A Life of Negotiation
Chapter 6: The Middleman
When we Vietnamese talk about marriage,
we often look for a matchmaker.
In the past,
the maid was usually an uncle,
aunt or someone close to the family.
They held the future groom as an infant in the cradle,
knew the bride when she was an elementary school student.
The society at that time was still a closed society,
the world only consisted of close family and friends.
These days the matchmaker is sometimes a classmate
who introduced the prospective couple to each other,
or more modernly,
a meeting on Facebook or another social network.
In Western European countries,
a lot of people who want to get married go to a professional company
that has profiles of hundreds
or even thousands of candidates for marriage.
Not limited to resume,
these companies sometimes analyze their customers’ personalities, tastes,
and even horoscopes
before introducing them to each other.
And just like that,
the candidates glided very quickly to the wedding.
I have heard that modern methods are equally effective,
and even less likely to lead to divorce than the cases of boys
and girls marrying for love,
including love at first sight.
The world has entered the stage of globalization.
From a society where people depended only on acquaintances
or relatives,
the world has moved to an open society,
where transactions go through people not previously known.
And the more unfamiliar,
the more I see the need to go through reliable,
serious and professional middlemen.
From a close uncle and aunt who helped her get married,
society turned to a professional agency
with modern methods
and tools so that each “candidate”
for marriage can find happiness through her marriage gentle,
comfortable selections with a high probability of success.
That alone is enough to illustrate the role of intermediaries in the new age.
* * *
A company merger is,
in principle,
no different from a wedding.
The two businesses,
whether they are similar
and want to strengthen their position in the market,
or different and want to expand their operations
into new markets,
are the same as the couple mentioned above before getting married.
The intention to find each other
and then discuss the matter directly is a very delicate matter,
if not to be avoided,
except in the cases of knowing each other
for a long time and communicating regularly.
Indeed,
imagine that
the President of a certain company invited the General Director
of another company to have a meal,
and when the meal was over,
he ventured to say:
“I see that if our two companies merge,
the It makes sense to do that!”.
How to say more delicately?
However, the answer will be no less sharp:
“Makes sense,
man.
I still believe that
you guys have wanted to swallow us for a long time,
but we have been waiting for a long time for a stronger
and healthier company to come to us!”
And so the love affair ended,
because one side suspected the other party intended to invade.
In such situations,
the relationship easily turns into a cause for long-term resentment.
Instead,
just a reputable intermediary with a few golden words
for each party:
“I see that if the two sides merge,
the future of the new company will be very bright”.
That is enough to make the leaders of both sides think
and see the favorable trend.
Who doesn’t like to hear the middlemen say:
“Two companies merging in one will bring the newly established corporation
to the international level!
Your playground will be the whole world!
Oh, what a grand vision!”.
And as soon as a business wants to get a project,
the presence of a good
and dedicated intermediary is a very powerful weapon:
“Delivering the project to the company
you recommend will be a solid guarantee in terms
of quality as well as speed of project implementation.
I worked with them many times,
each time with great success!
They are professional,
using all modern scientific methods,
agile staff…”.
If the middleman is really reputable,
just one sentence like
that has the potential to change the outcome of the game.
To be honest,
throughout my career,
most of the projects that get to where
they are going have been the result of an excellent team on our side
and the help of one
or more good outside intermediaries.
Psychologically,
the need for mediation is simply explained.
Wanting to show off that you’re good,
beautiful,
and good,
you can’t do it by yourself.
Boasting yourself,
no one will listen!
On the contrary,
from a third character,
the same compliment becomes a very respectable objective comment.
Just like in a wedding,
it’s easy to be brazen to ask directly.
Letting a third person suggest
it has a very positive effect.
And from a scandalous affair can turn into a charming situation.
Such is the effect of the mediator.
Whenever we use intermediaries,
we find that the price is too high.
But on the contrary,
if there is a lack of reputable intermediaries,
it is difficult to be effective.
