Complex Contract Negotiation Benefits from Team Diversity
by Sheryl Morrison
Director of Finance Pitney Bowes Inc.
One project with which The inclusive mindset of the team
I was involved as director of finance was a contract renewal broke down any cultural barriers or for IT support with an out- bias, and the diversity helped sourcing vendor. The challenge was to lead a team in structuring a deal with pricing, terms, and conditions appeal to a vendor located in a that were in line with the company’s expectations. different country. The global contract renewal was a multi-million dollar, five-year deal with numerous points to be agreed upon. A global cross-functional team was established However, the team understood that in order to have that included IT, Finance, Procurement, and Legal. a successful outcome for the contract, there needed The team diversity encompassed age, gender, cultural, to be perceived value on both sides. So the team was and racial differences. willing to be flexible on the negotiable items that were The team’s diversity was a catalyst to achieving a important to the vendor, while holding firm to other successful outcome. Different ideas were generated points that were critical to Pitney Bowes. The inclusive through numerous team meetings and the team mindset of the team broke down any cultural barriers or prioritized frequent communication. Through com- bias, and the diversity helped appeal to a vendor located munication and an inclusive mindset, the team was in a different country. The inclusive team environment able to understand various points of view and develop also led to greater innovation and creativity, as well as effective solutions. We were able to evaluate the facts, openness to listen to different perspectives. without bias. We also determined what items were The vendor’s final response met, and exceeded, both critical and what items were negotiable. our internal evaluation criteria and the external bench- In addition, we developed evaluation criteria to marks for competitiveness. The contract saved $1 mil- determine the need for competitive bidding. An lion in 2009, with essentially flat pricing through 2013. external benchmarking service was engaged to provide Foreign exchange exposure was borne by the vendor. market reference and productivity data. Workload Additional contract highlights included improvements volumes and service level requirements were updated in service levels, increased customer satisfaction targets, from the prior contract for the U.S., Canada, and and elimination of fees for early contract termination. International operations. As a result, the team negotiated a mutually acceptable We conducted several rounds of negotiations with renewal contract and the agreement was signed. Such a the vendor, covering all key elements of the contract. favorable outcome was directly linked to the diversity Initially, there were some areas where both parties held and inclusiveness of the team. PDJ firm to their positions. There were numerous long nights, spirited debates and heated discussions.
22 Pro f i les i n D i ve rsit y Journal M aY / J u n e 2 0 1 0