Businessman is holding a football
The big news in the past 48 hours is that the NFL players have approved the deal negotiated with the owners and that there will be professional football played in the USA this year.

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This news obviously excited football fans. But it also excited me as more than just a football fan, but also as a teacher and student of the art of negotiation, specifically procurement negotiation.

There was an interesting technique used in the negotiation between the NFL owners and players to end the lockout that had persisted for nearly five months. That technique was described in the article “Hackenberg: Ace in hole flips labor landscape” published in last Wednesday’s Pittsburgh Post-Gazette.

In the above-linked article, Dave Hackenberg writes that “the players had a mighty big card hiding in the hole, a weapon so secret that the vast majority of NFL Players Association members didn’t even know of its existence. Neither did the league’s owners. But since they were enlightened Thursday morning, negotiations toward a new collective bargaining agreement have proceeded at warp speed.”

What was this secret weapon that transformed a stalled negotiation into one that suddenly accelerated the reaching of an agreement?

It was having, and revealing at precisely the right time, what is known as a BATNA – Best Alternative To A Negotiated Agreement. I’m not 100% sure of the origin of this term, but I believe it to be from the groundbreaking negotiation book “Getting To Yes.”

When you have a BATNA, you have much more leverage in a negotiation. If the other side finds out about your BATNA and it is a decent alternative, they won’t be able to “push you around.”

What was the players’ BATNA?

It was having an insurance policy that would pay each player $200,000 if a lockout preempted the entire 2011 football season. This insurance policy reportedly cost the players $10 million.

The article says that the attempts to reach agreement “were at a standstill despite a marathon negotiating session a week ago. Afterward, [the players’ association’s executive director, DeMaurice Smith] and his executive committee decided it was time to flip over their hole card in this high-stakes poker game…It would be an understatement to suggest [the revelation of the insurance coverage] got the attention of the owners.”

Selecting the right time to reveal their alternative undermined the owners’ negotiation strategy, which was “to wear the players down by dragging [the lockout] out.” As you heard on last week’s Next Level Purchasing Association monthly webinar on IT negotiations, “the key to victory is not defeating the enemy, but in defeating the enemy’s strategy; therein lies their vulnerability.” (Sun Tzu, “The Art of War”)

The article closes by saying that, to “some millionaire athletes, $200,000 might be chump change. But it would pay the light bill and put groceries on the table. Most important, it would foster the solidarity needed by the players to dig in for the long haul. The owners and commissioner, Roger Goodell, who has been battered in the court of public opinion, thought time was on their side. But DeMaurice Smith flexed his muscle, showed his ace in the hole, and the owners blinked.”

Now, I know that this negotiation process isn’t an easily applicable template for procurement situations. You can’t tell your suppliers “We have lockout insurance” and then suddenly expect them to give you the price reductions you’ve been pushing for.

But, you know what? DeMaurice Smith didn’t have a template for his negotiations. If previous labor disputes had been resolved in exactly this way, the owners would have been prepared and that “secret weapon” would have been powerless.

So, sometimes, you need to come up with never-done-before ways of breaking a negotiation deadlock. Use the NFL lockout negotiations as inspiration for you to find new, creative, and surprising ways to persuade your suppliers. The “we’ll just buy from another supplier” line is old, predictable, and sometimes easy to see through.

What type of out-of-the-box “ace in the hole” can you think of to use in your negotiations with suppliers? Post in the comments below and help your fellow procurement professionals.

To Your Career,

Charles Dominick, SPSM, SPSM2
President & Chief Procurement Officer
Next Level Purchasing, Inc.
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Charles Dominick, SPSM, SPSM2, SPSM3

Charles Dominick, SPSM, SPSM2, SPSM3 is an internationally-recognized business expert, legendary procurement thought leader, award-winning entrepreneur, and provocative blogger. Charles founded the Next Level Purchasing Association in 2000, oversaw its incredible growth, and successfully led the organization to its acquisition by the Certitrek Group in 2016. He continues to blog and provide advisory services for the NLPA on a part-time basis as he incubates his upcoming business innovations. Charles is also the co-author of the wildly popular, groundbreaking book, "The Procurement Game Plan: Winning Strategies & Techniques For Supply Management Professionals."

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