Covey’s seven habits for a digital agency – Habit 4: Win-Win or No Deal
Hearing the clichéd notion of “win-win” raises immediate concern that one party is attempting to manipulate the situation towards a less than equitable proposition. In sales efforts, client relationships, and managing staff, there is incredible freedom through additional outcome of “no deal“.
It has been nine months since I last posted about Covey’s Seven Habits. The irony that the last habit was on priorities and time management does not escape me. Now that some big projects, holidays, and floods are out of the way, I figured we would break out the raisin toast for a final studio breakfast session, starting with the concept of win-win or no deal.
Your options for client relationships
Scenario 1: I win. You lose.
The win-lose scenario seems to be the one most loved by our capitalistic culture. Relationships between clients and vendors, managers and employees, and competing suppliers are designed as a competition, with each party investing in their personal outcome at the expense of another. Me winning means you losing.
In a sales transaction, the supplier tries to get the price as high as possible while the client tries to get the price as low as possible. Managers apply systems, structure and pressure to get the most productivity out of staff while employees attempt to work as little as possible for the highest wage. Organisations strive for monopolies through efforts directed at hurting competitors.
Scenario 2: I lose. You win.
The competitive environment aimed at success for your type A personalities can drive other temperaments towards a lose-win scenario. In lose-win, one party continually feels the need to capitulate to the other. Similar to abusive relationships between individuals, both parties develop a common understanding of the power imbalance.
This can be evident when small digital companies develop an unhealthy dependence on multi-national or large government clients. To break the cycle, the smaller agency needs to ensure they have sufficient work from other sources to reduce the dependency.
Scenario 3: I win.
In an “I win” scenario, there is no concept of “you”. I achieve my outcomes without regard for the other party. I recall one particularly grating sales manager in a previous career who typified this with his common greeting of “Are we winning?” From an organisational perspective, examples of this approach are when companies operate in a monopoly or as a single-source supplier of technology.
Facebook’s Zuckerberg confirmed his engagement with an “I win” disregard for other perspectives. When asked about the impact from the Social Network movie, he stated: “We build products that 500 million people see… If 5 million people see a movie, it doesn’t really matter that much”. The invisible hand of the capitalistic market does balance out these situations over time. Recent presentations by Facebook to developers focus on their mandate to generate revenue through selling advertising, showing a griowing alignment towards a competitive win-lose.
Scenario 4: I lose. You lose.
We see the lose-lose scenario when everything falls apart. Both parties have decided that neither can win. All efforts are applied towards ensuring the other party loses as badly if not worse than the other.
Digital solutions solve complex business needs, and the opportunities for scope, schedule and budget conflict is significant. I often wonder why, when projects do not meet expectations, the relationship goes quickly from one of collaboration to a situation where one party is perceived by the other as desiring to cause intentional hurt. Over the years, we have picked up the pieces of systems from other suppliers where both client and the previous supplier have been more intent on causing as much pain for the other party as possible than they were on resolving the issues.
Scenario 5: I win. You win.
Based on issues identified above, you would think a win-win scenario would be the solution. We both work together to ensure each party has an acceptable outcome. Looking at this scenario in depth, however, reveals a hidden word in the proposition: the notion of “must”.
Without any caveat or conditions, stating “I must win and you must win” is unrealistic. Clients frequently do not have a perception of the cost involved, and suppliers often do not view the technical solution from the client’s business perspective. Unless each side understands the need to educate the other, forcing a situation into a win for each side is a losing battle.
Scenario 6: I win and you win or no deal
This leads us to the final option: the “win-win-or-no-deal” scenario. Either we both get an acceptable outcome, or the deal is off, and that’s OK. Each party agrees that the project, contract, and even the relationship may terminate if the parameters are not acceptable.
I found this concept incredibly liberating when I first applied it to the sales process. If the nature of the sale is not going to meet the client’s objectives and be sustainable for my company, I need to be prepared to walk away. From the client’s perspective, if my services cannot align with what the client is after, then there may be another company more suited for the work.
Develop your character
Three character attributes are required if you are to apply a Scenario 6 approach.
1. Integrity
Integrity removes your duplicity, allowing you to know without doubt what constitutes a win. From a business perspective, you need to understand your core offering and be able to say no to work that falls outside of your value proposition.
2. Maturity
With maturity comes social intelligence, allowing you to understand the relationship from the other’s perspective.
3. Abundance Mentality
Confidence in your ability will result in a core belief that there will always be enough work to support you. If you feel that losing the relationship will destroy your business, then perhaps your business model may need to be re-examined.
The win-win or no deal conversation is a good one to have with clients. For some, we collectively come to the realisation that they are not prepared to invest in what is required to effectively manage their business. In others, we agree that the service we provide is not suitable for the price they are willing to pay. In most situations, however, the scenario provides a framework around which we can develop a strategy that allows us to work together towards a common goal of a sustainable relationship.
Like most of the habits, “win-win or no deal” is a paradigm shift in thinking and contrary to the natural inclination of the market environment. Consistent application requires an accurate awareness of the situation and a developed personal character by both parties.
Then again, if you disagree and feel the approach is not relevant for you, I suppose you could just say “no deal”.
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