To recap, our first seven bonehead negotiating mistakes were:

1. Arrogance
2. Acting Like a Robot
3. Acting Like a Used Car Salesman
4. Stepping Over Your Line in the Sand
5. Filling Every Silence With Talking
6. Trashing the Competition
7. Being Afraid to Walk Away

Here are the next seven mistakes you should avoid if you don’t want your customers to take advantage of you during IT negotiations:

Forget to Ask Where It Hurts
Before you can “ask for the sale,” you have to be a good listener. Pretend you’re their doctor, and ask them, “where does it hurt?” Uncover their pain points, unearth their bottom line, understand what they really, really need. Only then will you know how to structure your negotiation.

Get Hung Up on One Contentious Issue
Negotiations get derailed early when the parties are stuck on one contentious issue. You can only beat that horse so much. If you’ve spent more than 10 minutes on an issue without any movement, just table it. Move on to other items more easily agreed, and circle back to the difficult issue. By that time, the customer may be more conditioned to say “yes.” Or maybe you’ll find another issue you can bend on as a trade.

Give Artificial Deadlines
Common negotiating theory states setting a deadline gets everyone focused and more likely to make concessions. “If we can’t finalize this by June 30, this price is off the table.” Don’t say this. The customer KNOWS they’ll still get that price on July 1st, even if it means you’ve missed your number for this year. If June 30 is important to you, there are other ways to get there without looking desperate. And once you look desperate, game over.

Focus on Price
If price is everything, you have nothing special to sell. Telling the customer you are the cheapest in the market is a race to the bottom you don’t want to win. It seems counter-intuitive, but a higher price can be an advantage – if you frame it correctly. Most of your focus should be on your solution, the pain you can relieve. Then your premium pricing seems like good value.

Let the Buyer Control the Contract
No customer wants to sign your standard contract without negotiating changes. The trick is to keep that to a minimum. Massive changes mean you’re giving up more than you want, and spending too much on legal. By giving your standard contract to the customer in editable form, you’re inviting wholesale changes. You’ll get back a contract with so many changes the whole document is red. This is impossible to manage, and requires negotiation of every comma. Instead, present your .pdf standard and invite your customer to a conference call where you’ll discuss high-level issues. And offer to have YOUR lawyer make the agreed-upon changes.

Be Sneaky
If you agreed to make a change to the contract while negotiating, be sure to reflect that change exactly as agreed when you revise the document. Ensure every change shows in track changes. Don’t add in anything new that was never discussed. If you try to be sneaky, try to slip in something they might not notice, they WILL find out. And then you’re dead.

Sign It Without Reading It
This one is so obvious it shouldn’t need repeating. But unread contracts are signed all the time. “I was in a rush.” “It’s probably all OK.” “I trust the other guy.” A year down the road, when one of those unread terms comes up and bites your behind, you can’t say, “It doesn’t matter what it says, that’s not what I meant.” This isn’t strictly a negotiation strategy, but how can your negotiation be considered a success if you don’t know your contractual obligations?

In Conclusion
After two blogs, we’ve now been through fourteen bonehead mistakes. That must be all, right? Of course not. There are as many negotiating mistakes as there are stars in The Cloud. Stay tuned for the next seven. And the next seven….

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Unless you can read your customer’s mind like Dr. Xavier, you’ll have to rely on other skills to avoid being taken advantage of during IT negotiations. If you’re not careful, your approach will lead to one of two results: you lose the business, or win but leave money on the table. As a lawyer for IBM and Thomson Reuters, and as a purchaser for numerous billion-dollar corporations, I’ve negotiated for 25 years on both sides of the table for large IT acquisitions and sales teams. And I’ve seen negotiators crash and burn by making these self-destructive mistakes:

1   Arrogance

You’re negotiating for a big company, and your attitude is, “Hey, we’re great, and you’re stupid if you don’t pick us.” No one wants to do business with someone like that. The customer expects you to be arrogant, and you confirm their bias. Imagine how they’d react if you surprised them with some humility.

2   Acting Like a Robot

You’re not a machine, and neither is the customer. It won’t kill you to act like a human, and you may even enjoy it. Instead of getting right down to business, ask them about their family, where they grew up, what they do for fun. It’s a small thing, but you’d be amazed at how some friendly chit-chat at the beginning of negotiations will help you get what you want at the end. They say once you learn how to fake sincerity, you’ve got it made. Not true. Real sincerity and interest in another person will serve you well. Remember, if you do this right, your customer will buy from you again and again. It’s not a one-shot deal.

3   Acting Like a Used Car Salesman

There is nothing weaker than a salesperson who repeatedly says, “I think we can agree to that price (or that term), but I have to run it past my manager first.” It sounds like you’re buying a car, and soon they’ll ask you to add floor mats and undercoating. As a seller, go into the negotiation with a bottom-line price or set of business terms in your head, knowing you can make decisions up to that threshold. Otherwise, you may as well bring in the decision-maker early.

4   Stepping Over Your Line in the Sand

Never say, “This is absolutely my best offer,” unless it is. Once you lower a price you said you could never in a million years lower, you are at the mercy of the negotiator (and customer). Forever.

5    Filling Every Silence With Talking

“The next one to talk loses,” is a common negotiating maxim. Sometimes, it’s better to say nothing, and wait to see what the other person says, especially when the silence becomes uncomfortable. The customer may be ready to say “OK, I’ll buy,” but you keep talking until you’ve talked yourself out of the deal.

6   Trashing the Competition

You know how your mom said, “If you don’t have anything nice to say about a person, say nothing?” Well, that works in business too. The moment I hear trash-talking about a competitor, I have serious doubts about the ethics and professionalism of the negotiator. Long-term relationships don’t start there.

7   Being Afraid to Walk Away

Everyone wants to hit their number for the month, the quarter, the year. You always want the deal, right? But if you sound desperate, the customer will surely smell blood; before you know it, you’ve made huge concessions. Be willing to walk away – not fake walking away like you’re buying a rug in Marrakech – and you’ll either get the deal you want, or avoid a poor deal for your company.

In Conclusion

Are there only seven big negotiating mistakes, you ask? Of course not. There are as many negotiating mistakes as there are stars in The Cloud. Stay tuned for the next seven. And the next seven….

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