Case Studies
Researchers and students asked us for case studies, so we delivered. We hope that you're able to learn from these practical examples from around the world. Check out our negotiation training when you're ready to elevate your negotiation capability.
Issues in Negotiation: How to Solve a Problem
Negotiators can often fail to understand the real underlying issues of a problem. Meaning, these negotiators lack a key insight into what the basis for the negotiation really is. All too often, negotiators don't train themselves to identify and frame the issues in negotiation to resolve. Negotiation skills courses often emphasize that if this crucial first step of the negotiation process is not addressed properly, it's quite likely that the rest of the negotiation process
Case Studies
Negotiating with WalMart Buyers
WalMart, the world's largest retailer, sold $514.4 billion worth of goods in 2019. With its single-minded focus on "EDLP" (everyday low prices) and the power to make or break; suppliers, a partnership with Walmart is either the Holy Grail or the kiss of death, depending on one's perspective. There are numerous media accounts of the corporate monolith riding its suppliers into the ground. But what about those who manage to survive, and thrive, while dealing with the classic
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How Microsoft Outnegotiated Netscape in the Browser War
Microsoft vs. Netscape: Strategies Back in 1996, Steve Case’s AOL was urgently seeking a top-notch internet browser to market AOL's products. Both Bill Gates’ Microsoft and Netscape Navigator were vying with AOL to take them on as a client. In terms of their best alternative (BATNA), Netscape held a decisive advantage due to its strong technical superiority and dominance in the browser market. Microsoft was just in the process of entering the market and held a fledgling
Case Studies
Trust Building in a Trilateral China Japan Western Negotiation
Overview This complex, ongoing negotiation involves three countries, each with players who have their own agenda and preferred outcome. Although at the time of writing the negotiation had yet to become hard-nosed regarding price, delivery, and technology, it shows how relationships develop over time and some of the dynamics at play in this relatively early phase. The Scene Our company (English owned, with regional headquarters in Hong Kong, a joint venture in Japan, and
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Nepal–India Water Negotiations (Power Asymmetry)
Asymmetry of Power Between Nepal and India India is 40 times larger in land area than Nepal, and India was hungry to meet its increasing electrical power needs. Nepal is one of the poorest nations in the world. It's also economically linked to India due to its geographic situation. However, Nepal’s water wealth is enormous. Several studies revealed that 89 sites within Nepal are potentially capable of producing 30 gigawatts (GW) of hydroelectric power to energy-starved
Case Studies
Business Expansion Woven From Trust
Become a part of a foreign society Another example of someone who fitted in completely with the Chinese is the China trader Paul Winestock, who had been dealing with the Chinese since the 1960s. As a trader of textiles in China during the 1960s and 1970s, Winestock built up a large network of customers and friendly officials. One of the latter, who had known him since he was a young man living in drafty provincial hotels with no dining room, was Li Haoran, who had first appointed Winestock
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Camp David Third Party Intervener
There are occasions when negotiating parties cannot see the forest for the trees. They are unable to see past their own goals and interests which prevent them from arriving at a successful negotiated multiparty agreement. These are the instances when a third party intervener can help both parties find a solution to the dilemma that is plaguing their talks that have likely stalled. The Egyptian and Israeli conflict of the mid 1970’s posed that kind of dilemma. There were also
Case Studies
The Cost of Death on Chinese Roads
Overview Mark Rogers is an English expatriate in Beijing, where he is the finance director of the branch of a U.S. multinational. He has been in China for seven years, during most of which he has held a Chinese driving license and driven on Chinese roads. In 2004, he was driving to the famous Shaolin Temple, a few hours south of Beijing. An hour out of Beijing, it started to rain heavily, and on taking a sharp turn in the road in Hebei province, he accidentally drove into two pedestrians,
Case Studies
The Panama Canal Negotiations
The successful construction of the Panama Canal was one of the world's great engineering feats. The negotiations to complete and build this vital connector between two oceans spans decades. The cost in human lives, suffering, and capital staggers the imagination. It all began in 1847 when the United States entered in a treaty with New Granada (later to be know as Colombia), allowing the U.S. a transit passage over the Isthmus of Panama. The treaty guaranteed Panama's neutrality
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Contract Renegotiation with the Chilean Government
Negotiation value In the 1960s, Kennecott (Rio Tinto), a US company, was about to enter into renegotiation over its contract with the government of Chile concerning its El Teniente copper mine. At the time, Chile’s best alternative (BATNA) appeared overwhelmingly strong as the government took a strong pro-sovereignty stance toward foreign management of its natural resources. Can we take some lessons for our mortgage renegotiations? The government of Chile was politically
