Once a deal is signed, the parties agree to look together for changes that would leave both better off, with the signed deal as the fallback if none are found.
An example
Six weeks of hard bargaining produced a fixed-price subcontract between a general contractor and its mechanical subcontractor for a laboratory building, and both sides had given up things they wanted. The contractor's vice president of operations then proposed something new: two working sessions over the following month, with both teams, to look for changes to the signed terms that would leave both better off, on the understanding that if they found none the signed deal stood untouched. The subcontractor agreed, since it had nothing to lose. In the sessions they found two. The subcontractor could prefabricate duct assemblies off site if the contractor gave it a dry staging area, which saved the subcontractor money and shaved three weeks off the schedule. And the contractor could take over crane coordination, which it was better placed to run. They signed an amendment splitting the savings.
Why it works
Post-settlement sessions make improvement look better and easier for both sides, because the signed deal is safe: nobody risks losing what they already have, so both can share information they held back during the bargaining. Hard bargaining usually leaves gains on the table because each side hides its priorities, and once the deal is signed, revealing them is cheap. Both sides must trust that the fallback stands, and there must be issues on which their interests differ.
The thinking behind it
Howard Raiffa Howard Raiffa's Post-Settlement Settlements (1985) proposes that after the parties have reached and signed an agreement, they look together for a better one, keeping the signed deal as the default and adopting changes only if both sides prefer them. Because the signed deal stands unless both prefer a change, neither side risks what it already has. That guarantee is what let the contractor and subcontractor share the information that produced the prefabrication and crane changes.
When it fits
Complex deals with many terms suit it best, especially between parties who will keep working together, where the bargaining was hard and each side suspects value was left behind. You need a relationship good enough to propose it, time for the sessions, and authority to amend. Simple deals with one term gain little from it.
How to use it well
Propose it soon after signing, while the details are fresh and before the work is under way.
- Make the guarantee explicit: if no improvement is found, the signed deal stands.
- Bring the people who know the work as well as the negotiators.
- Share your real priorities and constraints, now that the deal is safe, and ask for theirs.
- Look for changes that improve both sides, and agree how to split any new savings.
- Put every change in a written amendment.
If nothing comes of it, close the session cleanly and keep the deal as signed.
What it costs and where it backfires
It takes time and asks both sides to reopen something they were relieved to close. Some counterparts will use it to try to win back concessions, so hold firm that any change must leave both better off. The guarantee is what makes it work: using the session to reopen terms you lost, or threatening the signed deal to win changes, turns it into renegotiation under pressure.
When it is used on you
Accept an invitation to a post-settlement session on the explicit condition that the signed deal stands if nothing better is found. Share priorities gradually, watch whether the other side shares theirs, and refuse any change that improves their side at your cost.