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Lawyers as Negotiators: Hitting the Wrong Targets?

December 2011
ContractAssociation

Abstract

The annual IACCM study of the most frequently negotiated terms in business-to-business contracts once again reveals a strong focus on the provisions that deal with risk allocation and the consequences of failure. Those who negotiate these deals confirm that their focus is often in the wrong place. Indeed, one General Counsel observed: “Having studied this issue, I realize that much of our negotiation is more driven by functional positions than it is by broader business interests”. In other words, business negotiations can result in the negotiation team fighting for things that undermine the interests of their own organization. This is vividly illustrated when we look at the behavioural impacts of terms and conditions. For example, onerous risk allocation forces defensive approaches to innovation and stifles good communication. Ill-considered performance measurements can lead to cost-cutting that jeopardises quality and outcomes. The inclusion of liquidated damages may result in a culture of blame that undermines cooperation and threatens key issues such as health and safety.

Author

Portrait image of Sally Hughes
Sally Hughes
Chief Executive Officer, IACCM - International Association for Contract and Commercial Management, UK

Sally is Chief Executive Officer for the IACCM, supporting the IACCM global team in the pursuit of both the recognition of and excellence in Commercial and Contract Management. Sally is an experienced and accomplished commercial and contracts management professional, holding senior commercial positions at a range of corporate and multi-national organizations. After gaining an Honors degree in Law, Sally spent her time in house in the corporate sector, where she worked globally in the Telecoms and IT industries, before establishing her own legal and commercial consultancy in 2007. Sally is passionate about enabling business efficiency and growth through contracting and commercial excellence; she understands the need for robust business operations to drive these efficiencies, together with the requirement for effective communication and collaboration at all times. Whether in contract development, negotiation, training or general communications, Sally has built a reputation for service excellence and responsiveness. Her focus is on the creation of positive and successful business relationships, constantly striving to ensure that businesses realize their true potential and value.

Company

IACCM - International Association for Contract and Commercial Management logo

IACCM - International Association for Contract and Commercial Management

IACCM is a global non-profit association that brings together lawyers, procurement specialists and contract managers to research and develop ‘best practices’ in contracting, negotiation and relationship management. It has more than 22,000 members representing over 6,000 corporations and government agencies from 130 countries. IACCM has recently published the world’s first authoritative guide to business contracting - "Contract & Commercial Management: The Operational Guide", available through IACCM or Van Haren Publishing.

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