Case Studies
A Negotiation Case Study: Exploring the Enron Case in India
Case Conditions In the early 1990s, the US energy giant Enron decided it needed to diversify. This meant expanding its growth abroad with emerging countries. In June of 1992, Enron engaged in negotiations with the government of India. Enron had identified the state of Maharashtra to negotiate a major energy project. Maharashtra was the third largest state in India with a population of roughly 79M, containing India’s commercial capital of Mumbai. The Congress Party governed
Case Studies
Scientists and Bureaucrats - Orientation Issues
Overview This case study involves attempts to set up a bilateral scientific research arrangement involving Chinese scientists and Australian government representatives based in the nation’s capital, Canberra. The discussions are ongoing. Three face-to-face meetings between Chinese and Australians have already been held, the first in the United States in 1999 and the subsequent two in Europe in 2001 and 2003. The setting, each time an international scientific conference
Gaming in Shanghai
Overview HyperHawk, one of the world’s major providers of global supply management software and services, helps companies reduce costs through efficient product and services sourcing. At the time of writing, HyperHawk had handled more than $50 billion worth of products and services in the oil and gas, other natural resources, retail, transport, finance, and industrial sectors for customers including General Motors, Nestlé, Shell, Japan Energy, Mitsubishi, and
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Andorra Versus the European Community (EC)
Andorra Versus the EC: Negotiations As a vestige of Charlemagne’s Empire, Andorra is a small land-locked principality snuggled between France and Spain. The President of France and the Bishop of Ugrell of Spain jointly govern Andorra as co-princes. They hold sovereign power over the principality except on issues of economic and social matters. Two parallel agreements ruled Andorra's trade, negotiated between France and Spain. When the EU negotiated to admit Spain into
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How Giving Face in China Translates to Negotiation Success
Overview Rod Zemanek, the principal negotiator, designer and Project Manager of an Australian chemical engineering consultancy, (Predict Pty Ltd) has a warning for those wanting to do business in China: “Many Chinese see it as their patriotic duty to shoot down foreigners, so you can be like a clay pigeon at target practice.” Despite this, Rod Zemanek has been successful in China and is responsible for the design of many of the country’s modern breweries. He was invited
Case Studies
Creative Problem-Solving in Negotiations
Creative Problem-Solving All too often, negotiators can become bound as they commit to taking a competitive approach to their negotiation. As a result, they don't allow themselves to be flexible or to consider a creative approach. Taking a versatile approach with outside-the-box thinking can generate more value from the negotiations. On the other hand, a common error committed by those who believe they are taking the win-win approach to their talks is to overcompensate
Case Studies
Power in Negotiation
Components of Successful Negotiations There are many occasions when a smaller company will want to form a negotiation partnership with a larger organization to further their business objectives. There are two hurdles that the smaller company might have to overcome to succeed in the negotiation process. The first problem is to get the larger organization’s attention, as they may express little or no interest in the partnership. The second problem revolves around the prickly
Case Studies
Kuwait Invasion Negotiation Perspective
On a scorching summer day in August 1990, the citizens of Kuwait stared in puzzlement then fear at the encroaching dusty streams of what appeared to be a pending desert sandstorm. To their dismay and horror filled eyes, the quaking citizenry had become helpless witnesses to the advancing forces of once CIA asset Saddam Hussein's Iraqi army. Kuwaiti resistance was swept aside much like one casually brushes away a crumb from one’s lapel. Kuwait had been drilling laterally into
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Lehman Leadership Negotiation Rivalry
Many people like to believe that the people in charge of the organizations that employ them are always working as a skillful trained negotiation team, united in working towards achieving unified goals and objectives. We like to believe that our management team has our company's best interests at heart. Well, sorry to stick a pin in this balloon, this case study illustrates a contrasting example. Situations such as the one shared in this case study occurs more often than many
Case Studies
Chinese Water Selling Negotiation
Overview Acqua International (AQ) is a Europe-based multinational company that has interests in water and other environment-related businesses. In China, the company has joint ventures with medium-size and large municipalities to produce and sell potable water. To increase its investments in China, the AQ Group arranged, through its local subsidiary Pacific Acqua International (PAQ), to enter into a strategic alliance with Tak Foy and Co., a Chinese conglomerate with
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Resolving Disputes Case Study: Business Mediation Example
