Over the past two decades, there has been a rise in the number of issues facing firms in different economic sectors. According to Gitman and McDaniel (2008, p.34), changes in the external and internal business environments affect the ability of businesses to achieve their objectives.
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Human resource managers face diverse challenges in an effort to deal with changes emanating from the external business environments. This arises from the fact that they do not have control over external business environment. However, human resource managers can be able to control issues emanating from the internal business environment.
Firms’ management teams attain this through formulation and implementation of effective human resource management practices. Some of the human resource management practices that organizations implement relate to development of an environment conducive for working.
There are numerous ways through which an organization can attain this. One of these ways entails ensuring fair compensation to the employees. According to Durai (n.d, p.538), organizations must avoid any form unfair labor practices.
Examples of such practices include unfair dismissals of labor union members and unfair employees’ disciplinary actions. Additionally, organizations management teams should not also undermine the employees’ collective bargaining rights.
There has been an increment in the number of labor disputes that organizations experience over the past few decades. Considering the fact that human capital is one of the most important organizational assets, it is paramount for management teams to ensure that disputes are effectively resolved. One of the ways through which organizations can achieve this is through negotiation.
Spoelstra and Pienaar (1999, p.3) define negotiation as the process through which different parties interact with the objective of reaching an agreement or resolving a conflict. Lewicki, Saunders and Minton (1999), assert that there are different strategies that organizations can use to resolve conflicts. Lewicki, Saunders and Minton (1999) further assert that conflicts within can be beneficial if they are resolved effectively.
Spoelstra and Pienaar (1999, p.3) assert that negotiation entails exchange of information. There are four main characteristics of negotiation. These include a common interest, conflicting interest, compromise and a common standard for the agreement to hold.
In an effort to develop a comprehensive understanding of the concept of negotiation as a human resource management strategy, the researcher considered evaluating the concept with regard to its application by Verizon Wireless.
Current issue at Verizon Wireless Company
Verizon Wireless is one of the largest telecommunication companies in the United States. The firm is the leader in provision of wireless services. Currently, Verizon Wireless is facing a labor dispute. Approximately 45,000 of the firm’s employees who work at the firm’s wire lines division who are represented by the union are considering striking.
Some of the unions that represent the firm’s employees include International Brotherhood Electrical Workers (IBEW) and Communications Workers of America (CWA). One of the issues that these unions are advocating for relate to an increment in the hourly wages. Additionally, the unions are also advocating for the betterment of Verizon Wireless employee’s pension and health care benefits.
Over the past few years, Verizon Wireless has experienced a significant growth in its performance with regard to profitability. For example, over the past four years, Verizon Wireless profit has increased to $19.1 billion. As a result, the firm has continuously increased the financial benefits received by the firm’s top executives in terms of annual salary increments and bonuses.
Employees within the lower employment levels in Verizon Wireless are not treated the same with the top level employees despite the fact that the fact that they are the ones who undertake most of the operational tasks that contributes to the firm’s profitability. Durai (n.d, p. 538) asserts that organizations should ensure that the unionized employees receive fair salaries and wage increment and other career development opportunities.
However, Verizon Wireless remuneration to lower level employees has not been fair. Additionally, Verizon Wireless fires employees unfairly (Campbell, 2011, para. 5). For example, Verizon Wireless fires employees who join the workers union. The firm also conducts captive audience meetings in an effort to discourage employees from joining the employees union.
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In an effort to diminish the powers of the employees unions, Verizon Wireless is considering influencing employees who are not union members to remain un-unionized. To achieve this, Verizon Wireless is discouraging its employees from signing Union Cards.
According to Durai (n.d, p.538), organization management teams should not engage in unfair staffing process in an effort to discourage its employees from becoming members of the employees union.
Additionally, organization’s management teams should also avoid preventing its employees from forming an employee union unfairly. However, in the case of Verizon Wireless Company, it is the firm’s objective to destroy the union. The poor payment to the firm’s employees has made their living standards to deteriorate. This indicates a high level of unfair treatment to the employees.
Kochan and Lipsky (2003, p.15) asserts that the process of negotiation is made up of four main sub-processes which include distributive bargaining, integrative bargaining, intra-organizational bargaining and attitudinal structuring.
Distributive bargaining tactic
According to Kochan and Lipsky (2003, p.15), distributive bargaining entails a negotiation strategy whereby the parties involved are in a conflict. The initial stage of the negotiation process is characterized by a gap between the conflicting parties.
