How to Accelerate and Simplify Your Negotiations with David Chan

Hello, my friends, and welcome to another exciting episode of Negotiate Anything. Negotiate Anything is produced by the American Negotiation Institute, and with over 3 million downloads and listeners in over 180 countries, listeners just like you have made this the number one negotiation podcast in the world. I'm Kwame Christian and I'm the director of the American Negotiation Institute. We're growing, and I want to introduce you to our new team members and new trainers. This will help to give you new diverse perspectives on negotiation and conflict resolution. That's why I'm excited to let you know that Shane Martin, our head of sales and partnerships, is going to serve as co host of the show from time to time. We are passionate about providing you with the best content that will help to make your difficult conversations easier, both at work and at home. Lastly, before we get into the episode, I want to remind you that our team conducts negotiation and conflict resolution trainings in the United States and abroad. Our trainings will give you the practical skills you need to resolve conflict, negotiate, lead, and persuade with confidence. Click the link in the description below to learn how we can help to make your difficult conversations easier. And now, let's get to the show.

Today we're with the CEO of Intellects, David Chan. We appreciate you joining us on today's podcast, and thanks for all the listeners who are tuning in. This podcast is built for negotiators with negotiators in mind. So I know you're gonna get a lot of value out of today's discussion with David and sneak peek. We're gonna be talking about accelerating your negotiations, and I know that's super important, whether you're in procurement, sales, or just negotiating maybe with a loved one at home. We're gonna talk about simplifying it, making it easier to negotiate, and making it quicker as well. So without further ado, David, welcome to the show. And please introduce yourself and briefly share what experience you have in negotiations.

Hey, Shane, thanks for having me on your podcast and good to see you again. You know, I tell you what, negotiations are part of everyday life. And like you said, negotiating with your spouse is probably number one thing you can negotiate in your whole life, I'm sure. But personally, I, you know, as a kid, I was negotiating comic books with the other kids down the block, and then I went on to cars and eventually homes. They were painful, but even more painful are negotiating professionally sales, contracts, purchase contracts, even commercial leases. I've done all of those things with my various companies like Proofpoint, HP and Oracle. So, you know, negotiation is part of everybody's life, including your children. And that's why we started Intellects.

Excellent. Yeah. And it's interesting to hear the similarities between negotiating for comic books versus negotiating for a multimillion dollar enterprise software. It's amazing how many similarities there are. But you're right, it is, it can be difficult. And so that is actually the purpose of today's show is we want to share actionable insights, tips that people can walk away with right after listening to this to build speed into their negotiations. So specifically what we're going to discuss is how to speed up negotiations. And then we're going to talk about a little bit about what the future of negotiations look like from your perspective as CEO of Intellect, and also share a little bit about what the company's doing, what your vision is, and ultimately where you see the world going to when it comes to negotiations. So we're going to get started with your two top negotiation tips. And I know you have many years of experience negotiating, over 30 years negotiating professionally. So what are your top two negotiation actionable tips?

Yeah, thanks, Shane. The two really important things I've learned over the years are, number one, really agreeing on what the ground rules for negotiating are and understanding who you're negotiating with. I cannot tell you how many times we've missed those points in my career as well as, you know, working with other people. Understanding the ground rules means what's on the table and what's not. You know, for example, are we discussing a particular type of contract and what do you want to get out of that contract and what are the timelines associated with them, what's the value add to each other and which terms in a negotiation are off the table. I can't tell you how many times we wasted time trying to talk about something that just the other party didn't want to talk about anyway. So why waste your time doing that? An example of that was another organization the same size as us. We internally did not know what the value is that we were getting out of the company, the partner. And so it was hard to quantify what we wanted in return. So let's come up with a win win solution for both of us. The second one is understanding with whom you're negotiating. You know, this is a really big thing from an enterprise level and from a personal level, from an enterprise level, you know, are you going into a relationship with them and not knowing that maybe they are having financial problems? If you know that they're having difficulty with meeting their financial requirements to Wall street, you might not get your timelines Achieved, and from a people perspective, deeply understanding who your counterparty is, what are they constrained by? What are their performance metrics? If you know that they take their time doing things, you definitely know they're not going to get it done in a reasonable timeframe. And again, one simple example of that was one of our staff attorneys at my previous companies really was just dealing with a throwaway term, a term that didn't matter to anybody. And I asked him, what the heck? Why are we wasting time on this one? And he said to me, I was just effing with the guy. I said, really? That was a colossal waste of time. Had I known ahead of time that he was just going to, you know, screw with the guy, I would have just asked for another staff attorney. So those are my two top tips.

