Project Management

Voices on Project Management

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Voices on Project Management offers insights, tips, advice and personal stories from project managers in different regions and industries. The goal is to get you thinking, and spark a discussion. So, if you read something that you agree with--or even disagree with--leave a comment.

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Cameron McGaughy
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Rex Holmlin
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Let’s Make a Deal: Negotiating During COVID-19

Categories: Negotiation

By Lynda Bourne

Eighty percent of the posts I’ve read about dealing with COVID-19 fall into three general categories:

  1. Stay safe and obey the rules.
  2. Stay motivated.
  3. Get legal advice, and document delays and damages.

While many of these posts contain good advice, to my mind they are all focused on threat mitigation. While minimizing threats is important, these approaches miss the opportunities inherent in unstable times. You need to do more than minimize threats to come out of the COVID-19 crisis in the best shape possible.

There are two factors that will help you get through this: your innovation skills and your negotiation skills. I discussed innovation in my previous post, Innovation and Design Thinking, Part One. In this post, I’d like to focus on negotiation in a time of uncertainty.

Of course, to be able to negotiate you do need to stay safe (the first category above). You also need to understand the current situation (the third). But, if you want some control over your future, you also need to be willing to have serious negotiations with the people who matter.

This is a very different situation than normal negotiations with employers, clients, subcontractors and suppliers. The traditional framework of negotiation involves having defined outcomes in mind, deciding on your “walk-away point” (best alternative to a negotiated agreement or BATNA) and using a range of negotiating stances and tactics to achieve your desired outcome. In the era of COVID-19, no one knows what the future holds, and everyone is suffering inconvenience and damage to different degrees. But we are all in this together, and playing hardball for short-term, illusory benefits is unlikely to help anyone.

For example, in normal times landlords around the globe tend to play hardball with tenants—you pay your rent or you are evicted. However, in Australia the government has now made it illegal for landlords to evict business tenants who are unable to pay their rent for the next six months (with the possibility of an extension). The objective of this measure is to ensure the tenant still has a business when the current lockdowns are over and that the landlord still has a tenant capable of paying rent in the future. There are government incentives and guidelines to encourage both parties to negotiate a workable agreement. Compare this to the normal business-as-usual alternative: The landlord evicts the tenant, the tenant goes bankrupt and the landlord misses out on 100 percent of rental income for two or three years until the market recovers.

The imposed solution has everyone sharing the pain. The tenant still has to pay some rent if possible, the landlord will receive less income, the banks support the landlords (after being asked by the government), and the government is paying some of the overall costs if there is an agreement. (Similar measures have also been introduced for private tenants.) This won’t save every business or every commercial landlord. But it will significantly reduce the damage to most businesses and the overall economy. At least, the government hopes this will be the outcome—no one really knows, given the unique situation we are all in.

So, how does this concept translate to your own situation during the COVID-19 crisis? Obviously, everyone and every business is in a unique situation, but there are some useful ideas you can apply at both the business and personal level:

  1. Start talking. You will not be able to influence your situation by passively accepting everything that happens to you. And more importantly, the only effective way to negotiate in the current situation is based on achieving a win-win outcome (while recognizing that the win may be a reduced loss). The ability of good negotiators to influence outcomes is not limited by contract terms or organizational position.
  2. Be realistic and adaptable. For some projects, the negotiation will result in shutting everything down with minimum costs all around. For example, I seriously doubt anyone will be interested in a new cruise liner terminal for a few years. This can be done cooperatively with costs minimized for everyone or arbitrarily with the likelihood of massive legal costs as the solution is fought through the courts. For other projects, the question may be how to stall the project for a period, and for others it may be how to accelerate or adapt the project to the new normal. In any of these situations, proactive win-win negotiations are likely to deliver better outcomes.
  3. Accept change is inevitable—even after the negotiations. Every negotiated agreement needs to be part of an adaptive and evolving approach that recognizes circumstances will change unpredictably. The only thing that taking a hard “win-lose” approach to a negotiated outcome is likely to achieve is cutting off possibilities for a better outcome as the situation changes. Collaboration is likely to deliver far better results than confrontation.
  4. Be innovative. In Australia, the smart rental agents and facilities managers are dealing with their massive loss of income by innovating processes to help landlords and tenants reach agreements and maximize government receipts. What’s in it for them? In part, a new stream of fees for services rendered and being in the box seat to carry on managing the facility once the lockdowns are over. Win-win-win.
  5. Be agile and adaptive. Vast areas of business will never return to “normal,” and many jobs will be permanently lost. But there will be a new normal, and there will be new jobs. It doesn’t matter if you are a person looking for work or a business looking for clients—the ones that succeed will be those that adapt fastest to whatever the new normal looks like.  But remember: Agility is not anarchy! Useful agility is based on research and assessment of what the future may hold. The problem is that no one knows for certain what this will look like—so being a pragmatic risk-taker is essential.

People and organizations that come through the current situation ready to succeed in the post-COVID-19 world will be resilient, adaptive and collaborative. Great negotiating skills and innovative thinking will be essential.

Still, a little luck will go a long way. As I discussed in my post Probability vs. Luck: Lessons Learned From a Day at the Races, luck will also play a major part in deciding who comes out of this in the best shape. But, to quote Coleman Cox: “I am a great believer in luck. The harder I work, the more of it I seem to have.”

