Negotiating with Friends: How we got it Right


Negotiation is very rarely about the short term. It’s an area where you really need to think ‘win/win’ because nine times out ten you’re going to have an ongoing relationship with the person across the table. So don’t set out to ‘screw’ someone: in the long run that attitude is unlikely to be profitable.

That was what I said last week when I was discussing the general principles of negotiation. ‘Think win/win. Nine times out of ten you’re going to have an ongoing relationship.’ But that becomes even more true when you’re negotiating with a friend – as I did when I bought TAB UK from Paul Dickinson and Jo Clarkson.

“Never do business with a friend,” is an old business maxim – and it’s probably saved a lot of friendships – but sometimes doing business with friends and, ultimately, negotiating with them is inevitable.

“Loan oft loses both itself and friendship,” said Polonius, giving advice to his son Laertes before he set sail for France. Well negotiation can do exactly the same: the negotiations can flounder and the friendship can be ruined. Worse still, the negotiations can apparently ‘succeed.’ And then one party gradually realises he’s been ripped off: that he’s been taken advantage of by someone he previously considered a friend. Not any more…

The negotiations to buy TAB UK were long and complex: there were two people involved on both sides, plus accountants, bankers, lawyers – and our respective families.

As Mags and I sat across the table from Paul and Jo I had four priorities:

  • I wanted to buy the UK franchise for The Alternative Board: I’d talked it over with Dav – at length – and I absolutely believed it was the right thing for me, and for my family
  • But like any business deal, I wanted to buy it at the right price
  • I wanted to make sure the negotiations did nothing to damage TAB UK going forward
  • And I wanted to retain the friendship of two people I liked, respected and valued greatly as business colleagues and confidantes.

So how did we set out to achieve that? There were three key rules that guided us through the negotiations and which protected and strengthened our friendship.

  • First and foremost, we set the stage. Both sides were absolutely open about what they wanted to achieve in the negotiations. We constantly asked ourselves a simple question: ‘Is this fair to you? Is it fair to us? And is it in the best long-term interests of TAB UK?’ That question was, if you like, the mission statement of the negotiations
  • …Which inevitably brings me to one of Stephen Covey’s ‘7 Habits.’ “Seek first to understand, then to be understood.” There was a real willingness to see the other side’s point of view. If you do find yourself negotiating with a friend it’s vital to see the negotiations from both sides of the table
  • So there was plenty of goodwill on both sides. But even with all that goodwill, there were bumps in the road: that was inevitable with such complex negotiations. The key was to look ahead and anticipate problems, to be open about setbacks and to clear up any misunderstandings as quickly as possible.

The net result? A very successful negotiation and both sides happy with the outcome. Was it easy? No, but then readers of this blog don’t need telling that few things that are worthwhile are easy. Ultimately, I’m absolutely delighted with the outcome – I’m equally delighted that Paul and Jo will be friends for life.

As it’s Easter, let me finish on a slightly lighter note – and a warning, if you’re planning to spend four days in the garden…

When I’m writing these posts I always – irrespective of how well I know the subject – check with Google, just to see if the Harvard Business Review or one of the entrepreneur magazines has a different perspective. And I’m increasingly astonished at how few words I need to type in before Google guesses what I’m after.

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Or I was – until this morning. How do you negotiate with I tapped in. Before I could add a friend, Google completed the sentence for me. How do you negotiate with a Sim eating plant? Seriously? That’s the most popular query about negotiation?

Well, fair enough. I always preach the value of knowing and researching your market…

So for those of you whose Easter might otherwise be ruined by the death of your carefully-nurtured Sims, I present perhaps the most useful advice ever offered on this blog. (Warning: the video contains violent scenes which some readers might find distressing. It also contains a teenage son doing nothing while his father is eaten by a tomato plant…)

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Nice Guys Finish First


On Monday I had the idea for this week’s post. As you’ll see from the title, it was ‘Nice Guys Finish First.’ And then came Tuesday, and President Elect Donald J. Trump. Very clearly, not a case of a nice guy finishing first…

But while this isn’t a politics blog and I’m not going to stray into the respective merits of the two candidates, let me draw just one business lesson from the campaign. For all the speeches and all the appearances with celebrities, I simply cannot pinpoint Hillary Clinton’s central message.

Contrast that with ‘Make America Great Again’ or – if you want a Democratic equivalent – ‘Yes we can’ in 2008. Define your market, ladies and gentlemen, and give them a simple message.

