The Negotiation Problem

A substantial electronics firm faces considerable difficulties in one of their subassemblies.

The root core of the problem revolved around certain types of fittings and pins that were
becoming bent and distorted by the operation of the machinery. Units which were being
produced were damaged and had to be rejected because of imperfections. These rejected
components were put aside and then re-worked later on in the month.
This duplication of effort resulted in increased costs as workers had to work overtime to meet
their quotas. These extra costs for the extra work performed had not been considered in the
manufacturing budget. The manager of this subassembly line did not want be charged with
these overhead expenses because he felt it was not their responsibility. Likewise, the manager
who was the overseer of the final assembly department also refused to accept the increased
costs to his budget.

Customer I
1. You went to buy tea set. You bought a tea set containing 6 cups from neighborhood
shop where you used to buy goods for last 5 years.
2. Shop owner is known for maintaining high quality. When you purchased the tea set
you just opened the box but did not check each piece. You found a crack on one tea
cup and you noticed this only next day when you about to use the cups.
3.

Evening you went to the shop and asked the shopkeeper to exchange the set. He is
actually a nice guy but that day somehow he was not in good mood and told you that
he will not exchange as it was your duty to check before buying the set.

4. Now you are at the counter negotiating with the shop owner for the exchange
Instructions:
You should blame the shopkeeper for keeping broken pieces
You could even accuse him of cheating
If he is not ready to exchange you threat him that you would inform all your friends that he is
cheating.
Threat him that you are going to file a case

Customer II
1. You went to buy tea set. You bought a tea set containing 6 cups from neighborhood
shop where you used to buy goods for last 5 years.
2. Shop owner is known for maintaining high quality. When you purchased the tea set
you just opened the box but did not check each piece. You found a crack on one tea
cup and you noticed this only next day when you about to use the cups.
3.

Evening you went to the shop and asked the shopkeeper to exchange the set. He is
actually a nice guy but that day somehow he was not in good mood and told you that
he will not exchange as it was your duty to check before buying the set.

4. Now you are at the counter negotiating with the shop owner for the exchange
Instructions:
You should admit that you have not checked and it is you mistake
You should explain to him that you have good relation with him and you intended to continue
it.
If he is not ready to exchange with new set you explain him why it necessary to exchange.

Shop owner
1. You have a provision shop and you are known for maintaining high quality. A
customer purchased the tea set and he comes back the next day and complain
you that he found a crack on one tea cup and he says he noticed this only next
day when he about to use the cups.
2.

Today he asked you to exchange the set. You are a nice guy but that day
somehow you were not in good mood and told the customer that you will not
exchange as it was his duty to check before buying the set.

3. Now you the customer is at the counter negotiating for the exchange.
Instructions:
If the customer blames you then you should blame the customer for not checking
If he accuses you of cheating, you could also accuse him of cheating
If he threats then you also give a threat.
If the customer is reasonable, you also act reasonably.
If the customer makes proper negotiation then you may agree for exchange.

Negotiation Evaluation Criteria

1

Interests

Options

Separate problems from relationship

Be firm on problem solving but soft on people.

Communication

What objective criteria will you use to persuade the other party

Relationship

Best Alternative To A Negotiate Agreement (BATNA)

Legitimacy

Generate options

Alternatives

Separate people from problems

Identifying Common interest & Conflicting Interest

Ready to listen and talk effectively

Commitment

Win-win and reasonable