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Case Study: When Two Leaders on the Senior Team Hate Each Other
- Boris Groysberg
- Katherine Connolly Baden
How should a CEO address friction between his CFO and the sales chief?
In this fictional case, the CEO of a sports apparel manufacturer is faced with an ongoing conflict between two of his top executives. Specifically, the head of sales and the CFO are at each other’s throats and the tension is having a ripple effect on their teams and the rest of the organization. The CEO, who tends to avoid conflict himself, is struggling with how to respond. His options include changing the company compensation scheme to encourage better collaboration, firing the two leaders, getting them each a coach, and doing more team building activities.
The feedback in the 360-degree reviews was supposed to be anonymous. But it was crystal clear who’d made the negative comments in the assessment of one executive.
- BG Boris Groysberg is a professor of business administration in the Organizational Behavior unit at Harvard Business School and a faculty affiliate at the school’s Race, Gender & Equity Initiative. He is the coauthor, with Colleen Ammerman, of Glass Half-Broken: Shattering the Barriers That Still Hold Women Back at Work (Harvard Business Review Press, 2021). bgroysberg
- KB Katherine Connolly Baden is a research associate at Harvard Business School.
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Unlocking Success: The Role of Negotiation Case Studies in Business and International Contexts
- Author Georgie Mclean
- Published 3 March 2024
Negotiation is an integral skill in both personal and professional settings, dictating the success of interactions ranging from everyday decisions to major corporate deals. This article delves into the importance of case studies, providing a structured path to mastering this crucial skill through examples and analyses. We explore how these case studies can improve negotiation skills, the best types of cases to study, and where to find real-life scenarios.
How Will Case Studies Help M e Improve As A Negotiator?
Case studies are not just stories; they are valuable learning tools that provide insights into the dynamics of negotiation processes. They help in understanding both successful strategies and common pitfalls. Through analysis of different negotiation scenarios , such as famous business case study examples, individuals learn to anticipate potential challenges and react appropriately, enhancing their negotiation capabilities significantly.
Case studies often detail the strategies used by negotiators, the outcomes achieved, and the lessons learned. They allow individuals to see the application of theoretical principles in real-world contexts, helping to bridge the gap between knowledge and practice. By studying varied international negotiation scenarios and corporate deals, individuals can broaden their understanding and adaptability, which is crucial for successful negotiations.
What is the Best Type of Negotiation Insight Example to Study?
The best type of insight depends on one’s professional needs and the complexity of the negotiations they face. For students and newcomers to negotiation, starting with basic ones that cover essential principles, such as the example of negotiation between two companies, can be very beneficial. As one advances, more complex scenarios involving multiple parties or high stakes, like those seen in international negotiations or government agreements, can provide deeper insights.
Business case studies often involve a range of elements such as deadlines, legal implications, and high financial stakes. Studying these cases helps in understanding sector-specific nuances and can prepare employees for similar challenges in their fields.
Where Can I Find Real Life Business Negotiation Case Studies?
Real-life cases on negotiation can be found in several places:
- Books and eBooks: There are numerous books dedicated to negotiation techniques that include detailed case studies. Books specifically focusing on negotiation cases for students are also available.
- Training Programs: Organisations like ENS Negotiation and Influencing offer workshops and seminars that include a variety of case studies and real-world scenarios to help professionals understand and improve their negotiation technique.
- Online Platforms: Websites like negotiate.org provide resources and insights into negotiation strategies and also include examples and case studies drawn from real-life business scenarios.
What Makes Case Studies So Crucial for Business Negotiators?
Case studies are critical because they provide a granular view of tactics and decision-making processes in high-stakes business environments. These studies allow negotiators to dissect complex involving large companies, significant financial stakes, or critical strategic outcomes. By understanding the moves and countermoves of seasoned negotiators, learners can develop a robust toolkit of strategies and approaches. Such insights are invaluable for anticipating challenges and crafting nuanced responses that leverage proven tactics, thereby enhancing the negotiator’s ability to manage complex with greater confidence and strategic foresight.
