Interactive Negotiation Exercise: Dispute with BMW Over the Repeated Failure of Run-Flat Tires

by: Andrew Hoffman

Publication Date: February 19, 2019
Length: 26 pages
Product ID#: 1-728-781

Core Disciplines: Marketing/Sales, Negotiations

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Teaching Note

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Description

This exercise is based on an actual negotiation that took place in the fall of 2018 between a BMW customer and BMW Customer Relations over the continued and repeated failure of Bridgestone Potenza Run-Flat (RF) original equipment (OE) tires. The exercise provides an in-class experience for students to discuss and learn multiple facets, strategies, and tactics of negotiations. It can be used within any undergraduate or graduate negotiations class or in a course that explores elements of customer service.

In real life, this was a five-week, seven-round negotiation. In this exercise, it is presented as a five-round negotiation with the facts accurate as presented. Students should read the five rounds one at a time and sequentially, with a pause at the end of each round for an instructor-led discussion.

Teaching Objectives

After reading and discussing the material, students should:

  • Analyze the structure of a negotiation including Best Alternative to a Negotiated Agreement (BATNA), reservation price, and target price.
  • Recognize the roles of interests, rights, and power in a negotiation.
  • Assess the role of social media in a negotiation.
  • Evaluate the use of email vs. telephone as a medium for negotiation.