The art of Contracts Drafting with Laura Frederick

Hello my fellow negotiators. Did you know I once had a listener share that after listening to our podcast, she was able to negotiate a $53,000 raise. And you know what I told her? Where is my commission? Just kidding. But the real story is this was after years of being too afraid to negotiate. But after listening to a couple of episodes on Salary Negotiation, she felt equipped with with the confidence and tools to ask for the payment she deserved. And that, my friends, is the power of negotiation. And through a subscription to our new membership community Negotiate Anything Premium, we're taking that power to the next level. With customized playlists based on our most popular topics, you'll be able to find the episodes you're looking for much faster and much easier. A tool that comes in handy as you're getting ready to prepare for an important negotiation. Even I find myself asking which episode should I listen to before heading into a high stakes negotiation? And you might be saying, but Kwame, you're the ones having the conversations. But I forget. So I listen to the episodes multiple times. Okay, now here's the thing about Negotiate Anything Premium. It'll allow you to dive deeper into the specific situations you're facing, whether it's a salary negotiation, an important business meeting, or an emotional conversation with a loved one. Bonus for you. In addition to ad free and extended episodes, Premium members will have exclusive access to solo episodes and insights from yours truly. And as you know, it will be very dry and very boring. Because I have no sense of humor and this is something that you all have been asking for. I'll also be offering personalized answers to some of your most burning questions through our Ask Me Anything feature. If you've been enjoying our traditional feedback, imagine the value a premium subscription can offer. I've felt the benefit of negotiation firsthand and it is life changing. Many of you don't know this, but my journey has taken me from people pleaser to a confident negotiator. Because I was able to do two simple things through negotiation. I was able to first change my mindset and then I was able to improve my skill set. And that is what will happen for you when you join Premium. I've already seen the impact of these skills and the power of this model not only in my own life, but also in the lives and careers of our clients all around the world. My family, my friends, and our team here at A&I, and I am confident that it can do the same for you. Now, are you ready to negotiate more of the best things in life? Check the link in the show notes to learn more. I'm excited to continue the conversation. I'll catch you later. Laura, thanks for joining us today.

Oh, I'm so happy to be here.

We are excited to have you back, my friend. So how would you get us started? By telling us a little bit about yourself and what you do.

Yeah. So my name is Laura Frederick and I am the founder and CEO of a company called how to Contract. And we offer practical contract training on how we draft and negotiate in the real world. So it's a different way of drafting and negotiating when you're learning in law school or in an academic setting. But there's a way that people who actually work with contracts every day do things. And that's what I'm trying to teach with how to Contract.

Yes. And I appreciate the work that you do. It's so important because I don't think non lawyers fully understand this reality that a lot of times when we are going through law school it's very theoretical and then we have to learn how to draft contracts, how to negotiate. Like the real nitty gritty of lawyering, you learn that on the job. And so it's important to have these types of opportunities to get real and practical advice that you could actually use. So that's really important.

Thank you. Yeah, no, and I think so many of us learn that way. I remember as a new lawyer at a law school, I'd never looked at a contract when I graduated and I'm, you know, a new lawyer working at a law firm and they give me a contract, I'm like, okay, what do I do? And it took a long time. It's a different style of writing, it's a different way of communicating and you have to kind of learn how to. It's almost like learning a computer programming language. It's just a particular style and you have to learn it. And it's not just because you graduated law school, you know the style, it's you actually have to put in the time and practice and have somebody coach you on it.

Absolutely. And I want to give you kudos too because in a very short period of time you have created a really robust and active audience. So listeners check out Laura on LinkedIn. We're going to link to her profile in the description so you can follow her. And you know, I've been to a lot of conferences, Laura, I've been to a lot of conferences and I've been to a lot of first time conferences. And let me tell you, contractscan did not seem like a first time Conference. So kudos for what you pulled off. That was really, really impressive.

Oh, thank you. Thank you. I was for. I was so excited about it. I just didn't expect, you know, I hoped it would be great. And I kn. The people who are coming, and I knew they're amazing, and I knew the speakers were amazing. But to be able to see it in real life and experience that and the. The. The camaraderie, the support, the just the whole vibe of it was just such a special event for me.

Ditto. Same. And let me tell you something. I. I got particular joy. So listen, I spoke twice. I spoke Thursday morning and Friday. Speaking from the stage. Laura was so entertaining. Seeing over 100 lawyers after a second night in Miami, dragging themselves in in the morning. Oh, my gosh. So funny to watch.

So.

But they came. That's what matters. They still showed up.

