The Pacific Oil Company a well-established oil company with an assorted diversified product line including “Vinyl Chloride Monomer (VCM)”. (Lewicki, 2010, p. 583) As one of the pioneer producers of VCM, Pacific Oil cornered the market share for contracting, distributing and selling their niche product, VCM worldwide. One of Pacific’s longtime customers was Reliant Corporation. This partnership was more than a decade old and was strong. However, if Pacific Oil decided to further diversify its product line to include Polyvinyl Chloride (PVC) a VCM derivative, “it would not want to be in the position of supplying a product competitor with the raw materials to manufacture the product line, unless the formula price was extremely …show more content…
(Lewicki, 2010, p. 585) Fontaine and Gaudin did not prepared to negotiate the full contract. They did not anticipate nor prepare to resolve additional issues. Due to their inexperience, Fontaine and Gaudin were not the correct pairing to conduct the renegotiation, as well, they did not have decision making authority. They had to contact senior level management in order to reach a final agreement. This delay extended the negotiation timeline. Adding to the already stressful situation, the prospect of losing Reliant as a consistent client prosed a potential major issue, especially relating to supply as it would be difficult to identify another client to fill the former demand level. Also, Pacific senior leaders delayed their decision to expand into PVC products, over a year. This delay created uncertainty with the forecast for VCM and derivate products, which had a negative marketing impact for one of the top essential products. Also, contributing to the list of weaknesses, Fontaine’s definition of a successful negotiation differed from the corporate office, in that, he linked a successful negotiation outcome to keeping Reliant as a client by extending the current terms of the contract, solely. However, just as important, Fontaine neglected to take into account all the other potential issues or points of
Identify the strengths and weaknesses of Fontaine's and Gaudin's negotiating strategy in their deliberations with Reliant Chemical Company. How effectively did Fontaine and Gaudin approach the negotiation?
The case study on Pacific Oil Company shows from beginning to end the role of power in the outcome of a negotiation. From the beginning, the problem that Pacific Oil Company faced as it reopened negotiations with Reliant Chemical Company was that they did not assert the power necessary to really end up with the outcome of the negotiation they were hoping for. The case study points out several factors that Pacific Oil Company is trying to achieve in the contract negotiations with Reliant Chemical company: the change to a surplus of VCM in the market, the possibility of Pacific Oil needing a supply of their own of VCM to produce their own PVC, and the start-up of several other companies in the production of VCM (Lewiski, n.d.). These
The TexasAgs oil company case study gave us insights on different aspects of a negotiation that can happen in real world scenarios. It elegantly portrayed the importance of having a BATNA, setting target and restriction points, impact of the fluctuating markets on the ongoing negotiations, downside of the emotional behavior, importance of having a third party member or mediator in the negotiation. The case illustrates that the negotiations should be based assumptions as they may or may not be right. Having facts and understanding the other parties true objectives and goals are truly essential in negotiation. It is a typical example of how the current power on one side can dominate and take complete advantage of their position.
In the early 2000’s, Martin Eberhard and Marc Tarpenning worked alongside Elon Musk in order to develop electric vehicles which also provide the expectations of a luxury car. With headquarters in Palo Alto, California, Tesla currently has over six thousand employees and tesla cars on the roads in over thirty-seven countries. The Tesla Motor Company has created a trio lineup of vehicles which include the Model S, the Model X, and the Roadster. As the product architect and CEO of Tesla Motors, Musk implemented his plans to perfection including zero emission cars with the ability to go nearly three hundred miles per charge (National Geographic, 2012). Tesla is also a leader in selling online cars, a tactic they use in order to cut out people’s interaction with salespersons. Tesla’s strategy of direct customer sales and owning its own stores and service centers is a significant departure from the standard dealership model currently dominating the U.S. vehicle marketplace. Tesla Motors is the only automaker that sells cars directly to consumers, with all other automakers using independently owned dealerships. We incorporated the same approach with our new service which provides a test driving option to potential customers. Potential customers now have the option of utilizing our database to search for existing Tesla customers in their area and reaching out to them for a one on one test drive session in order to learn more about Tesla cars. Existing customers willing to
Both organizations would have benefited from a quicker negotiation process. Pacific assumed that there were aspects of the contract that would need to be discussed. However, they did not feel that, other than price there were major changes that needed to be addressed. For that reason, the absence of strategic planning on Pacific’s part aided in the loss of vital time, resources, and money. Many negotiators fail to ask questions during the process, which was a factor in the negotiation and was Pacific’s shortfall. By asking questions it reveals a great deal of information, the ability to uncover all things that may be left disclosed, and getting to a common ground on what everyone understands as the needs (Barry, Lewicki, Saunders, 2016). Pacific should have started stronger in order to have some common ground and planning would have accomplished this. By laying all the issues and perspectives out on the table the organization could have painted a clearer picture and would have speeded up the process. In the long-term the lack of planning caused more frustration and stress on both sides. By drawing out the negotiation process Pacific risked the loss of a large contract and possibly other items that would have been a win for them. By assuming that Reliant would just be compliant and ink a new contract with no issues it further added to the problem at hand.