Kochan and Lipsky (2003, p.16) further assert that the bargainers have a particular target and resistance point in their mind. These points affect their offers and counteroffers. The target point represents the most-favorable goal for each stakeholder. On the other hand, the resistant point depicts the least desirable outcome.
According to Lewicki, Saunders and Minton (1999), distributive bargaining as a negotiation process is most appropriate when one of the negotiators’ interests is expressly opposed. During the bargaining process, the parties involved struggle to establish a compromise. According to Kochan and Lipsky (2003, p.16), existence of a huge gap between the two points leads into an impasse.
This impasse is likely to be manifested by a strike during the negotiations. For example, in the case of Verizon Wireless, the strike by the firm’s employees is an indication of an existing gap between the employees’ labor demands and the firm’s top executive desire.
During the negotiations, the union representatives pulled out of the negotiations since the firm’s management team was not willing to give the employees their desires despite making it known to the management team.
According to the union representatives, the firm’s management took a hard-line position hence limiting the effectiveness of the bargaining process. The union representatives further said that the Verizon Wireless was willing to disregard the collective bargaining process which had been established within the firm for over fifty years.
In such a situation, the union members should consider integrating distributive bargaining. According to the firm’s management team, Verizon Wireless have established a contingency plan whose objective is to ensure minimal disruption in the firm’s operation by the strike.
The plan entails training a sufficient number of retirees and management employees who will take the positions of the union workers who go on strike. This indicates a high level of disregard of the employee’s rights.
Instead of developing a contingency plan, Verizon Wireless and the unions’ representatives should emphasize on developing a positive contract zone. According to Kochan and Lipsky (2003, p.16), establishment of a positive contract zone increases the probability of the parties reaching an agreement. Additionally, there is an increment in the level of motivation with regard to negotiation amongst the parties involved.
By establishing a continuing interdependent relationship between Verizon Wireless management team and the union representatives, there is a high probability that no employee strike would occur. This means that both the employees and firm would not be adversely affected since they are dependent on each other.
This negotiation strategy is also referred to as cooperative negotiation. The process entails negotiating with the objective of achieving a mutual gain. According to Guasco and Robinson (2007, p.66), it is the objective of the parties involved to create a value that will be shared by the two negotiating parties. Integrative bargaining is only successful if the negotiating parties avoid exploitation during the initial stages of the negotiation.
Additionally, the negotiators must accept an anti-competitive premise. One of the ways through which the negotiators can achieve this if they are negotiating for establishment of a shared gain is by developing a mutually satisfying deal. This is referred to as the win-win negotiation (Guasco & Robinson, 2007, p.66).
Integrative negotiation is aimed at developing a situation whereby both negotiators attain what they need. For cooperative negotiation to be successful, a high degree of patience is required. Kochan and Lipsky (2003, p.18) assert that in the event of a mixed-motive situation, the negotiations must identify a trade-off that will contribute towards ensuring that the both parties are better off.
In the case of Verizon Wireless, the employees were motivated to strike because of unfair treatment by the management team in a number of ways. For example, the lower level employees were poorly remunerated while the top level managers were highly remunerated.
Additionally, in their negotiation with the firm’s management teams, the union representatives are also pressuring Verizon Wireless to increase their employees’ pension and health care benefits.
However, Verizon Wireless is not willing to compromise on its reserved profits by increasing the employees’ financial benefits. This is despite the fact that it is the lower level employees who have worked hard to ensure that the firm remains profitable. Verizon Wireless management team should strive to ensure that the lower level employees also benefit from their hard work.
The objective of this strategy is to resolve internal conflicts such as the labor disputes within Verizon Wireless Company. It is aimed at establishing consensus between the employees and the management teams. Kochan and Lipsky (2003, p.18) appreciate the fact that most negotiators do not act in their own individual capacity. However, they act as representatives of a particular group of individuals.
Within organizations, the union representatives are the ones who are mostly involved in the negotiation process. For example, in the case of Verizon Wireless, the employees are interests are advocated by unions which include CWA and IBEW. The representatives have an obligation to report to their constituents.
Due to existence of a large number of individuals, there is a high probability of conflict of interest as a result of diversity in their views. Therefore, there is a high probability of differences amongst the union members.
Prior to the representative engaging in the negotiations, the union should reconcile internally with the members of the group so as to eliminate any differences. This means that there has to be an intra-organizational bargaining which entails undertaking negotiation within the particular teams. The resultant effect is that there is a high probability of the negotiations succeeding.
