trustworthy.

Cheers,
Ian Graham

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I had an interesting conversation with a very well respected Ottawa area leader in the start-up community. The discussion was based around getting the right people for your start-up. This is particularly important for a growing company. The conversation went along the lines of making sure that you had “A” type people on the team, A type being top calibre rather than type A personalities.

Any way this got me to thinking… is the person the most important part of the start-up team or is it the fit with the existing team.

There is an old business adage to the effect of “Better B Strategy and A Implementation than A Strategy and B Implementation.” I think you can apply the same concept to start-up team members and fit with the existing team. The saying would go something like this:

“Better a B person and an A fit than a A person and a B fit”

In my opinion team cohesiveness and productivity will be what separates the good from the great in the start-up community. Productivity is directly related to how well the team functions together. While you need good and great people fit is the lynch pin to success and when under stress (which will occur in a start-up) what holds the team together.

Cheers,
Ian Graham

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