Negotiating a Deal? Be a Mediator, Not a Gladiator

What’s the primary goal of most business negotiations? I don’t mean negotiations in the context of a dispute – I mean in the context of a prospective business deal or relationship. In that setting, the primary goal is to reach agreement. And that generally means emphasizing mutual benefit and necessary compromise to reach the desired outcome for both parties, not just one – after all, if your negotiations are so “successful” that the other party has lost everything, there’s really no reason for that party to proceed at all. In other words, you may “win” the negotiation battle but “lose” the deal.

So, how should a business person (and that business person’s lawyer) approach negotiations? Simply put, I think it’s better to assume the role of mediator than that of gladiator; be a problem-solver not a competitor. That doesn’t mean that you must avoid confrontation and disagreement in all cases. What it does mean is you should pick and choose your “battles” carefully; and where possible, avoid them entirely by finding creative solutions.

Negotiation is not generally possible without some level of disagreement. If that weren’t the case, we’d never need to exchange multiple drafts of an agreement, since all parties would simply agree to the first draft. Disagreement is not the problem. Confrontation, however, often times can be – particularly if it’s not handled with professionalism and diplomacy. If disagreement is necessary, try and explain to the other party why your position is reasonable, and why the issue is important. If it’s a potential “deal-breaker,” explain that too. In the end, I believe it’s most productive to avoid confrontation when you can. Disagree when it’s important, but even then seek compromise where it’s possible and makes business sense. Be creative and seek to find win-win solutions. Remember, the goal is to get the deal done on terms that benefit everyone – not walk away after “fighting a good fight.”

Outside and In-House Counsel – Why the Disconnect?

Perhaps no situation validates the premise behind BizB4Law than the relationship between in-house counsel and their outside private law firm counterparts – that premise being that business issues and objectives should always come before and actually determine the legal approaches and strategies.

There’s a historical tension between in-house and outside lawyers that, if anything, has become more prevalent in the past several years.  Although there are hundreds of articles speculating as to why this tension exists, I think it can be summed up simply – outside counsel doesn’t take the time or care enough to focus on the specific company as a business and the in-house counsel as a business person, rather than viewing both as simply clients or worse yet, viewing the in-house lawyer as only a lawyer (there’s a reason many in house attorneys have additional titles such as Vice President, Secretary and General Counsel). 

Don’t get me wrong, as clients these businesses are entitled to the same benefits and privileges as other clients (e.g., top level service, responsiveness, communication, etc.), but what’s too often missing from outside counsel is the level of commitment necessary to really understand this client and this business/industry, and this division or product line, and this transaction, and of course, this particular in-house attorney.

What I’m really saying is in each relationship with in-house counsel, the outside attorney or firm needs to think not just like a lawyer and a business person, but like a business person at this specific company in this specific situation and with these specific objectives – and the only way outside counsel can do this is if they really know and understand these things about this client.  That means understanding things like budgeting, timing constraints, scope, priorities, etc.

The bottom line is, the tension between in-house and outside counsel is not inherent or inevitable, but rather is the result of a lack of effort and/or commitment by outside counsel – as in-house counsel you should demand more; and as outside counsel we must do better.