Organization’s management teams should not only emphasize on distributive and integrative bargaining, however, they should also consider attitudinal restructuring in their negotiation process. According to Lewicki, Saunders and Barry (2010), the negotiators perception of each other affects the outcome of the bargaining process.
The negotiators should develop strategies on how to positively influence each parties approach in an effort to attain their needs. The resultant effect is achievement of a mutual benefit. Attitudinal restructuring in negotiation entails developing trust between the parties. Lewicki, Saunders and Minton (1999), assert that development of trust aid in effective conduction of integrative negotiation.
According to Kochan and Lipsky (2003, p.18), the negotiation process may result into development or a decline in the level of trust between the parties depending on the treatment received.
The union members have developed a negative attitude towards Verizon Wireless. This is due to the unfair treatment that the firm subjects to its employees. This may have adverse effects on future relationship between the firm and its employees.
Context of negotiation
There are a wide range of contexts which compose the negotiation process. One of these contexts relate to relationships. Lewicki, Saunders and Barry (2010) assert that the relationship between the negotiators affect the outcome of the negotiation.
During internal conflicts, the parties involved must assess the effect of negotiation on the future relationship established. In order to manage negotiations, human resource managers promote positive emotions amongst the parties. Organizations should also ensure that they address the issues they are facing with justice and fairness.
The negotiation process is also composed of an audience. The audience may be composed of different parties such the team or the group members. According to Lewicki, Saunders and Barry (2010), the audience in the negotiation puts more pressure to the negotiators to be more tough and unyielding.
As a result, the negotiators usually advocate their audience’s position (Asherman & Asherman, 2001, p.207). In the case of Verizon Wireless, the union representatives have an obligation to advocate for the needs of the firm’s employees.
According to Asherman and Asherman (2001, p.207), there are two main rules that guide negotiators when there is an audience involved. The first rule relates to flexibility whereby the negotiators make proposals and compromises that may seem undesirable to the audience initially.
On the other hand, a win-lose negotiation compels the negotiators to adhere to the audiences’ position which means that they should not concede so easily.
In an effort to fight for their rights, Verizon Wireless employees are using CWA and IBEW to negotiate with the management. Additionally, the employees should also consider incorporating agents in their negotiation process. The agent is required to act in accordance with the needs of the audience. In the event that the agent makes a concession that is not desirable, the principal can withdraw.
Asherman and Asherman (2001, p.207) asserts that using agents in the negotiation process can be advantageous since they are not intensely involved psychologically in the negotiation. In addition, the probability of emotions interfering with the negotiation process is limited since the agents do not have their ego at stake.
On the other hand, multiparty negotiation, entails a large number of parties whereby each party is either concerned with achieving their own ends or a group consensus. Multiparty negotiations are also characterized by formation of coalitions.
The coalitions contribute towards the strengthening of the weaker parties thus enabling them to push for their needs and to block any unacceptable decisions (Harvard Business School Press, 2005, p.59). According to Lewicki, Saunders and Barry (2010), assert that coalitions may be dissolved during the negotiation process.
There are two main forms of coalitions in multiparty negotiation. These include natural coalition and a single-issue coalition. Natural coalition is characterized by one or more allies who have a wide range of universal interests.
For example, in negotiating for their rights, Verizon Wireless employees are represented by two parties which include IBEW and CWA. The objective of the two labor unions is to fight for the employees rights within the telecommunication industry. On the other hand, a single-issue coalition is composed of two of more parties whose interests differ but unite on others.
Negotiation and culture
Culture has a significant effect on the outcome of the negotiation process. According to Brett (2007, p.280), cultural differences exist in the negotiation process. This is due to the fact that the principals and the representatives have different priorities, interests and positions.
These positions are influenced by different factors which emanate from social, economic, and political contexts. Additionally, the negotiators have diverse motives which include individualistic, competitive and cooperative motives.
The parties involved in the negotiation process in the case of Verizon Wireless should have a comprehensive understanding of the existing cultural differences. This will play a vital role in ensuring that the negotiation is successful. For example, in a collectivist culture, negotiators tend to avoid any form of direct conflict or its manifestation.
For example, when Japanese is negotiating with an American and he or she is not comfortable with proposal; the Japanese may say that he will look further into the issue. This may be a tactic of saying no which the American does not understand (Trevino & Nelson, 2011, p. 406).On raising the issue later, the Japanese may be direct and say no.
This may make the American to perceive the negotiation process as being unfair. When resolving conflicts, understanding the culture is also critical since it aids in determining the most effective conflict resolution strategy to use. For example, some cultures prefer mediation as the best method of conflict resolution.