Those are great tips. So know the ground rules. In other words, negotiate the negotiation, and then also know who you're negotiating with. And so let's break them down. I mean, I think that we could talk about this for probably days, for hours, but we'll be brief. So let's start with first negotiating the negotiation. So let's say you and I are entering a negotiation. And practically, what would you say? What would you ask to negotiate the negotiation? If we're preparing to negotiate, I would.

Ask the account, first of all, internally, understand what we want from the other party. If we understand that, then we go to the other party and ask them, what do you expect from this? What are your outcomes from this particular negotiation? What do you think is the value add to both sides? Are we going to grow the market together? Are we going to achieve certain sales together? Are we going to increase each other's margins, those type of things? What is the value add? Because if we don't know, that also is a colossal waste of time. I've heard companies do Barney deals just to get a deal done. Those Barney deals go nowhere, as you can imagine.

Absolutely. And for those who aren't familiar with what that term means, what does Barney Deal mean?

Yeah, Barney Deal means forgot the kids song.

Feel free. If you want to sing the song, feel free.

I'm trying to remember if I sang that song to my kids, but I can't remember how it goes now. But Barney Deal is just something that you can say to the public, for example, that we're doing something together, we're going to grow the market. But in reality, there's no meat behind that particular deal. There are no deliverables. There are no real outcomes from that particular point of deal. It's just to please the market. And you probably seen spikes in the stocks at certain times when a certain press release comes out. Those, in my mind, some of them are just Barney deals just to please the market.

Absolutely. All right, that makes a lot of sense. So for those listening in, be aware of Barney deals because there is no actionable outcomes. And so again, that should be. That's another topic for a whole other show. But knowing the ground rules of your negotiation, then also knowing who you're negotiating with, I think that going into negotiations, a lot of times the negotiation is actually already won prior to it even beginning. And what I mean specifically is, do you know the challenges of, let's say the VP of sales or the VP of procurement that you're going to the conversation with? Do you know what they care most about? You mentioned press releases. Have you read the latest press release on where they're putting their initiatives, where they're putting their energy this year? It's amazing what's in these press releases. They're just very boring to read. But there's so much content in there, almost to the penny of how much they're spending on a particular initiative that your solution might actually solve. And then you can quantify that as you go into the negotiation. Thus you're prepared to negotiate because you know who you're going to negotiation with. And despite knowing the ground rules, despite knowing who you're negotiating with, there's still a lot of inefficiencies in negotiations. And some of them just take way too long, too many red lines, et cetera. So tell us about what common inefficiencies in negotiations that you see right now.

Oh, sure, there's lots of inefficiencies. Number one, as you mentioned, redlines. The first thing that people do typically when they want to do a deal with another company, they send a contract over. You know, sometimes 20, 30, 40 page contract. That's the very first thing they do. They think negotiating is about sending a contract over. And what happens between the two companies is they redline it. And who's going to read all the red lines and all the comments in every single contract? It's virtually impossible. That's one big problem. The second big problem is in a large organization, imagine an HP where I used to work 100 and some odd thousand people, right? And each division could have maybe 30, you know, hundreds of people. Each stakeholder has to approve different terms. So how do you get everybody to approve a specific term and get them aligned around it and then keep them accountable to agree to it? At a certain time frame. And then thirdly, you know, they keep repeating the same things over and over again. We might have done a deal in the past with another company, but we repeat our mistakes because we never learned anything from the past. The institutional knowledge is not saved to be reused by the organization again. So things are not documented, conversations are not archived. You can't go back in history. That's a really bad way of doing negotiations.

It sounds like negotiations are prime for disruption with technology.

Absolutely, 100%.

Does your company invest in professional development training? If you believe that your team would benefit from a negotiation workshop, all you need to do is go to our website, fill out the workshop request form, and then we'll set up a time to chat. These workshops are completely customizable and we've done them all around the country. Negotiation and conflict resolution skills are beneficial across all professions, but they're especially useful in procurement, purchasing, sales, sourcing, and contract management. Our calendar is filling up quickly and we even have some workshops scheduled for next year if you think you might want one. I'd suggest reaching out soon so you don't miss out. Check out the link in the description to learn more. And now back to the show.

