I was listening to the radio yesterday as they were reporting on the Sanofi buyout of Genzyme. What was very interesting to me was when they said Sanofi and Genzyme had sealed this deal through some creative ideas.
A little history behind this news story - Genzyme wanted a price premium for their pipeline of block buster drugs, however Sanofi did not want to pay a premium as they were not sure of the potential success for these drugs. So the two companies argued for months on a price. Instead of spliting the difference, the 2 CEOs of these companies took a rather creative approach to discuss options. They left their teams of lawyers and bankers and instead took a hike together in the Swiss Alps.
The hike and the conversations that followed lead to a creative solution. Genzyme would be entitled to a payout over time if the Genzyme drugs succeed. This way both companies come out better. Sanofi is not paying a premium for something that might not work, and Genzyme still gets the opportunity to reap the rewards if their drugs are successful.
What does have to do with MIT Sloan? This type of creative value creation technique is exactly what I learnt in my Power&Negotiations class last semester. Negotiations are not only about capturing value from other but more importantly about value creation ; look for creative solutions so that both parties end up walking away better after the deal!
I look forward to connecting many such dots as I enter the corporate world soon. Meanwhile I am happy to be at place like MIT Sloan that takes so much effort and pride in preparing their MBAs for their foray into the workplace.
