🔁 ETA Friday: When negotiations fail

Welcome to ETA (Edited to Add) Friday. Every Friday morning we’ll rehash a previous newsletter. Why? There’s always more to learn, and leadership practices are ever-evolving.

My take:

As my public callout of Zendesk's contract issues gained traction, it felt fitting to discuss the delicate balance between private negotiations and public accountability in business relationships.

I previously shared how I approach effective contract negotiations, emphasizing clear communication and firm but fair tactics. Last week’s experience with Zendesk provides a real-world case study on what to do when those strategies fall short.

Let’s dive in.

A negotiation nightmare

If you follow me on Twitter, you know I recently had some challenges with a particular customer support company.

1. They misled us about our contract renewal date - twice.

2. They acknowledged their mistake but refused to correct it.

3. They were charging us over $2,000/month for a service we explicitly canceled.

You want real-world examples in my newsletter? I’ve got them! This example shows just how critical effective negotiation and clear communication are - and how challenging it can be when the other party isn't playing fair.

Why it matters for tech leaders

Anyone who knows me knows I really don’t like putting companies on blast on social media. With over 118k followers there’s a huge responsibility to keep the peace, whether or not I agree with this. But the reality is we sometimes have to escalate things when they’re clearly not going to resolve on their own.

In Tuesday's newsletter, I focused on proactive strategies. But what happens when, despite your best efforts, you find yourself in an unfair situation?

Expanding your negotiation toolkit

Let’s recap where we started on Tuesday:

• Do your homework

• Understand the vendor's position

• Leverage your position

• Propose alternatives where applicable

• Be willing to walk away

• Be firm with your language

In a perfect world this would be enough. But capitalism is going to capitalism and businesses sometimes need a little reality check when they forget they’re serving real people on the other side. So let’s expand on this negotiation toolkit a bit more.

1. Document everything. Keep meticulous records of all communications. If you don’t have a copy of the contract, get it from someone who does. Save all conversations via support. If you have a phone conversation with their team, note down the date and time and a recap of the conversation.

2. Escalate strategically. Know when to take your case up the chain of command. “Can I speak to your manager” is something I’m sure we’ve all heard someone say, but it’s often forgotten when dealing with B2B contracts and corresponding via email. If you’re not getting a realistic answer, ask to escalate.

3. Know your legal rights. I’m not going to dive into this one because I’m not an attorney, but all I’ll say here is understand your contract before signing it and know when it’s time to seek legal advice.

4. Leverage public accountability. I put this one last for a reason. As stated before, I don’t like dragging a company through the mud, but unfortunately it does work.

Social media and customer complaints

Leveraging social media to complain about a brand isn’t going anywhere; if it works, why would customers stop? 84% of customers who complained on social media got a response from the company, and generally quickly too! Depending on the platform, between 27% and 33% of customers expect a response within an hour. I even said internally when I posted about Zendesk “I’ll give them an hour”.

In reality, they responded in two. In fact, within about 2 hours, I heard back from a Zendesk VP. While I was out to dinner (an hour later), they proceeded to cancel the contract as requested. And then approximately a week later, the refund for a little over $7,000 was processed.

This resolution underscores the power of public accountability. What had been months of frustrating private negotiations and silence was resolved in a matter of hours once the issue was made public.

What should you take away from this?

1. Public accountability can be remarkably effective when other methods fail.

2. The speed of resolution (2 hours vs. months) highlights how companies prioritize public-facing issues.

3. While effective, this should still be viewed as a last resort after exhausting private channels.

This experience reinforces the importance of having a full toolkit of negotiation strategies. While we can always hope for fair and straightforward negotiations, it's crucial to be prepared for all scenarios.

As leaders in the tech industry, we need to push our organization create an environment where such measures aren't necessary. However, when faced with continued blockers, it's important to know how and when to escalate effectively.

I hope sharing this experience provides valuable insights for your own negotiations and vendor relationships. Again, I don’t love that this is what I had to resort to, but it’s the last tool in your toolbox and does serve a purpose.