A Different Perspective

I would like to bring in a slightly different perspective to what has been discussed till now in the forum. A negotiation need not necessarily be just between an employer & an employee, it can be between an organization and a government or an organization and its clients (say in case of a Project based company wherein the conditions of the contract have to be negotiated & agreed upon by both parties) or between an opposition party to a government and an organization also.

One very unique example which instantaneously comes to mind when we think of a negotiation between an organization and a government is the recent episode of Tata Nano in West Bengal. The agreement between Tata Motors and the government of West Bengal to manufacture the world's cheapest car in the state involved much more than subsidies on land and interest paid on bank loans. The government worked out a package -- which included tax paybacks and concessional power -- to match the benefits the plant would have enjoyed in Uttarakhand and Himachal Pradesh, both designated backward areas that attracted central tax concessions. In return Tata Motors pledged to flourish industry stricken West Bengal with employment opportunities and of course further scope of industrialization in the state.

But the interesting thing here was that the major negotiation(around which the entire fate of the project revolved) was not done between “the parties to the contract” but between a “third part” i.e the opposition party of Bengal in this case and the parties to the contract and all this was made possible owing to a phenomenon called Miss Mamata Banerjee better known as “Didi” in Bengal. Didi’s unflinching demand of 600 acres to be returned to the farmers ultimately jeopardized the whole project wherein finally Mr Ratan Tata had to relent & pull out the project of West Bengal and move it to Sanand in Gujarat. “The plight of the Tata’s here can be compared to say an employee who has had his final negotiation with his employer and is all set to join the organization but is not able to join owing to a failed third party negotiation say with a job agency with regards to the amount of money that agency would be charging both to that employee as well as that organization for that employee to finally join the organization”. This was one of those cases wherein an organization of the stature of “Tata Motors” was at the receiving end, at the negotiation table.

I agree to the fact that an individual is free to earn in any legally possible way. But in the above case where the Indian players denied to play international matches for some advertising obligations with certain companies is also not something to be encouraged. As players representing a nation they shouldn’t forget the basic fact that, they are here to entertain and people prefer to see them on the field rather than in some flashy advertisements for some colas. On the other hand it is also harsh on the players where the contracts overlap for the 30 days before and after the competition and I think that can be negotiated with ICC.
In the above case it is also mentioned that the “Indian cricketers refused to signed the agreement” Does that mean all the players refused? The only reason for my curiosity is that not all the players get advertising contracts. How many “Romesh Powars ” we see on TV ads? We only see the “MS dhonis” and “Tendulkars”. So I wonder if the lesser known players declined to sign agreement for peer pressure?
One of my friends in the above posts coined the term “standing out of the crowd” and he also explains this by giving the example of IITs and NITs in comparison to any grade-II college. But we have also witnessed how the same IITs and NITs lost their negotiating power in the recession times.!!!! I agree to the fact that it’s rare for the freshers to negotiate on the salary. But after attaining a certain level of expertise employees get an upper hand in bargaining provided the economy goes through a better phase.
I have a friend who works with a pharmaceutical company and at frequent intervals he converts an interview with some other company and negotiates with his current employer that to continue the service they must pay him an amount greater than or equal to his new achievement. And it has happened twice that his employers retained him. I wonder if an employer should maintain relationship with such employees who have a frequent tendency to leave the job?

Negotiation is a must..

From the case given here it’s evident that bargaining is possible and we see that the Indian players had raised to the occasion then, one of the key reasons for this being the forte of the Indian players and their contribution to bringing laurels to the country. However I agree to disagree with Santhosh in the matter that only highly skilled people can afford to negotiate. Taking the same example as he, In case of premier institutions like IITs and IIMs, it is implicitly assumed that the students will have a lot to contribute and hence they can negotiate. Then why not in the case of other colleges? No one can predict when he/she can come up with an innovative idea. In case of these second tier institutions which are also filled with talent, if individual negotiation is not possible the placement team or the faculty in charge could negotiate representing the future employees and protecting their rights.

Also the BCCI selected the best players from the pool of players. These people were asked to represent the nation and play tournaments. This is the role that the BCCI plays. Depending on the player’s performance, they are offered to be brand ambassadors. The BCCI is not fair in demanding forsaking personal commercial rights. BCCI however may interfere if the players accept offers who are direct competitors to the team sponsors or in some similar cases.

