Congratulations! After many months (or years…) of negotiations you’ve reached an agreement with your counterpart. The contract has been cleaned up from all of the redlines and it’s on its way through to be approved at corporate. Time to shake hands, toast your success, and move on to the next deal, right?
Not so fast.
Once you’ve reached the close of negotiations, you may have an agreement in principle, but the deal is far from being closed. That only happens once reviews are complete and signatures – from both parties – are in place.
This period between agreement and signature is The Danger Zone. A time when a change of heart, or change of strategy with one of the parties can trigger the unraveling of the deal you’ve worked so hard to craft. The key is to complete all necessary due diligence as efficiently as possible, and get signatures in place quickly in order to minimize the risk of changes or additions to the deal.
Here are three proven techniques to help you navigate The Danger Zone and come out the other side with your deal secure.
During the negotiation be sure to keep stakeholders in the loop on progress so that you can course correct as needed. Surprise elements during the final review of the contract will create tension and slow down the process, as approvers start to wonder what else is going on in the contract that they’ve not been told about. Sharing news and obtaining approvals at key milestones during your negotiations minimizes that risk.
As you approach the end of your negotiations, begin to prepare a streamlined summary of the deal for distribution along with the contract. It’s highly unlikely that the person approving the deal will have time to read each and every word in a hefty document, so pulling together the highlights along with a quick blurb on the impact they have on the organization will help them review quickly. Keeping this to a single page is ideal.
While you’re in the Danger Zone don’t underestimate the power of handholding the document through an approval cycle. Instead of simply leaving a folder for review on someone’s desk, book a meeting to review the contract and secure signature. Working remotely? A conference call may do the trick; or, if the review has been dragging on, this may be the perfect time for a business trip to secure signature face-to-face.
Just as it’s important for your organization to move a deal through approval cycles efficiently, it’s also vital that your counterpart does the same within their firm. At each stage, you can work together to implement these techniques.
During the negotiation, set joint milestones and check-in points with your respective stakeholders. As the end of discussions approaches, you may want to collaborate on the creation of a summary document that will serve as the foundation for your company-specific ones. Once you're in the approval phase, be sure to stay in contact instead of cutting off communication because the deal is ‘done’.
Until both parties are signing the contract, you’re still in the Danger Zone – together.
To learn more about how advantageSPRING can help your firm build teams of brilliant negotiators, explore our training programmes.