Introduction to Negotiation Strategy
At Oak Spring University, we provide corporate level professional Negotiation Strategy and other business case study solution. Ezra Holdings: Entrepreneurship and Capability Building case study is a Harvard Business School (HBR) case study written by Beng Geok Wee, Yvonne Chong. The Ezra Holdings: Entrepreneurship and Capability Building (referred as “Offshore Ezra” from here on) case study provides evaluation & decision scenario in field of Strategy & Execution. It also touches upon business topics such as - negotiation strategy, negotiation framework, Financial analysis, International business, Manufacturing, Strategy.
Negotiation strategy solution for case study Ezra Holdings: Entrepreneurship and Capability Building ” provides a comprehensive framework to analyse all issues at hand and reach a unambiguous negotiated agreement. At Oak Spring University, we provide comprehensive negotiation strategies that have proven their worth both in the academic sphere and corporate world.
What’s my BATNA (Best Alternative To a Negotiated Agreement) – my walkaway option if the deal fails?
What are my most important interests, in ranked order?
What is the other side’s BATNA, and what are his interests?
The case discusses the entrepreneurial paths taken by two men, a father and son team, who created a highly successful business venture in regional marine offshore industry in the first decade of the 21st century. The factors that contributed to venture's rapid growth are examined as well as the challenges they faced in taking their company, Ezra Holdings, to the next level of fast growth. Started in 1992, the entrepreneurs leveraged on their knowledge of the regional oil and gas (O&G) and marine engineering businesses to grow the firm into a global offshore support services company with market capitalisation of US$1.2 billion by the end of January 2010. The firm began as a small company managing and operating supply vessels supporting offshore O&G activities in the region. From managing small vessels, they moved on to build the essential capabilities needed to operate efficient offshore support services for O&G exploration and production projects of major global firms. To drive growth, they embarked on a series of asset acquisitions and joint ventures with other players. In a highly capital-intensive business, they were successful in prospecting for funds needed to secure the operating assets of their business. As they moved up the value chain in their segment of the industry, they also kept a lookout for industry veterans or specialists and technical staff from acquired companies to build their human resource pool. Ezra's decade of rapid growth is examined from several perspectives: a?? Entrepreneurship as the dynamic process of structure and action. a?? Capability building as an essential condition for new venture success as reflected in Ezra's resource acquisition strategies for funds, human capital and technical knowhow.
By interests, we do not mean the preconceived demands or positions that you or the other party may have, but rather the underlying needs, aims, fears, and concerns that shape what you want. Negotiation is more than getting what you want. It is not winning at all cost. Number of times Win-Win is better option that outright winning or getting what you want.
Options are the solutions you generate that could meet your and your counterpart’s interests . Often people come to negotiations with very fixed ideas and things they want to achieve. This strategy leaves unexplored options which might be even better than the one that one party wanted to achieve. So always try to provide as many options as possible during the negotiation process. The best outcome should be out of many options rather than few options.
When soft bargainers meet hard bargainers there is always the danger of soft bargainers ceding more than what is necessary. To avoid this scenario you should always focus on legitimate standards or expectations. Standards are often external and objective measures to assess the fairness such as rules and regulations, financial values & resources , market prices etc. If the negotiated agreement is going beyond the industry norms or established standards of fairness then it is prudent to get out of the negotiation.
Every negotiators going into the negotiations should always work out the “what if” scenario. The negotiating parties in the “Ezra Holdings: Entrepreneurship and Capability Building” has three to four plausible scenarios. The negotiating protagonist needs to have clear idea of – what will happen if the negotiations fail. To put it in the negotiating literature – BATNA - Best Alternative to a Negotiated Agreement. If the negotiated agreement is not better than BATNA then there is no point in accepting the negotiated solution.
One of the biggest problems in implementing the negotiated agreements in corporate world is – the ambiguity in the negotiated agreement. Sometimes the negotiated agreements are not realistic or various parties interpret the outcomes based on their understanding of the situation. It is critical to do negotiations as water tight as possible so that there is less scope for ambiguity.
Many negotiators make the mistake of focusing only on the substance of the negotiation (interests, options, standards, and so on). How you communicate about that substance, however, can make all the difference. The language you use and the way that you build understanding, jointly solve problems, and together determine the process of the negotiation with your counterpart make your negotiation more efficient, yield clear agreements that each party understands, and help you build better relationships.
Another critical factor in the success of your negotiation is how you manage your relationship with your counterpart. According to “Beng Geok Wee, Yvonne Chong”, the protagonist may want to establish a new connection or repair a damaged one; in any case, you want to build a strong working relationship built on mutual respect, well-established trust, and a side-by-side problem- solving approach.
According to
Harvard Business Review
, there are three types of negotiators – Hard Bargainers, Soft Bargainers, and Principled Bargainers.
Hard Bargainers – These people see negotiations as an activity that they need to win. They are less focused less on the real objectives of the negotiations but more on winning. In the “Ezra Holdings: Entrepreneurship and Capability Building ”, do you think a hard bargaining strategy will deliver desired results? Hard bargainers are easy to negotiate with as they often have a very
predictable strategy
Soft Bargainers – These people are focused on relationship rather than hard outcomes of the negotiations. It doesn’t mean they are pushovers. These negotiators often scribe to long term relationship rather than immediate bargain.
Principled Bargainers – As explained in the seven elemental tools of negotiations above, these negotiators are more concern about the standards and norms of fairness. They often have inclusive approach to negotiations and like to work on numerous solutions that can improve the BATNA of both parties.
Open lines of communication between parties in the case study “Ezra Holdings: Entrepreneurship and Capability Building” can make for an effective negotiation strategy and will make it easier to negotiate with this party the next time as well.
Beng Geok Wee, Yvonne Chong (2018), "Ezra Holdings: Entrepreneurship and Capability Building Harvard Business Review Case Study. Published by HBR Publications.
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