From the class discussions and the cases discussed, I strongly believe that negotiation is the only way out. This is because the application of the IPR is very subjective depending on the role that you play in the organization. A researcher who is funded by an organization to try and come up with innovations and is paid for it whether or not he succeeds is not the same case as a budding IT professional. So in every case a proper negotiation should be done before hand and each of the party should gain from it.

As already pointed in an earlier post, it really matters who is in a position to negotiate. Here some may say that those who have got name and fame can negotiate when it comes to clauses on issues like IPR, some may say that those individuals who possess some critical skills, required by the company, can negotiate on such clauses. And some like me, say that anybody can negotiate on such clauses if they really want to. The consequences may not be favorable. One may not get the job s/he applied for, just because s/he is not willing to sign on the particular clause relating to IPR. Hardships may come their way but they will have right over their own innovation, if ever they succeed in innovating.

Also, many a times it happens that the employment contracts are signed by employees just when they are joining. They don't even get the time to read the whole document and neither do they feel the need of going through the document before signing it. So clauses like IPR are signed by the employees without their knowledge of the existence of such clauses. Many a times even if the employees try to read the contract they are signing on, they find it beyond their comprehension. Instead of consulting anyone else, they simply sign on it. So the question of negotiating over the IPR type clause never arises.

Impartial Bargain

Arguments given by Santhosh and Kaushik are correct in the context mention in their posts.

As the current theme is about open source development, let’s look into the matter from a different perspective. If we take the example of software industry, we can easily justify weather the employee has used physical resources like computer systems, company funds, time from his working hours or not but we can never differentiate and justify weather intellectual resources used by the employee like work experience on a particular technology, domain knowledge, best practices and processes, managerial assistance in job work which might have been essential inputs used in his development work doesn’t belong to his employer. Such resources are provided to the employees during the term of the employment with the organisation and claims for ownership of these resources may not be possible. In such cases, I feel, due credit should also be given to the employer for the same even such terms and conditions are not clearly dictated in the contract. Without using such resources, might be, development of such work would not have been possible.

Can We Learn From Our Heroes?

Dear Participants,

Today we started the new theme "You Are Hired!".  Once again, we are dragged into the issues related to "bargaining" but the context is altogether different as the issues related to our discussion are intellectual property rights (IPR) and trade related property rights (TRPR).

One of the key issues raised in the "Open Source Development" case is the negotiating ability of the software professionals emphasizing on the fact that an employer does not own everything you do by law but only by the contract you may have signed.  How many of us have the negotiating ability to pull off a better deal, without compromising on the professional interests, by critically look into the various clauses and analyze the pros and cons?

In this context, I thought of sharing with you the following interesting episode very much pertaining to our current theme discussion.
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INDIAN PLAYERS REFUSE TO SIGN ICC CONTRACT

Source: http://www.rediff.com/ 19th August 2002.
Indian cricketers on Monday night refused to sign the agreement for the Champions Trophy in Sri Lanka and accused the International Cricket Council of 'boycotting' them.

The players sent a letter to the Board of Control for Cricket in India explaining the reasons for their decision, which said, "We believe by signing the player contract, we are caught totally in the middle."

"On the one hand, we suffer exposure from the ICC/BCCI when they could allege non-compliance with our obligations. On the other hand, we could face exposure from our competitive sponsors who have paid us for the right to exploit our brand and image commercially," the players said in a press release.

"We have been told that unless we sign a document which forces us to relinquish all our intellectual property and personal commercial rights, we would be ineligible to play for our country in tournaments conducted by the International Cricket Council.

"We are put in a peculiar situation where we are not boycotting the ICC run tournaments but the ICC is boycotting us," the players said.

The players also rejected BCCI's proposal to sign the agreement only for the Champions Trophy, after which it promised to take up the matter with ICC.

"The ICC restrictions are overly broad, covering not just the Champions Trophy but thirty days before and after. In the present case, therefore, by simply signing the contract, the ICC could already allege breach," the players said, pointing out that less than one month remained for the start of Champions Trophy.

"We want to play. We are not asking for anything more than that we have been getting. We are just not being allowed to play much against our wishes," they said.
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• Like the case of "non-negotiable offer" from Darrel Hair, What can we learn from our heroes from this episode?
• How do we look at the issues related to Marketing, Advertising, Brand Management, IPR, TRPR, Compensation etc., from the perspectives of Players, BCCI, ICC and other significant stakeholders? 

