Tuesday, March 17, 2009
Musical Contracts
Perhaps I need to start working on my singing and acting skills for my next contract negotiation.
Green Eggs and Ham
I had breakfast with my kids at my parents' house this morning before work. My mom had a tradition of fixing a green breakfast on St. Patrick's Day when I was growing up, and she invited us over this morning to pass that along to my kids. They still talk about the green breakfast they had two years ago when they stayed with my parents while my wife and I were in Mexico for our 10th anniversary, so they were excited to go. Mom served eggs, ham, milk, grapes, and muffins. Everything but the ham was green. We had a nice meal, then my mom went to find Green Eggs and Ham while I headed off to work in my green Notre Dame shirt (St. Patrick's Day is a great day to be a ND alum).
Thanks, Mom!
Thanks, Mom!
Monday, March 16, 2009
Negotiating against myself
I've been heavily involved lately with a significant set of contracts with one of the world's largest IT companies. This company is moving into a new market segment and is partnering with us as an OEM distributor of our software, bundled with their offering.
On Friday afternoon, we were down to just one major issue, indemnification. The partner wanted to use their big name as justification for our offering more indemnity coverage, but we had explained to them that we had other "big" OEM partners, too, and that our coverage should be tied to the revenue generated by the deal. I thought we had reached a compromise position that would offer them less protection than they wanted, but extra protection in case a certain class of claims was brought--a class of claims they were worried about, but one that we thought was very unlikely to occur.
Imagine my surprise when their attorney called me back to say that his business folks had heard that my company would offer more indemnification, if pressed. The sales director had learned of our absolute bottom-line position and went behind my back to leak this information to the partner with the express intent of getting me to cave. His oft-repeated mantra is "Let's just get the deal done," as if the only function of legal is to kill good deals. He cares nothing about the interests of the company, just his team's sales and commission figures.
I had a tense conversation with my legal counterpart as I assured him that what he had heard was not my company's official position. In the end, I prevailed and they accepted our lower indemnification, but I was very angry that my own colleague would jeopardize the deal and the terms on which it would be consummated to pursue his own agenda. I like being involved in strategic revenue deals, but it is frustrating that my most difficult conversations are usually with my company's own salespeople. For that reason, I sometimes think it would be better to be in a position that was less sales-facing, like drafting inbound engineering development agreements, for instance.
On Friday afternoon, we were down to just one major issue, indemnification. The partner wanted to use their big name as justification for our offering more indemnity coverage, but we had explained to them that we had other "big" OEM partners, too, and that our coverage should be tied to the revenue generated by the deal. I thought we had reached a compromise position that would offer them less protection than they wanted, but extra protection in case a certain class of claims was brought--a class of claims they were worried about, but one that we thought was very unlikely to occur.
Imagine my surprise when their attorney called me back to say that his business folks had heard that my company would offer more indemnification, if pressed. The sales director had learned of our absolute bottom-line position and went behind my back to leak this information to the partner with the express intent of getting me to cave. His oft-repeated mantra is "Let's just get the deal done," as if the only function of legal is to kill good deals. He cares nothing about the interests of the company, just his team's sales and commission figures.
I had a tense conversation with my legal counterpart as I assured him that what he had heard was not my company's official position. In the end, I prevailed and they accepted our lower indemnification, but I was very angry that my own colleague would jeopardize the deal and the terms on which it would be consummated to pursue his own agenda. I like being involved in strategic revenue deals, but it is frustrating that my most difficult conversations are usually with my company's own salespeople. For that reason, I sometimes think it would be better to be in a position that was less sales-facing, like drafting inbound engineering development agreements, for instance.
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