rate of inflation, and to concede nothing that would raise the
total cost of the package above 8 per cent. There was some debate
within the management team about strategy. One hawk wanted
to pre-empt the union claim by starting with the final offer,
allowing no room for bargaining. He was overruled on the
grounds that this would cause a confrontation and hence long-
term damage to relations with the union. The next question was
how much room for manoeuvre should be allowed between the
opening and closing offer. Some wanted to start as low as
possible, say 3 per cent, so as to close well below the 15 per cent
claim expected from the union. The prevailing view, however,
was that too low an offer would prolong the negotiations unne-
cessarily. It was thought better to start at 5 per cent, so that, if it
had to, the firm could take two steps of 1^1 ⁄ 2 per cent before
reaching its maximum of 8 per cent.
Stage 2: Opening – Negotiators reveal their initial bargaining positions
to their opposite numbers
The union started by stating its case. It wanted a substantial
increase to protect its members from inflation and to restore the
differentials lost over the previous three years. The extras
(reduced working week, etc) were thrown in almost as make-
weights, giving management the clue that there might be scope
for some trading later on.
Management stated that no ‘substantial offer’ could be
expected. It emphasized the poor trading results of the firm and
the fact that, overall, the pay of the union’s members compared
favourably with other workers. The point was also made (it was
to be repeated many times in ensuing meetings) that the firm
could not guarantee that pay increases would match inflation.
Having set out their opening positions and their main arguments
the two parties agreed to adjourn the meeting.
Stage 3: Bargaining – At this stage both parties have the same aims. As
a negotiator you will be trying: (a) to probe the weaknesses in the other
side’s case, and (b) to convince the other side that they must abandon
their position and move closer to your own. You will also be checking to
see if your own position holds good in the light of information received
from your opponents and their reactions to your case. Your original
judgement may be confirmed or you may have to adjust it now. You
may also decide to apply pressure or give concessions now in order to
move towards a satisfactory conclusion.
234 How to be an Even Better Manager