Negotiation and Conflict Resolution

Adam Baxter Company - Local 190 Project Paper

Team: Gratien Davasse, Pratik Jain, Shivam Mehta, Yurika Akashi
Trust and Relationship

In our simulation, trust was just as crucial as economic values to have effective negotiations. We

suffered from distrust and miscommunication but successfully established a trustworthy

relationship at the end by closing a mutually beneficial agreement. The level of trust was

changed through each round and determined by the round’s situational attributes.

In the first round, both Local 190 and ABC maintained a high level of trust. Both of us used an

integrative negotiation approach because we recognized each other’s significance. Our

agreement was fair from our Local 190’s perspective, and we felt respected. ABC agreed with

building the new plant in Deloitte and transferring the employees. Besides, they increased wages

by 50% and allowed employees’ voices into work rules instead of eliminating the incentive

program.

In the second round, the trust level of both parties almost fell to the bottom. Because ABC was

trying to amend the existing contract, we Local 190 sensed duped and became defensive about

shielding our interest, taking a distributive nature. As a result, we initially tried to increase wages

and were reluctant to make concessions. We also felt ABC was lying that the factory was at risk

of bankruptcy to decrease wages. ABC showed their frustration during the negotiation. The

result favored Local 190 with a 4% decrease in wages. During the self-debriefing, we honestly

shared with ABC what was problematic during the negotiation. We apologized that some of our

wording misled the conversation and thought about preventing a future problem with ABC. This

conversation significantly helped us repair our relationship and close a forward-looking deal in

the final round.

Although the situation constituted massive conflicts between both parties, our final round went

smoothly by having integrative approaches on both sides. We overcame the trust and

1
Negotiation and Conflict Resolution
Adam Baxter Company - Local 190 Project Paper
Team: Gratien Davasse, Pratik Jain, Shivam Mehta, Yurika Akashi
communication issue together in the second round and shared the same vision to enable mutual

satisfaction. We also established knowledge-based trust between the parties, which increased

dependence and emotional commitment between the parties. Both parties tried to understand the

other and chose to work together by modifying each RP and AP. As a result, we had a

constructive discussion, reaching the best package.

Team Dynamics

We formed a multicultural team; two from India, one from Japan, and one from France. Each of

these countries has their interpretations of a union’s role. In France, for example, unions are

perceived as very conflictual but safeguard social rights. In Japan, unions exist but have more

peaceful relationships with management, adjusting potential gaps with workers. In India, unions

exist and usually mediate. They have limited power due to political influences. Our different

cultural backgrounds influenced our team, and our attitude varied in every negotiation, reflecting

these differences.

In the first round, we Local 190 were cautious and wanted to preserve our long-term relationship

with ABC as the relationship was old but beneficial. ABC had enough data to make sure we

understood the issue, and one of our counterparties, Lea Didelon, was very data-oriented. It

seemed there was no room for us to negotiate, but her teammates, Clément and Iris, were softer,

making the team balanced.

The second round was more conflictual than the first because of its situational attributes. Except

that it was to negotiate the salary only, the French conflictual mindset stood up (embodied by

Gratien) to defend workers and their fair share of revenues. The time constraint also increased

the tension and made it hard for Local 190 to understand what would happen if we stuck to

increase wages. In the end, not to lose any cent after the time due, ABC rushed to raise wages to

2
Negotiation and Conflict Resolution
Adam Baxter Company - Local 190 Project Paper
Team: Gratien Davasse, Pratik Jain, Shivam Mehta, Yurika Akashi
close a deal. We, Local 190, felt delighted from the French point of view because we protected

workers’ wages, but ABC didn’t.

In the third round, we took a cooperative approach by emphasizing common interests because we

agreed that our team was too offensive in the second round. We opened our negotiation by

stating that we wanted to preserve our long-term relationship and build the future with ABC. It

helped us rebuild trust, which we ruined in the second round. Our multicultural backgrounds also

efficiently combined the assertive negotiation style (mainly embodied by Gratien and Shivam

during the second round) and the accommodating style (Yurika and Pratik). Besides, ABC also

recognized the importance of rebuilding trust and listening to each other as we did. Both parties

were sincere to realize mutual satisfaction.