While trying to analyze the issue kindly keep the following norms in mind.

• There are plenty of materials available in "public domain" in the internet. However, one is expected to use the information wisely without making everybody suffer from information overload. Let me remind you from our FAQs that we, as a batch, value your original meaningful contribution and "copy-pasting from internet" would be treated as plagiarism and dealt with as per the provisions in PGDM Students MoP.
• Secondly, while trying to present the facts and contexts, let us try to be precise without arguing like lawyers. Let us keep in mind that too much of description of facts would confuse the readers.
• Thirdly, do not try to be solely focusing on what you have to say but lend your ears, eyes, brain and even your heart to what others have to say on this issue.  As far as I am concerned, I am going to restrain myself, to the extent possible, from making any comment to allow you act as moderators of each other as a learning community. Build on the analysis of other participants.  Learn from the experience of Dialectic Forum 01 - Non-Negotiable Offer.
• You are required to participate only if the topic interests you. While every participation counts, desparate participation does not! This also means do not wait till the last day to make your contribution. As mentioned in the FAQs, "Ordinarily, each forum will be kept open for a week", but it may be closed anytime before if I think there are sufficient number of contributions covering the signficant issues pertaining to the forum.
• Last but not the least, I have requested participants to display their unique id i.e., Roll number, if not the full name as in the attendance.  But many participants have not conformed with the quest. Kindly go to the settings and change the display name with your roll number. Non-compliance will lead to natural omission of the postings for the purpose of course involvement.

 All the best!

With Regards,
Ganesh

From Kings, Queens, Concubines to Darwin...

Dear Co-Creators,

My comments on the posting by various participants are given below. They are based on chronological order and do not signify anything.  I must confess that there are some hilarious, but insightful and creative, postings. For example, Anup’s posting using Charles Darwin’s Theory of Evolution and Sudeep’s historical / royal touch using the analogy of Kings and Swords of Power etc.,

Shreejit, “its a golden rule for the management (both line and top) to make sure strong dependencies are not created on any single person and at least one more person knows how to take care of critical work.”

My comment: Again an important insight conveying the management principle “No one is indispensable.”  Great! But How do you do that? Any idea? (See Mukul Sachdeva's Posting)

Abhijoy, “Here I recall a definition of Theory of constraints which said “A problem precisely defined until it can be presented as a conflict between two necessary conditions”. In accurate sciences what they do whey they face conflict is to negate one option for the other. But in cases related to employment relations the spotlight is not the word “ALTERNATIVE” but on the word “ACCEPTABLE COMPROMISE”. 

My comment:  More often than not, the question is “compromise at the expense of what?”

Abhijoy, “one senior plant manager of above 20 years experienced said me “Guys the days of employment policies for years and years are over; now you are all machines which depreciates and only the instrument that will rule you are yearly contracts”. What I see is the dawn of non negotiable offers in a large scale.” 

My comment:  True! Many companies are “Distancing” themselves from the liabilities of providing regular employment contracts and moving to “contract for service” by hiring the employees as independent contractors in the pay roll of third party agencies.  For example, Microsoft is a champion of this “Distancing” practice which invited multi million dollar class-action law suites by the employees who were converted from permanent employees of Microsoft having standard employment contract to independent contractors having “contract for service”.

Akash Bansal “Real Life Story”.  My comment:  Good Reflection!

Hemant, “the moral grounds of presenting the employer with a non-negotiable offer can always be debated upon….there can be situations, when the employee is not left with any option, other than to confront the employer head-on and present them with such an offer. From Shreejit's post and the mail Darrel Hair wrote to Doug Cowie, we can say that he was in such a situation…The decision not to allow Hair to officiate any further in any international games would have been extremely humiliating for someone of his stature.” 

My comment:  I completely agree with your statement that ICC’s decision as not to allow Hair to officiate any international games would have been extremely humiliating for a person with stature that of Hair and he had no option other than to confront his employer with  the one-time non-negotiable offer.  However, I also agree with your statement that ex post facto it is to analyze the episode on the moral grounds of presenting such non-negotiable offer.

Soumyo, “"If one bus leaves, other is sure to come by in next 15 minutes. After all one should not run after trains and buses" this is what has been taught to us. As we all saw in the past, the companies used to chase candidates to join (HPS Case First Half) as would have been experienced by many of my classsmates having work-ex.

