Hormel Company Case Study

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The one of the fundamental errors P-9 made was to fail to understand BATNA in the negotiation table. The consultant and the local P-9 did not consider the best of many options for workers. They just wanted to gain their reservation point by the aid of strike. In this case, P-9’s target point was to recover wages of workers to $10.89 per hour. However, the Hormel Company’s reservation point was to cut wages by 23%. Obviously, P-9’s bottom line was not reality and unachievable to Hormel. Facing this deadlock, P-9 was too tough and refused to make any concessions. According to the situation, P-9 negotiators should attempt to improve their BATNA. However, when they rejected the counterparty’s final offer, which meat they did not identify Hormel …show more content…
The local P-9 sought support of the UFCW international union. Although the UFCW international union was in favor of defending labor rights for Hormel’s workers, they did not agree with the strategy used by strikes of workers. As a result, Hormel did not feel threatened by powerful organization. In addition, P-9 union also used the rights-based negotiation approach. The P-9 union thought that Hormel’s wages cutting plan was unfair because Hormel Company gained bigger profits than before. However, Lewie Anderson, the representative of International Union, pointed out the fact that present the wages standard was higher than other packers in other locations. The P-9 union’s requirement was unreasonable. So, comparing all packers’ wages in Minnesota, Hormel could not accept the local labor union’s offer. Due to the failure of these two approaches, I think they should first use the interests-based approach, and then use the rights-based and power-based approach. That would have been more successful. These workers’ interests were simple; they were to keep working and to get reasonable wages. If P-9 could recognize workers’ needs, the local union should accept Hormel’s final offer. Concessions of both parties could achieve a win-win …show more content…
Firstly, because of their strategy, they gained the Hormel’s concession that was $10 per hour and a contract for three years. This concession encouraged P-9 members to believe that they could achieve success by strike. Secondly, the public opinion had a strong impact on their choices. They had to insist on tactics to get rid of the “traitor” mark. Lastly, Ray was an attractive elocutionist.
The role of the international union had linkage influences on other negotiators who negotiated wage issue with other meat packing companies. First, Lewie supported P-9 to gain their rights, but disagreed with the labor strike. Lewie’s attitude to P-9 must influence other unions’ activities, such as negotiation or strike. On the other hand, both P-9 and the international union rejected Hormel’s final offer. Lewie’s rejection was for the wage negotiation of whole industry. Lewie thought P-9’s wage requirement was too high to be accepted. His first job was to protect workers’ job at the reasonable wage

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