Timely Tips for Renegotiating Due to Covid-19 - Pathfinders Downunder

Timely Tips for Renegotiating Due to Covid-19 - Pathfinders Downunder

Wayne Harrison is a highly respected researcher, practitioner, strategist and thought leader on negotiation and communication. For nearly 25 years Wayne has been providing proven and practical problem solving know how to communicate, influence, negotiate and manage conflict. Here are some of his insights into renegotiating due to the COVID crisis.

How relevant are your existing agreements?
COVID-19 changes to work conditions, supply chains, business models and demand curves, have all contributed to a loss of relevance for many agreements. When this loss of relevance leads to dissatisfaction a renegotiation is often viewed as a better option than risking further deterioration, conflict and relationship strains.

What makes renegotiations more challenging?
Renegotiation seeks to rebalance inequities that have arisen in an existing agreement, which if left unchecked can cause a sense of loss. This becomes particularly problematic when the focus is on allocating those losses, rather than the co-creation of value that is better for both parties. Adding further difficulty is when those involved feel they need to accept a sub-optimal outcome because the sunken costs in the relationship make walking away more difficult.

How do you enable win/win renegotiations?
A collaborative starting point is to recognise that those involved in the original agreement were unable to predict how a future crisis like COVID-19 could fully impact on an existing agreement. Commencing the negotiations with a more neutral and mutual framing helps to encourage the conditions for a joint problem-solving opportunity.

To help build rapport and to get discretionary effort, focus on the common ground that gives the relationship unique strengths. Then manage the ‘discovery’ stage of the renegotiation by discussing multiple issues, this will increase the probability of revealing differing preferences on some issues, which may in turn result in exchanges that rebalance and add relevance to a renegotiated agreement.

Wayne Harrison
Director – Pathfinders Downunder