I thought both candidates were unimpressive: as one commentator put it, Trump was simply “the imperfect candidate” who had “the perfect message.” But it wasn’t their qualities that depressed me, as much as the tone of the debate. Like our referendum – and the rancour that continues after it – the presidential contest was bitter, divisive and, at times, downright nasty.

Does it have to be that way? In politics, maybe it does. Maybe social media means that a murky business will inevitably get ever murkier.

Will business go the same way? There’ll be plenty of wannabee Donald Trumps waking up this morning – although I do like the story that he’d have been even richer if he’d simply invested in index funds

Nevertheless, the popular stereotype remains the ruthless entrepreneur: the man best portrayed by Gordon Gekko in Wall Street, where nice guys finish last and lunch is for wimps.

But as I look round the TAB boardroom table I don’t see Gordon Gekko – or Donald Trump. You might argue that it’s self-selecting: that I wouldn’t want to work with people like that and they wouldn’t want to work with me. But I think it goes deeper than that.

When I first started this blog I jotted down a few notes on how I wanted to come across. I’ve written about the list before but it bears repeating:

Nice guy – loves his family – knowledgeable about business – could help you – good experience working with him

I wonder now if I was subconsciously defining the clients I wanted. As I look round a TAB table what do I see?

Interesting people who are interested in others – who have ethics and values – who want to grow and who want to help others grow – who respect others – who want to know themselves better – and who are, without exception, ‘nice guys’

…And despite having what our archetypal entrepreneur would see as dreadful handicaps – respect and time for other people, ethics and values – the people I see are all successful. They’ve all finished – or are on their way to finishing – first.

Clearly, ‘first’ means different things to different people. But there is one common thread running through the definitions of ‘first’ around a TAB table.

‘First’ is long term.

It’s about developing and nurturing relationships and helping other people along the way. It’s also about people trusting you: and the only way to guarantee that will happen is to treat people well and to deliver on your promises.

In short, the best way to finish first in the long term is to be a ‘nice guy.’

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So as I look at the nastiness in politics, I’m desperately hoping it doesn’t spill over into business. I absolutely hope we’re not inspiring a generation of children with the message that the best way to win is to unleash a barrage of hostility via social media and then refuse to accept the result if it has the temerity to go against you.

There are two reasons for this: firstly business is going to be a much less welcoming place. Secondly – and rather more importantly – there are going to be far more failed businesses.

Success – as the old saying goes – is a journey, not a destination. And on that journey we all need to work with other people and develop long term relationships. In short, we all need to be nice guys…

I’m Lazy, I’m Fat and I’m off to Play Golf


The UK trade deficit shrank in July, down to £4.5bn from £5.6bn the previous month. The services sector rebounded sharply as the Purchasing Managers’ Index jumped to 52.9 from a seven year low of 47.4 in July. The construction sector is showing signs of recovery – but the British Chambers of Commerce has cut its forecast for UK growth this year, reducing it from 2.2% in March to 1.8%, citing uncertainty over the Brexit negotiations.

In short there’s been the usual mixture of good and bad economic news over the past couple of weeks. There hasn’t been the immediate post-Brexit apocalypse some commentators had predicted, but the negotiations to leave the EU have barely begun. None of us – including the negotiators – have much idea what the talks over the next two years will bring.

But none of this has stopped Liam Fox, the MP for North Somerset, current Secretary of State for International Trade and quite recently, possible successor to David Cameron.

Last week Liam Fox made his feelings known on British businessmen. The country, he declared, was “too lazy and too fat” with businessmen preferring golf on a Friday afternoon to trying to boost the country’s prosperity.

This country is not the free-trading nation it once was. We have become too lazy and too fat on our successes in previous generations. Companies who could contribute to our national prosperity – but choose not to because it might be too difficult or too time-consuming or because they can’t play golf on a Friday afternoon – we’ve got to say to them that if you want to share in the prosperity of our country you have a duty to contribute to the prosperity of our country.

Richard Reed, co-founder of Innocent Drinks, said that Mr Fox had “never done a day’s business in his life.” I suspect that several members of TAB York would respond in significantly stronger terms…

Of course the comments are nonsense. Of course they’re insulting to the overwhelming majority of people running SMEs – and worryingly they show an International Trade Minister alarmingly out of touch with… well, trade. But there are possibly even more important considerations than that.

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I’m not fat (said he, squeezing into the suit he got married in 18 years ago) and I hope no-one considers me lazy. I did, however, play golf on Thursday and I make no apology for that.

Since this blog started – more than six years ago now – I’ve repeatedly stressed the need for time away from work. ‘Work hard, play hard’ might be a cliché, but it stops burnout, keeps you fresh and, importantly, gives you a broader perspective on life.