Power and BATNA

Power and BATNA both play an essential role in negotiation. Usually, people use power instead

of BATNA because they look for an advantage to work with the same people instead of using the

other alternative. Similarly, it happened between Local 190 and ABC in all three rounds of

negotiation. We considered using our power and negotiating effectively to work with each other

instead of using our BATNA.

In the first round, it seemed that ABC had the position power to bring the elegant solution and

force some commitments on Local 190. Simultaneously, Local 190 had the expert power that we

used our expert information for negotiation. For both parties, it would be beneficial to use our

powers instead of BATNA. However, we think ABC had more power in the first round. The

final decisions to close the contract were to be made by ABC. However, Local 190 could only

participate in arguments and convince ABC for their decision making in the new plant location,

incentive program, labor wage, and making a contract. Local 190 had the advantage of expert

3
Negotiation and Conflict Resolution
Adam Baxter Company - Local 190 Project Paper
Team: Gratien Davasse, Pratik Jain, Shivam Mehta, Yurika Akashi
power, as most facts were in favor of workers. But, in the end, both ABC and Local 190 used

their powers wisely, ending with a win-win situation.

Furthermore, in the second round, the main issue was to increase or decrease the wage rate. Here,

Local 190 had more legitimate power as compared to ABC. Moreover, it was difficult for ABC

to overpower Local 190. Using more power gets a no-deal, and even the BATNA is not

advantageous enough rather than compromising the negotiation. So, it was difficult for ABC to

use its positional power because the facts favored workers. For instance, ABC wanted to

decrease the wages but was still profitable without doing so. Thus, Local 190 had this legitimate

power because the issue was only on laborers.

In the third round, both Management and Local 190 had the coercive power to threaten each

other if the conclusion is not on the point. However, we both got an opportunity to present our

data and successfully came to a mutual agreement. The main reason for the growing power on

both sides was that we worked together for a long-term relationship because it would be wise for

us to use our power and conclude instead of using BATNA.

Video Analysis; Trust and Power

The trust level constantly shifted and was fluid during the entire negotiation, both in real life and

in simulation. In our simulation, we struggled but maintained trust and reached an agreement in

each round. On the flip side, in the third round of the real-life negotiation, Local P9 could not

keep their trust in Hormel. In the beginning, both parties, Hormel and Local P9, communicated

well to reach an agreement and settled some issues promptly and reasonably at the other’s

expense. However, this collaborative approach disappeared when Hormel tendered their offer for

wages and tried to amend the entire contract with Local P9. As trust shattered, it was difficult to

4
Negotiation and Conflict Resolution
Adam Baxter Company - Local 190 Project Paper
Team: Gratien Davasse, Pratik Jain, Shivam Mehta, Yurika Akashi
restore it within Local P9, which led to striking in the real-life negotiation. Trust is essential but

expensive because once wholly broken, it's tough to repair.

As far as power is concerned, Local P9/190 had no strong power except going on strike, which

was not favorable. However, Hormel/ABC did possess power as they could even shut down the

plant or employ new workers without any legitimate disputes. In our simulation, we Local 190

took a constructive approach without using too much power to ruin the negotiations, and so did

our counterparty, ABC. On the other hand, in the real-life negotiation, Local P9 appealed to

power by believing that they had much to overpower Hormel. Also, Hormel’s strategic error was

that they displayed too much power in all the rounds and put themselves as an enemy of the

workers, making the workers angry at Hormel.

In the first round, Hormel balanced their position by cutting some profits and locating the new

plant in Austin because they knew that they benefited from Austin’s employees. Local P9 also

presented the mutually beneficial offers to Hormel. In the second round, Hormel had more

control over the wages as they were already granting wages higher than the industry standards,

and the obscurity in words penned in the contract. As the contract was about to finish in the third

round, Hormel had no lawful limitations to hire fresh employees and compensate them as per

their desire. Local P9 never grasped that they had no influence over anything and got carried

away by emotions and dreams given by Ray Rogers, which were outrageous and objectionable.

Breaking relationships with International Union Federation and overtly shaming Hormel to harm

their reputation and finances never worked in Local P9’s favor. They made the pact worse for the

union adherents as the strike continued for seven months. If Local P9 hadn’t broken the

relationship with International Union, they would have saved many humiliation and job losses

for the union members.