* * *
There are many people who often think that
when there is an intermediary,
there is corruption.
This is understandable,
because corruption does indeed help a number of projects
around the world get underway.
However, the laws of many countries
that are famous for being clean
and transparent such as Denmark,
Singapore, and Switzerland all recognize the role
of intermediaries in business.
When an intermediary introduces your company to a customer,
their job has a price.
If the intermediary is a reputable person
who has had many successes in the intermediary service,
there is no reason not to pay them properly.
As for corruption,
let me say this right away:
can’t blame the middleman!
They are still just intermediaries.
If the customer is honest,
the middleman can’t do anything
even if he wants to be corrupt.
And when the customers themselves are corrupt and have demands,
the intermediaries can only transfer the claims to their clients.
Intermediaries cannot bear responsibility
when society is corrupt
and of course cannot bear that crime alone.
In addition,
do not think that having a middleman will work.
Intermediaries must also have quality:
prestige,
wide familiarity,
persuasion,
understanding the psychology of customers as well as clients.
Experience shows that in large international projects,
we often use many intermediaries
because the number of personnel in the project is too large and diverse,
from many agencies, ministries and branches.
Sometimes even two private companies working together need a considerate
and positive referral from a reputable intermediary.
There are agile,
delicate intermediaries,
as well as “simpler” intermediaries
because the customer is equally simple.
It is important to get the job done,
get the contract,
and when the results are reaped,
it is undeniably important that
the intermediary plays an important role.
Throughout this chapter
I will not delve into the aspect of corruption
as this is not the main aim of the book.
When necessary,
I will only skim through to help readers not forget the whole scene.
* * *
In a broad negotiation,
whether commercial,
emotional,
or political,
nothing is needed that is more difficult
to use than an intermediary.
From professional experience,
I have to admit that all of the greatest “successes” are
due to the collaboration with one or more good,
if not highly skilled,
and reputable intermediaries.
But after each victory,
I also understand that it is really difficult
and laborious to direct them,
direct them to know where to fight,
what information to find,
what arguments to convince someone.
So what makes choosing and using mediators difficult?
1. An intermediary is a person
does not belong to the standing ranks of the company.
They work erratically,
their presence is necessary
or not depending on the map of the actor
both on the investor’s side
and on the side of the bidding company.
The intermediary is a kind of glue
that binds the customer to the contractor,
also a grease that can make the negotiating machine run smoothly.
But because they are not employees of anyone
but only their own,
so it is difficult for anyone to dare to grasp them
and control them.
The main paradox is there:
how to control the middleman
you have hired and pay you well.
How many times has my company yelled at him to give him
a few million dollars to help get the project,
but when he needed it,
it disappeared…
Intermediaries don’t just work for your company.
There are even many intermediaries
who are very close to the investor
and are also the eyes and ears of the investor into your own ranks.
If your company reveals to the intermediary how to work in a scandal,
the intermediary will tell the investor.
In this case,
your company’s chances of winning the bid are slim.
All intermediaries are inherently afraid that
the company they recommend cannot do the job.
Just like a wedding,
matchmakers are very discouraged
if the couple they introduce to each other divorce
after a short honeymoon!
2 Intermediaries can also be insiders of the enemy side.
Normally, a small company is not powerful enough
to “raise” its own intermediaries.
Therefore,
every time there is a project,
the company rushes to find an intermediary.
A good intermediary has already been encouraged
by a big company.
So only the country chooses the great among the “remainers”.
If you’re unlucky,
you’ll find a man working with an enemy company!
I would like to say right away:
choosing great is lowering the book.
The probability of winning the bid will be very low.
When you choose a great intermediary
while having no idea of the upcoming battle,
you are unintentionally
or intentionally entrusting the future to luck.
3. An intermediary in the international market is a person who is usually very highly qualified.
Their expertise allows them
to follow the negotiation in detail on both the technical
and legal and financial fronts,
which is the obvious tip.