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Home » Case Studies » Negotiating with WalMart Buyers
Negotiating with WalMart Buyers
Walmart buyers are trained to treat their vendors in a variety of ways, depending on where you fit into their plan. This case shares a story of a vendor called Sarah who negotiated a win-win outcome with Walmart.
WalMart, the world’s largest retailer, sold $514.4 billion worth of goods in 2019. With its single-minded focus on “EDLP” (everyday low prices) and the power to make or break; suppliers, a partnership with Walmart is either the Holy Grail or the kiss of death, depending on one’s perspective.
There are numerous media accounts of the corporate monolith riding its suppliers into the ground. But what about those who manage to survive, and thrive, while dealing with the classic hardball negotiator?
In “Sarah Talley and Frey Farms Produce: Negotiating with Walmart” and “Tom Muccio: Negotiating the P&G Relationship with Walmart,” HBS professor Jim Sebenius and Research Associate Ellen Knebel show two very different organisations doing just that. The cases are part of a series that involve hard bargaining situations.
“The concept of win-win bargaining is a good and powerful message,” Sebenius says, “but a lot of our students and executives face negotiation counterparts who aren’t interested in playing by those rules. So what happens when you encounter someone with a great deal of power, like Walmart, who is also the ultimate non-negotiable partner?”
The case details how P&G executive Tom Muccio pioneers a new supplier-retailer partnership between P&G and Walmart. Built on proximity (Muccio relocated to Walmart’s turf in Arkansas) and growing trust (both sides eventually eliminated elaborate legal contracts in favor of Letters of Intent), the new relationship focused on establishing a joint vision and problem-solving process, information sharing, and generally moving away from the “lowest common denominator” pricing issues that had defined their interactions previously. From 1987, when Muccio initiated the changes, to 2003, shortly before his retirement, P&G’s sales to Walmart grew from $350 million to $7.8 billion.
“There are obvious differences between P&G and a much smaller entity like Frey Farms,” Sebenius notes. “Walmart could clearly live without Frey Farms, but it’s pretty hard to live without Tide and Pampers.”
Sarah meets Goliath
Sarah Talley was 19 in 1997, when she first began negotiating with Walmart’s buyers for her family farm’s pumpkins and watermelons. Like Muccio, Talley confronted some of the same hardball price challenges, and like Muccio, she acquired a deep understanding of the Walmart culture while finding “new money” in the supply chain through innovative tactics.
For example, Frey Farms used school busses ($1,500 each) instead of tractors ($12,000 each) as a cheaper and faster way to transport melons to the warehouse.
Talley also was skillful at negotiating a coveted co-management supplier agreement with Walmart, showing how Frey Farms could share the responsibility of managing inventory levels and sales and ultimately save customers money while improving their own margins.
“Two sides in this sort of negotiation will always differ on price,” Sebenius observes. “However, if that conflict is the centerpiece of their interaction, then it’s a bad situation. If they’re trying to develop the customer, the relationship, and sales, the price piece will be one of many points, most of which they’re aligned on.”
Research Associate Knebel points out that while Tom Muccio’s approach to Walmart was pioneering for its time, many other companies have since followed P&G’s lead and enjoyed their own versions of success with the mega-retailer. Getting a ground-level view of how two companies achieved those positive outcomes illustrates the story-within-a-story of implementing corporate change.
“Achieving that is where macro concepts, micro imperatives, and managerial skill really come together,” says Sebenius. And the payoffs—as Muccio and Talley discover—are well worth the effort.
Sarah Talley’s Key Negotiation Principles
- When you have a problem, when there’s something you engage in with Walmart that requires agreement so that it becomes a negotiation, the first advice is to think in partnership terms, really focus on a common goal, for example of getting costs out, and ask questions. Don’t make demands or statements. Rather ask if you can do this better. If the relationship with Walmart is truly a partnership, negotiating to resolve differences should focus on long term mutual partnership gains.
