Assignment:
Negotiations Simulation
Part A:(beginning of class). Pre-Negotiation Analysis.
Approximately 7-8 pages (single spaced), summarizing your team's negotiating position and strategy. You will need to be very succinct. Feel free to use bullet points, tables, and appendices. Please note that in the process of completing the requested analysis, below, each team will effectively analyze the strengths and weaknesses of every other team. The paper should address the following four points:
1) Industry analysis. What industry characteristics and trends will influence the development of the industry over the next five years? How are markets growing, and what does this mean for production capacity? How do costs of production compare across countries for finished products and for subassemblies? What is the role of transport costs and tariffs, and what are the economics of serving each market from different locations? What are the implications of these issues for your negotiating strategy?
2) Country analysis. How do the countries vary on relative attractiveness in this industry? Consider market size, political risks, government policy toward trade and FDI. What are the implications of these issues for your negotiating strategy? Keep in mind that the teams representing Tropicalia and Paradiso will be making their own decisions regarding specific policies toward business as the simulation unfolds. (Note that Paradisan firms/governments must also analyze Tropicalia and vice versa).
3) Company analysis. What are the strengths and weaknesses of the MNEs and local companies? What resources does each company bring to the negotiations? What factors might constrain their actions? What strategy will each company likely follow? What are the implications of these issues for your negotiating strategy? (Note that Paradisan firms must analyze Tropicalian firms and vice versa.)