The hidden part is
that usually they have a very wide acquaintance,
long-term communication with party
or government leaders,
even trade unions,
the press…
Their high level is a problem,
because their company
No matter how hard you try,
you can only send delegates
with a high level of director.
That difference is easy to cause discomfort for intermediaries,
as well as guilt for company representatives.
One side is a real tycoon,
known to the top of a country;
and on the other side is an industrious employee,
no matter how high the rank how of a small company!
Throughout my life,
I have been fortunate to meet all sharp
but likable mediators who accept to work effectively with me.
Honestly,
when they introduced me to the king of this country,
the president of that country,
having dinner at the private house of that prime minister,
then I understood that
they were not just intermediaries.
They must have been a figure of the court,
with origin,
name,
prestige and extreme respect.
The mediator can also be an extraordinary influencer.
I once met a Spanish-Jewish mediator
who had only two minutes.
He looked so normal,
who would have thought
that every word he said was a heavy command.
He smiled and asked me:
“Does your great company really want to take that project?”.
I only had time to say “Of course yes”,
and he picked up the phone,
gave the exact instructions
and turned back to me:
“Remember to sell at that price,
I guarantee your company will win.
Don’t find me again.
I will finish the job you ask,
and when you win the bid,
someone will ask you to pay for the service on my behalf.”
That’s all,
2 minutes,
3 sentences.
We won.
And we happily paid for the service,
not sparing a dime.
It’s wonderful.
Sometimes
I secretly dream…
if any intermediary is so effective,
how happy is my wandering life!
Of course,
in the above case,
our company must also be how powerful and reputable,
for the power of intermediaries to be effective.
But without their dedicated help,
it’s really hard to move forward.
4. Choosing an intermediary is not easy.
My recollection actually contains many wacky instances.
There is a company
that brags about having “caught” the “number one” intermediary
to carry an important project.
In the end,
they lost the bid,
not only that,
but it was painful to admit
that the middleman couldn’t do anything!
This is a very common case.
Let me tell you a funny story
during the period of peak development of Indonesia (Indonesia),
1970-1980.
At that time,
the descendants of the top leaders in the country acted as mediators!
There was a time
when our company wanted to build a hotel on Sudirman Road,
in the city of Jakarta.
I looked for an intermediary,
only to find out that the children of the General,
both boys and girls,
are all intermediaries.
Even his wife.
They all work separately,
competing for projects.
I really don’t know which child to ask for help.
So an old friend explained to me:
“In this country,
only the General above knows which son will win the project.
But he only decided at the last minute.
He is very clever,
dividing the turn for the children equally.
But we are below,
we can’t guess what he means,
if we miss it,
we lose the project.
I have no magic power to help you choose the right children
or the wife herself to mediate your company.
Only thing is certain that in the end,
the winner is always Uncle!”.
The friend also added:
“Working with Uncle’s descendants is very difficult!
From the date of bidding to the date of award of contract,
no company had the good fortune to interact
with his children.
They didn’t bother to visit, nor did they care.
You will be in the dark,
and of course in your company,
your colleagues will wonder and react to you,
because you don’t have a single piece of information
to bring back to the company!”
Indeed,
intermediaries that do not give you information will not bring you back.
Many times,
I have been in a similar situation with great anxiety.
Call the intermediary,
do not pick up the phone!
Visit the office,
as empty as the temple of Ba Danh!
But fortunately,
sometimes we still win the bid.
It’s just that a high-class intermediary won’t need to show up,
and they don’t need your opinion,
even if you’re their client.
5. “I am a friend of God”.
In the above case,
it is clear that the intermediaries are friends of God (sons).
However,
there are many other cases where the intermediary also claims
to be a friend of God.
Right or wrong,
subjective or objective,
you cannot check.
In the market of every country,
everywhere,
there are a lot of middlemen who beat their chests
to say they are familiar with “God”
and then start extorting money in any form.
This type of intermediary is even more prevalent in countries
that lack the rule of law.
