Assignment 1: The Art of Negotiation
Kelley Verenysee Gunn
Dr. Deborah Hill
Strayer University
BUS 526
January 27, 2014
Abstract
This paper will discuss the art of negotiation. The focus will be on the UPS Strike Negotiation of 1997 between UPS and the Teamsters. The negotiation will be briefly described. The issues and interests of the involved parties will be discussed. Ethical behaviors will be analyzed. Proposals for distributive and integrative negotiations are developed for the conflict between the parties involved.
1. Briefly describe the selected negotiation.
The Teamster’s UPS Strike of 1997 was one of the largest strikes in the U.S., disrupting the delivery of
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The mobilization of the union’s members to shut down the company’s operation was the basic weapon which won the strike for the Teamsters.
4. Determine the Best Alternative to a Negotiated Agreement (BATNA) and Worst Alternative to a Negotiated Agreement (WATNA) for each side of the negotiation.
At the start of the strike, the BATNA for UPS was to offer to advance 10,000 part-time workers into full-time jobs only after other full timers retired or quit. They also stated they would only agree to create 1,000 new full time jobs. Their concessions for subcontracting were also included in their Best Alternative to a Negotiated Agreement. The Worst Alternative to a Negotiated Agreement for UPS was holding out and refusing to concede to the demands of the union causing the company to lose business and money.
The BATNA for the union workers was creating full-time jobs for part-timers and reducing the hourly wage differential. The WATNA for the union was to be offered the full-time positions only after the current full-time workers retired.
5. Develop a proposal for a distributive negotiation strategy for this negotiation.
The objective of a distributive negotiation is to achieve an efficient compromise by focusing on the distribution of outcomes as opposed to meeting the needs of the parties involved (Demarr, de Janasz, 2013). Distributive negotiations are often adversarial in nature. UPS offering the
Hormel company had their BATNA in placed and their anchor points and also presented their solid reservation point, which allowed them to have the upper hand around the negotiation table. Even though Hormel company had their alternatives and had the ability to replace their workers there was no Justificability. They did not consider their reputation, assuming that in the future they will be seated at at table negotiating with another company. They also did not take into consideration that these workers had families that could cause the public to stop buying their products. Also they allowed the
“Instead of approaching the problem in a competitive as distributive bargaining (claiming value only for one), the integrative negotiation the parties adopt an attitude aimed at solving the problem and seek a favorable outcome for both” (Business Blog Review, 2011).
In August 1997, the 190 000 teamsters employed at UPS went on strike for 15 days before agreeing to a new five year contract. The strike cost UPS $700million
Negotiation is a fundamental form of dispute resolution involving two or more parties (Michelle, M.2003). Negotiations can also take place in order to avoid any future disputes. It can be either an interpersonal or inter-group process. Negotiations can occur at international or corporate level and also at a personal level. Negotiations often involve give and take acknowledging that there is interdependence between the disputants to some extent to achieve the goal. This means that negotiations only arise when the goals cannot be achieved independently (Lewicki and Saunders et al., 1997). Interdependence means the both parties can influence the outcome for the other party and vice versa. The negotiations can be win-lose or win-win in nature.
Teamsters strive to help workers who want to bargain collectively. As management enforces a set agreement and sign it, the Union works to make it happen and hold the management to its standards. Contracts under Teamsters can guarantee fair wages, proper promotion, health insurance, job safety, off-time pay and retirement pay. The Teamsters earliest strike was made up of 4,600 people from Chicago against Montgomery Ward. The strike did not go as planned and
Another issue in negotiations was full-time versus part-time positions. UPS employees argued that too many workers were working 35-45 hours a week, often at two different jobs, for part-time pay. Having about two-thirds of all teamsters being part-time this was a central issue. They wanted these part-time positions to be converted into full-time positions. UPS claimed that it did not want to guarantee full-time positions because of fluctuations in work and wants flexibility for competitive reasons (UPS vs Teamsters). Along with full-time positions and the pension arguments, strikers wanted limits on giving work to subcontractors, and health and safety improvements.
