Negotiations
Training
Taking
Stock of Non-Negotiable Terms:
Deal-Breakers
Every organization
has specific clauses, issues and other items that they consider
to be non-negotiable.
Some companies have particular contract terms that they consider
to be set in stone. Others have particular
principles and beliefs which they are unwilling to compromise
at any cost. In many cases, these items are subjective and based
on an organization's
preferences. Others are important terms that play a vital role
in a organization's ability to operate successful.
We believe that
every single organization needs to have a solid understanding of
what items should be defined as outside the pale of negotiations.
These are deal-breakers...
issues that an organization holds so dearly that they are willing
to walk away from the negotiating table. We have listed some
items that every organization should consider as well as others
that are more subjective and based on individual needs. Regardless
of the reasoning behind why an item or term is included in this
"protected class", taking stock of this inventory is crucial.
Whatever is included should then be disseminated to those tasked
with negotiating
contracts, agreements and other legal arrangements.
* Organizational
Requirements - Many organizations have
specific terms and clauses that absolutely, positively must
be protected at all costs. These often vary from company-to-company
or industry-to-industry and may be established according to industry
standards or personal preference. For example, technology
firms often have established rules about intellectual property
rights related to developed products. Intellectual property is the
lifeblood of a software company and protecting those rights it vital
in any agreement. Other requirements may be less important but placed
in a protected
class. Some organizations may not be willing to bend on non-solicitation
clauses, regardless of the reason. As you look at your contracts
and agreements, determine which items or terms fall into this area.
* Ethical
Concerns - The leadership of any organization, large or small,
should always strive to act in an ethical and honest manner. Requests,
clauses or terms that would directly or indirectly force an organization
to act in an unethical manner should be avoided at all costs. Regardless
of whether those activities are considered legal or illegal, a company
is only as good as its reputation. Simply the insinuation or accusation
of impropriety or scandal can have a severely damaging effect on
an organization, whether privately run or publicly traded.
* Legal Issues
- To take the last issue one step further, anything that would require
an organization to knowingly break the law or violate another agreement
(such as a non-disclosure agreement) should be avoided at all costs.
There is no reason to enter into any agreement that will violate
local, state or federal laws or place an organization in jeopardy
of a lawsuit. None.
* Code or Industry
Requirements - Many industries are required by associations and
other bodies to comply with specific
standards, accepted codes and requirements. Any requests that
may cause an organization to "bend" or ignore these requirements
should be avoided.
Requests to
negotiate protected items should be handled in a professional manner.
When the other party makes a request to negotiate a "deal-breaker",
you should rationally explain that a particular item is not open
for discussion. Generally, we suggest you inquire as to why the
other party is interested in discussing
that particular item. In many cases, they may simply not be
aware that a particular clause cannot be negotiated or may violate
some possible industry standard, existing contract or law. This
will also enable you understand their reasoning and may allow you
to negotiate some other clause or provide
a suggestion that may satisfy
their request. If the other party is adamant that a "deal-breaker"
clause be modified, you should be prepared to exercise your ability
to walk away from the table. There are some deals that are just
not worth pursuing.
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