Any company that spends a lot of money purchasing goods and services, and that wants to make sure its contracts and contracting process is as efficient as possible.

If what you are interested in is negotiating with Procurement, then go here.

Contracting with a large bank, or other large organisation with a strong procurement function, can be a daunting experience. You think you’ve got a deal, but suddenly Procurement wades in, and what you thought was agreed is now suddenly up in the air. And the person in the bank that you have a relationship with is now sidelined and can’t do much to help.

It's frustrating but, on the plus side, it’s predictable.  And because it’s predictable, there are a number of things you can do to manage it. I say “manage”, not “avoid” as with large organisations, unless you have a large amount of negotiating power (e.g. Microsoft), or you are selling something that is really high-ticket, or which the bank (not you) really believes is strategic, going through the Procurement machine is largely unavoidable.

The trick is to manage it as effectively as possible so that a) the deal gets done quickly, and b) the deal still makes commercial sense for you. There are three main parts to this:

1.     The Sales-Side Set Up

2.     Boxing Clever

3.     Good Negotiating Skills

The Sales-Side Set Up is something you need to have done a long time before you meet Procurement. All your proposal documents need crystal clear about the pricing assumptions and link them back to your terms and conditions. This then gives you permission, when Procurement asks for a change in one area, to make a corresponding change in another area (e.g. increase your price in relation to an increased take-on of risk). On its own, this doesn’t get you of the woods but, played right, it can make a significant difference.

Boxing Clever means acknowledging that you are going to lose some battles and will need to focus on picking the ones that you really care about. It also means not picking fights which can be easily side stepped. For example, the word “indemnify” is a red rag to a lot of Procurement depts. Use the word “compensate” instead, Procurement depts won’t object and you will have got 99% of what you were looking for.

Good Negotiating Skills are important because you’re dealing with humans after all, and Procurement will be swayed (consciously or unconsciously) by someone who knows how to be persuasive and who recognises their trigger points.

1. I have a track record of negotiating for and against the biggest and the toughest: Goldman Sachs, Barclays, Investec, Prudential, Blackstone, BAE Systems, Unisys, Genpact, Microsoft, Mambu, Marqeta, to name a few.

2. Strong negotiation skills make for a substantially better deal.

3. Inhouse background means that advice and work is grounded in the pragmatic.

Do Nothing. N/A

DIY. Depending on the size of the deal and the amount of work required (and the other calls on your time) this can be a viable option if you have been involved in similar deals in the past.

Use an external. There are plenty of law firms that will help you negotiate a deal with a large bank or other large institution. However, most of them won’t have specific strategy for large institutions and will end up burning your costs without a clear sense of direction.

Usually a fixed price, based on scope and the value of the deal. But sometimes billed by the hour if there’s too much uncertainty for a fixed price (or if the client has a strong preference for hourly).

It’s hard to measure ROI on legal spend for this kind of deal, but I expect your ROI to be at least 5x.