Saturday Morning Sales

Kevin Latchford


The Spirit Of The Law / The Letter Of The Law - April 22, 2017

To say this week was stressful would be an understatement. I knew it was coming. I could see it coming. And, as much as I wanted to believe the meeting would go differently, it went as expected. To say the meeting went poorly would also be an understatement. Pleasantries aside, a longtime client’s newest executive team member is as cold as she is calculated, and I found myself quoting a saying my father taught me many years ago: “we’ve gone from working under the spirit of the law to working under the letter of the law”. Furthermore, my internal crystal ball is telling me to prepare for this longtime relationship to end sooner than later.


I’ve long been a believer that there is no single, right way to enter into an agreement with a client, rather every firm/company does things a little differently. My personal approach for practically my whole career has been based on the handshake (yet still written) style of negotiation and agreeing to do business. What I mean is this, my handshake is my bond, and our relationship is more valuable than a signature on a legally binding contract. Now, don’t get me wrong, I am not naïve and I do believe contracts are a necessary tool in business, but I prefer to err on the side of “spirit” versus “letter” of the agreement.


I believe in the good that is within people I choose to do business with, and I believe both my client and my firm will treat one another with respect and fairness. Leaning on the fact that no one is perfect, or that perfection does not exist, means that people are human and make mistakes. Owning up to one’s mistakes is a sign of honesty and maturity. Sometimes my side makes a mistake and sometimes a client’s side may make a mistake. How these situations are handled is what separates one firm from another, one firm being calculated in every aspect, while the other firm may be more open to changing the rules of engagement along the way for mutual benefit.


Going back to the point that various firms have varying ways of working with clients, in the area of professional services, the time & materials approach is likely the most common, and on occasion you’ll come across fixed bid contracts. Time & materials tend to lean on terms like “estimated”, “approximate”, or “ballpark” in the description of fee’s and timeframes for deliverable or engagements. In many case’s there are simply unknows at the time of execution of the agreement that both sides just don’t know how much that engagement may total by the end, at least not down to the penny. Unfortunately, there are those individuals in business that either do not agree with this approach (or like this approach), or they simply cannot grasp the concept. And, these are dangerous business people for long-term healthy relationships. These are the cold and calculated, and are the type of individuals that believe in the vendor-transactional approach to business, not the human-relationship approach. They tend to think of it this way: business is business and personal is personal and never the two shall mix.


Don’t get me wrong, I’ve dealt with these types of clients in the past, and will likely deal with them again in the future. However, you generally know what you’re dealing with or getting in to in the beginning, and can then plan your business engagement and agreement accordingly. However, when this type of person comes into your existing business relationship, after years of being treated not as a vendor but as a partner, well your relationship is about to be torn apart.


Dealing with these types of individuals and so called relationships requires tact in the sense that you must remain level headed at all times. Additionally, you must move away from the spirit of the law or the spirit of the relationship, and work on the letter of the law or the letter of the contractual relationship. This can be tough on a person or a firm that believes in always putting the clients best interests first. Regardless of the situation, you will be held accountable for the details in writing, and not the intentions you’re attempting to display. It will no longer matter if you have a better idea, a better solution to their problem, you must abide by the documentation set forth, or else you may wind up not being compensated or you’ll lose the client.


It is a hard lesson to learn and one that I hope you’ll learn through my experience. My client does not see the detriment for which their new executive has already caused in our relationship, but my guess is they will after it is too late, and we are done doing business together. It may not be tomorrow, it may not even be in six months, but I’ll bet in a year’s time this client will come to regret their decision to hire the cold and calculated executive. The Rolling Stones sang: You can’t always get what you want, but sometimes you get what you need. When those in business always demand they get every little detail of an agreement fulfilled, ruling only by the letter of the law rather than the spirit of the law, they will then get what they want and rarely get what they need.

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