Negotiating in the shadow of a giant.

I’m afraid I am on my soapbox again….and apologies in advance for the rant.

I am currently supporting a client who is supplying an on-premise software solution to a customer via an integrator. The integrator is a very large, global corporate and in fact SO large it has become monolithic in attitude and approach. This is frustrating me greatly.

I understand and appreciate that there need to be rules. In society, if we had no rules we would be in a state of chaos – anarchy and disorder would reign and people would suffer.
Rules are therefore good right? Well, within society I believe this is true, but when organisational rules are so rigid and inflexible then, after a time, they become non-sensical and this is what I am experiencing.

By its definition a Contract is “a written or spoken agreement that is intended to be enforceable by law”. The word “agreement” is key here in that it indicates there is some kind of harmony or accord reached during negotiation. However, when the ‘Monolith’ says no, it means no… computer says no……. no is, after all, no.

With my pragmatic hat on, and understanding the differing negotiation strengths, I may sometimes tell a small supplier that they just have to accept the position taken by the corporate giant they are attempting to negotiate with. However, this is on the basis the position the corporate starts with (in particular the contract they intend to use as the basis of the agreement) is fit for purpose. If the engagement relates to the provision of a SaaS solution, then why propose a hardware supply contract as the starting position? This is like trying to force a square peg into a round hole and when you are told ‘we don’t negotiate’ it is hugely frustrating!

This current engagement has involved my client having to review hundreds, and I mean hundreds!, of pages of the integrators ‘standard terms and policies’ most of which have absolutely no relevance to the nature of the software solution being provided by my client. But when questioned and challenged, the integrator response has repeatedly been ‘this is our position and we don’t negotiate’. Big sigh…….

Championing Negotiations for SMEs

The government has a challenging aspiration that 33% of government procurement spend should be with small businesses by 2022 and has a number of initiatives to try and break down barriers for small businesses. If the government is willing to “break down barriers” then shouldn’t big corporates demonstrate some real corporate social responsibility by also making contracting with smaller businesses easier?

I will continue to try and fight battles on behalf of the SMEs I represent and will try my best to encourage the large corporates to negotiate fairly and pragmatically with smaller suppliers. However, I fear unless there is a cultural shift within the corporate world, similar to the UK government’s procurement initiatives, then smaller suppliers will continue to be on the receiving end of harsh and unreasonable negotiating positions.

If you feel in an impossible ‘David & Goliath’ negotiating position, then do give us a call. We are passionate about protecting our smaller clients and making sure the contracts you enter into are fair and protect your business and commercial interests.

Marion Blackmore
Client Services Director and Principal Consultant