Negotiating Strategy on XYZ Airport Services - Essay Example

 Negotiating Strategy on XYZ Airport Services Introduction To renew the contract for XYZ, the company should negotiate with Airport Authority some ways on how the company will be able to address complaints concerning the long delays in the delivery of luggage in both domestic and international terminal. Given that Airport Authority believes that the problem lies behind the poor management of XYZ workforce, XYZ should prove that the company has poor facilities and is seriously in need of financial assistance in order to replace the old facilities in both domestic and international airport. Role Playing The First Stage of Negotiation is the search for agenda formulation. Under this stage, XYZ should get to know the other party (Airport Authority) by initially setting an appointment. Before making any attempt to establish a wide-range of settlement with the Airport Authority, the top management of XYZ should carefully plan on some strategies that could enable both parties to come up with a win-win situation or conduct negotiations on neutral ground (Guirdham 2002, pp. 400 – 404). Since negotiation process is dynamic by nature, Shell (2001) suggests the need to be careful when choosing the best bargaining style. In line with this, negotiator such as in the case of XYZ company should consider not only the culture but also the personality of the people behind the Airport Authority. For instance: The personality of the people behind the Airport Authority is outgoing. Therefore, it is necessary on the part of XYZ company to satisfy the personality, needs, and wants of the people behind the Airport Authority. Since most of them are outgoing people, XYZ management should invite and treat these people to have lunch or dinner as a group meeting or play golf while discussing the issue involved. This strategy will enable XYZ management to easily win the trust and sympathy of the people behind Airport Authority. Role A: Good morning Mr. X. I am ___ from XYZ company. On behalf of XYZ company, we would like to invite you for a meeting concerning our proposed settlement plan with the Airport Authority. Becoming familiar with the entry phase of negotiation is a crucial factor that determines whether or not the outcome of a given negotiation process can be successful. Right timing is very important in negotiation process. As explained by Zartmann (2002) and Rubin (1989), the process of knowing the phases of negotiation could somehow enable the negotiator to know whether or not it is the right time to begin the pre-negotiation stage, the formal negotiation stage which normally takes place after the preparation stage, and end the bargaining process which is the post negotiation stage. During the pre-negotiation stage, both XYZ and Airport Authority will discuss issues on how to solve the problems related to the services offered by XYZ. During the discussion, XYZ should state their demands and offers before both parties will come into a clear agreement (Guirdham 2002, pp. 400 – 404). To make it easier for XYZ to come-up with sufficient fund to improve its facilities, the company can seek lesser airport tax from the Airport Authority. Role A: Good morning Mr. X. We would like to express our sincere gratitude for accepting our invitation for a meeting. In order to renew our yearly contract with the Airport Authority, we are aware that we need to improve the quality of our services. Company XYZ admits having a limited fund available to improve the facilities and belt breakdown in domestic and international terminal. Since XYZ is in need to renew its contract with the Airport Authority, the company would like to request for airport tax assistance (from the Airport Authority) to enable the company be able to pay back the interest in case the company will need to loan some money from the bank. Through the use of Airport tax assistance, XYZ will be able to gradually fix, improve and upgrade its existing airport facilities in order to avoid causing unnecessary delays on the part of the customers. As soon as the company is able to improve its existing airport facilities, there is a better chance wherein more people would visit the airport. As a result, there is a better opportunity on the part of the Airport Authority to be able to claim more Airport taxes coming from the travelers. According to Saunders (1985), learning the factors that could significantly affect the pre-negotiation stage is important because this stage could enable the XYZ and Airport Authority to develop a common understanding which usually serve as an agreement framework. Normally, it is the agreement framework which has been developed based on the outcome of the pre-negotiation stage is used for the preparation stage before the formal negotiation stage begins. “Negotiation process can be time-consuming and difficult than reaching agreement once the negiotiation has began” (Saunders, 1985, p. 249). Since XYZ has already declared what they wanted from Airport Authority, the top management of Airport Authority should come up with a negotiation plan than can be beneficial to both parties. In line with this, “the other party’s negotiation strategies can help negotiators direct the negotiation process to facilitate the generation of joint gains” (Adair et al. 2004, p. 108). This is the stage of narrowing differences and final bargaining (Guirdham 2002, pp. 400 – 404). Therefore, a compromising agreement with the Airport Authority will enable both parties resolve the problem. Role A: Since Airport Authority do not agree with the proposed plan. XYZ company would like to offer other options such as delay the plan of purchasing or upgrading both domestic and international airport facilities while XYZ concentrates on the promotion of local tourism such as winter sports, races, festivals, and concerts to enable the company raise sufficient funds needed for the upgrading of airport facilities. Since XYZ is made responsible to upgrade and improve its existing airport facilities right away, the company could offer paying 50% of the costs while sponsoring some major events in order to promote tourism. This option will give the company extra exposure to the public. Therefore, both parties will end up with a win-win situation. References Adair, W, Brett, J, Lempereur, A, Okumura, T, Shikhirev, P, Tinsley, C, et al. 2004, ‘Culture and Negotiation Strategies’, Negotiation Journal , vol. 20, no. 1, pp. 87-111. Guirdham, M 2002, Interactive Behaviour at Work, 3rd ed. Prentice-Hall. Rubin, J 1989, ‘Some wise and Mistaken Assumptions about Conflict and Negotiation’, Journal of Social Issues , vol. 45, no. 2, pp. 195-209. Saunders, H 1985, ‘We need a Larger Theory of Negotiation: The Importance of Pre-negotiating Phases’, Negotiation Journal , vol. 1, no. 3, pp. 249-262. Shell, G 2001, ‘Bargaining Styles and Negotiation: The Thomas-Kilmann Conflict Mode Instruments in Negotiation Training’, Negotiation Journal , vol. 17, no. 2, pp. 155-174. Zartmann, I 2002, Regional conflict resolution. In VA Kremenyuk (Ed.), International Negotiation: Analysis, approaches, issues (pp. 348-361). Jossey-Bass, San Francisco. Read More