How are you preparing for the post-COVID-19 future?

Posted by Lynda Bourne on: April 23, 2020 10:16 PM | Permalink | Comments (3)

Forging Resilience as Project Professionals

By Conrado Morlan

 

“A man may have wisdom and discernment, but that is not like embracing a favorable opportunity. A man may have instruments of husbandry, but that is not like waiting for the farming seasons.” — Mengzi

I do not know a project management professional who has not faced challenging situations during their career. The range of challenges can include unforeseen risks that quickly became issues, such as geopolitical events, acts of God or, most recently, a pandemic.

Those kinds of stressful situations help to forge the resilience skills and traits characteristic of the modern project management professional. Resilience is not about toughness; it is about equanimity. It’s about how you manage your temperament in challenging situations and move forward.

During these times, stakeholders expect you, the project management professional, to act and act fast. There is a desire for instant gratification and often a misinterpretation of the concept of “being agile” by both stakeholders and project management professionals.

I remember one time in which I was leading the negotiation process with a prospect in South America. On that Friday morning, I recommended that my manager hold off on sharing the final proposal until I met with the prospect in person on Monday. On Saturday morning, I received a text from my manager telling me that he was about to leave for South America for the Monday meeting, which was not in the original plan. Due to personal commitments, I was flying in on Sunday night. As soon as I landed, I already had two missed calls from the customer and a couple of texts asking for an explanation about the drastic changes in the proposal and why the purchasing department was copied in the email.

My approach, based on Fabian strategy—a military strategy in which pitched battles and frontal assaults are avoided in favor of wearing down an opponent through a war of attrition and indirection—was not successful. Much like when Fabius fought Hannibal, a third party involved took action without my knowledge.

When we met with the customer, I tried to regain control of the situation, but it was too late. Now the purchasing director was at the negotiation table, something that was not part of the original negotiation strategy. After several hours of renegotiation, the contract was signed, but the two parties left money on the table. The customer saw a reduction in their IT budget, as the planned spend was reduced by 15 percent.

History Repeats Itself

Similar to what happened to Fabius during the Second Punic War, my manager was hailed as the key negotiator who closed the deal, and my perceived lack of action was recorded in my annual performance review.

The desire for instant gratification was satiated, but it made the company lose sight of the future. When the contract was about to end, the customer called to notify us that they would not renew the contract for the second phase of the project.

My strategy not to share the proposal ahead of time was focused on the long term, and on building a strong relationship with the customer—which would later translate into more business for the company. After the contract ended, my manager and his boss realized the reason for my “lack” of action and changed their views.

Lessons Learned

This event was one of the best learning experiences in my professional career. It gave me the knowledge of how to bounce back and the strength to learn the lessons I needed in order to move to the next stage in my career.

Cultural awareness cannot and should not be ignored. Contract negotiations have strong ties to culture, and local and national business etiquette should be followed to be successful.

Recognition for your efforts may not happen at first. It may take some time, but it will help confirm that your decisions were for the best.

It was one of the many setbacks in my career, but I am grateful for the experience.

As a project management professional, what events or situations have forged your resilience?

 

Posted by Conrado Morlan on: April 14, 2020 11:10 PM | Permalink | Comments (3)

Project Bully on Your Case? Here Are the Negotiation Skills You Need to Get What You Want

If you’re new to project management, mastering negotiation skills is going to provide you with an invaluable asset to cope with real-life situations that drive project managers crazy sometimes.

If you’re a seasoned project manager, you’ll probably wish you’d read this post before!

In fact, negotiation skills offer many benefits to project managers. Most important, they:

  • Equip you with tools and techniques to resolve differences and to mend hard feelings, instead of avoiding them
  • Help you to build relationships with stakeholders
  • Provide you with strategies to clarify expectations
  • Improve your chances of getting support while also keeping conflict to manageable levels
  • Facilitate a deeper understanding of stakeholders' needs, expectations and agendas

The term “negotiation” derives from Latin roots. Its original meaning likely won’t surprise you:

  • “neg” means “not”
  • “otium” means “leisure”

Negotiating isn’t easy. That’s why most people try to avoid or withdraw from negotiations. But doing this makes you worse off, increasing the chances of being exploited and bullied.

Stop for a moment and ask yourself: Did any stakeholder take advantage of you in a recent negotiation? Maybe your boss shouted at you, “Why are you still planning—when are you going to start doing some work?” Or perhaps a client asked, “It is just a small change to the requirements. Can’t you get it done by next week?”

Here are the Ten Commandments of negotiating with project bullies:

1. Prepare before starting to negotiate

2. Don’t be emotional. Don't take it personally

3. Always be honest

4. Put yourself in “their shoes”

5. Know your BATNA—the best alternative to a negotiated agreement

6. Identify the zone of potential agreement

7. Learn how to say no

8. Think long-term

9. Understand that every problem is an opportunity

10. Whenever possible, improve relationships and build trust

Have you ever taken a negotiation course? Or did you read a great book on negotiation that helped you as a project manager? Please share your thoughts, suggestions and experiences below.

 

Posted by Mario Trentim on: August 06, 2015 11:04 AM | Permalink | Comments (21)
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