Introduction to Negotiation Strategy
At Oak Spring University, we provide corporate level professional Negotiation Strategy and other business case study solution. Designing Trustworthy Organizations case study is a Harvard Business School (HBR) case study written by Robert F. Hurley, Nicole Gillespie, Donald L. Ferrin, Graham Dietz. The Designing Trustworthy Organizations (referred as “Trust Violations” from here on) case study provides evaluation & decision scenario in field of Leadership & Managing People. It also touches upon business topics such as - negotiation strategy, negotiation framework, .
Negotiation strategy solution for case study Designing Trustworthy Organizations ” 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?
This is an MIT Sloan Management Review article. In the aftermath of the well-publicized frauds of Enron, WorldCom and Tyco circa 2001 and 2002, there were major efforts in the United States to restore trust and enforce corporate compliance. Among other things, the U.S. Congress passed the Sarbanes-Oxley Act of 2002, corporate spending on compliance increased an estimated $6 billion annually and leading business schools created ethics centers and made ethics training mandatory.Yet despite these reform efforts, corporate trust violations continue. In fact, some of the most insidious practices from the Enron era (notably, disguising financial weakness with offbalance-sheet debt) were front and center again during the global financial crisis of 2008. Why do trust failures continue to occur with such frequency, and how can they be reliably prevented? The authors found that building and sustaining organizational trust is different from building and sustaining interpersonal trust, and that major organizational trust violations are almost never the result of "bad apples"or "rogue employees."Rather, these violations are predictable in organizations that allow dysfunctional, conflicting or incongruent elements to take root. Trust betrayals occur, the authors note, when the organization actively caters to a group (or groups) at the expense of and even causing harm to another group. Given the global prevalence of social media, online global forums and 24-hour news cycles, a breach of trust with any one stakeholder group can rapidly undermine an organization's reputation for trust in its broader stakeholder community. Ironically, the authors note, trust failures can act as catalysts for creating a high-trust organization. Much can be learned about how to establish and sustain organizational trustworthiness by examining how organizations successfully restore trust after a major violation. In analyzing cases of companies that have attempted to repair trust, the authors identified three critical stages: investigation, organizational reform and evaluation. Reforms must be evaluated to ensure they are working as intended, and shortfalls must be addressed. Successful trust repair requires taking a systems perspective to accurately diagnose and reform the true faults in the organizational system.
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 “Designing Trustworthy Organizations” 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 “Robert F. Hurley, Nicole Gillespie, Donald L. Ferrin, Graham Dietz”, 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 “Designing Trustworthy Organizations ”, 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 “Designing Trustworthy Organizations” can make for an effective negotiation strategy and will make it easier to negotiate with this party the next time as well.
Robert F. Hurley, Nicole Gillespie, Donald L. Ferrin, Graham Dietz (2018), "Designing Trustworthy Organizations Harvard Business Review Case Study. Published by HBR Publications.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of Designing Trustworthy Organizations
Services , Retail (Department & Discount)
Basic Materials , Misc. Fabricated Products
Consumer Cyclical , Photography
Consumer Cyclical , Apparel/Accessories
Capital Goods , Misc. Capital Goods
Financial , Misc. Financial Services
Services , Real Estate Operations
Healthcare , Biotechnology & Drugs
Consumer/Non-Cyclical , Personal & Household Prods.
Energy , Coal
Healthcare , Biotechnology & Drugs
Technology , Electronic Instr. & Controls