An agreement is an agreement. But in a relationship that is valuable, parties recognize that when critical underpinnings of an agreement change, they may be better off renegotiating under the new circumstances than requiring performance under the original terms.
Obviously you can't rely on renegotiation to change an agreement that you have second-guessed, sure you can now achieve a more beneficial solution. But if the circumstances that led to the agreement have truly changed, you can't lose anything by discussing this with the other side and asking for a re-negotiation.
At a minimum the other side is on alert that you will want different terms at the end of the current arrangement. It may be in their best interest to negotiate those different terms now when they hold the leverage of a current binding agreement. And, the other side may have wanted to renegotiate some part of the agreement as well, but didn't ask. You may find them more than ready to renegotiate.
If you decide to ask for re-negotiation, here are some pointers
- Attitude is everything. You don't want to appear the victim or the bully. You want to state your case and ask for consideration based on the significant change in circumstances.
- Develop and improve your BATNAs.
- Without threats, explain where you fear things are headed if there is no re-negotiation. Lay out possible scenarios – a new division or company representative will take over, delayed shipments, legal actions, asset purchases that leave the current agreement in the hands of the bankrupt entity, etc.
- Throw something new into the discussion.
- Don't assume that you have no leverage here. Look for opportunities:
- Things the other side may need changed
- Things they gave up reluctantly in the last round of negotiations but which you would have given had they pressed further
- Things that have changed in their environment since the original negotiation
If you are asked by the other side to re-negotiate an agreement, weigh the costs of re-negotiation against
- The cost of getting eventual nonperformance
- The strength of your BATNAs should you need to get an agreement elsewhere
- The damage to the relationship if you say "No," or the benefit to the relationship if you say "Yes, if…"
- Whether in this relationship you are likely to need the same consideration in the future, or have asked for it in the past
- Something new you could get in a re-negotiation that you didn't get or forgot to get in the original agreement, or now need
In either case, if you are re-negotiating an agreement, don't use shortcuts. Use a full negotiating process. Begin again with preparation and establish your Negotiating Envelope, then exchange information and get validation of facts and assumptions before going into bargaining. Retest assumptions, as the answers may have changed. Use all the Best Negotiating Practices.
- And above all, believe in win-win; it's an attitude, not an outcome.