The Business of Negotiation

The Business of Negotiation

When building software, there are many times that you will be negotiating with other companies or clients.  Negotiation is a business within itself. If done properly, it can really benefit you. If done improperly, it can really hurt you. Negotiations will come up in countless areas of development.  For example, when developing software you may be negotiating with a company for the honor of using their own software inside of yours.  This type of deal is a mutually beneficial one.  My company will get the benefits of your software to add value to mine, and you will get money from every transaction that transpires or set of software sold. If you can negotiate properly, so that everyone is satisfied, it’s a win-win.

The problem falls into the negotiation itself. There are several aspects of negotiation that you have to be aware of going into any deal.  You can’t be so unrealistic with your demands and approach that you kill a deal and hurt yourself in the long run. Don't be short sighted. What does this mean? Maybe you’re trying to make the quick dollar up front instead of looking at long term.  This can be a large detriment to your business.  You have to consider what you are negotiating for, what it truly is worth to you, and if you really do need it in the long run or if it’s something that you can in fact walk away from if the deal doesn’t benefit you.  

Let’s take the example from before of negotiating with a company for the right to use their software inside yours. If you can’t get it for the price that makes it worth it for you, maybe the result is that you just won’t put it in your software then. Maybe you don't have to have it. Maybe you do. You have to decide how important it is to you and what it’s worth to you. This is where the negotiation comes in. The thought process is, “I'm selling lots of software without it. I could sell more with it, but that would be making both of us money. Let's negotiate.”

When you start at two radically different places for what your expectations are in a deal –negotiation is a must. Your goal is to figure out how to get people on the other side to align and come together. At the end of the day, if this is something that you really want and need to move forward, then you have to figure out how to get a deal done when you’re so far apart.  It’s important to know when to let go and let a deal happen.  You don’t want to be the only thing standing in your own way.

What have your experiences been with negotiations in business? Before starting any negotiations, what are the most important questions you can ask yourself?  What is the worst thing you can do when negotiating?  Comment below!

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  • 2 February 2017
  • Author: James Nagy
  • Number of views: 735
James Nagy

James NagyJames Nagy

Need a consultant today? How can I help? As Co-Founder and Managing Partner of J&S Tech Designs I have nearly three decades of experience and expertise to share with you to help your business, product, or idea thrive. If you like this article, please sign up in the “stay informed” section!

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Full biography

Full biography

James Nagy is managing partner and co-founder of J&S Tech Designs - a business consulting organization that specializes in providing software and website design, development, and management expertise to organizations. He is also Managing Director and one of four co-founders of Sprocket Websites, Inc. and Chief Executive Office and one of four co-founding members of Clinical Collaboration Software, LLC.

James has over twenty-five years of experience in the information technology field, spending twenty years in software development, sixteen years in executive management and the last six years as a serial entrepreneur launching and running several successful technology organizations.

Throughout his career he has led companies, divisions, departments and teams to successful outcomes. He has executed process reengineering within organizations that were struggling to produce. He has provided strategic vision and organization planning in situations that needed direction. He has built complex systems in several unique marketplaces that required thorough knowledge and expertise to be successful. It is his passion for excellence and desire for success that has enabled him to meet the challenges presented and continue to exceed expectations.

James’ passion for delivering innovative solutions and creative strategies enabled him to develop strong business foundations for long-term success. He is an active member of the Conejo Valley Chamber of Commerce, the North of the River Chamber of Commerce and the Naperville Area Chamber of Commerce where he served on several teams, advisory committees, and legislative groups. He is a founding member of the Chicago Area DotNetNuke Users Group that has held several large, successful Website design and development events. James has donated time, money and expertise to many volunteer, fundraising and charitable organizations like KidsMatter of Naperville, The Naperville Film Festival, Summer Place Theatre, TEDxNaperville, Neuqua Valley High School Senior Spectacular and many others.

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