Yeah. No, that was why I had you first, because I was like, if anybody's going to engage them, it's going to be Kwame. So you. You brought everybody up and with their cup of coffee, and they were excited to be there.

I appreciate it. That was fun. And listeners, in this episode, we're going to talk about the negotiation process, obviously, as it relates to contracts. But I want to take a step back and give you an opportunity to explain your Goldilocks theory of negotiation. I thought that was so fascinating.

I used that analogy for how I learned to negotiate. And, you know, I started negotiating. I was thrown into the deep end. Nobody really trained me how to negotiate. I'd watch some other lawyers do it, but then I find myself on the phone. First phone call with the other side negotiating a contract provision, and they'd say something back to me. Most of the time, I had no clue what they were saying or whether I should say yes or no. And so I would say, oh, let me check on that. And then they'd say something else. They'd say, oh, that's very interesting. I'll have to talk to my client. So I went through this process, and I call this the too soft. So I was too soft. I wasn't engaging. I wasn't doing anything really in the negotiation other than almost being a note taker and trying to figure out what to say, because I didn't have the skill set to really engage robustly with the counterparty. And then over time, I gained that knowledge. I became very aware. I became better at understanding what to negotiate in contract provisions. But then I started becoming kind of harsh and kind of forward and abrupt, and I would really, almost like, get down deep in the mud and wrestle it out with people, because I was right and I knew what the right answer was. And. And if they weren't agreeing with my correct answer, well, then I needed to use brute force to get them to agree to my right answer. And that was what was my negotiation goal. And that's when I think of that as the too hard, it was just too harsh, it was too in their face. There really wasn't any of the delicacy that we need to have sometimes with negotiations. And then I finally got to this place where I was able to find a happier kind of happy medium, and it was between soft and hard. So I would go into negotiations with an open mind, listening, engaging, hear what they had to say. I knew what I thought was the right answer, but I didn't necessarily hit them on the head with it. And we'd have this friendly dialogue about it and recognize that my job often isn't to just get them to agree with me or even for me to agree with them. It was to find how close together we could get. And so I consider that my just right negotiating style. And it also reflected I'm by nature nice and friendly. So if you meet me in the street, if you meet me at a party, I'm a nice and friendly person. So trying to be that hard didn't really work that well for me. So I feel like the just right was more authentic. And because I was more authentic, I think I was able to be much more effective in the negotiations. So that's kind of my Goldilocks theory of learning negotiations.

I love this story because I think a lot of people can relate to that. I mean, I can too. When you first start off there, you have to learn how to be a lawyer, you have to learn how to negotiate and those type of things, and you have to find your way. And a lot of times there's nobody really guiding you as to specifically how to negotiate. It's. I think that's really surprising to a lot of people who don't know about law and also when they get into law school, because I don't know how it was in your school, but negotiation, conflict resolution, alternative dispute resolution, all of that stuff, those were electives. And in a lot of schools, they don't even exist, so you don't even need to take it. So most lawyers graduate without that skill set, and you just kind of figure it out through years, decades of trial and error, which is, again, speaks to why it's so the work that you do is so important. And I really want to kind of focus in on this point, because when you were using the too hard approach, you knew what the right answer was and you would try to kind of bully them there through brute force. And what's interesting was that you said it was too harsh, but you didn't talk about the outcomes. And so when you said it was too harsh, what led you to that conclusion? And then let's talk about the outcomes later.

Yeah, so I think when I was too harsh, and this is something I've seen a lot of over my career, you know, since I've kind of figured out how to negotiate, which is the, for me, and when I see other people take that same harsh brute force approach, sometimes they're successful short term. And I was as well. You know, I can beat them down and make them agree with me and they might concede something just because it's so painful negotiating with me and they just want to move on. And unless it was like this issue that was everything to them, they might concede just to keep moving, but they're left with the distaste and the acrimony that comes with that kind of negotiations style. And I'm doing deals, negotiating deals that were for ongoing relationships. And so I could see sometimes the impact of these very hard fought negotiations and what happened after we signed and that what would happen because I was in house counsel managing the commercial team, supply chain sales. So I got to watch the relationship over time. And I noticed when those harsh renegotiations happen, the other side stays bitter. And that bitterness makes them be very harsh in the relationship. And any little thing happens, forget it. They're sending you a notice of default. Any favor you need, no way, they're not going to give it. So I might have officially got better terms by being harsh and using that brute force, but it definitely affects that relationship. And I def. I saw that all the time. And I learned, and that was kind of the wisdom that I gained over time, that being more cooperative doesn't mean I'm weak or I am, you know, letting my client down because we're agreeing to things even though I know with brute force I could get them to agree to my way, my client is better off when I get there with them in a, in a contract and under terms that we both believe in and do it in a very professional and courteous way.

