When Big Organizations Sign Deals: The Pattern That Emerges
Signing a deal with a large organization can be a lengthy, complex process. But if you look more closely at what happens, you'll likely find that there is in fact a pattern that emerges each time. This pattern begins with the initial signing of the agreement and then progresses through several stages, often resulting in success or failure for both parties involved.
Sign Deal At C-Level -> Transition The Services -> Critical Situation Due To Transition Failures -> Exit Transition -> Enter Steady State -> Critical Situation Due to Unable to Deliver Contracted Services -> Back Into Steady State -> Enter Transformation Phase -> Critical Situation Due to Disagreements -> Exit Transformation -> Back Into Steady State -> Could Be Several More Critical Situations -> Contract Termination Discussions Start -> Legal Gets Involved -> Concessions Are Made -> Back To Steady State -> Contract Ends Acrimoniously At End of Term or Contract Terminates
From signing to transitioning to steady state to critical situations and eventually transformation, what is the pattern large organizations follow when entering into contracts? Let's explore this idea further.
When an organization first signs on with another party, they will usually commit to certain goals and objectives set by both parties. If these are met or exceeded during the transition phase—during which an organization moves from one stage of their agreement to another—then the two parties can move forward into the steady state period. During this phase, both parties should feel confident that their end goals will be achieved as initially agreed upon; if not, then it's best to reexamine the agreement and make any necessary modifications before proceeding any further.
How can you minimize the misunderstandings?
Contracts between two parties typically involve the following steps:
- Drafting and Negotiation: The process begins with one of the parties drafting an agreement that sets out the terms, conditions, and objectives of their relationship. The draft is then reviewed and negotiated between both parties to ensure that they are both comfortable with all aspects of the contract.
- Signing: After reaching a mutual understanding, both parties will sign the agreement in order to officially commit to it. This step can be done electronically or physically, depending on how each party chooses to execute it.
- Implementation: The agreement is then put into action as both sides work towards meeting their respective goals and objectives outlined in the contract. If any changes or modifications need to be made during this phase for whatever reason, these must also be agreed upon by both parties and documented before continuing.
- Termination/Renewal/Amendment: Once the agreed-upon timeline has been completed, either side may choose to terminate the agreement or renegotiate its terms while amending or adding components where necessary.
Unfortunately, however, even when agreements have been honored during transition and steady state phases, unforeseen issues can arise suddenly during this stage as well as later ones—putting both institutions back on their heels and resulting in difficult situations that need to be remedied quickly. These scenarios include failing to deliver on promised outcomes or projects falling behind schedule due to logistical hiccups or other problems facing one or both parties.
The situation may call for “transformation” —a process through which contract modification(s) occur in order for both sides to reach a satisfactory resolution without ending the contract altogether. Depending on how much each side values the existing arrangement (and whether they're willing/able to negotiate), such transformations might take place without too much ado or become extremely contentious debates between opposing stakeholders who cannot agree on terms or outcomes they would consider acceptable. Ultimately though, big organizations must reach consensus if they are going to move forward together successfully —or else run the risk of ending their contractual relationships altogether after yet another critical situation arises down the line..
Ultimately, understanding this pattern enables organizations of any size to better approach contract negotiations with larger entities in anticipation of potential pitfalls along the way —allowing them to experience successful transitions and implementations so that their projects can remain productive and profitable for years to come.
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