Paddy Moore, Hal Movius and Lawrence SusskindSix-person, four-issue negotiation between three representatives of an industrial manufacturer and three representatives of its primary client over restructuring of an existing purchase agreement
SCENARIO: Three years ago Flagship Airways signed a ten-year, $1 billion contract with Eureka Aircraft Engines. Since then, things have changed for both Flagship and Eureka. Flagship’s revenues have steadily decreased and they are now reluctant to put forth $1 billion to expand. Meanwhile, Eureka’s development of its “revolutionary” engine has not proved as efficient as Eureka had hoped. Today, at Flagship’s request, the two companies are meeting to discuss how to restructure the agreement. This is not an unprecedented procedure. The two companies have met in the past to restructure deals when circumstances have changed significantly for either party. In their negotiation, there is a great deal of data to be managed by both parties. There is also a longstanding relationship between the two lead negotiators for each side. Each must decide how to secure the best deal for his/her respective company, while maintaining their relationship. Each must also build trust within his/her team to make sure that the terms agreed upon are acceptable to all.
- To insure relationships that promote quality within the organization, both long-term and short-term interests must be balanced very thoroughly.
- This exercise demonstrates the dependency of successful internal negotiations on successful external negotiations. Thorough preparation is absolutely critical in this negotiation.
- Don’t jeopardize long-term relationships by pushing too hard for short-term gains.
- Effective cross-cultural negotiation depends upon making sure what you are saying is what is being heard and that you are hearing what is said. Clear communication is critical.
- Common Measures
- BMP Policy
Flagship Airways Attributes
- Time required:
- 1-2 hours
- Number of participants:
- Teams involved:
- Agent present:
- Neutral third party present:
- Teaching notes available:
- Non-English version available:
- Portuguese, German
PON Teaching Negotiation Resource Center
Soft copy vs. hard copy
You may order this role simulation in either soft copy (electronic) or hard copy (paper) format. If you select the soft copy option, you will receive an e-mail with a URL (website address) from which you may download an electronic file in Adobe Acrobat PDF format. You will have one week to download your materials from when you receive the email. You are then only authorized to use, print, or share the materials as many times as the number of copies you purchase. The TNRC charges for use of this simulation on a per-participant basis. Therefore, you must purchase a separate copy of this simulation for each person who will be participating, regardless of the number of roles in the simulation. You will only receive a link to one electronic file, which includes all general instructions, confidential instructions, and any teaching notes for the simulation. You should separate out the instructions before distributing to participants.
If you select the hard copy option, you will receive paper copies of this role simulation via the shipping method you select.
For additional information about the soft copy option, please visit our FAQ section, or contact the PON Teaching Negotiation Resource Center at firstname.lastname@example.org or 800-258-4406 (within the U.S.) or 301-528-2676 (outside the U.S.).
Please note: At the present time, Teaching Negotiation Resource Center soft copies are compatible with the following versions of the Adobe Acrobat Reader: English, German, French, Spanish, Swedish, Portuguese, Japanese, and Korean. If you have a different version of the Acrobat Reader, you may wish to download one of these at http://www.adobe.com/products/acrobat/readstep2.html, or contact the PON Teaching Negotiation Resource Center at email@example.com, 800-258-4406 (within the U.S.), or 301-528-2676 (outside the U.S.) for further assistance. This restriction does not apply to the freely available Teacher’s Package Review Copies.
Ordering a single copy for review
If you wish to review the materials for a particular role simulation to decide whether you’d like to use it, a PDF, or soft copy, version of the Teacher’s Package for the simulation is available as a free download from the description page of most role simulations and case studies. All Teacher’s Packages include copies of all participant materials. In addition, some Teacher’s Packages (but not all) include additional teaching materials such as teaching notes or overhead masters.
Ordering copies for multiple participants
To order multiple copies of a role simulation for use in a course or workshop, simply enter the total number of participants in the box next to “Quantity.” There is no need to calculate how many of each role is required.
If you are ordering hard copies, the Teaching Negotiation Resource Center will calculate the appropriate numbers of each role to provide, based on the total number of participants. For example, if you wish to order a 2-party role simulation for use with a class of 30 students, you would enter “30” in the box next to “Quantity.” You then would receive 15 copies of one role and 15 copies of the other role, for use with your 30 participants. As another example, if you ordered 30 participant copies of a 6-party role simulation, you would receive 5 copies of each role.
In the event that the number of participant copies you order is not evenly divisible by the number of roles in the simulation, you will receive extra copies of one or more roles. Participants receiving the extra roles may partner with other participants playing the same role, thus negotiating as a team. So, for instance, if you ordered 31 copies of a 2-party role simulation, you would receive 15 copies of the first role and 16 copies of the second role. One of the participants playing the second role would partner with another participant playing that same role, and the two would negotiate as a team.