EIC Coffee Break with the Summer School trainer Andre Doria – It’s a deal! Is it?
Every month, during a Coffee Break, we dive into the stories of EIC innovators, but in this months’ edition we decided to flip the script and conduct an interview with Andre Doria, the negotiation trainer for this years’ EIC Summer School. Andre Doria is co-founder and CEO of Value Negotiation Technologies and guest professor at Porto Business School and King Fahd University of Petroleum & Minerals (Saudi Arabia), where he teaches MBAs and Executive Education programs. In the two-day workshop, Andre took a deep dive into negotiation tactics and strategies and gave tips on how to improve the art of negotiation. Find out more in this month’s EIC Coffee Break.
What interested you in participating as trainer for the EIC Summer School?
Being part of an EIC event was in itself already a true pleasure. Beyond that, the targeted audience was very appealing. They are European entrepreneurs and founders, much like myself. As such, I found this a wonderful opportunity to offer them what I know about negotiations but at the same time to discuss founders’ negotiation challenges. That's actually the way I prefer to run my workshops; engaging with the participants in a bidirectional conversation, so that there is as much hands-on learning as possible.
What made you decide to become an expert on negotiations?
Well, my initial professional aspiration was creating software engineering products. During my Master in electrical engineering & computer science, I learned some software development skills, but that was hardly enough to succeed. Then I took a scholarship in Germany to do some R&D geeky stuff in mechanical fluids software, and after that it I ended up in the automotive industry as a systems engineer, working with different Manufacturers. Having explored different projects, I discovered that I was not in love with car engines but rather in the “problem-solving and managerial science” issues. So, I went for an MBA which suddenly included a course on Negotiation. It quickly became my favorite discipline during the full program, alongside entrepreneurship. In Negotiation, I could understand how to solve “human-like” problems in the heat of the moment and at the same time trying to create an analytical approach to maximizing the value of deals and disputes. I could see myself crossing two worlds, the engineering & the value optimization, from an analytical standpoint, with the conflict resolution part; and the balance of that to me was called negotiation. That set the stage to my next career moves which included negotiating large wind farm installations and telecom infrastructure projects globally, and later launching disruptive executive programs and creating VN Tech with my partners Rodrigo Gouveia and Horacio Falcao.
What main difficulties do SMEs face when negotiating with parties like corporates and big investor firms?
I could list two difficulties with these counterparties. Firstly, the power difference and secondly, the internal process complexity.
Some corporates and investments firms, when dealing with SMEs, may feel the temptation to use their perceived power superiority (e.g. much larger budgets or higher number of alternatives) in order to set both the rules of the negotiation and the intended outcome. That is a common and tricky problem, as in some situations it may lead to positional bargaining, or a conflict around demands and threats (take it or leave it), which ultimately hinders value discovery opportunities and grants inferior results to both parties, or no deal at all. Tackling these challenges is not easy as it involves being positive without being naïve. Such behaviors include setting the right initial tone; knowing how to push back without creating resistance; and exhibiting & rewarding positive moves such as a) exchanging interests early and b) committing to specific options only later in the process.
The second point comes with the structure of large corporates. Due to their size, internal processes may become complex, so it gets harder to identify the right people. Especially when dealing with innovation, there may be no process owner at all. Or too many owners simultaneously, if a new product adoption impacts multiple departments. Acquiring the right internal sponsor and mapping the decision-making process is key, but then can we fit their packed agendas? Meetings, follow-ups and striving to keep everyone’s interests up sounds daunting. Then comes procurement, with often legacy contracting processes disentangled from the required timelines. These factors turn negotiations a lengthy process and thus vulnerable to organizational changes, which affect large companies every now and then. This is also why the drop rate is so high when you're dealing with corporates. I wish I had the silver bullet, beyond urging negotiators to identify these “invisible negotiations” right from the start and taking preventive measures upfront.
What is the one main tip you would give SMEs in terms of negotiations?
That’s a tough choice, but I would say one very important skill is the capability to diagnose a negotiation. Having a clear picture of what’s going on prompts you to prepare and chose better moves (lower risk, higher reward) at any critical moment. These moves can be structured using the Seven Elements negotiation framework: Relationship (do we trust each other?) and Communication (is the process clear?) are normally the starting point, also called the Bridge. Then off to the value elements: Interests (what needs to satisfy and concerns to mitigate?), Options (which, among many possible terms, to put in the contract?) and Legitimacy (are the options making sense or being pushed?). Finally, we take the decision: Commitment (should we accept the terms?) or Alternatives (are we better off leaving this negotiation towards our plan B?). Mastering these requires preparation and training but pays off dramatically – not just through significantly better deals but also on a personal level!
What were your thoughts about the summer school in general?
I really enjoyed the program, from the outstanding organization to the great participants engagement. There were lots of practical questions which proved the curiosity and experience of the audience, who shared very concrete negotiation examples, from cultural issues in China and power dynamics found in pharma partnerships, to the debriefing of process moves in the role play cases negotiated during the sessions. This may have slowed down the pace a bit, but hopefully to the reward of the majority in the call.
Which negotiation books would you recommend to our EIC innovators?
The first one is “Getting to Yes” by Roger Fisher. A basic yet powerful negotiation book where you learn a lot about how to do a win-win negotiation approach, through what it became known as the Harvard Negotiation method. It is pretty amazing the amount of powerful things that can be taught in a 100 page book.
The second one that I love due to my engineering background is “Negotiation Analysis” by Howard Raiffa. It is a more analytical book written by a mathematician who devoted most of his time to building a negotiation science. I recommend this one to the most quantitative-driven EIC innovators. Word of caution – it’s a longer one!
Then the third one, which I'm using more frequently today is the one written by my partner at VN Tech and INSEAD professor Horacio Falcao: “Value Negotiation: How to Finally Get the Win-Win Right”. That’s the methodology behind the training I provided to EIC and the to me one of the few negotiation books that comprehend a full end-to-end strategy, masterly presented along baby steps and packaged with plenty of dialogues and detailed examples.
If you could talk business over lunch with a large corporate CEO or global leader, which one would you choose and why?
My first thought would go with Elon Musk. Mainly because I just admire his innovation mindset, energy and creativity – that guy knows no limits to building new stuff and bringing it to the market, from e-cars to hyperloops, neurochips and reusable space rockets. But on a second thought, I would prefer a lunch with someone closer to my business, such as Salesforce founder Marc Benioff, who started the most popular CRM software from scratch. I would love to hear his thoughts about a potential immersion of automatic contract negotiation engines into CRM systems to help companies close better deals. That would be awesome!