Ideally, when true friends do business, all the natural laws of
negotiation are suspended. The gladiators lay down their swords,
and water flows uphill. The buyer demands to pay more, and the
seller even insists on taking less!
But the real world instructs us differently: Friendship is
better for business than business is for friendship. Valued
relationships will often explode or dissolve when business deals
get rocky.
At best, it's a scenario that promotes unrealistic
expectations and hurtful miscommunication. For one thing, odds are
you're more likely to have a spat with a friend you're
making a business deal with than one you're not. There are
simply more opportunities for you and your friend to get your
signals crossed.
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And who hasn't been astonished by how differently some
friends act when doing business? You think you know someone well,
but suddenly, he or she morphs into the insanely competitive or
disgustingly docile. But actually, it's a deeper dilemma.
In life, the friendship is important in and of itself. But in
deal-making, the relationship takes a back seat to business. So
experienced deal-makers are not unduly ruffled by greedy, grabby,
pushy, evasive, high-handed, disingenuous and/or manipulative
opponents. Hey, it's just business right? "Let every eye
negotiate for itself and trust no agent," as Shakespeare
wrote. In reality, however, we would never expect true friends to
treat us this way. Should they dare, then business becomes all too
personal.
Adopting the philosophy of never mixing business with pleasure
is one approach. Of course, there's safety in it. With some of
your friends (and you know who they are), this is the only way. On
the other hand, if you never take the risk, you'll never gain
the best of both worlds--a friend in life and a friend at the
bargaining table.
It's better to remain open to the possibility. Be selective,
but when you do these deals, aspire to an unusual level of candor.
Consider laying your cards out on the table early. If you're
unsure about how to handle an issue fairly, look to some objective
standard or custom and practice for guidance. Here, it's even
more important to plan for the downside. Make some contingency
plans that are not only appropriate but will also keep everyone
involved on speaking terms.
Of course, you should write everything down, just as you would
with any other deal. But friends owe each other more than strict
compliance with the letter of some contract. Be exceptionally clear
with each other about your expectations, large and small. Talk it
out fully before the fact.
Remember: The stakes are higher when you do business with good
friends. Not only can your deal go south, but so can your
friendship. And most of us would agree that it's much easier to
make a good deal than it is to make a good friend.
A speaker and attorney in Los Angeles, Marc Diener is the author of
Deal Power.