But come a recession, there is only a single bus to catch for all.”

My comment:  I slightly disagree with the last statement “but come a recession, there is only a single bus to catch for all.”  It cannot be generalized for all.  Some wise, courageous people may decide to walk to the distance too rather than looking for a transport.  I also disagree with your statement “…even in crunch time the company can't let go of its best task people, especially managers.(Hope its a respite for future MBAs)” since the best managers are not always MBAs.  Also there is a quote, no offence meant really, for MBA – Mediocre But Arrogant which may support this argument to some extent.

Partho, “I would be able to make a similar non negotiable offer to my employer at a certain point in time. This bargaining will be based on the following suppositions:- 1. If I feel that the employer is paying me less than the industry standards. 2. If I feel that I am underpaid based on the nature of the job and also the expertise needed for that job.For eg.- If I am in an IT firm and working on a niche tool in a very critical project which needs long hours of services for a considerable amount of time, then I will definitely expect some kind of incentive in addition to my package. 3. If the employer neglects or fails to appreciate the work done by me and thereby mitigating my chances to grow in the organization though fulfilling the salary demands. “

My comment:  The questions for Partho are “What do you mean by industry standards?” and how do you know them?” 

Satyajoyti Roy, “I believe making a non-negotiable offer is very arrogant and impolite. So in my career I will make negotiable offers but not non-negotiable offers.”

My comment:  A principled approach towards negotiation.  It truly illustrates the meaning of your name Satya – Jyoti! In my opinion, a non-negotiable offer is an paradox or even an oxymoron.  If it cannot be negotiated, it is not an offer but a commandment.  (See Sudip’s Views on Non-Negotiable Offer)

Swati, “Here, ICC is in the weaker position amongst the two of them because the bargaining power has shifted in the favour of the employee owing to his expertise and contractual clauses.”

My comment: What Swati? After reading so many posts you think “ICC is in the weaker position”?  Come On.. 

Sudip, “Macroeconomic Factors:….Microeconomic Factors…Notice Period..Competitor paying for the notice period…Rationale for Shorter Notice Period…There is no non-negotiable offer etc.,”

My comment: Sudip Alias Jason, you have asked for comments and feedback on your posting and requested for correction if you had gone wrong.   Good observations and great insights!  I liked the way to Macro / Micro economic factors are analyzed.  A small correction if you wish… The pressure one faces through peers and family when losing a job is usually known as social pressure and not necessarily psychological pressure.

Pratyush, “I would be able to make such a non-negotiable offer to my employer if I become a top executive in the corporate world…. If I were to receive such a onetime non-negotiable offer from my employer I would first take into account the economic conditions of the business world”.

My comment:  I think Pratyush is too obsessed with making a non-negotiable offer, he is unable to, not willing to, understand the context where he receives similar non-negotiable offer from employee. Simply, he does not want put himself in the shoes of the employer in a situation like this. Wake up, Man!

Sweta Parekh has been able to successfully convert the forum discussion into a question answer session. Kudos to you madam!

Mukul Sachdeva, “Organizations always prefer to have more than one person to know about the job and through Knowledge transfer, Shadowing and Training sessions they attempt to create sufficient backup for a key resource…. character certificate and background checks are also a source of power that employer possesses..”

My comment:  Good observations Mukul, especially the relevance of Knowledge Management practices that you have highlighted in this context.  While your posting in general makes sense, we need the wisdom to revisit some statements like, “It is not wrong for employee to be opportunistic…” or “There is definitely no place for emotions in such negotiations” etc.,  If you think, there is no place for emotions in such negotiations, probably we may have to conclude that your Emotional Quotient (EQ) is very low.

Sudeep, “employee was the king…the sword of power…employer…they were the new king…”

My comment:  I liked sudeep’s optimism all through his post.  For example, the way he markets his experience “24 months…” great. Why not “108 weeks or 730 days”?   He has also given a historic / royal touch to his analysis by giving the title of kings to both employers and employees.  But I thought, employer is the king and the employees are queens…not even queens… but concubines… Suddep’s example of Steve Jobs is really worth looking at.