- Don’t spend time griping. Be problem solvers instead. Approach Walmart by saying, “Let’s work together and drive costs down and produce it so much cheaper you don’t have to replace me, because if you work with me I could do it better.”
- Learn from and lobby with people and their partners who have credibility, and with people having problems in the field.
- Don’t ignore small issues or let things fester.
- Try not to let Walmart become more than 20% of your company’s business.
- It’s hard to negotiate with well trained buyers who know that their company could put your company out of business.
- Never go into a meeting without a clear negotiation agenda . Make good use of the buyers’ face time. Leave with answers. Don’t make small talk. Get to the point; their time is valuable. Bring underlying issues to the surface. Attack them head on and find resolution face to face.
- Trying to bluff Walmart buyers is never a good idea. There is usually someone willing to do it cheaper to gain the business. You have to treat the relationship as a marriage. Communication and negotiated compromises are key.
- Don’t take for granted that just because the buyer is young they don’t know what they are talking about or that it will be an easy sell. Most young buyers are very ambitious to move up within the company and can be some of the toughest, most educated buyers you will encounter. Know your product all the way from the production standpoint to the end use. Chances are your buyer does, and will expect you to be even more knowledgeable.
My top 3 favorites are don’t ignore small issues, be a problem solver and hold on to a high percentage of your business. You should always communicate when something comes up instead of letting it fester because it could develop into something big that would have never happened if discussed in the first place. When you develop your own business you should never let someone take over more percentage than you have because then you will lose control over what you started. Never gripe and be a problem solver. Larger companies don’t want to hear complaining they want to see action and larger profits
I have negotiated with Walmart for large and small business and I don’t recall any subjects of the conversations that were valued more or equal to price and their margin protection. Logistics or supply it was still a an unyielding stand of profit. Kroger,Publix, Winn Dixie, would &will negotiate for volume -promotions -discounting. Your article is not specific enough for analysis nor to draw the conclusions you present.
The two cases, one with a large vendor and the other with a small one, both working with Wal-Mart reframes some of the classic views of negotiating in a practical way.
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Team-Building Strategies: Building a Winning Team for Your Organization
Discover how to build a winning team and boost your business negotiation results in this free special report, Team Building Strategies for Your Organization, from Harvard Law School.
Best-In-Class Negotiation Case Studies
Negotiation case studies to help you improve your negotiation training and instruction.
By Lara SanPietro — on August 5th, 2019 / Teaching Negotiation
What’s one of the best ways to teach the art and science of negotiation? Negotiation case studies that spark lively discussion or facilitate self-reflection. Based on real-world examples, these teaching resources are designed to help students envision how to apply what they’ve learned in the classroom and beyond.
The Teaching Negotiation Resource Center (TNRC) at the Program on Negotiation offers negotiation case studies from renowned authors who’ve negotiated trade agreements, aided peace treaties, and handled many other high-stakes deals. By drawing on their own experiences, they’ve crafted negotiation case studies that are authentic, compelling, and enlightening.
Two of the TNRC’s most useful negotiation case studies are Negotiating About Pandas for San Diego Zoo and The Mariyinsky Palace Negotiations .
Featured Negotiation Case Studies
Negotiating about pandas for san diego zoo.
How do you negotiate from a position of relative weakness? It’s a question that plagues negotiation students and professionals alike. This case tackles the issue head-on with a negotiation between the executive director of an American zoo and China, the only country in the world that has giant pandas.
If that’s not challenging enough, the case becomes more complex when the China Wildlife Conservation Association, the US Fish and Wildlife Service, and nongovernmental (NGO) conservation groups get involved. Based on actual negotiations, this three-part case offers lessons for business, law and government students as well as professionals. By working on this case, participants can learn to:
- Pay attention to the “big picture” and the creation of frameworks (formulas) that structure a transaction or relationship between parties
- Identify different sources of bargaining power and BATNA (Best Alternative To a Negotiated Agreement)
- Handle uncomfortable topics or tasks in creative, tactful ways that are sensitive to the parties’ relationship
- Respond effectively to extreme demands from a counterpart
- Consider when (if, how) to incorporate cultural factors in plans for negotiation
The Mariyinsky Palace Negotiations
A factual case study based on the disputed 2004 Ukrainian presidential election, The Mariyinsky Palace Negotiations: Maintaining Peace Throughout the Ukraine’s Orange Revolution offers a rich illustration of complex multiparty negotiation dynamics.
