How to manage your negotiating team, by Joanna Brett, Kristin Behfar and Ray Friedman, Harvard Business Review, August 2009

This article is at a relatively practical and down to earth level for the HBR and seems to be relevant to an increasing number of our clients. There was a time when negotiating teams mainly featured as part of major acquisitions and contract deals but now we see them increasingly as part of day to day business life.

Consumer goods companies send cross-functional teams to talk to retailer customers about next year’s terms of trade. Companies pitching for major contracts can no longer rely on one to one personal relationships but find Finance, IT and Procurement Departments becoming involved; their response has to be to fight fire with fire by sending in their own cross-functional team.

This article confirms the point that we have often made in our sessions on negotiations – that the more people you include in a negotiating team, the more difficult it is to coordinate and the more likely it is for things to go wrong. But if a multi-functional approach is essential, then something has to be done to make coordination as effective as possible.

The article is based on research into 45 negotiating teams and the results showed that the biggest challenges normally come from ‘their own side of the table’. The two key challenges are aligning the conflicting interests of the different team members and implementing a disciplined process during the negotiation itself. The finance person is likely to focus on costs and the marketer on quality so they must agree the right balance before the key meetings, not during the negotiations.

As with all things in negotiation, the answer is preparation, part of which must be the opening up of all the potential conflicts. Agreement of the overall business objective, discussion of the different priorities and internal trade-offs, must all be hammered out beforehand. In other words the internal negotiation must precede the external negotiation so that there are no signs of disunity.

The article sometimes seems to be better at highlighting the problems rather than finding solutions but identifying the problem may be enough in some cases to save companies from potential disaster. The solutions may be something that each company has to work out in its own unique context. However there were a few interesting suggestions of ways to improve:

•Where you have control over team selection, look for those who have good cross-functional relationships, which may be more important than negotiating skills
•Invite senior managers and other key influencers to planning sessions
•The team leader to carry out facilitation and bargaining outside meetings to ensure that all hidden agendas come out

I would have added one further simple question – does everybody have to be there? Cross-functional involvement does not have to mean attendance at every meeting; the planning discussions should agree clarity of roles and this should in turn lead to agreement on the optimum number to achieve the objectives.

Altogether an interesting and practical article that is worth a read by anyone who has team negotiation as a current issue.

To access this article go to http://hbr.harvardbusiness.org/2009/09/how-to-manage-your-negotiating-team/ar/1