I've got a quick story for you. So I was at this keynote and I talked to a listener and he said, kwame, I love the podcast, but my favorite Part man, I love those commercials. And I said, I don't think this is a true story. And now let me tell you about Negotiate Anything Premium where you can listen to your favorite Negotiate Anything episodes ad free. With a subscription to Premium, you can get access to more insights from your free favorite favorite experts and ad free listening and extended episodes. Bonus, you'll also get access to exclusive episodes and personalized advice from yours truly. If you've been looking for an easy and affordable way to level up your skills and negotiate more of the best things in life, join our Premium community Now for that gentleman in that fictional story. This ads for you and for the rest of you, I'll see you in premium. I love this. Because what we're recognizing is that there is value that we can claim in a variety of different types of ways. Because if we think about value just in terms of favorable deal terms and money and things like that, then it might lead us to short term thinking where we're just claiming as much value as we can at the table. But when you think about the overall relationship having value, that's when we realize, okay, sometimes I need to turn down the intensity a little bit in order to have greater value over the course of the relationship as a whole. And it reminds me of Bob Wolf, who was the sports agent for Larry Bird, if I'm remembering the story correctly. And one of the things he would say is I intentionally leave 10% of the value that I know I could claim on the table. I know if I push hard I can get it, but I'm not going to because I want to be somebody who people want to do deals with so I can get more value over the lifetime by having a better relationship and going a little bit softer on the terms while still advocating for my clients needs, but giving a little bit more just to make sure that the relationship has value itself.

And I had the very similar story was I was working in one of the big companies that I worked at and the supply chain lead, one of the best ones I'd worked at, we were working together and he's like, well, I've calculated the supplier's profit margin and we need to raise the price a little bit more. And I was like, what are you talking about? You're supposed to squeeze them for every penny. And he came back and he said, well, then my supplier goes out of business. So it's in my best interest, even though I'm looking for good deals, looking for good margins to make sure my suppliers have decent margins that keep them in business. So when I need them a year from now, and I need them five years from now, they're still there. And so that was a big part of how he structured, structured it, which is, you know, really different from how a lot of procurement operations are run where you're squeezing every penny. And I get that because we're all tight budgets and all that, but it was really refreshing and I think very enlightened having that approach to things.

Absolutely. And now let's draw a distinction here between the too hard approach and the too soft approach, because I want to highlight something that I think could be interesting now if you were to analyze the relationships that you created when you were too soft and compare it to the outcomes. Tell us about that.

Yeah, I think at least my sense, and part of this may be because I was more junior, but I didn't feel the respect when I would deal with them in the future. I felt like I hadn't created a relationship that was founded on two equals. It was really, I was the note taker. I was the one, you know, going to fetch the answers from somebody else. And it really, in looking back and I think I can see the elements of that, that it, it devalued me in that conversation and that relationship with the counterparty. And so that's where I think you have to, even if you have to bluff some in terms of your ability and you being the decision is to be an equal with whoever you're negotiating, even if in reality, you know that behind the scenes, maybe you are going to check with people. It's better, at least in my mind, to come to negotiations as equal. And we each have different roles, we each have different groups behind us, but being that equal, I think can help address that.

Yep, agreed. Yeah, it makes a lot of sense. I think we have to recognize that there are going to be certain times where, yes, being likable is important, but if it comes at the expense of the respect that you get from the other party, then it's not worth it. And it's a really difficult balance to keep in mind. But I think just being mindful of that tension is something that's valuable too, because we have to be assertive and advocate for what we want. But we also know that there are benefits to being likable and having a good relationship. So we want to try to manage both and flex as necessary in order to have a good relationship, but also get a good deal as well.

Yeah. And that's what makes negotiations so challenging, is because why do I have to worry about all that stuff. I just. I have a contract provision. I need this changed. You know, why are you talking about likability and tough, you know, but as you know, and as I've learned those skills for negotiating, that ability to juggle those kind of different competing interests and trying to find that balance is where the best deals come from and where you can reach the best deals with your counterparty. When you are focused both on the specific task at hand, but also how you're bringing that to fruition.

I love it. Yeah, you spot on, spot on. And when you think about your approach to negotiations strategically, specifically contract negotiations, how would you describe your strategic approach to those conversations?