Even more amusing is the case in certain countries
that there are many “Gods”.
So your company will hardly know the “numb tissue”.
So what should you do with these people?
Who knows they are real friends?
First of all,
I advise you to stick to the company’s immutable policy.
You are not qualified to speak your mind personally,
so hiding behind the company’s policies
and working principles is an appropriate attitude.
Our company only believes in God
when it comes in to meet him,
with an intermediary to open the way.
No meeting is no God, the end!
Don’t tell us God is too high,
we have no right to meet.
Our company is a customer of God in case God wants
to mediate for us.
And the customer is king. End.
God must confirm as a mediator
sits next to actually working with you on the project
and will defend our exclusive rights.
If God does not confirm,
then maybe the intermediary is only familiar with the speaker?
Or what if God goes two rows?
(Just to be clear, every God walks in two rows!)
Intermediaries must be sympathetic to the company’s policy,
as the company pays them for their services.
You keep telling the intermediary:
“We invest a lot of effort and money in the bidding,
how can we not work seriously and unprofessionally?”.
If you talk about it and the middleman still disagrees,
then you should doubt their ability,
because on the contrary,
they should be happy to be lucky enough to work
with a decent and powerful company!
Our company does not pay for intermediary services in advance.
Always pay after the project is delivered to the company
and officially on the construction period.
It must be acknowledged
that a number of reputable intermediaries work extremely effectively.
They are quiet,
quiet,
understand thoroughly the issues raised in the negotiation.
They help find solutions when negotiations stall.
They explain to both sides
why the other side makes decisions
that are confusing to one party;
they anticipate limitations;
they solve some problem
before it shows up;
sometimes they
even support interpreters who are struggling to find words.
When one day of negotiations didn’t go well,
everyone was unhappy,
the mediator continued to work into the night,
meeting the whole scene with key players to explain,
and just like that
the next day the atmosphere was light gentle warmth will return
to the conference table.
The work of a good intermediary is truly priceless.
They alone have the ability to turn a game around
– something not everyone can do.
Therefore,
their wages are very high compared
to the number of hours worked.
Experience shows that very good intermediaries never ask
for remuneration before the contract is signed or in operation.
They are too sure of their potential and strength.
They are not afraid of being strangled by the client,
and if this were to happen,
their defensive response would be extremely strong.
On the contrary,
you must keep in mind that once you pay in advance,
from that moment the intermediary will not work as you expect.
I wonder if there is anyone in this world
who continues to work effectively after receiving a salary?
It is better to lose the opportunity to work
with a greedy intermediary,
than to never pay in advance,
even partially.
An elderly engineer even admonished me in strong words:
“After all,
middlemen are just dogs looking for bones to chew on.
Dogs run only when starved.
A full dog will sleep well.”
I have never seen this comment wrong.
When working with intermediaries,
it is worth remembering to be discreet.
The lack of confidentiality will allow the opposing firms
to know who the bidder’s intermediaries are.
They will even find a way to neutralize the middleman.
Normally good intermediaries work very quietly and discreetly.
If you choose a middleman to brag,
you will definitely lose the bid.
The essence of their work is to walk at night,
to blow gently in the ear,
to suggest! If they show off their supercars,
hang out with loud sexes,
and speak without knowing what to expect,
then they are worms.
Every branch has a worm.
The intermediate branch is no different.
* * *
Here are the questions you should ask yourself when choosing an intermediary.
Are intermediaries reliable?
Are intermediaries trusted by investors?
Is it even “appointed” for the job?
Do intermediaries understand
that they must be careful in project information:
information is immediate (timed),
information is checked before it is faithfully transferred (accurate information).
Does the intermediary understand the strategy of both the investor and the company?
Are intermediaries available 24 hours/7 days when needed?
Is it possible to communicate day and night?
Do you have working facilities
(smartphone, computer, fax, printer…)?
Do intermediaries work discreetly?
Flamboyant display is the immature intermediate.
Does the intermediary have a good grasp of the personnel/player map?