Amit Kar, “He can be forgiven for been straightforward, he can be forgiven for speaking his mind, but can he be forgiven for the non negotiable offer which offended the sanctity of the ever decreasing halo of umpiring profession which many felt brought the game to disrepute…legal platform…moral platform…”

My comment:  Good perspective.  I liked the way you have described the non-negotiable offer… “the demand calculated in numbers to a non numeric entity- Greed, Avarice”  and why you don’t like umpiring “not because it is a thankless job but because you have just one mate with whom you can hang out with i.e. the second umpire for the whole day” Keep it up!

Prabhash, “If you have shown your opportunistic tendency to the employer before then the life of your career in the company would be the life of your indispensability to the company.”

My comment:  I liked the equation very much. But would you tell your ethics professor honestly that If somebody has question marks on ethical or moral ground, my answer is "market doesn't understand ethics and morality”.

Anup, “Bargaining Power: A Charles Darwin Perspective”

My comment:  We should appreciate this out of the box thinking (no kidding) to approach bargaining power through Darwin’s perspective.  When I read Anup’s application of Darwin’s perspective to illustrate bargaining power in individual-organizational relationship, I prayed to Goddess Saraswati, to whom he too offered prayers couple of days back, to help him in the course of life.  For the application so was inappropriate, he remained me of Bernard Shaw’s uncle who did not mention his name in his will. 

G.B. Shaw wrote, “One day the richest and consequently most dogmatic of my uncles came into a restaurant where I was dining, and found himself, much against his will, in conversation with the most questionable of his nephews. By way of making myself agreeable, I spoke of modern thought and Darwin. He said, 'Oh, thats the fellow who wants to make out that we all have tails like monkeys.' I tried to explain that what Darwin had insisted on in this connection was that some monkeys have no tails. But my uncle was as impervious to what Darwin really said as any Neo-Darwinian nowadays. He died impenitent, and did not mention me in his will.”

Anup’s application of Darwin’s principles like Heredity (inheritance), Circumstantial Selection (Natural Selection) of Species, and Evolution is proving that Darwin has been the highly abused human being in the entire human civilization.  For example, his statement that “the employer is able to work hard and put his company in the “wanna – be” list naturally the employers say becomes more effective. Microsoft as we all know is one such elite company which enjoys this position” is the best example.

Soumyo, “employer may at times stand ground and refuse to budge. We see this often where strikes lead to no result and in fact the organization may be ready with a new workforce by the time you can be back.”

My comment:  Very pragmatic approach. 

Ashish Sharma, “companies do not consider anything when it comes to their profit, irrespective of external conditions good or bad. “

My comment:  What an insight!

Abhya Mittal, “BCCI’s Offer to Souvrav Ganguly”

My comment:  This requires a separate forum for discussion. Any way, thanks for the example.

Adersh, “I would like to quote the guiding principle of International Labour Organisation. Its guiding principle is that "labour is not a commodity" to be traded in the same way as goods, services or capital, and that human dignity demands equality of treatment and fairness in dealing within the workplace.”

My comment:  Thanks for the quoting ILO’s guiding principle

Avishek Sharma, “Ideally, negotiation results in win-win situation for both the parties. However, most of the times bargaining results in favour of only 1 party.“

My comment:  We would like to disagree sir!

Charlie, “the case where we have labour unions and employee is a part of that. There the stakes are higher for the employer as well as the treatment to the employee can trigger different reactions in the union.”

My comment: Good to see the application of the organized, collective, institutional perspectives for illustrating bargaining power.

Juhi Agarwal, “in the case of nuclear deal, the way India prioritized the givings and takings gives a very nice example of power of bargain as to how we were able to manage the Indo-US relationship and still get our share of bargain.”

My comment: Madam, the analogy of nuclear deal is much more complex than what we have been discussing in the context of bargaining power and non-negotiable offers.

Ruplai, “The Shift in the Balance of Bargaining Power”

My comment: You too Rupali! Along with Sweta Parekh, you have succeeded in converting the forum discussion into a question answer session. Kudos to you madam!

Abhilash, “See-Saw – The Balance Keep Shifting”

My comment: Thank you bringing the class analysis to the discussion Sir. Let also keep in mind that market does not always regulate itself, even if it regulates the regulation is not necessarily efficient and for the betterment of the stakeholders.

Deepak, “Faced with such kind of situation as that of Mr. Hair, I would not have any doubts in rejecting the offer if my employee offers this. But in other scenarios, I would like to bargain till I see that the cost of bargain is more than the replacement of such employee”

My comment: What is the cost of bargain sir?

With Regards,

Ganesh