Yeah, so I still come, you know, what I try to do is be as authentic as I can, because what I've found is when I try to adopt a Persona that I think I'm supposed to be like, I supposed to sound smarter because I'm not the most formal speaker. I'm not the courtroom lawyer who every word that spills out of their mouth is perfect eloquence. That's never been me. For years I tried to sound that way. Now from a strategic negotiations, I focus in on really how do I approach things in normal life, in regular life, I just am myself in negotiations. And what I find is doing it that way lets me. Me focus on the content more because I'm less worried about, oh, how should I look? Oh, wait, that word choice I just used sounded weird, you know, oh, okay. They must think this. I get preoccupied in my head trying to negotiate how I think I'm supposed to negotiate. And instead what I really come back to is, what's my strategic goal? What do I need to accomplish? How can I communicate and read their communication needs and see where they're coming from and kind of feel out what I need, what the other side needs, and how does that fit into this overall strategic goal? And so staying very nimble. Unless, you know, I used to be much more focused on outcome specific. I need this provision to say this. And now I look at it much more holistically. You know, this is the big deal. This is the big relationship we're creating. My initial vision is it'll look like X as we negotiate. I see it's turning into why. And I keep that why could still really work and could be great. And just let. Let it kind of create its own. Let it develop as it does naturally. Because I'm not in control. I only can do my side. And ultimately it takes two people to come up with this deal. So I Think in my strategic deals, I'm more free flowing to find solutions that work for both than I was before, where it was more like, here's my map, let's follow that.

This is so good. I'm taking so many notes. This is great. So essentially when you talk about your strategic approach, it's rooted in authenticity and you like to be more nimble and have a holistic approach to the overall deal. So not just the specific narrow contract terms, but also thinking about what does our relationship look like going forward, because there's value in the relationship itself. And I think what's really interesting is that being more flexible came about. And correct me if I'm wrong on this, it sounds like your willingness to be more flexible and free flowing and nimble in the moment came about with higher levels of confidence in your skill.

Definitely. And higher, I think, better understanding of the contract provisions. And that's for me, part of my mission of helping people learn contracts is the confidence piece. Because when you don't know what you're talking about and you're not a master of your subject, it's very hard to be confident in that negotiation because you're really having to invest a lot of time kind of faking it, pretending to be confident and pretending to know what you're talking about when you don't. And believe me, did this a lot, so know what I'm talking about. But as I became better at contracts and really understood the provisions and understood the risk associated with different changes to the language, then I was much better at communicating options and following this kind of freeform discussion to find a solution that worked for both as opposed to the choices A or B, which one's it going to be? And now it's like, well, A and B aren't really working. So maybe C or maybe X or maybe Q, you know, let's go figure it out together. What could work which if you know the underlying subject matter here, kind of the contract concepts, there's a lot more confidence to be able to pursue those alternative options.

Yes. And this is great because you, because you have more confidence, because you understand more, then you can flow better in the moment because. And again, extrapolation. Tell me if I'm off on this. It sounds like now that you have a better understanding of the contract provisions and you have more experience, you understand the upper and lower bounds of what is possible. You recognize that whereas at the beginning of your career you said, I need to have a very specific roadmap for what it takes to be successful in this Negotiation. But now that you have more experience, you can say there are a multitude of pathways for me to meet my needs through this conversation. I'm going to go in with some ideas, but I'm going to be open and willing to hear what the other person says so we can figure out what a path forward could be like. That works for you and works for me.

Yeah, no, 100%. And I think that's the best negotiators and I've been around a lot of great negotiators in my career and definitely the ones who have a more free form path to reaching agreements and who are open to random ideas that could solve both parties problems tend to be the ones who get the best deals and also earn the respect and don't have the bitterness. And all of those things that were tying back to my Goldilocks analogy is ultimately we want to be in that place where we're negotiating with that open mindedness and that problem solving together. And doing that is so much more effective than any other way of negotiating, at least in my experience.

Yes, this is great. So let me do a callback to the conversation we had before we started recording. So listeners, I was telling Laura about the online course that we're creating within the platform called Negotiable the Essential Elements of Negotiation. And I was telling Laura about how there are some really interesting commonalities between what people say, even if we might use different terms in the podcast. They're commonalities. Everybody says these type of things in different ways. And so one of the elements. Elements, and nobody's used this term, but this is the term we came up with is fluidity. The best negotiators are able to flow. They're able to recognize what it is that I want to accomplish and recognize there are various pathways for me to get there and in the moment as they empathize with the other side, understand where they're coming from and get a better understanding of the situation as a whole, they're willing to flow and fluidly adapt to the changing circumstances while still meeting their goals. So this is great validation on this because I just made that the script for that video this morning and I was. This makes me feel more confident in it. So I appreciate that.

