Preparing for the Inevitable Negotiation - Term Paper Example

Negotiating Strategy and Negotiation practice of group Unity 04254 Table of Contents Table of Contents 2 Introduction 3 Literature Review 3 Negotiation Plan and Process 6 Self reflection 8 Reference list 10 Introduction According to Druckman (2001), negotiation can be defined from different aspects. Usually it is the bargaining procedure that occurs between more than one associate. This process helps them in maintaining balance of their unique aims, requirements, and perspective. Negotiation process emerges all of the aspects into a common objective and empowers common agreement for achieving highest possible benefits for all the parties. Negotiation helps the management in mitigating the challenge of organisational conflicts (DuToit, 2004). On the other hand, trading or business operations are signifying negotiation process in order to develop the beneficiary of the parties involved. Mainly, any trading process is including the parties like transferor and transferee. Firms have to maintain proper commitment in terms of maintaining post sales support and delivery products (Crump, 2011). In the current study, the negotiation process will be detailed out for Beaufort, XFM and Unity perspective. It is a Northampton, United Kingdom based high-end shoemaking firm. However, they are facing huge challenge from the shoe producers of Asia. Thus, they selected the strategy of ‘offshore’ production which will be done by XFM, China. This policy will be reducing the production cost as it reduces the UK based high rate workers. This study will be outlining the negotiation process between Beaufort’s management, XFM, and Unity, which is a UK trade union. The negotiation process will be outlining benefits of the UK based shoemaking employee, who are facing higher risk of job cuts for Beaufort’s offshore strategy. Literature Review Druckman (2001) stated that the negotiation process of firms or other trading bodies are using the various strategies and theories for achieving best possible benefits of the involved parties. Mainly, any negotiator can use the negotiation strategies or approaches like structural approach, strategic approach, behavioural approach, processional approach and integrative approach. Organisations are adopting various types of negotiation process in order to increase commercial relationship and employee beneficiary. On the other hand, trade unions will be looking for the welfare of their members. Global firms and trade unions are using negotiation process for managing labour cost. The process also fixes up wage rates, working time and employment contracts. Organisational management can adopt various negotiation strategies for increasing the beneficiary of all the parties involved in the process. Structural Negotiation approach: Dajani (2006) opined that structural approaches of negotiations are delivering outcomes that are more structured in terms of managing the welfare of the involved parties. Organisations are seeking for structural definition of the every negotiation process. Such negotiation process outlines the number of involved persons or groups and the issue of negotiation process. Trade unions and human resources management are using the structural approaches of negotiation. They are analysing the conflict scenarios between employees and other stakeholders who are responsible for achieving organisational goals. Such negotiation process will be helping out involved parties with the potential outcome of the negotiation process. Strategic Negotiation approach Strategic negotiation approaches are using different type of analysis techniques like arithmetic, decision-making theory and logical alternative theory. Negotiators are also justifying potential advantage of process finances, environmental science and conflict issue analysis. Strategic models are developing rational support that is increasing the compatibility of the people by increasing the interactive bargaining of the welfare of employees and other parties in various situations (Goldman and Rojot, 2003). According to Dur, Mateo and Thomas (2011), game theory is one of the major strategic negotiation approaches. Negotiators are using various recognized statistical models in order to explain, advise or forecast performance of involved parties. This will aid negotiator in outlining the benefits of trading or the commercial actions. They are able to outline the consequences of the potential actions that are negotiated. Game theory approach of negotiation impact decision making of the various parties involved in the negotiation process (Grzelczyk, 2009). Negotiators are applying strategic games for contrasting the issues and challenge of potential negotiation. Negotiators are using real life games for increasing the rate of feasibility in the decision making process. The firms are outlining potential conflicts and change management related issues with the help of real life games. Trade unions and human recourse management are using the game theory approach for making collective negotiation. However, such negotiation process has certain limitations like it could provide incomplete information that is constraining the decision making aptitude of the negotiators (Folberg and Golann, 2006). Behavioural Negotiation approach Ibarra et al. (2001) argued that the behavioural negotiation approaches are outlining the impacts of individuality or behavioural traits of the negotiators. Outcome of negotiation process is highly dependent on the behavioural traits of the negotiators and the involved parties. In the international business environment, firms are using behavioural negotiation in order to increase the feasibility of international trading and decision-making. Such negotiation will reduce diplomatic attitude of the parties involved in the process. Jacks (2011) criticised that behavioural negotiation derives different psychological traits of the involved persons. Tentative outcome of the cultural traits in the strategic negotiation will be outlining potential success and limitations. Trade union and organisational management uses such technique in order to reach to optimal