If you’re looking to win at negotiations in contract management, and aren’t sure how to go about it, then this article is for you. Here you will learn the seven ways to successfully negotiate a contract that has long-term benefits.
Negotiating a contract, like any business deal, involves give and take. The process of negotiation and agreement to specific contract terms is so two or more parties involved are able to reach a final agreement on a deal.
Each part is obviously going to approach the negotiations with their, or their business’s, own best interest at heart. They are going to want to get the best deal for themselves. Which is why there is so often a lot of back and forth between the two negotiating parties.
However, this is one way that can help you reduce the amount of time spent on the negotiation process. And, it can help all concerned parties achieve their desired outcome. This way is contract management software.
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7 ways to successfully negotiate in contract management
There are many ways contract management software can help you successfully negotiate a contract. In this article, we’re going to in-depth on seven of those ways.
1. Be clear about your desired outcome
Before you enter into a negotiating process, your business needs to be clear about what it wants out of the contract. Which may sound obvious. But too often, businesses rush through a contract because they want the whole thing to be over.
By taking your time, you will be better able to negotiate the efficiently negotiate the contract.
2. Get legal advice
Your legal team, or council, should be part of the negotiating phase as early as possible. They will ensure the contract iscompliant and has all the necessary legal language to comply with the necessary regulatory bodies. Legal advisors will also be able to ensure they are no missed terms of clauses in the contract.
With contract management software, it’s easy to keep your legal advisors notified. If necessary, they can make changes, and leave notes, in real time to streamline the process.
3. Take your time to prepare
It’s important that you gather all available estimates, information, negotiation papers, and financial statements. These will help you during the negotiation, if the other parties request evidence. By being this prepared, you can save a lot of back and forth. Which can mean fewer meetings, and a faster resolution.
4. Be prepared for some compromise
This is why step one is so important. By having a clear understanding of what you need the contract negotiations to achieve, you will know where you can and can’t compromise.
But make no mistake, at some point during negotiations you will have to make some. What it will come down to is how much you can compromise before the contract becomes untenable.
5. Have a clear understanding of what’sreasonable to expect
Do your research. Make sure that what you want the contract to achieve is possible for vendors and other parties involved in the contract.
Failure to understand the position of the other negotiating parties can lead to one of two things. Very long, protracted negotiations which may go eventually go somewhere. Or, simply a waste of time, if your expectations, and the expectations of the other parties aren’t realistic.
This is why it’s so important to do your research and ensure you know what is and isn’t achievable.
6. Track Every Change
This may sound a laborious task. And if you’re doing contract management manually, it is. However, if you’re using a contract management software, tracking every change throughout the negotiations can help all concerned parties stay on top of things.
The advantage of this is speedier negotiations, and contract drafts. And a benefit of this is smoother, easier, contract negotiations that make all concern parties happier.
7. Walk away if necessary
Sometimes winning doesn’t involve signing a contract. Sometimes it can be obvious that the best deal for you and your company is to walk away. This is not defeat. It’s saving your valuable time for a deal that will provide some value to your company, and prevent you from getting into a toxic contractual obligation.
Winning at Negotiations in Contract Management
Winning at negotiations in contract management is a methodical process whereby you can successfully win a contract using the right negotiation tools and practices. And one of those tools is contract management software.
If you would like to know more about how to win at negotiations in contract management; or, are looking for the contract management software to help exponentially improve your contract management lifecycle; please get in touch with ContraxAware today.
Negotiation in contract management FAQs
Here are three of the more frequently asked questions around winning at negotiations in contract management:
What can contract management software ensure?
When it comes to negotiations, contract management software can ensure you keep tabs on every step of the process. It also ensures the right people are notified when their department is needed to weigh in on a contract.
The advantage of this is it can help create a smoother and easy contract management negotiation process.
What role does contract management software play in procurement?
Contract management software plays a vital role in procurement. If your team where to do the process manually, it would involve spreadsheets and siloed systems to manage the pre-award as well as the post-award phases of contracts.
By digitizing the whole process with contract management software, you save time, reduce cost, and ensure a better organized contract process. The advantage of which is far fewer risks, and a greater chance of contract renewal.
How do you negotiate managed contracts?
Negotiating managed contracts involves having a clear understanding of your goals. You need to know what you can’t compromise on, and where you’re able to give ground up, if necessary.
Very few, if any, negotiations work unless both parties are willing to compromise.It is also important that negotiations are completed before any contract is signed. This way, all parties enter into the contract understanding what is necessary.
