CONFLICT MANAGEMENT AND NEGOTIATION SKILLS
CASE I: MARUTI UDYOG LIMITED
PART A: Conflict
Case of Labour Unrest at Maruti Udyog Limited.
Introduction of the company
Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation (SMC) of Japan, manufactures cars in the 800cc range. The commercial production started in December, 83. The installed capacity has been gradually increased to 350000 units per annum. During the fiscal year 2007-08, the production was 680,000 units. Maruti has become the largest Asian car company (Outside Japan and Korea). In the first half of 2007-08, Maruti sold more cars in the Indian market than sold by Suzuki in the Japanese market.
Even though there was no real competition and Maruti was the dominant player, it has been regularly introducing new models to meet rapidly changing customer needs. Till now 9 major models, namely Maruti -800, Omni, Gypsy, Alto, Esteem, Swift, Zen, Estilo, SX-4, and Wagon R have been introduced.
Maruti’s contribution as the engine of the growth of the auto industry indeed has its impact on the lifestyle and psyche of an entire generation of Indian middle class. Maruti has been instrumental in laying the foundation for strong vendor base in India. In 2000-01, J D Power, the reputed name in car market surveys, has rated Maruti as the number one car company in customer service. It has noted that this is the first instance anywhere in the world of a market leader topping in customer satisfaction as well. Shortly after that, J D Power’s Quality Survey rated Maruti has maintained the position since then.
Maruti has identified Pre-owned car business, leasing and fleet management, Car insurance and Auto finance as strategic areas of growth.
Source of Conflict
To motivate the workmen for higher productivity, in 1989, management introduced an incentive scheme valid for 4 years and this was modified form time to time in consultation with union. After expiry of the scheme on 31.03.1995, as no common understanding could be reached with union, management introduced a revised scheme through notification on 01.01.1996, effective from 01.04.1995 for 4 years, and was implemented and accepted by the workmen without any dispute.
As the scheme has lapsed on 31.3.1999, management has given a proposal of the revised incentive scheme to be effective from 1.4.1999. When the initial incentive schemes were formulated, the need of the day at that time was higher production. Accordingly, the focus in the earlier schemes was achieving higher productivity. However, in the current
Questions:
1. Do you think that the conflict was resolved in proper manner? Give reasons?
2. If you were the union leader how would you have solved this dispute?
3. Amongst all the incentives schemes from the negotiated settlement which 3 skills are more effective? And why?
CASE STUDY 2: PHARMACEUTICAL INDUSTRY
The pharmaceutical industry has been growing at fast pace with the introduction of new molecule and newer brands of the existing molecule in market. The sale of a company is totally dependant on the prescription of a doctor. To promote their brand every company recruits their representatives, who are required to visit the doctor on a regular basis. A representative has to either take appointment with the doctor for visit or meet him on their convenient timings; this could be in morning, afternoon or evening.
Conflict between the sales representative and his manager on sales territory:
As per the norm of the company, every representative has to meet a specific number of doctors and chemist in a day. This case is of a newly recruited representative Sachin, who Sachin was new to industry Sachin, was recruited due to his good communication skills and his great interest to work for the organization.
Questions:
1. Does role of power play a vital impact in negotiation? Take the base of case and explain?
2. Explain the behavior during negotiation in this case (that is the opening move, negotiation dance & influence mechanism)?
3. What was the main reason for the communication gap in this case? And also explain the classification of conflict?
CASE STUDY 3: RESENTMENT OF LOCAL VILLAGERS TO PRESERVE THEIR INTEREST AND GOVERNMENT’S DRIVE TOWARDS DEVELOPMENT OF THAT AREA BY OPENING AN ENGINEERING COLLEGE
Conflict
It is common to hear of conflicts arising out of rural population getting displaced for development projects. They often charge government of taking over their lands at prices considerably lower then the market price. Though sometimes it is also true that for any future projects Government acquires land and the project may take years to take off. Meanwhile landowners, in most cases the poor farmers, continue to use their sold land as before and being unable to utilize money properly end up in this intervening period getting dependent on the produce from this land which was sold to Government. When the project does start these poor villagers find it as a direct attack on their livelihood. This results into a conflict of interest and for survival as far as villagers are concerned.
Questions:
1. Who was the main reason for this conflict? Government or the rural population? Explain in detail?
2. Was it possible to avoid this conflict? Give reasons to your answers?
3. In this case, explain the different levels of conflict (That is low level, optimum level, high level)?
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