Etiquette is often overlooked in contract negotiations, but it plays a crucial role in reaching a successful conclusion. The absence of etiquette can lead to misunderstandings and unnecessary conflicts. It’s not about softening one’s negotiation power, but about fostering a respectful and productive dialogue.
The Pitfalls of Over-Reliance on Contract Templates
While contract templates and a strong legal department can simplify procurement processes, they can also lead to complacency. Instead of critically examining contracts, there’s a temptation to hand over a template to the supplier. This can result in irrelevant or inappropriate terms being included, triggering a new round of negotiations. To avoid this, it’s advisable to review the contract template thoroughly and remove any non-applicable parts, saving time and preventing unnecessary disputes.
The Importance of “Track Changes” in Contract Negotiation
The “Track Changes” feature in Word is a valuable tool in contract negotiations. It allows both parties to easily identify changes and focus their negotiation efforts on areas of disagreement. However, it’s crucial to ensure that no versions are skipped when a new “Tracked Changes” contract is received. Ignoring a supplier’s changes can lead to questions about your integrity, so it’s important to be diligent.
Ensuring Completeness and Relevance in Initial Contract Proposals
The initial contract presented to a supplier should be both complete and relevant. It should not include anything irrelevant, but it should also contain everything necessary for the deal. Adding unrelated or onerous provisions in later revisions can raise questions about competence or ethics. It’s essential to maintain professionalism and not tolerate such behavior from suppliers.
The Value of Direct Communication in Closing Contracts
If an agreement is not reached after each party has made one revision to the original contract, it may be time for direct communication. A brief phone call between decision-makers can often lead to the understanding necessary to find common ground and finalize a contract. Both parties should bring their decision-makers to the conversation to avoid unnecessary delays.
In summary, successful contract negotiation requires a balance of etiquette, critical thinking, efficient use of tools, and direct communication. By keeping these principles in mind, procurement professionals can navigate negotiations more effectively and reach beneficial agreements more quickly.
