Scaling Contract Mountain
This is yet another in the "it's against the policy" series of blogs I've written in the past year. And no doubt not the last. The mission of Astrapto is change management for positive impact. Policies and contracts often get in the way of moving forward with improvements that would achieve desirable social and environmental outcomes.
I frequently speak with those, both those selling ideas from within the organization and those outside selling products and services that help companies be more sustainable. In both cases it can be rather frustrating to face a “no”. It is easy to get discouraged.
When it comes to selling ideas, products, and services to larger organizations, one of the most common obstacles you’ll run up against is contracts. This can be particularly frustrating because it feels like a hard, nonnegotiable NO - an unscalable mountain.
But let’s look at the contracts hurdle and plan out your journey to scale that mountain and reach the peak of social and environmental impact!
Restrictions vs. Incentives?
The most important thing to do when facing seemingly insurmountable hurdles is to break it down and unpack it. When you dismantle it this way you can distill the a massive problem into the one or two small problems and focus your energies on solutions that will move the needle.
Does the contract force or prefer a choice? The power the contract exerts is undeniable, but what is the driving force? Is someone penalized for going outside the boundaries of the terms or is someone rewarded for staying within? This is vital information if you want to know what levers to pull! The challenge with contracts is the egos and needs of those who enforce them.
What exact behavior or practice does the contract reward? This is important because oftentimes a specific procedure defined by the contract spills over into other, similar procedures, and assumptions become set-in-stone truths. If you can determine that wasteful and inefficient practices are NOT mandated in a contract then it’s worth it to get key decision makers together and outline the proposed changes in light of their benefits and to make it very clear a contract or policy is not an actual deterrent, only a perceived one.
How exactly do the contract requirements contradict the organization’s public sustainability commitments? Spell out how the rewarded behavior prevents the company from keeping its promises. For example, if an agreement provides financial incentive to buy a certain number of bottles of a beverage, then that directly goes against the company's claim on the website that they are making efforts to reduce single-use plastics.
Which is the better incentive - honor the contract or protect the brand’s reputation? Most likely the consequences of breaking the contract terms are felt more strongly than the consequences of failing to reduce plastics. But that tide is turning. Companies are getting called out left and right these days for greenwashing. Make the business case by showing brand reputation risk pitted against
Goon vs. Gear?
The hardest part of contracts is not the legal terms on a piece of paper, it’s the people whose egos, reputations, and wallets are at stake. When I hear people complain about contracts that block sustainability, it often sounds like the author or enforcer of the contract is some nebulous corporate goon. And sometimes that is a true characterization. There’s a lot of arm twisting in the corporate world - don’t be naïve about that.
But more likely this person is just a cog in the machine, a gear you can maneuver to steer the company towards improved social and environmental performance. This is just another example of breaking it down to determine exactly what - or rather who - to address.
Who wrote it? What assumptions are you making about them? What was their objective or assignment when drafting and negotiating the contract? It is rare that all staff and departments are sufficiently trained on sustainability initiatives so it’s very likely those in charge of contract negotiations had little or no knowledge of how their decisions interplay with sustainability strategy or goals.
Approach this person respecting where they’re coming from and offer nuggets of awareness. Be collaborative and helpful, not judgmental. It’s likely this person is not aware of the negative outcomes of their actions. It’s obvious to you but that doesn’t mean it is to everyone else. Some, like a contract that requires continued growth of single-use plastics, will be easier to point out than others.
Whose budget does it affect? What are the power dynamics? Instead of thinking of this person or department as the bad guy, remember that they are often a lever someone else is pulling. It's all about motivation and power. So break that down and follow the trail of decision making and influence. Where this tends to be a real problem is in large, global companies. In those cases, the decision makers are often looked upon as distant and untouchable. It's all part of the scary upper management leadership layer no one can touch.
That upper level of the organization is increasingly expected to prioritize social and environmental issues. In fact, in a global 2020 Edelman Trust survey, 68% of respondents felt CEOs should step in when government does not fix societal problems. 65% feel CEOs should hold themselves accountable to the public and not just shareholders or the board of directors. This pressure will come from all sides, so as you apply pressure, do so in a way that reminds others of their accountability to more than just one stakeholder - the shareholder.
And remember that on the other side of the contract is another human - a salesperson trying to do their job, even if their job is selling straws and stuff with toxic chemicals. I’m not justifying the existence of those products but just reminding you that at the heart of all this is just a bunch of people trying to make a living. If you threaten that, you can expect a fight on your hands. So be sure to have alternatives and empathy.
Permanent vs. Persevere?
Contracts don’t last forever. Rather than view it as an unscalable mountain find out the expiration date and that is your window of opportunity to change minds and offer alternative solutions. Use that time to spread awareness of the related social and environmental issue.
As you’re planning out your timeline it’s an opportunity to prioritize. Which contract changes would generate the greatest triple bottom line impact? Which would be the easiest to change without rocking the boat? There’s a good chance the answers to those questions is entirely different. You may find it’s easier to start with the latter so you can build the trust and relationships necessary to change the more entrenched contracts.
At play in this element is price. That’s usually at the root of the problem and the reason for a contract in the first place. Sustainability options are often seen as more expensive, but prices are lowering on alternative materials every day, the technology is getting more accessible to offer better materials and approaches. You need time to build a solid business case. Once you know the timeline for new contract negotiations, be ready with the ROI presentation for your ideas, alternative vendors, and action plans for necessary operational changes.
Reach the Peak!
Doing all this doesn't guarantee you'll get around the contract. In the process you may discover it's easier than you thought (e.g. the restriction was perceived, not reveal) or the process may reveal the situation is worse than you'd realized. If that's the case, then you have a bigger problem. This is now a deeper-rooted corporate culture phenomenon that must be dealt with if the company is going to live up to promises.
Don't be afraid to call it out. And if you work for jerks that you can't confront then start looking for a place where your integrity will be appreciated. But before you abandon ship or just give up in resignation, invite others into a dialogue. Don't approach it in confrontation but present it like a problem to solve: How do you suggest we reconcile this practice/contract with what we've said publicly? You might be surprised how rarely the person even knew of the public commitment, much less had considered the contradiction or incongruency.
Let me know how YOU are overcoming objections or book a coaching session with me and I’ll help you scale whatever mountain you are climbing – together we’ll reach the peak and celebrate your impact on the planet!
Read and watch more from the IGNITE series here.
