Question description

 

In APA format, review the case listed below and address the questions that follow. The response should be 2-3 pages.

Sometimes, reaching a negotiated agreement is the only way in which the parties can achieve their goals.That was the case in the 1980s when IBM embarked on negotiations with the Mexican government about establishing production plants in Mexico.Before detailed negotiations began, the two sides had to educate each other, in formal and informal discussion, about computer technology and local conditions respectively.The negotiations themselves were conducted both by means of informal discussions and through a process of formal proposals and responses.

At the time of the initial negotiations, IBM’s willingness to contribute resources and technological know-how to the proposed project gave the company great negotiating power.This was matched, however, by the power of the Mexican government whose negotiators were given power to authorize the project- or to turn it down.

The resulting power balance led to protracted and complex negotiations.Numerous actors ranging from individuals, groups and departments, to organizations and groups of organizations, were involved at various times in the negotiations.Both sides also went through constant internal negotiations.

Eventually, however, a final agreement was reached.A wholly owned IBM operation would produce 603,000 PCs over five years, and transfer new technology within six months of it US debut.

Questions:

• Develop an argument to show that in fact an imbalance of negotiating power probably existed between the parties during the negotiations.Identify, the factors accounting for the imbalance.
• Identify strategies that either party could have used to increase its negotiating power in this particular negotiation.