I think with so many moving parts and I've seen the 40 page contracts with redlines, it's kind of like drinking from a fire hose. As a negotiator, as a procurement person, as a salesperson and repeating the same task just seems really inefficient. And so that really takes us to the company that you founded and that you're building with your team. Intellects. And that spelt for anyone listening, it's I N T E L L E X T. Did I get that right?

Absolutely, yes. Okay, great.

So tell us what that means. What does intellect mean to you?

Yeah, when we're thinking about what we were doing, it's basically intelligent law. And so intellect, intel, I N T E L was part of intelligent. And lex is Latin for law. I took Latin for many years a long time ago, so I still remember that. And so that's a play on words for intel, lex. But in addition to that, it's also play on intellect. So if you replace the X with a C, you get intellect. Then our team is called. Anybody who participates with us are called intellectuals.

Got it. All right, so it's a play on words. Play on words. Nice. Excellent. So speaking of that, a lot of people see negotiation as kind of a playground. It's a place to experiment. It's a place to try different things. And it seems like that's what intellects is offering people the ability to do. But who's using intellects? Who are the early adopters? Who's your, let's say they say in school, your cult following, like who's really using the tool right now?

Yeah. So remember, we're a seed company. We have some beta customers. The areas that we're focused on specifically are procurement and financial services and within financial services, specifically commercial lending companies as well as asset. Sorry. As well as swaps and derivatives. And I'll explain to you why the fine art technology. So compelling.

Yeah, definitely. I think that procurement people, especially we at American Negotiation Institute, do trainings with procurement teams as well and have found that the same inefficiencies that we already mentioned today are coming up in those trainings as well. So tell us about how maybe from a procurement person's perspective, maybe one of your beta customers, how they are negotiating, like what is their negotiation look like with intellects and then without intellects.

Sure. Yeah. So let's take a. I won't name the name, but a large company has multiple thousands of products that they procure across thousands of suppliers. So each category of supplier might provide a commodity product, some might provide a higher value product. Okay, let's take RJ11 Jacks. You familiar with RJ11 kind of little nibs for your modem, for example. Or they might have higher value products, say for example cable boxes or maybe even on demand TV channels that could offer up thousands of different shows. When you're procuring across multiple suppliers with multiple products, you have to figure out a way to streamline how you work with each of these different suppliers. What are the basic terms that you want them to negotiate and what's not on the table to negotiate. Example would be the contract itself. Especially if you're a large company, the contract never changes, but the terms within the contract you can definitely negotiate. It could be how much of this widget, what's the price of this widget? When are you going to deliver this widget? How do you normalize that data across thousands and thousands of suppliers and across thousands and thousands of products such that the category manager within the procurement department can then get some structure around how that's around all that data. Once you've structured that data, you can then analyze data very quickly to see how you're performing across again multiple suppliers and multiple categories of products. Normalizing the data is the most important part of a supplier of a procurement type relationship.

Definitely. Yeah. I mean that's a Great, great answer. And normalizing the data. I think that there's a massive shift happening for chief procurement office. Specifically in a Deloitte survey they were talking about how innovation is playing a huge part into procurement teams, into their day to day and implementing it. But a lot of teams, according to the report, are hesitant to adopt technology. So to someone in procurement who's maybe leading a team listening today, but doesn't know how to normalize the data, what advice tips or just thoughts do you have to share with them?

Yeah, thanks. So I think the scariest part for people to get their arms around, especially somebody who's done procurement for tens of years, if you will, is again thinking about separating the contract legalese language, if you will, from the actual terms of a contract. What am I negotiating rather than what is a legalese is a good first step. So if you know that, for example, your suppliers, they're generally maybe at most a dozen terms that are really, really valuable to a procurement officer, price, margin or discount delivery date, ship to ship from those type of things, if you could just come up with that list first, that is the great first step of normalizing the data. Once you've normalized that piece of it, it's a very easy process to put into a technology to then at your fingertips all the analytics you could ever want. Which negotiations failed? How quickly have we negotiated these negotiations? Did we get our pricing terms that we wanted? Which suppliers are the best suppliers? Which terms are negotiated more than others? That is really the bulk of how you really. The back end analytics is where you're going to get the true value in this type of scenario.