solution for implementing change strategies and complex business situation. Off shoring and re-shoring strategies is requiring behavioural trait analysis of the employees and other stakeholders (Kim, Cundiff and Choi, 2014). Concession exchange or Processional Negotiation approach Kolb (2004) referred that concessional negotiation exchange theories are using both features of structural approach and the strategic approach. Organisations HR management and trade unions are negotiating various allowances offered to the employees. This will create more attraction among the employees. Appraisal policy is easy and firms are able to develop sound employee relation and workplace culture (KirylukDryjska, 2013). Integrative Negotiation approach The integrative negotiation approach will develop international relations among the employees. Such negotiation will be concentrating on political presumptions, labour argument and decision-making (Korobkin, 2002). Trade unions and global firms are using such negotiation in terms of developing higher international relations. Civil rights are also maintained in the integrative bargaining process. Negotiation Plan and Process According to Nelken (2007), negotiation process of the study will be including three different parties like HR management of Beaufort and Sons, management of XFM group and representatives of Unity group. Unity is a UK based trade union signifying the comfort level of shoemaking employees of London. Various negotiation process will be outlining situation occurred in the year 2008. During that time, Beauforts and sons decided to close their bigger and old operational location in city centre area. They planned to use ‘offshore’ strategies for the production of the high end shoes. XFM was given the off soaring rights. However, this strategy harmed the UK based employees welfare. Mainly, the strategy resulted Beaufort’s UK workforce cut off highly as there was more than 1000 employees during the year 2008, whereas, it was reduced to 300 only after that the off soaring decision. Huge numbers of employees are facing fear of the job cuts and reduced incomes (Nixon, 2005). Unity group is mainly an UK based trade union, showing interest in making welfare and beneficiary action for the employees. During 2015, Beaufort’s business review outlined that the offshoring strategy have not achieved as much as success as expected. Thus, negotiation process occurred between the above mentioned three parties. Unity group outlined the benefits of ‘coming home’ or ‘re-shoring strategies’ for the Beaufort groups. Mainly, it could have helped the shoe making labours and the organisation itself. The negotiation process followed integrative bargaining strategies for communicating the positive factors to the involved parties. Seven fundamentals are controlling the process of negotiation (Ng, Fang and Skitmore, 2008). Negation process identifies interests of the involved parties, people or other stakeholders, listing out all alternatives and options are allocated along with various operational policies, legitimacy and other governance rules impacts on negotiation process. Moreover, commitments, and communication are another major part of negotiation process. Negotiation process included four different stages in order to convince Beaufort’s Management. Unity will be stating beneficial factors of re shoring and XFM will be favouring the off shoring strategies (Nelken, 2007). First Step: Preparing negotiation strategy Nixon (2005) criticised negotiation process of Beaufort group with different options and benefits in coming home strategies. Unity group outlined the beneficiary of the re-shoring strategies. The negotiation process also outlined the offers of “Northampton Borough Council and Northamptonshire Enterprise Partnership”. Mainly, such offers were influencing the firm to restart the UK based production. On the other hand, XFM will state the benefits of continuing the off-shore production (Korobkin, 2002). Unity group offered different location for restarting or expanding English production. Locations are Wallingford (Oxfordshire) having area of 507 Metre Square (MS) having concessional price of £ 7,200, Gnosall (Staffordshire) area of 868 MS offered £ 6,250 and Broadwas (Worcestershire) pricing £ 4,000. Quality Standards are using EN ISO 13287 and ISO EN 20345:2011. It will reduce the risks of mechanical, slip, thermal and ergonomic traits of organisational members (Miles, 2013). On the other hand, XFM offered the quality standards ISO 09000: 2010 that signifies 7% usage rates. They were offering lower rate of labour cost and lower unemployment rate. They also offered skilled labours having lower rejection rates (Sanin, 2001). Second Step: Exchanging information According to Tracy (2013), negotiation process aims to establish relationship among the different parties involved in it. In the current context, the relationship will be developed between the Beaufort’s Management, Unity and XFM. Firstly, the Beaufort’s Management required information on various aspects like potential rise of labour cost, benefits of relocation and contrast of the offers made and options available from the other two parties involved in the negotiation process (Olszewski, 2008). On the other hand, Unity provided the information of benefits that are obtained through expanding in the UK area. Land rents are offered in a concessional rate. Moreover, trade union also identified three different locations like Wallingford, Gnosall and Broadwas in the UK that are potential expansion area for the organisation. They obtained employees welfare plan of Beaufort in the UK. XFM on the other hand provided information on the benefits of Chinese off shore production. They exchanged information on the quality standards and potential labour rates inflation in China (Taylor, 2005). Third Step: Opening and making concessions Beaufort was running out of loss so they required higher concessional rates in order to meet the challenges of financial crisis. Concessional rates of the resources helped the firm in gaining profitability and success (Wheeler, 2008). Unity group offered concessional rate in the land and area rent