No, and I do see that. I think that fluidity is such a great word for really describes that. It's a nimbleness, it's a flexibility. I love that concept.

This is great. I appreciate that. Now I feel good. I feel the warm and fuzzies. And now back to focusing On Laura, something else that you said that I want to home in on is authenticity. What you said was that authenticity allows you to focus more on the content and what you actually want to say. And I think this is something that people really need to appreciate because I think there are some, like, moral and ethical or, I don't know, there's some like, there's a value judgment that we put on authenticity. It is a good thing to be authentic. Okay, yes, we can say that. But also, let's not forget the fact that there is a strategic value to being authentic. And so when you think about the reality of cognitive load, there's a lot that's going through our mind during these conversations. First of all, we're probably feeling some element of stress or pressure because it's a conversation with high stakes. There are several contract terms that we need to go over. I need to keep your needs, my needs, and the needs of my client and my. Throughout this interaction. Each thing that we're thinking about adds to the cognitive load and makes us less nimble in the moment and makes it more difficult for us to consider alternatives. And so by simply being yourself, you take something off your shoulders. I don't need to figure out what Kwame the lawyer sounds like. I'm just Kwame me. And this is how I talk. Right. And so it helps you to be better.

And I think it just also because that we're so prone to just focusing in on ourselves. What does everybody think about me? Does everybody think I just sounded stupid? What? Wait. Oh, you know, just everything. We're in our heads so much, and it's so hard to let go of that. And if you just kind of accept your authentic self, you automatically get past that, you know, it's a free pass out of your head because whatever you sound like, whatever, you know, verbal missteps you make, whatever awkward phrasing you use, whatever stupid point you ramble on about like it doesn't matter because you're just being you. And the other thing is it just draws the other person in, I find, because then there's trust, then they can see you're being an authentic self. And then. And people can tell. And it just takes away this element of who is she really? What is her agenda? There's something behind that's going on. But even you know, I'll negotiate and I'm had. In my experience, I negotiate billion dollar deals and I'm still just me. And if anything, I'm even more me when I do the billion dollar deals because we are really focused on important stuff, and every word matters when you get to that level. And for me to worry about anything other than what we're trying to do together. And this contract is a distraction, and it actually hurts my client because it's making me less effective and able to do that flow and fluidity to find the solution.

I love this. Oh, Laura, you know, I could talk to you forever. This is great. This is great. But before you go, I want to give you an opportunity to shout out your podcast. This is exciting.

Yes. Well, Kwame, you are a big part of that, because I've been thinking about it for a while, and when we were talking at ContractScan, you're like, Laura, you gotta do it. And I knew I did. And it was. It just, I think, helped me say and figure out what it would be. So the new podcast is called you Can Contract. And the focus is gonna be on all the different journeys people have to learn about contracts. Because just like learning how to negotiate, there's so many different ways that people come to it. There's people who learn in school from a mentor. There's people who figure it out on their own. And I think a lot of us worry that the way we learned isn't the right way. But the thing is, there's no one right way. There's lots of different ways. And so I want to tell the stories of people that I respect, people who are really successful in what they're doing and how they reach that place in the journey to learn how to negotiate. What things were great, what things weren't great, who influenced them, what advice do they have for people earlier in their contract training journey. So I'm super excited about it.

Yes. And we are excited to share and promote. We appreciate you coming on the show and listeners, there will be a link in the description to everything that we discussed today in this episode. Laura, thank you so much for joining us. Really appreciate it.

Yeah, no, it was wonderful, as always. Thank you.

Wait, wait, wait, wait, wait. Now, before you sign off, I have something to tell you that I've never told you before. Just kidding. I've told you before, but you should listen to it again. I want you to know about Negotiate Anything Premium. Imagine all of the things that you love about our traditional feed, plus so much more. I know you like our traditional feed because you're at the end of the day, the episode. And with Negotiate Anything Premium, you'll get more bonus content. You've been asking for more of the expert insights that you can't get anywhere else. And more exclusive behind the scenes access into every conversation. Are you ready to get more of what you want out of your life, career and every conversation? With Negotiate Anything Premium, you'll have access to more high level, custom designed content and insights giving you the tools you need to negotiate higher salaries, better deals, and better relationships in your life and career. Once I had a listener share that Negotiate Anything helped her to negotiate a $53,000 raise. Could this be you? What would that mean for your life? I've seen firsthand the impact this model has had on my life and the lives of my corporate clients, and I am confident confident that it can do the same for you. Are you ready to negotiate more of the best things in life? Click the link in the show notes to learn more. I'll catch you later.