Options to Resolve Business Disputes Companies that find themselves embroiled in a bitter feud over a contract dispute have three options to find a solution. They can either: Litigate their claim through the court system Go to arbitration Use a mediation process to resolve the dispute Many companies have invariably used one of these processes to address a dispute. There are significant differences to consider before deciding upon which method to employ. Arbitration and
Case Studies
How NOT to Negotiate in China
Overview In 1998 Simon Turner worked for Bassano, a large Australian women's wear company with eighteen retail outlets across Australia. The following story recounts his experience in a business negotiation in Beijing with Happy Clothing. Bassano required a cheaper manufacturer of tailored women's wear and approached Happy Clothing, a tailored menswear manufacturer, to provide this service. Turner and his CEO Brian Thompson travelled to Beijing with a Chinese-Australian
Case Studies
Unequal Indonesian Foreign Negotiations
Usage of power When two parties enter into an unequal negotiation, in terms of the negotiation power they bring to the table, the interests or goals of either party can have a dramatic influence on the positions they adopt in the negotiations. Sometimes this can have the effect of giving the weaker more negotiating power. Usually however, this power disparity is leveraged by the more powerful party for their advantage. The negotiation case study of the U.S. – Indonesian negotiations
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Win-Win Negotiation Case Study
In trying to create win-win negotiation agreements, one of the biggest mistakes made by negotiators who haven't taken negotiation training seminars is to deal with the issues on an issue-by-issue basis. This often results in a breakdown in negotiations. Why? Invariably, conflicting monetary issues arise that result in a showdown between the two sides. Negotiating on an issue-by-issue agenda does not present the opportunity to make concessionary trade-offs between the
Case Studies
The 'Fixed Pie' in Negotiations
Missed opportunities The mythical fixed pie syndrome is one of those bizarre anomalies that still persistently seep stealthily into the minds of the largest corporations. It is not unlike a virulent pestilence that paralyses its host into a rigid mindset, blurring the host’s vision into a fixed stare where its hapless victim can see nothing more than what sits on the negotiation table. Many agreements fail to materialise because of this limited vision. The resulting loss
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Chinese Negotiation Training on Sales Price
Sales Negotiation Overview K. G. Marwin Inc. developed a particular technology in the 1980s, called the Trilliamp Process, that the Chinese government sought to buy and integrate into an ethylene facility in Lanzhou, the capital of Gansu province. Marwin's successful sales negotiation training resulted in a contract with Chinese Government, which in 1985 invited further sales inquiries from U.S. and Japanese manufacturers for production of the machinery. Marwin recommended
Case Studies
Third-Party Agents
The Role of a Third-Party Agent Even as negotiation trainers we often use third-party agents to represent our interests in the negotiation process. We use them as we believe that their expertise as negotiators will better serve our goals and achieve better results. Many agents are paid on a commission basis. As a consequence, they can be very concerned about a negotiated outcome. This is because of what they might derive from the negotiation, whether trained or not. Their influence
Case Studies
The Price of Giving Face in China
Overview Chando, a Chinese shipbuilder, had agreed to change the main engine in a ship it was building for the Danish shipowner Danske. Although this would involve a lot of work and great expense for Chando, it was willing to substitute a low-speed engine for one of medium speed. Prior to this, Jurgen Martens, Danske’s vice-president and technical director, had made a very good impression on the senior Chando people, as had their sales and marketing director. Usually, a shipyard
Case Studies
Competitive Business Conflict Escalation
Healthy Competition Has Its Place Competition is clearly a healthy means to increase sales for any business. It's essential because competition provides a stimulus for a company or organization to prosper and grow. However, does this mean that a company should compete at all costs? The answer, of course, is "no"! There comes a point when excessive competition may cause serious harm when the losses exceed the gains. Sounds like simple common sense, doesn't it? Yet, there are
Case Studies
Negotiation Alliances
Alliance Benefits In multiparty negotiations, the negotiation power, or the position of one negotiating party, can be enhanced or weakened by making alliances. The use of alliances is a powerful technique. By utilizing alliances, any member in a multiparty negotiation can strengthen their own BATNA (Best Alternative to a Negotiated Agreement). Conversely, alliances can weaken the BATNA of an opponent. The main advantage of forming an alliance is that it allows two or more
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Overconfidence in Negotiation
Balanced Confidence Negotiation courses often suggest that business managers need to possess a high level of confidence to succeed. Confidence allows managers to meet the many challenges they face in a fast-paced and evolving business climate. However, there's a hazy line that separates being confident in what we do and becoming overconfident. Overconfidence is a serious mental error that lurks in the background, like a banana peel lying innocently splayed on the sidewalk.