Negotiation and gender
Numerous studies have been conducted to establish the relationship between gender and negotiation. These studies were aimed at establishing whether various demographic characteristics such as age and race affect the outcome of the negotiation process.
This is due to the fact that negotiation is an interpersonal process. According to Moffitt and Bordone (2005, p.136), gender as an individual attribute plays a vital role in the negotiation process.
Moffitt and Bordone (2005, p.136) assert that women are more sensitive and tend to nurture a long term relationship. Therefore, women involved in a negotiation process are more likely to consider the negotiation process as a long term relationship. As a result, they are likely to be more concerned with ensuring that the process is fair.
On the other hand, men are more individualistic. In addition, they regard the negotiation process to be a one time event which does not have any direct consequences with regard to future interactions. Moffitt and Bordone (2005, p.137) are of the opinion that women are less aggressive in that they do not feel that they are entitled to receive the same salary as their male counterparts.
Findings by researchers reveal that women are likely to accept relatively low salaries. They also feel less confident in the negotiation process. On the other hand, men are more offensive which makes them to succeed in the negotiation process.
However, when women are negotiating for others as agents, they tend t o be more effective compared to when they are negotiating for their own demands. In order to reach a consensus with Verizon Wireless management team, the labor union should ensure that both genders are considered in the selection of negotiators.
Individual differences; personality and abilities
According to Griffin and Moorhead (2009, p. 395), personality traits such as authoritarianism, self-esteem, Machiavellianism, tolerance to ambiguity, risk taking, and locus on control affect the negotiation process. Griffin and Moorhead (2009, p.395) assert that the two parties involved in a dispute should ensure that they select the right negotiators.
The success of Verizon Wireless employees in negotiating for their rights is dependent on the effectiveness of selecting negotiators from the union to represent the members. Griffin and Moorhead (2009, p.395) asserts that the selection of a negotiator with the right personality is critical factor in the negotiation process. This arises from the fact that the negotiation process is both personal and interactive.
Managing negotiation difficulties
According to Lewicki, Saunders and Barry (2010), there is a high probability of negotiations failing due to different reasons. In the case of Verizon Wireless, the negotiations stalled as a result of the firm’s management team failure to change its initial proposal regarding the employees’ demands to have a fair employment contract.
This motivated the firm’s employees to resort to strike as an alternative to address their concerns. Lewicki, Saunders and Barry (2010) assert that integrative bargaining may fail in the event of the negotiators failing to establish a mutually beneficial option.
Additionally, negotiations may also fail if one of the parties to the conflict has adopted an integrative negotiation strategy while the other party has adopted a distributive strategy.
Failed negotiations can result into the parties involved incurring significant cost. In order for the negotiation process to be successful, the parties must develop effective strategies aimed at ensuring that an impasse does not occur.
One of the ways through which they can achieve this is by ensuring that there is effective communication amongst the negotiators. In the case of Verizon Wireless, it is important for the firm’s management team and the union representatives to ensure that there is effective communication between the parties.
The strike by Verizon Wireless employees may affect the firm’s profitability. As a result, it is vital for the firm’s management team to incorporate enticing offers. In addition, the negotiators should strive towards developing a common ground. To manage negotiation difficulties, the parties involved must undertake effective preparations prior to the negotiation.
The analysis illustrates the importance of negotiations in resolving conflicts within organizations. In its operation, Verizon Wireless Company is experiencing an internal conflict between its employees and the management team.
The current dispute between the management team of Verizon Wireless and its employees relates to labor issues. The employees union is advocating for better employment terms which the management team is not willing to offer.
In order to resolve this labor dispute through negotiation, there are different negotiation processes that negotiators can adopt. However, the choice of the negotiation process to adopt is dependent on the existing situation. Some of the negotiation processes to consider include distributive bargaining, integrative bargaining, intra-organizational bargaining and attitudinal restructuring.
Additionally, the research also evaluates the diverse contexts which compose the negotiation process. These contexts include the various relationships in the negotiation, agents, audiences, coalitions, and constituents. Additionally, the negotiation process may be composed of multiple parties.
During the negotiation process, the negotiators must also have a comprehensive understanding of the existing cultural differences. Other factors that the negotiators must consider relate to gender, individual differences and abilities. This is due to the fact that these factors influence the outcome of the negotiation.
The research has also appreciated the fact that there are a number of difficulties that can affect the success of the negotiation process. Therefore, to ensure that negotiations do not fail, effective strategies should be implemented. Some of these strategies relate to ensuring effective communication, establishing a common ground and effective planning.
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