Definitely. And so once you have the. So once teams have data, there are a lot of things that can happen. But what are the true, true benefits of as a negotiator having more data at your fingertips? What's the outcome?

Oh yeah. So having data is, let me. The outcome is better margins for your company, higher revenue, less cost to your legal department, for example, less cost even to your organization in general because you're not having to use a lot of people churning around unstructured data. That's really the big cost is looking at so much infrastructure to manage the contract. That's really what we're talking about. Higher revenues, better margins and faster turnaround.

Well, I think everyone should buy intellects then I'm ready. Higher margins, I imagine if you can even quant. I mean those are reasons why data is important to negotiations. If you could even attach numbers and quantify the salesperson is coming out and mean out. But when you can attach a clear, like return on investment to that of like using this tool gives our customers this amount of better margins. I mean, that is like the numbers do not lie. There's no emotions in numbers. And so that's really exciting. I'm a believer of intellects and I can't wait to see more of the platform as it continues to grow and as the customer base continues to grow as well. And as you take on more investment. I know that you're a fast paced company, you're moving very quickly, you're doing a lot of things. I imagine you have a lot of things up in the air and you're keeping everything afloat and continuing on the voyage. And so I think it's excellent that you're able to come on here and share a little bit about the company. And I know that you just hired a new cto, so congratulations. And it makes me think when we're looking to the future of negotiations, it's going to be, there's going to be more data involved and intellects is going to be able to be a major part of that. And so if we sat down, let's say a couple years from now, what do you hope that you can say that intellect has accomplished?

My big idea is this for the company. We want to get back to negotiations being a handshake. You know the book Outlier by Malcolm.

Gladwell, very popular book.

Sorry, not outlier, sorry, Blink. Yeah, outlier and also blink. I believe that negotiations should be done at the blink of an eye or a handshake. And what that means is, you know, we've interjected into negotiations such a complex set of rules, which I call contracts, that it's virtually impossible for anybody to get beyond that. So if we can get back to the handshake or get back to the. Back in the old days when startup companies were growing up in Silicon Valley, you used to write your business plan on a paper napkin and shake hands with the vc. That's what I would like to see us get back to.

I think you just came up with the next marketing slogan. Negotiations done in a blink.

Yeah, well, actually that was one of our taglines at one point.

I think there needs to be a billboard in California somewhere with that on there. I mean, just the idea, because that aligns with where the future generates, like where the future of business is going. The future of negotiations are going is speed and quick. We want things. Things are at our fingertip. Salespeople are becoming less relevant as more information is being spread. On the web. And so we have to find ways as salespeople, as procurement people, to deliver exceptional value. And one of the ways to do that is through data and is through analytics. And so it's been just incredible having you on the show today. I really appreciate you coming on here and sharing your negotiation tips about setting ground rules and ultimately knowing who you're negotiating with. That way, you can get more favorable deals and also talking about the common mistakes in negotiations. And again, that's how you get better. Right. So there's a lot of moving parts, but with more data, there's more speed. And so it's an incredibly exciting time to be following Intellect on social media and connecting with their team to see kind of what they're working on and how it can hopefully help you. And that's what it's all about. So for that to happen, what is a good way for listeners to connect and support you and your company?

Yeah. Thank you. So first, our website, intellect AI www.intellects.AI with an X rather than a C. Just so you know, over the next 30 days, you'll see a major transformation on our website to reflect the speed and the personality of our company. Number two, if they want to personally email me davidtellex AI, I answer 99.9% of my emails very quickly. I don't sleep.

All right, salespeople, you heard that if you're selling to David, 99% response rate. That's excellent. Well, it was pleasure having you on the show. We truly cannot wait to see see how intellects impacts the world. So it was a pleasure having you.

So before we hang up, and I know this is just a recording, I love you, you love me. There you go.

Now you remember the Barney song.

That's the Barney song.

Great show today.

Thanks, Jeff.

Congratulations. You've just joined an elite club by listening to a full episode. You're now officially on the Negotiate Any team. So welcome aboard. What most team members do is they subscribe to the podcast because that allows them to automatically get the latest episodes of the show. The best things in life lie on the other side of difficult conversations. Keep learning, keep practicing, and keep getting better. Your relationships will improve, your career will soar, and you'll have the confidence you need to get the most out of these crucial conversations. Again, thank you for. For joining the team. We're excited to have you, and I will see you in the next episode. I'll catch you later.