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HUDDLE TIME
The Art of the Deal: Negotiating Tips for Running Your Business
By Jean D. Sifleet
The saying goes, "You don't get what you deserve; you get what you negotiate." Easier said than done. Negotiating is complicated; no one style is effective in every situation. Of course, the ideal situation is where both parties are clear and collaborative and work toward a win-win solution.
However, it doesn't always work that way. It is important to stay focused on your objectives and remain flexible because the other side will not necessarily play by your rules or behave in a reasonable way.
Here are some tips on successful negotiations:
1. Learn to Walk Away
If the negotiation becomes deadlocked or the other party is unreasonable to deal with, you may need to walk away. You can't force the other party to be reasonable, and making too many concessions is not the basis for a healthy business relationship.
2. Involve an Intermediary
Sometimes cultural or style differences make it advisable to involve an intermediary. Effective negotiation needs to be peer-to-peer. Involving an intermediary can help bridge the differences and find the common ground or "win-win" outcome. However, be careful in your choice of an intermediary; you want a deal—not a battle.
3. Beware of Adversarial Lawyers
Not all lawyers are adversarial, but the sad truth is that lawyers make more money when there's a fight. Lawyers have an economic incentive to turn amicable business relationships into protracted negotiations and even adversarial outcomes.
Warning signs include:
- Lawyer is taking positions that are obviously one-sided and trigger protracted negotiations to get to a position of reasonable balance for all parties.
- Lawyer demands last-minute concessions, price reductions, or other major changes just before the deal is to be completed.
- Lawyer uses massive boilerplate documents, 80 percent of which are incomprehensible and 90 percent are irrelevant to the deal.
4. Shun Adversarial Lawyers
Adversarial negotiations are unlikely to produce a deal or a good business relationship. The deal needs to be fair to all parties to work well. The party that feels unfairly treated usually finds a way to get even. To avoid having your deal derailed by such lawyer tactics, I recommend that you keep adversarial lawyers out of the negotiations.
5. Keep it Simple
Parties should draft a term sheet that captures the essence of their agreement on one page. They should answer the questions, Who? What? Where? When? How much?
Then each party reviews the term sheet with his or her respective advisor and revises the term sheet based on such input. Basically, use your lawyer as a coach and do the negotiating yourself.
The parties discuss the agreement and revise the term sheet. Next, instruct the lawyers to write up your agreement—without gobs of boilerplate—and include a provision to mediate any dispute. (One lawyer should draft and the other review.) With this approach, you'll get a deal that is fair and workable and an agreement that you understand.
Excerpted from BNI member Jean Sifleet's new book, "Smart Fast: The Desktop Reference Guide for Running Your Business." Jean is a Business Attorney, CPA and three-time entrepreneur.
"Smart Fast: The Desktop Reference Guide for Running Your Business" is available at http://www.smartfast.com, http://www.amazon.com, http://www.bn.com for $18.95 plus tax and shipping. Or, feel free to contact Jean at:
Jean D. Sifleet
Attorney at Law
Certified Public Accountant
120 South Meadow Road
Clinton, MA 01510 USA
T. 978-368-6104
F. 978-368-6105
E. jean@smartfast.com
HUDDLE TIME
Power of the Lapel Pin
By Elisabeth and Ivan Misner, Ph.D.
Every member of BNI receives a BNI Member lapel pin in the New Member Packet. Do you know where yours is?
We have found that the lapel pin is not worn by a majority of members, but we feel it is a valuable tool for both recruiting and recognizing members from other chapters.
The lapel pin can be a conversation starter. Many people wear identifying pins for clubs, organizations, and status in their companies. These people take a keen interest in the pins of others. A BNI Member pin can prompt a question about the organization and give you a chance to talk about your chapter and possibly invite an interested businessperson to your meeting.
Not long ago when we were in a regional airport, another BNI member noticed our BNI lapel pins and struck up a conversation with us in the security line. It was great to meet a fellow BNI member with whom we could chat and get acquainted while traveling.
So, if you don't normally wear your BNI Member lapel pin, dust it off, shine it up, and wear it to your next business gathering, chamber mixer, or as part of your work uniform. You'll be amazed at the attention you'll get and the opportunities for building relationships that will come your way.
HUDDLE TIME
Increase Your Membership with a Chapter Contest
By Don Morgan
Imagine 60 referral partners! If you are up to the challenge, the WIT chapter of Montreal, Canada, has the solution. This chapter added 25 new members through a membership contest designed just for their own chapter.
Chapter president, Stephen Hindelang, explained to me how it works.
A core group of WIT members became determined to build their membership from 18 to 30 members. This occurred when the small group invited lots of guests to the well-run meetings where they passed lots of referrals. Their meetings sold the guests.
Once their chapter had 30 members, they started their recruiting contest, determined that they could grow their chapter even more using just a bit of creativity. To excite the members, they designed a contest around three motivating factors:
- A sense of accomplishment for members
- An understanding that more members equal more business opportunities
- Prizes for 1st, 2nd, and 3rd place winners to fuel competitiveness
The Set-Up
The contest can work with any size chapter, but the chapter must be divided into small teams. For example, 18 members = 9 teams of two; 20 members = 10 teams of two; 27 members = 9 teams of three; or 36 members = 12 teams of three. A lot of small teams means that team members can get to know each other and learn to work cooperatively.
The president should assign one key outgoing person to be the leader for the team. The president, or contest coordinator, must assign each team their target groups to recruit. One team can "steal" another's target group—this is a lot of fun—and therefore take away the potential higher point allocation from the other team's end result. (See below point system.)
The Point System
- Bringing in a new member from your own target group = 25 points
- Bringing in a member from another's target group = 15 points
- Bringing in a member from chapter's Top Ten List = 10 points
- Bringing in a member not on any target list or Top Ten List = 5 points
- An invited guest comes to meeting = 1 point
When a new member joins the chapter, they are assigned to the team with the lowest points. This helps equalize the teams by adding more "new blood" to the lowest-scoring team.
The Prizes
The WIT chapter created their own highly sought after prizes. Members had to maintain good standing (generate good referrals during the contest) to qualify for a reward. Prizes included a BNI membership for winning team members, gift certificates, $1,000 in travel certificates, and other smaller prizes. This contest was fully "owned" by the membership of this chapter. To create this sense of ownership, each team made up their team name, such as Flower Pot, El Nino, The Untouchables, Four Guys in a Boat, and Movers and Groovers.
The Results
The WIT contest ran for several months. It resulted in more than 25 new members. The chapter currently has about 60 members and is working to develop the fundamentals to enable their chapter to create increasingly strong referrals for the large membership. (Oh, yes. The group does finish on time each week. They assemble at 6:30 AM, and the president runs the meeting like a dictator.)
Imagine, spending all this energy on building a large chapter like the WIT and then more energy networking with all these members and their contacts. This group could represent more than 24,000 buyers of products and services. It's no wonder that the chapter's lawyer gets three to five new clients per week.
Don Morgan is National Director of BNI Canada and Executive Director of BNI Northern Illinois.
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