Does the intermediary have natural authority?
If it’s just a small parrot,
don’t use it.
There will be times in the negotiation,
the exchange is stuck,
the middleman will be the right person
to solve the problem.
Can the mediator speak many foreign languages?
The main point is that
when the company negotiates with foreign countries,
the intermediary must thoroughly understand
both languages of the two delegations directly.
The conversation between the two parties may require an interpreter,
but the intermediary must master the language directly,
not through an interpreter service.
The mediator must control the interpreter
so that the negotiation does not derail.
Can the intermediary be a guide to connect the arms of the two sides?
To do that, the mediator must understand the psychology
of the actors on both sides.
Is the intermediary alert enough
to avoid a third opponent jumping into the game?
This case happens very often,
because the investor is not afraid to expand the race.
Are intermediaries serious in service and not greedy?
Usually, at the end of a negotiation
when each participating company has to make a sacrifice
to reduce the price,
the intermediary also reduces a portion
of the remuneration called “participating in the joint effort”.
Finally, is the intermediary capable
of understanding the minimum scientific
and technical aspects of the project?
The list of advantages of the intermediary is probably many more,
not limited…
but it is enough to show that
the intermediary must be an extraordinary person.
Also, the remuneration for intermediaries is very high.
In a project of about 100 million USD,
the remuneration for the intermediary alone is not less than 1
or 2 million USD,
for a job that lasts only a few months.
It’s generous,
but it’s probably totally worth it.
It should also be added that
greedy intermediaries can ruin the whole project,
because in the price of course
there is the intermediary’s remuneration,
and too high remuneration will make the quotation unbalanced.
Negotiate with mediators often a negotiation
begins with the mediator himself and no one else.
The intermediary brings the project to the company,
makes the so-called God’s demands,
introduces the actors of the negotiation to each other,
and helps the negotiation to reach its destination.
The result is a balanced contract
between the investor
and the contract performance company.
Then on the day of signing,
the intermediary helps the two parties arrange the signing ceremony solemnly and happily.
Of course,
if the intermediary refuses
to sign a contract with the company,
the hope of success is very small.
When negotiating with an intermediary,
you should remember the following working principles:
Contracts with intermediaries must fall within the framework
of the laws of countries that recognize the role of intermediaries.
Switzerland is an example.
There are many countries that do not recognize this,
thus adding complexity to the administrator.
In the future,
if there is a disagreement,
it will be difficult for me to resolve it
without pre-determining the applicable law
and resolving it in court in which country.
It is also important to emphasize that
when there is a disagreement with an intermediary,
it is best to find a mediation
between the two parties in a confidential manner.
There is no point in going to court,
and the court may ask difficult questions.
Then when intermediaries are not happy,
they can exert a strong influence
so that your company is “closed in isolation” in their country.
The role of the intermediary must be well defined.
They must also really clearly state
who they know and who are not familiar
with the investor side.
A project has dozens of characters participating
from many sides (ministries, sectors, banks, lawyers,
main contractor companies, subcontractors).
If the mediator is only used to having God,
that’s fine,
because that’s the most necessary condition.
However, it was still not enough to win the bid.
Must know the advisory board,
the approval board…
Therefore, if the intermediary alone does not understand it all,
the company will need to rely on a number of other intermediaries.
On the client side,
the investor,
often with underground politicians, cannot be ignored.
The domination of the implicit array is also the responsibility of the intermediary.
Intermediaries must honestly acknowledge
that they work exclusively with clients.
If you let the intermediary go “two rows” will cause disaster.
Worse still is the intermediary
that acts as an insider for the enemy.
This is rare,
but it does.
In the contract,
it must be clearly stated that
when the company has evidence
that the intermediary is dishonest
or does not work exclusively,
the contract is automatically canceled.
The intermediary must respect the intermediary contract
until the main contract of the project is signed,
regardless of who the project contract is for,
for an opponent or for a client.