The Great Railroad Strike of 1877 was America’s first nationwide strike. The strike was a result of a 10 percent pay deduction by four of the largest railroads. “Nearly 100,000 workers were idled and approximately two-thirds of the railroad mileage across the Unites States was shut down with over 14 states and ten railroads involved” (AP Study Notes: Rise of Unions). President Hayes eventually sent troops to coral the strikers but they were so unorganized that they eventually stopped and went back to work.
Having analyzed the scoring scheme and weights given to each outcome, I realized that the most important outcome was obtaining a large federal loan from the government. In fact, obtaining a $2 billion loan outcome alone would satisfy the governor’s scoring scheme to support the project. Therefore, before going into the negotiation I realized that this issue would be a pivotal outcome in the negotiation for me. If I succeed in negotiating the right federal loan amount I could be flexible with the other issues in the negotiation but keeping in mind that the higher the score the better the result for the governor. My BATNA was to walk away from the deal where I would still maintain the 30 points in that situation which meant that if the result of the outcome was less than 30 points, I would vote against the deal.
Negotiation is one of the most common approaches used to make decisions and manage disputes. It is also the major building block for many other alternative dispute resolution procedures. According to Christopher W (2012), negotiation is the principal way that people redefine an old relationship that is not working to their satisfaction or establish a new relationship where none existed before. Because negotiation is such a common problem-solving process, it is in everyone 's interest to become familiar with negotiating dynamics and skills. This section is designed to identify what worked well and not well in the negotiation. In addition, to present strategies that generally makes the negotiation more efficient and improvement in the next
The TexasAgs oil company case study gave us insights on different aspects of a negotiation that can happen in real world scenarios. It elegantly portrayed the importance of having a BATNA, setting target and restriction points, impact of the fluctuating markets on the ongoing negotiations, downside of the emotional behavior, importance of having a third party member or mediator in the negotiation. The case illustrates that the negotiations should be based assumptions as they may or may not be right. Having facts and understanding the other parties true objectives and goals are truly essential in negotiation. It is a typical example of how the current power on one side can dominate and take complete advantage of their position.
Getting to YES, Negotiating Agreement Without Giving In is an excellent book that discusses the best methods of negotiation. The book is divided into three sections that include defining the problem, the method to solve it, and possible scenarios that may arise when using these methods. Each section is broken down into a series of chapters that is simple to navigate and outlines each of the ideas in a way that is easy for any reader to comprehend. There are also several real life explanations for each issue that make the concepts easier to apply and understand. These ideas are reflective of a method developed by the Harvard Negotiation Project called “principled negotiation”. This method combines the two ideas of soft and hard negotiation
Whether or not we are aware of it, each of us is faced with an abundance of conflict each and every day. From the division of chores within a household, to asking one's boss for a raise, we've all learned the basic skills of negotiation. A national bestseller, Getting to Yes, introduces the method of principled negotiation, a form of alternative dispute resolutions as opposed to the common method of positional bargaining. Within the book, four basic elements of principled negotiation are stressed; separate the people from the problem, focus on interests instead of positions, invest options for mutual gain, and insist on using objective criteria. Following this section of the book are suggestions for problems that may occur and finally a
Whether it is at work, church or in our private relationships, negotiations are a necessary tool for reaching an agreement. They are made by discussing each parties point of view with the aim being to reach an agreement that is mutually beneficial. For the most part, negotiation is the process by which those people involved successfully adopt or abandon their respective position through the use of positional bargaining. There are different types of approaches for the negotiation process - some hard and others soft in their manner of approach. The desired outcome of
A ruthless, aggressive and cold blooded negotiation style is the framework approach most people have when it comes to negotiation,[6] a theoretical example of that is Adversarial Approach Style Negotiation.[6] But in reality, as mentioned by experts and researchers such as Fisher and Ury [3] it doesn’t have to be that way. As the world moves to more sophisticated platforms of communication, negotiation follows the trend and Problem-Solving Approach(citation) is in a way, the “antidote" of Adversarial Approach Style Negotiation. Getting to YES[3] suggest an Interest-Based Model for the use of Problem-Solving Approach. Interest-Based Model focus on separating the person (positional) from the problems (resolution) and then concentrate on the resolution. This way allowing for both parties in a distributive way to get the results they both want.