By 1982, Pacific Oil and Reliant had renegotiated the original contract and extended it another four years with no specific changes to the original contract. During the next four-year period, the demand for VCM steadily increased within the market, meaning that competition would soon develop as new suppliers came into existence, and that would ultimately affect the prices
This essay will explore the extent to which a mature and cyclical product market led to General Motors (GM) restructuring in 2009 following its Chapter 11 bankruptcy protection filing in the United States. It will be debated that market maturity contributed to the company’s restructuring as the increased competition, worsened economy, and product innovation brought up the need for GM to develop a new effective strategy. Although GM enjoyed decades of success as the most important industrial company in the United States, flawed internal structure and lack of focus on the external environment, caused them to fall behind competitors and the realities of market trends. Therefore, when the global economic crisis came in 2008, GM’s
Are the departments working well with each other? This part of the model will discuss if the operation of the company is efficient.
On my first day I was surprised when I was brought to this huge company as an intern. At the beginning I definitely had no ideas what should I do and was a little bit nervous. But after a while when I got what should I do I felt comfortable. The colleagues that I worked with were very nice and helpful.
A claim is commonly regarded as a four-letter word which draws the line in the sand between the contactor and the employer. It is a better strategy to manage claims instead of behaving them in an emotional and inappropriate way which make them to legal actions. Claims are normal issues in oil and gas projects and are considered as rights of parties. We are not allowed to insert a term or provision which deprives parties of this right, entirely. Claim is a right which must be demanded by a party and has to have legal and contractual evidence. Otherwise, it would be a false and unrealistic claim. So, the claim is a written statement by one of the parties relies on the right of he/she demands other party or it is possible that one of the
• Fontaine and Guadin from Pacific Oil want to comply with all the problems recognized by Reliant. They want to maintain the relationship with Reliant knowing that they are the biggest purchaser they have under contract. Hauptmann and Zinnser from Reliant want to make sure that they are not loosing anything in signing the extended contract with Pacific Oil. They want to make sure that they are treated the same as any other purchaser, that they get a fair price when the market declines in VCM and that they get a fair purchasing contract. They are making sure that Pacific Oil really complies to their conditions before they come to an agreement. They are finding any problems that may come up in the near future with the market being so foreseeable. In the long run Reliant will be stuck with the contract and want to make sure they have everything covered under the extended contract.
Esther Henchmen is a PhD student at EASED Business School – Universi dad de Ramon Lull, Barcelona. She has participated in non-governmental organizations including UNICEF, World Bank and Oxfam Intermon. This has led her in expertise about development management and human rights. Dealing with issues such as the involvement of corporations in major environmental disasters such the oil spill that occurred in Niger delta by shell. Her title “Royal Dutch Shell in Nigeria: Where Do Responsibilities End?” explains the problem of fractured responsibility coupled with harm produced by collective action. Her journal focuses on the cause, integrity and reputation of the perpetrators involved in the ongoing Niger Delta oil spill. She discusses the dispute over the corporate social responsibility, malpractices and legal preceding of its operating licensure. Since corporations are artificial persons in the law, it is difficult to isolate perpetrators based on causality in fact it’s not realistic, so they could be sued for failing to meet standard of care.
The Ford Motor Company fell into a trap of greed that resulted in the loss of many human lives. Before the disaster of the Pinto fires, Ford had a reputation as being the safety pioneer in the automobile industry with additions such as the seat belts even raising awareness of their safety. However, as the invention of small cars began to take emerge Ford began to lose market shares to the foreign market causing Ford to construct a small compact to satisfy this emerging market. Ford’s stance on “safety doesn’t sell” resulted in over 400 burn deaths. The cases involving the explosion of Ford Pinto 's due to a defective fuel system design led to the debate of many issues, most centering around the use by Ford of a cost-benefit analysis and the ethics surrounding its decision not to upgrade the fuel system. The issue is should a risk/benefit analysis be used in situations where a defect in design or manufacturing could lead to death or seriously bodily harm, such as in the Ford Pinto situation?
The case introduces two companies with generally different cultures. Symerlane was a large U.S. financial-services company that was running a merger and acquisition strategy. It continued growing by acquiring small companies with bad administration and take over its businesses. Integration after an acquisition usually meant to Symerlane, firing the old management and closing any old back-office, shifting the work to its own facilities. This normally caused the cut of several jobs.
In the global business environment, success of an organization is based on several factors. Namely, the capital required to start and maintain the organization, human resource component, and the influence of stakeholders. Theories and strategies have been developed, and their efficient integration ensures that the company can achieve its organizational goals. However, the interaction of these factors needs a framework based on the operational capability of the organization. Operations management facilitates the transfer of theoretical policies and decisions into tangible products, which an organization can offer to its clients. Without the utilization of operations management, different departments cannot work