I remember reading about Denis Healey criticising Margaret Thatcher for having no ‘hinterland:’ no breadth of knowledge of art, culture, literature or science.

You might argue that ‘hinterland’ isn’t important for business success: that a laser-like focus on your goal will get you there.

I wonder… As the worlds of technology and business continue to change ever more rapidly, then knowing about – and learning from – seemingly unconnected disciplines will, I think, become increasingly important.

Just as importantly, hinterland – and the associated work/life balance – is a lot of fun. Which brings me back to Master Fox and our politicians: when was the last time you saw one on a golf course? Too many of our politicians – other than the obligatory August photo op in Cornwall – don’t seem to have any concept of work/life balance: and our political life is poorer for it.

Rather than criticising people running businesses, perhaps our politicians could learn from them – not least in being able to take planned, productive time off. If I see someone who never takes time off then I see someone who’s heading for trouble. You only have to look across to the US to see the latest example of a seemingly ‘indestructible’ politician showing herself to be all too vulnerable.

So I’ll continue to encourage the members of TAB York to work hard and play harder. The idea that any of them opt to do less than their best is simply wrong: the moral obligation they feel to their businesses, their staff, their customers – and the work ethic that flows from that – is something I’m honoured to see on a daily basis.

The Only Way is Ethics


The long arm of coincidence as the saying goes. Or if it doesn’t, it should do. One day last week I read this article on the BBC business site: Trust Me, I’m a Chief Executive.

The premise is simple. Chief executives are a cynical, hard-bitten lot. By the time they’ve climbed the greasy pole and reached the top, all the humour, warmth and humanity has been knocked out of them. Or they’ve been forced to abandon it…

And then along comes Julian Warowioff and his company, Lemonaid. In many ways this takes me back to my recent blog about Howies T-shirts. There’s an ethos, a set of values which underpins Lemonaid – changing the world, drop by drop, as the company says.

As you’ll see if you visit the site, Lemonaid’s ingredients are all ethically sourced with the fairest of Fair Trade ingredients. And for every bottle that’s purchased, Lemonaid donates 5p to charity: so far, they’ve raised more than £560,000 for a variety of development projects. No wonder – as the BBC reports – that Julian Warowioff’s eyes start to fill with tears when he describes what his company does.

Contrast that with the speech from Mark Carney, Governor of the Bank of England, at the Mansion House this week. “The age of irresponsibility” is over he declared, heralding what looks like a much more American-style approach to market rigging – and other practices that most of us would describe with a stronger word than ‘irresponsibility.’ In future, declared Carney, “Individuals will be held to account.” Good, because so far there doesn’t seem to have been an underlying set of values in the City – apart from one – and you and I have been paying for it.

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Those two ethical extremes reminded me of conversation I’d had with one of the members of TAB York; someone I respect hugely, who’s built a business she can be justifiably proud of. Moreover, it’s a business with a real sense of beliefs and values. That’s where the coincidence came in: the two articles neatly framed the conversation we’d had.

“I think I need to sack one of my managers,” she’d said.

“I thought his numbers were really good?”

“They are. The best we’ve ever had. But…”

The ‘but’ was a big ‘but.’ The good results – and they were outstanding – were being obtained with a ‘sell at all costs’ attitude. The manager was undermining the other teams in the organisation. His business ethics ran directly counter to the business ethics of my TAB member. The results were stellar: but the price the business would pay in the long term was too high.

“So there’s only one decision you can take.”

“I know. Well, I’d known before you came in, Ed. I just needed to hear someone else say it.”

As I say, she’s built a business she can be proud of – just as I’m proud of the success of all the members of TAB York. And one of the things that gives me most pleasure is seeing that success achieved without resorting to ‘the age of irresponsibility:’ to seeing success that has far more to do with the ethical values of Lemonaid than it has to do with rigging the markets.

If results and sales are all that matter to you, you’re probably not a member of TAB York. In fact, you’re probably not even reading this blog. Of course results are important, but they’re not the only thing that is important – and that will be more and more evident in the years ahead. Clients and consumers will increasingly be drawn to companies like Lemonaid that have a strong set of ethics underpinning the company. They’ll be drawn to companies that believe in something – and are not afraid to say so.

Enjoy your weekend. And I’d better finish with an apology. ‘The Only Way is Ethics.’ I know: nearly 250 blog posts and it’s the worst title by a long way. I’m sorry, something came over me. I couldn’t resist it…