This case study, which is based on extensive research and interviews with key observers, offers an account of the factors that contributed to the contested first runoff election, unprecedented second runoff election, and victory for opposition candidate Viktor Yushchenko. An advanced teaching tool, Mariyinsky Palace Negotiations features a comprehensive exploration of:
- Sophisticated negotiation techniques
- Coalitional and other multi-party dynamics
- The pressure of constituencies and the role of third-party facilitators
- The influence of external events on the negotiations
Take your Training to the Next Level with the TNRC
The Teaching Negotiation Resource Center offers a wide range of effective teaching materials, including
- Over 200 role-play simulations
- Critical negotiation case studies
- Enlightening periodicals
- More than 30 videos
- 100-plus books
Most TNRC materials are designed for educational purposes— for use in college classrooms or corporate training settings. TNRC cases and exercises help mediators and facilitators introduce their clients to a processor issue and help individuals who want to enhance their negotiation skills and knowledge .
Negotiation case studies introduce participants to new negotiation and dispute resolution tools, techniques and strategies. Videos are also a helpful way of introducing viewers to key concepts, and TNRC books , role-play simulations , and periodicals address the theory and practice of negotiation and conflict management.
Check out all that the TNRC has in store >>
Originally published in 2014.
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Preparing for negotiation.
Understanding how to arrange the meeting space is a key aspect of preparing for negotiation. In this video, Professor Guhan Subramanian discusses a real world example of how seating arrangements can influence a negotiator’s success. This discussion was held at the 3 day executive education workshop for senior executives at the Program on Negotiation at Harvard Law School.
Guhan Subramanian is the Professor of Law and Business at the Harvard Law School and Professor of Business Law at the Harvard Business School.
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Negotiation case studies use the power of example to teach negotiation strategies. Looking to past negotiations where students can analyze what approaches the parties took and how effective they were in reaching an agreement, can help students gain new insights into negotiation dynamics.
With negotiation case studies that spark lively discussion or facilitate self-reflection. Based on real-world examples, these teaching resources are designed to help students envision how to apply what they’ve learned in the classroom and beyond.
In this fictional case, the CEO of a sports apparel manufacturer is faced with an ongoing conflict between two of his top executives. Specifically, the head of sales and the CFO are at each other...
International business negotiation case studies offer insights to business negotiators who face challenges in cross-cultural business negotiation.
The increasing complexity of many negotiating contexts requires negotiators to master both content and skills of negotiations, as well as processes for designing negotiations, preparing parties and facilita-tors for negotiations, and enabling parties to assess the feasibility of a negotiated settlement.
This article offers three types of tailored advice for producing cases on negotiation and related topics (such as mediation and diplomacy) that are primarily intended for classroom discussion: 1) how to decide whether a negotiation related case lead is worth developing; 2) how to choose the perspectiv...
This article delves into the importance of case studies, providing a structured path to mastering this crucial skill through examples and analyses. We explore how these case studies can improve negotiation skills, the best types of cases to study, and where to find real-life scenarios.
Updated: 22 Jul 2024. Negotiating with WalMart Buyers. Summary. Walmart buyers are trained to treat their vendors in a variety of ways, depending on where you fit into their plan. This case shares a story of a vendor called Sarah who negotiated a win-win outcome with Walmart.
New research on negotiation from Harvard Business School faculty on issues including negotiation strategy, style, and tactics.
Negotiation case studies that spark lively discussion or facilitate self-reflection. Based on real-world examples, these teaching resources are designed to help students envision how to apply what they’ve learned in the classroom and beyond.