What the NFL's Referee Mess Can Teach Small Businesses about Negotiation

by QuickBooks

2 min read

Football fans have returned to a normal level of complaining about the NFL’s referees. That’s because the “real refs” are back after a labor dispute that sidelined them for the first three weeks of the 2012 season. Their replacements were, to put it politely, not good.

Like most business disagreements, the NFL’s referee lockout boiled down to money. But it was also a lesson in negotiation. In a post for Forbes.com, negotiation expert Jim Camp says the league made four mistakes at the bargaining table. One particular error that should resonate with small businesses “They did not think in the long term.”

Camp points out that the NFL did lasting damage in its attempt to save a relatively small amount of money (considering the league’s multibillion-dollar empire). “Many people, both in and out of the industry, now recognize that the NFL behaved like a rich, evil dictatorship whose main goal was to save a few bucks at the expense of the referees,” Camp says.

That got us at the Intuit Small Business Blog thinking about a few other lessons the ref lockout could teach small-business owners. Here are three to consider.

1. Study hard. Take it from a football fan — the replacement refs really were that bad. It wasn’t their fault; they just were the wrong people for the job. The NFL clearly didn’t do its homework on Plan B when negotiations stalled. Just one example of the ensuing disarray: The league had to pull one official at the last minute from a New Orleans game when his Facebook page revealed that he was a Saints fan, complete with tailgating photos from a preseason game several weeks earlier. Whoops! No matter what you’re negotiating, preparation is critical. In hindsight, the NFL wasn’t prepared to handle its regularly scheduled games without its usual referees.

2. Realize that timing matters. The NFL and its referees could have had the ugliest, most contentious negotiations in business history, and most people wouldn’t have noticed — until the league let the situation run into the start of a new season, a joyous time of year for football fans. Suddenly, the NFL’s flagship product (professional games) was directly affected in a negative way. You can’t always control timing, but you can at least be cognizant of it. If you want to try to renegotiate your commercial lease, for example, don’t approach your landlord after a couple of late rent checks. Do it when you’re on solid financial ground and can make your best case.

3. Remember your customers. Sometimes you deal directly with clients on matters such as price and service. But many business negotiations happen behind the scenes with vendors, suppliers, partners, landlords, and — as in the NFL’s case — employees. Even in those scenarios, it’s important to put your customers’ needs first. The NFL clearly lost sight of its fans — the sports world’s word for customers — in what amounts to a labor dispute with a group of employees. And guess what? Fans were unhappy about that, so much so that NFL Commissioner Roger Goodell publicly apologized after the lockout ended. In the end, the NFL will steamroll on, but not without having unnecessarily riled its enormous customer base.

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