Session 3: The Art of Negotiation and Contractual Pitfalls

Date: December 11, 2015
Location: National Institute of Building Sciences
1090 Vermont Ave NW, Washington , DC, 20005

Time: 12:00 pm – 5:00pm
Led by: Julia Siple, AIA, LEED AP BD+C | Quinn Evans Architects & Brandon Tobias, AIA, LEED AP BD+C  | US Army Corps Of Engineers

Session 3 PDF
Agenda
Speakers

Summary:

Contract language and negotiation tactics can be viewed as dour topics. While at times this can be true, Session #3 of the Christopher Kelley Leadership program brought a great level of life and engagement to the topic. Brandon Tobias and Julia Siple organized this session – held at the National Institute of Building Sciences (NIBS) headquarters – with presentations, contract language and negotiation exercises, a federal contract primer, role-playing, and even arm-wrestling.

The session began with a welcome by Ryan Colker, Director of the Consultative Council and Presidential Advisor at NIBS. He described the key role NIBS plays in building performance and sustainability, bridging the gap between design and construction, creating guidelines for disaster mitigation, and conducting research. These missions inform recommendations and action items for The United States’ Congress.

Jim Walker, partner at Vandeventer Black LLP followed with a two-parted presentation, enlightening scholars with best practices on how design professionals should manage risk – namely through analyzing scope and indemnity provisions. Jim discussed potential pitfalls with design professional contracts and presented the understanding that in order “to manage risk means to understand what you’re agreeing to”. Jim shared questionable scope language and shaky indemnity provisions and gave scholars a process to review them. Scholars learned, using Jim’s phrase, that “all words in contracts mean something.”

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Michelle Crawford, Chief Administrative Officer and General Counsel for Technologists, Inc. Wielding the Federal Acquisition Regulations (FAR), described how the FAR controls contractual content and relationships. She also described the federal government’s solicitation (RFP) process, the ensuing negotiation, and how contracts are awarded. Michelle showed the differences between the private award of contracts versus government award of contracts, noting that they are awarded on a “best value basis”; taxpayer funded projects mean the government seeks the best bang for its buck.

Michael Payne echoed Michelle’s sentiments. Michael, partner and chair of Federal Construction Practice Group at Cohen Seglias Pallas Greenhall & Furman PC, described how design professional’s resumes are evaluated when responding to government RFPs. Focusing on experience and clarity, the government selects to form a shortlist, and will award a contract at a set percentage. Ron Gross, Deputy General Counsel for Technologists, Inc., demonstrated in his presentation that this streamlined process makes it clear to those obtaining federal contracts what they can expect from them. In short, the federal government tells the contractor executing the contract how the relationship operates.

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Whether a contract is government-related or not, negotiation is still critical. Professor Charles G. Field, Senior Research Fellow and lecturer at at the University of Maryland, engaged participants with a revealing look at how various parties may differ in perceptions. We discussed how to establish a vision to work together through the basic strategies of successful negotiation.

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The scholars’ first exercise was designed to reveal that our natural tendencies can be competitive. Through a series of extercises, Charles presented his points that “our different experiences just mean there is something to be explored” through successful negotiations. Scholars engaged in role-playing exercise focused around a real-world scenario. Scholars acted as either a developer or a reluctant community leader, both with their respective interests of making a profit and protecting the community. Participants tried to satisfy each of their own interests, while having to acquiesce to the other party’s requirements. Professor Field remarked that this was idea crucial; successful negotiation is interest-based and necessitated both sides being and feeling considered. Both sides often need to offer the other something.

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To close the session, Sean Stadler, Principal at WDG Architecture, continued the negotiation theme by applying it to our everyday careers as young architects. He plotted his career arc, encouraging scholars to constantly asking themselves why they are where they are in their careers and why they are there. Sean suggested scholars to find opportunities to help their firm and take an involvement there. Aligning their passions with this type of involvement, Sean remarked, would give scholars immeasurable career boosts.

In conclusion, session #3 of the Christopher Kelley Leadership Program provided critical education on the overlooked topics of contractual pitfalls and negotiation. Day-to-day tasks for young architects don’t usually involve scrutinizing contract language or negotiating services, but defining roles and relationships along with aligning interests is crucial to being a design business leader. Scholars took home the tangible benefits of understanding vague contract language, learning to negotiate effectively in a variety of situations.

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