INDIANAPOLIS, Ind.— Negotiations training isn’t limited to trial by fire on the job. Kelley School of Business Indianapolis Evening MBA students in Associate Professor Charles Dhanaraj’s international negotiations class recently had the chance to go through a negotiation simulation.
“I used the case in a very different way from my usual case teaching style,” explained Dhanaraj, Schmenner Faculty Fellow and associate professor of management. “I had the student teams work on a pre-negotiation document and had them dress formally for the negotiation simulation. The teams had 45 minutes to work through the simulation.”
The case involved a possible joint venture between a Finnish telecommunications manufacturer and a Malaysian supplier. Teams of four or five students negotiated each company’s objectives, and wrote a press release regarding the outcome.
Students also received feedback from Kelley alumni Mark Barbato (MBA ‘82), president and CEO of InChromatics as well as Sunny Lu Williams (MBA ‘08), vice president of business development at Telamon Corporation.
“I was impressed by the students’ enthusiasm,” said Barbato, previously the vice president of alliance management at Eli Lilly & Company. “I was impressed with their understanding with the case knowledge itself but also the understanding of negotiations. They really knew how to negotiate and understand a potential partner’s needs.”
The Q&A session with Barbato and Lu Williams gave Evening MBA students a chance get advice from professional negotiators.
“Charles Dhanaraj taught my class during my MBA and I loved his creativity,” said Lu Williams. “The simulation was great. Students experienced how to approach other business folks with common courtesy. In negotiations, you’re touching upon hard topics and trying to reach a mutual understanding between both companies. It was interesting seeing students undertake those roles having never done that before. Basically, just being able to approach it form a standpoint of how you would approach a difficult conversation with any person.”
“The role play opportunity put us in the hot seat where we experienced, as True Alliance managers, negotiated a deal with guidance from two great experts in the field- Mark Barbato and Sunny Lu Williams,” said Evening MBA student Nandha Manoharan. “Learning by role play experience was an excellent complement to the class room lectures.”
Students wanted to know from the alumni guests the principles they rely on during negotiations.
“It’s important to understand negotiation is the beginning of a long-term relationship that you want to continue with a partner because that partner can help you solve your business problems and turn that a situation into a win-win,” said Barbato.
“In any new experience, the most important thing is to first listen and observe,” added Lu Williams. “Observe overall body language and role of each individual. Just because an individual is the CEO of the organization doesn’t mean he or she is the chief negotiator for that particular topic; that role may have been delegated to another individual at the table. During negotiations you might not pick up on such a nuance, and you could negotiate with the wrong party.”
Because the simulation case revolved around two international companies, students had to consider cultural differences.
“Be absolutely sure you have an understanding of culture and respect cultural practices,” said Lu Williams. “If a culture doesn’t shake hands, don’t be too forward or aggressive in the American style of a firm handshake or look in the eye. If you start on the wrong foot, you put people on the defensive.”
“Some cultures certainly expect you to take time to get to know the person you’re negotiating with, rather than jumping into the details of the business discussion immediately,” added Barbato. “I think cultural understandings are important and in today’s world, probably more important than ever before.”