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Client Contract Negotiation Basics for IT Consultants

Client Contract Negotiation Basics for IT Consultants

Tuesday, February 23, 2016/Categories: IT Business Tips

Talking with people can be scary. Talking with business people over an important contract can be really scary. But you don’t have to be a cutthroat, high-powered, $1000-suit-wearing type to excel at the art of negotiation. In fact, the average IT consultant should be able to wheel and deal well enough to secure good contracts throughout their career.

Don’t know how?

Carrie Gallant (@GallantLeader), negotiation expert and president of and Gallant Solutions Inc., offers advice for how IT consultants can better negotiate a fair and beneficial contract with their clients. One benefit of getting better at negotiating? You’re less likely to need to make a claim on your IT consultant insurance.

When Negotiating IT Contracts, Clarity is Key

Gallant recommends always thinking about clarity in your communication, whether it’s verbal or written. She advises that an IT consultant consistently think about two things over the course of a negotiation:

  • Am I being clear about what I want?
  • Is the client being clear about what they want?

If you aren’t thinking about this, Gallant says, there’s a danger that your lines of communication will miss one another “like ships passing in the night.” You both might be conveying a message, but is that message clear?

Contract Negotiation Tip: Understand Your Client’s Frame of Reference

In IT, conversations can easily start revolving around technical aspects of a job. But, Gallant warns, if the client isn’t a technical expert, they might be looking at the situation from an entirely different perspective. “Often, they’re only looking for specific results,” she says. “Or they might have a certain vision for the project.”

Always be checking in with them and fitting your discussion to a common language. Ask yourself:

  • Are you both approaching the conversation from the same angle?
  • Are they talking vision-language, tech-language, or results-language?

In a practical sense, use this awareness to set clear expectations for your price, your scope of work, your timeline, and other important terms involved in the negotiation process. Frame your argument in terms that they’ll understand. If they’re only looking at results and you need time to achieve what they want, make it clear that your timeline is necessary for the desired results. (See “Get It in Writing: The IT Professional’s Guide to Essential Contracts” for more factors you should consider.)

Develop Listening and Questioning Skills for Better Contract Negotiations

To help achieve clarity in a negotiation, Gallant says there are two skills an IT consultant should absolutely master:

  • Really good listening.
  • Really good questioning.

“Listening doesn’t involve just words. It means trying to tune in to the whole message,” Gallant says. “We listen with our bodies. There are non-verbal cues, body language. If you notice something not quite right in the conversation, then check in and find out what it is.”

But noticing and listening only go so far if you aren’t asking the right questions. Gallant says you should learn to ask questions that reveal clarity from your client. What’s important to them in this project? And if you have a concern in the negotiation, frame it as a question. That gives them an opportunity to respond and gives you an insight into their priorities.

To Master Contract Negotiation: Practice, Practice, Practice

Gallant says she works with tech professionals and lawyers a lot, and one of the things she’s noticed is that these individuals are not often trained in the so-called soft skills (e.g., listening and talking with people, managing conflict, cultivating good business relationships, etc.).

Both the “soft” and the technical skills are necessary to be an effective manager, business owner, and negotiator. Gallant advises that people practice these skills as often as they can to strengthen their confidence and capabilities when dealing with people. For negotiating, Gallant suggests that you:

  • Practice with colleagues, with a video tutorial, or in front of a mirror.
  • Visualize the conversation going both ways – in your favor and not in your favor.

“Don’t leave it until the stakes are high and you have an important contract on the line” Gallant says. “Practice any time you can.”

Gallant likens this practice to an athlete who trains consistently up to the big game. With practice, your people skills develop into a kind of “muscle memory” that comes naturally to you when you’re at the negotiation table.

Good Negotiating is Good Risk-Management for IT Businesses

If you don’t fulfill your end of the contract, you could be sued by the client. Don’t agree to something you know you can’t accomplish. You may have IT consultant insurance, and Errors and Omissions Insurance in particular to cover your professional work, but what can be counted as an “error” or “omission” is defined by your contract. Be proactive from the beginning and negotiate a deal that’s achievable – and profitable – for you.

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