Look at this receipt from my last “business lunch” …
Got this when I flew to Russia to meet a client who was late on a bill …
That's Right … as a “reward” for traveling half-way around the world for a 1-hour meeting … I ALSO got to pay for lunch.
That's B****&#^t's …
I know I know … unprofessional language.
But if you’ve been following me for any amount of time…
Then you already know, I don’t have the most popular opinions…
And what I’m going to share today is probably one of them.
You see, I had just signed a contract with a large billion dollar company in France.
They are so large, they just buy random companies that don't make any sense like Semiconductors, Beer, and Tennis Rackets.
Which makes them the perfect client: Big, Confused and Rich…
Because once we get them “unconfused,” we make them money, and we look like superstars.
But still, they were late on a $250,000 payment to my firm.
Now, I'm not sure what YOU do when someone doesn't pay $250K on time …
But I hop on Kayak.com to book a flight to WHEREVER that person is …
Which put me in a bad airline seat for 13.5 hours …
Heading to Russia ..
Actually, Montenegro, still basically Russia because its years as a Soviet puppet state, where “The Big Client” was at an industry conference.
The James Bond connection…
In the film version of Casino Royale James Bond and Vesper stay in Hotel Splendid in an unidentified town in Montenegro.
This was the “unidentified town” and was my second visit to the James Bond hotel, but of course I didn't have a cool gun, I didn't even have a charged cell phone, it had died hours ago..
My contact was “Gustave” who I had never met, but we had spoken several times.
Nice Guy.
Until he stabbed me in the back and held up my payment…
I found Gustave in the conference room just before lunch. As the CFO of The Big Client … he controls the payments, and was the person I needed to talk to.
SUPRISE!!!
“Hi Gustave, it's me, OREN from Pitch Anything. I flew out here to see you … Got time for a quick lunch??
Gustave replied, [insert many french words here.]
So … VERY RELUCTANTLY, Gustave came to a lunch with me to discuss the missing payment.
I had with me a printed copy of the SIGNED contract …
Whereupon … page 6 … it clear states:
$250,000 PAYMENT UPON EXECUTION OF CONTRACT
Or in other words, “YOU SIGN THIS PAPER, YOU PAY RIGHT AWAY.”
I don't speak French but I'm pretty sure NON doesn't mean “yes.”
What Gustave said next really surprised me:
“Oren, Please understand that the words “execution of contract”, in French, means “when you finish the work.”
F****&#^[email protected]
Gustave … Are you telling me you think “Upon Execution” means something different then UPON EXECUTION?
I continued, “I've done a thousand of these agreements. You just sign, then you pay, and the work gets done… I can't believe we're even talking about this!”
OK, GUSTAVE, I guess we are now NEGOTIATING.
Which is something I hate doing: Negotiating AFTER an agreement has been signed and we have started doing the work.
Now you’re understanding my real life.
20 hours of travel…
3 hours of sleep…
Dead phone…
Dead laptop…
Drinking beer the flavor of chicken soup…
Last 9 meals on airplanes….
And now I'm renegotiating a signed agreement with a billion dollar client?
And so here's what I tried with Gustave:
…and I did 22 other “conflict resolution” things you're SUPPOSED to do in these situations.
That got me nowhere.
And this is The Moment when I learned:
Negotiation books are full of B.S. that some New York City cop figured out from Hostage Negotiations … when everyone was packing a machine gun and helicopters were flying overhead and they had 12 hours or 100 hours or WEEKS to figure it out …
And this academic negotiation “stuff” was NEVER tested in real business deals… Like the one I was in right now.
That's when I finally realized …compromise is not always the best strategy … and …
IN BIG DEALS, NO GOOD DEED GOES UNPUNISHED
In other words, big companies will take advantage when you try to be reasonable and make concessions.
Because in this situation no matter what I did to try and be reasonable, it backfired in my face and lost me money.
So after nothing else worked, here’s what I decided to do:
I stopped covering my words with sugar …
I disagreed boldly with a very powerful customer…
I told THE TRUTH.
I pointed my finger at the stack of papers on the lunch table, our CONTRACT.
I said, Gustave, this is a 2,000 word contract. It says “you pay” in 20 different places. You're picking ONE WORD to play games with, and that's No Good.
I think it's below your status as Chief Financial Officer.
I know it's embarrassing for you.
And … I just don't allow you to do this to me …
But MOST IMPORTANTLY … I don't allow you to do this to yourself. You're a good person but THIS is beneath you.
At that moment …
I STOPPED MAKING CONCESSIONS…
AND HELD GUSTAVE ACCOUNTABLE FOR HIS ACTIONS.
It turns out, even In big deals, YOU CAN Speak your mind without losing the deal.
You CAN stick to your guns (even if it leads to tension in the short term)…
You can have a conflict of ideas on intractable issues to find big resolutions.
You DON'T need to be stubborn or hot-headed…
But instead, just frank and honest.
The other side will take you more seriously, and eventually, they’ll learn to be just as bold with you.
The TRUTH from both sides will bring you to a place where there is no more backstabbing or contract changes.
That lunch with Gustave was very uncomfortable, but I left with an agreement to receive $250,000 within 72 hours.
I left that meeting, which was 6,400 miles from my home … with a lot more than $250K:
Yes, I know what you're thinking …
In this quick email, I made this all sound pretty easy … but as you can imagine, there's some careful technique involved with telling THE TRUTH in difficult situations.
Because the TRUTH hurts, and you deliver it in the wrong way, people will pack up their toys and go home.
My partner Russell once told me..
ONLY 3 KINDS OF PEOPLE TELL THE TRUTH…
– KIDS
– DRUNKS
– AND ANYONE WHO IS REALLY PISSED OFF
So just “blurting out” your “truth” is not the way to win a negotiation.
But you should learn the techniques…
Because when you learn this, you can keep your edge, and stay true to your values …. and say what you mean… even if it doesn’t please everyone.
So Right Now, if you're in a tough deal …
Or are dealing with a contract negotiation…
Or need to close a deal that is stuck…
… and you would like to hold people accountable for their actions…
And you need stop last minute contract changes…
…and STILL close the deal…
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