Case Studies
'Chinese Negotiations' 'Guanxi'
How it all starts A well-known, government-owned, five-star hotel in Beijing owns an associated marketing company called High Jewel Marketing. With branches in six cities including the capital, it has both a retail division, which sells jewellery and handicrafts to foreign tourists at high prices, and a wholesale division selling export-quality clothing and high-quality home appliances. One of the marketing company’s senior managers was formerly a high Communist
Case Studies
Distributive Negotiation Settlement
Theory A distributive negotiation will focus on the division of a set amount of resources, largely determined by the aspiration price (the maximum that party 'A' would like to get, constrained by the lowest amount that party 'B' would like to pay), and the reservation price (the lowest amount that party 'A' would be prepared to accept, and the maximum that party 'B' would prepared to pay). Well over 90% of all civil lawsuits in USA are settled out of court, and most are largely resolved
Case Studies
VW's Long-Term Negotiation Thinking pays off in China
Negotiation Overview At the time this case was written, Volkswagen (VW) was the first foreign overseas car-maker in China to have been making a profit in China over the past ten years. It all began in October 1984, when VW skillfully negotiated and then signed a joint venture agreement with China. One of the country’s first major joint venture agreements, it involved several government authorities, including the Ministry of Foreign Trade and Cooperation (MOFTEC, now MoCom),
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Political Impact on Global Negotiations
Negotiators have a general understanding of their own local political environment. They are raised in a business milieu that clearly distinguishes who the key players are, and who has to be pitched about a proposal. They learn the roles that each level of government may bring to the table, and the impact roles bring to bear on negotiations. When negotiators take their proposals abroad and negotiate with a foreign power, negotiators often don't sufficiently realize the impact
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Foreign Currency Contract Agreement Risks
When a negotiator embarks on an negotiating an international agreement with a foreign partner, they have to give serious consideration to which currency is going to be used in their financial transactions. There is a certain amount of risk that a company might have to assume as even veteran skilled negotiators consider whether they are going to issue or receive payments in a foreign denomination. It occasionally happens that between the time when a contract is signed, and when
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Union Constituency Authority Limits
Union negotiators may find that the authority limits they are authorised to observe in a collective bargaining labour negotiation on behalf of their members can be a double edged sword. One tactical advantage in using their constituency authority can include the ability to manipulate public visibility to what is transpiring behind closed doors Another advantage to gain leverage. By raising issues into the public forum, negotiators may be able to manipulate public support
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Japanese Business Communication
The importance of keeping the lines of communication open with your business partners cannot be overemphasized. Both our domestic partnerships and especially our foreign partnerships are premised extensively on the how frequently and on which important issues the partners talk. Lines of communications need to be a two way process, flowing back and forth. Too many international negotiators do not take the time, and dismiss the need to include some frank discussion in how
Case Studies
Success in China - The Celanese Joint Venture
Disclaimer: It is against the The Negotiation Experts' principles to offer its services to the tobacco industry. This Celanese case study has been reproduced for the purposes of study only, and in no way condones the damage tobacco causes. Overview One of the most closely studied Chinese joint ventures is that involving Celanese Corporation of the United States, a producer of value-added industrial chemicals, and China National Tobacco Corporation (CNTC). The venture
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