At that point,
the intermediary is out of office,
but must promise not to work with the enemy
until after the project is over.
The reason is that in many cases,
after the contract has been signed,
the winning side wants to use the losing side’s intermediary
to perform many dependent but important parts,
such as applying for additional funding,
or neutralizing other parties characters
who opposed them before
when they were still on the losing side.
Contracts with intermediaries must be within the standard framework.
This means that the combined employment
of all intermediaries cannot exceed 4 or 5%
of the total project value.
Of course, many parts of the world have higher requirements.
The contract with the intermediary must clearly state never
to pay the intermediary in advance.
Experience shows that many negotiations span many years.
Large projects, especially metro projects,
sometimes take up to 20 years,
from the time of feasibility study
to actual construction
(metro Bangkok or Jakarta, for example).
Therefore,
paying the intermediary in advance is both reasonable
and unreasonable.
It makes sense
because if intermediaries have to work 20 years on a project,
they really deserve to be paid,
regardless of the outcome.
However,
if you look more closely,
over the course of 20 years,
how many Cabinets have replaced,
how many Transport Ministers
or Mayors have gone through the project.
If the company pays upfront,
it means a lot of payouts
before the project becomes a reality.
It’s absurd!
Is it possible that the intermediary does not have many means of communication,
for example,
and the company may accept some expenses
such as telephone,
fax, etc. in advance for a certain period of time.
The contract must include a termination clause for the intermediary. In many schools
Your company does not work with intermediaries
and does not trust them 100%.
At those very times,
the intermediary will be as dangerous as a “cobra”!
Better release them than keep them in your pocket!
* * *
When looking for projects abroad,
you will often encounter all kinds of intermediaries.
There are middlemen
who insist on bragging that everyone they know,
everyone has been close friends since school.
Then even “God” is their brother and sister.
I advise you to be cool
with those kinds of exaggerations.
Maybe they’re telling the truth,
but it’s better to give the company’s immutable working principle:
everything must be proven to believe!
There is an intermediate type that speaks in white,
speaks in black,
and lacks coherence.
These people do not understand the problem,
should be avoided.
Intermediaries report slowly,
clearly showing that
there is no “outpost” position in the collection of information.
They know a lot of real investors,
but slow information is of little value,
like reading a daily newspaper two or three days later.
I have met a case where an intermediary knows everything,
but only knows slowly
and does not know the cause of the problem.
I later found out that he was just the mistress
of the investor’s secretary!
The most important information is the enemy’s cost.
If the intermediary does not understand this factor,
it is very difficult to bid.
On the contrary,
I have worked with many great intermediaries.
They are similar in many ways.
They showed my company the content of everything clearly.
They advise doing everything at the right time,
they say whatever is in the right situation.
Of course having their cooperation is a solid guarantee
of progress towards results.
Once, I was able to work
with a famous intermediary in the Middle East (Syria).
When he invited us to his country to bid,
he introduced us to the authorities of the project,
and then immediately brought us
to meet “God” at the private residence.
Then he organized excursions,
and then used the pretext of inviting a friend from the investor side
to establish a strategy to come to a contract for our company.
We always know the price to be quoted at the time of bidding,
what conditions must be accepted.
It’s true that the god drew the way for the deer to run,
but what a wonderful road!
Our contract has just been signed,
with the middleman’s fee,
he bought a 5-star hotel in Paris.
And well deserved for him!
Things to remember
The presence of a good intermediary
and a deep understanding of the actor’s map
(also through the intermediary) are two of the prerequisites
for success in the marketplace.
Knowing a good middleman will help your company open all doors.
Without a good intermediary,
there will be no guide.
However, even with a guide,
the company still has to prove its technical ability,
excellent track record,
offer an attractive price,
and then gradually gain the trust of customers
and ultimately win contractor.
A good intermediary can only help,
but not replace,
your company in the bidding
and subsequent negotiations.
An excellent intermediary is a necessary condition for success,
but it is not sufficient.
