The first step of any type of negotiation is planning or preparation as outlined by McGraw and Armstrong (Bamberry 2015). Planning involves proper
... [Show More] investigation and analysis of what the CEO, board members, and employees want. It also includes formal structuring of negotiation such as timing and place. Furthermore, planning involves formulating relevant arguments using facts and figures to push certain agendas. By referring to the union’s log of claims we were able to determine the union’s position on various key issues such as occupational health and safety, wages, redundancy, parental leave etc. However, our response to each of the union claims needed to be justified by recent, relevant and accurate information. Our position for each of the claims had to be SMART that is ‘Specific, Measurable, Achievable, Realistic and Timed-framed’ (Rossiter 2013, p.32). We used the BATNA, WATNA and ZOPA tools to establish our position for wages, redundancy severance pay, parental leave and carer’s leave. The first claim outlined by the union team was for a 6% wage increase. In
preparation for negotiation of wages, we as the management team came to a consensus that our BATNA would be 3% increase per year, our WATNA would be 4% increase per year and lastly our ZOPA for wages would be between 2.5% to 3% increase per year. Our estimation for wages was based on research and analysis of the Australian CPI (Consumer Price Index: 2.1%; Reserve Bank of Australia 2015), the productivity of the workplace, the profitability of the company, the industry average wage increase (2.5% to 3%) and lastly our valuation of employees’ skills. However, in a real-life negotiation, both the management and union team would generally conduct their own internal investigation and analysis through conducting surveys and questionnaires as a way of finding out what the main issues concerning their respective members are. A proper investigation and analysis, requires collecting two types of data information that is qualitative and quantitative. Although, we were provided with relevant qualitative information, we did not have quantitative data for this negotiation activity. The relevant quantitative information that was needed for this negotiation activity included the company’s past and present financial report, past and productivity report, and past cost report for wages, redundancy, parental leave and annual leave. By having a sufficient amount of qualitative and quantitative data, we can make proper informed decisions. Ultimately, our goal is to effectively minimise cost. In order to do so you need to be in a position where you can accurately calculate the cost for each of the claims and relate it back to the company’s financial position. To overcome this problem we, as the management team came to a consensus to use Cadbury Australia 2014 recorded profit of $168.1 million, as general guide for estimating a profit figure for ‘the chocolate factory’ which in this case is $100 million (Mitchell 2015). Another problem in preparing the cost calculations was that we had to make very board assumptions, as we did not have the relevant background information for each of the employees such as age, number of year of service, home address, and gender. Basically, all our calculations had to be based on our broad assumptions. In a real-life negotiation all calculations must be based on accurate and relevant data. Furthermore, sufficient time must be spent on planning that is defining the issues, consulting with others, identifying BATNA, WATNA, ZOPA, setting SMART
objective targets and developing supporting arguments using relevant and accurate facts and figures (Lewicki et al. 2011, p.97).
The overtime, shift work, occupational health and safety, compassionate leave, annual leave and Christmas bonus claims outlined by the union, was unanimously agreed upon by the management team..... [Show Less]