for the UK based production extension. Manly, concessional rate was offered in the areas like Staffordshire, Oxfordshire and Worcestershire. On the other hand, XFM offered concessional rates in the wage rate of the skilled labours. Low rejection rate was offered by the shoe production company (Thompson, 2006). Fourth Step: Closing and getting commitment from each of the parties Negotiation leads to an agreement with obligation to ensure proper action. Beaufort contrasted the offers from XFM and Unity group. They selected to continue off shore strategies in order to develop compatibility and growth in the international market of high end shoes. Henceforth, they rejected the offers of Unity group in expanding the set up in the UK area (Wheeler, 2007). Reasons of wining negotiation XFM Group In the concerned negotiation process, Beaufort has selected the XFM group in order to develop operational strategies. XFM group offered them with lower rejection rate less than 3% along with high quality skilled labours in lower rate. In addition, XFM won the negotiation as they were offering the operational set up. Thus, Beaufort and Son enjoy lower capital intensive operations. Third party labours are also demanding no post employment benefits. Therefore, the offers from Unity Group were not sufficient enough to grab the attention of Beaufort’s management (Tracy, 2013). Self reflection Being the member of Unity, a UK based trade union group, I have gained an in depth knowledge on the negotiation approach. I have learned how to use different type of negotiation theory, strategies and polices politically. Being a part of the trade union group, I was concerned for the UK based shoe making employees. In the current negotiation process, Beaufort and Sons are the major company. They are traditional ‘high-end’ shoe producers developing products for both men and women. Negotiation process helped me to gain the knowledge of the market share decline of the company. Beauforts was using the offshore production strategy to XFM that reduced the opportunity of our UK based shoe producing members. They were facing huge problems in making proper income. I observed that Beaufort reduced UK workforce in order to cut their cost. We observed that the number of staff reduced drastically, from 1000 staff in year 2008 it reported with only 300 staffs in the year 2009. I also observed that the residual number of staff were transferred to design and marketing department. They were divided into small groups and engaged in new product development process. However, they were expertise in the production or operational process. Being a part of the trade union, we are really concerned for welfare of the employees. We were trying to negotiate welfare of our UK based members. The negotiation process helped me to work with the huge regulatory bodies like the Northampton Borough Council and the Northamptonshire Enterprise Partnership. Collaboratively, we encouraged Beauforts in expanding their UK based production units. Our main ambition was to develop the local members. We have offered the firm with various concessional rates of various products. Three different land areas are presented to the client for developing their operational or production process. Highway and other transportation factors and structures are developed in terms of creating a linkage between production and sales unit of Beaufort and sons. In the negotiation process, we offered reduced rates to the firm to influence them in retaining local workforce. Mainly, in this negotiation process we were highly emphasising on the re-shoring or coming home strategies. I think that Beaufort’s UK based shoe production will reinforce our members. They can develop their life style with the help of the increased job related opportunity. However, I observed that Beauforts have rejected our offers. They were expecting higher growth of the organisation through off shoring strategies. Although they faced negative publicity issues in UK, they were much more influenced by the capital investment policy. We failed to offer the firm with guarantee of the rejection. We faced disappointment in the negotiation process although it increased my ability of communicating need and gaining insight on economic regeneration of the employees. Reference list Crump, L., 2011. Negotiation Process and Negotiation Context. International Negotiation, 16(2), pp.197-227. Dajani, O., 2006. Preparing for the Inevitable Negotiation. J. Palest. Stud., 35(3), pp.39-45. Druckman, P., 2001. Negotiation and Identity: Implications for Negotiation Theory. International Negotiation, 6(2), pp.281-291. DuToit, A., 2004. New Testament exegesis in theory and practice: the various stages of the exegetical programme: research. Acta. Theol., 24(1). Dur, A., Mateo, G. and Thomas, D., 2011. Negotiation theory and the EU. London: Routledge. Folberg, J. and Golann, D., 2006. Lawyer negotiation. New York, NY: Aspen Publishers. Goldman, A. and Rojot, J., 2003. Negotiation. Hague: Kluwer Law International. Grzelczyk, V. 2009. Six-Party Talks and Negotiation Strategy: When Do We Get There? 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Nelken, M., 2007. Negotiation. Newark, NJ: LexisNexis. Ng, S., Fang, Y. and Skitmore, R., 2008. Negotiation of on-site buffer stocks: A fuzzy non-structural fuzzy decision support system approach. Construction Innovation: Information, Process, Management, 8(3), pp.202-217. Nixon, P., 2005. Negotiation. Singapore: Wiley. Olszewski, W., 2008. Contractility Patterns of Human Leg Lymphatics in Various Stages of Obstructive Lymphedema. Annals of the New York Academy of Sciences, 1131(1), pp.110-118. Sanin, S., 2001. Tempting the Wrath: ``Plan Colombia in the Colombian Peace Process. International Negotiation, 6(3), pp.417-435. Taylor, M., 2005. Negotiation. Oxford, UK: Oxford University Press. Thompson, L., 2006. Negotiation theory and research. New York: Psychology Press. Tracy, B., 2013. Negotiation. New York: American Management Association. Wheeler, M., 2007. Negotiation Journal. Negotiation Journal, 23(4), pp.365-366. Wheeler, M., 2008. Negotiation Journal. 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