Two companies were vying for a lucrative contract from the Mexican government. Both firms—one from the U.S. and one from Sweden—had already jumped several hurdles to get the business. Each was invited to Mexico City to present proposals to ministry officials to start the process of negotiating the terms of the proposed deal.
The Americans put a lot of effort into producing an impressive high-tech and hard-hitting presentation, working hard to assemble a team of senior technical experts, lawyers, and interpreters from the New York office. Their bottom line was clear: “We can give you the most technically advanced equipment at a price the others can’t match.” The team met several times with senior management before the presentation to discuss possible concessions, and they were given latitude to make decisions on the spot if need be. The team flew to Mexico City for a week and stayed at one of the top hotels in the city.
Arrangements for a fancy hotel conference room were made so that they could make the best possible presentation to the ministry officials. In a demonstration of due diligence and to impress their potential customer, they brought all the necessary equipment with them and had mailed outlines of the presentation to officials two weeks ahead of time. They also proposed a detailed schedule and other arrangements in a memo to the officials along with the presentation. The Mexican officials dutifully thanked the Americans for their information and said they looked forward to meeting with them and finding out more about their proposal and their firm. They provided information about the history of their agency and the top members of the current ministry.
The Americans arrived early the day before the meeting to avoid problems with their flight. And all team members met at the conference room very early to set it up and make sure all was a go for the meeting later that day. Finally, at the agreed time, the Americans were all ready to present and impress. Unfortunately, the Mexican ministry officials were not—in fact, no one from the ministry was there yet! Instead, various ministry officials arrived gradually over the next hour. They offered no apologies to the perplexed Americans, but instead began to chat amiably about a variety of non-contract-related matters. The U.S. team leader was feeling pressure from both thesituation and his team members—should he act leaderly and get the meeting organized, or should he let the Mexican officials provide the right signal? Finally, after about an hour of glancing at his watch and scanning nervously, the team leader assertively suggested that the meeting should start. The Mexicans seemed surprised but politely agreed and took their seats that were set up ahead of time by the Americans.
The presentation began with informal introductions of the team members by the presenter. The presentation itself was flawlessly delivered, thanks to endless practice. About 20 minutes into the presentation, the minister himself, with an entourage of other officials, walked in. When he figured out what was going on, his demeanor turned unpleasant. Angrily, he asked the Americans to start the presentation over. They complied and started again. Once more, the presentation was going for about 10 minutes, and then an aide arrived with a message for the minister that was delivered in hushed tones. Not wanting to anger him again, the U.S. presenter stopped to wait until themessage was delivered. But the minister signaled for him to continue, so he did. A few minutes later, a number of audience members were talking among themselves. By this time, the Americans were frustrated, but they slogged on and finished. At the end, when the audience was invited to ask questions, the minister’s only comment was to wonder why the Americans had focused so much on the technical details—why had they told the Mexicans so little about their firm’s history?
Later during lunch, the Americans felt that they had to be very forceful about keeping the conversation focused on the topic at hand—the contract and any outstanding issues or problems they could address. Most of theconversation was again seemingly casual, having little or nothing to do with the business at hand—not unlike what happened earlier during the presentation. The Americans were surprised by the many questions about their individual backgrounds and personal experience—including their qualifications. The minister breezed in during the lunch, had a brief but casual conversation with the U.S. team leader, and then left, not to return.
Over the next several days of their time in Mexico City, the Americans repeatedly contacted the Mexican officials for follow-up. Were there additional questions about the specs? How about the technical features of their implementation? What were the initial reactions? Was more information needed? They reminded ministry officials of the schedule they had shared ahead of time and the fact that they needed to return to New York soon. In short, they wished to start the negotiation process. The Mexican response was the same to all these forays throughout the rest of the week: “We need time to examine your proposal among ourselves here first.” The Americans got more and more angry; at the end of the week, this turned to plain frustration. After all, the ministry officials had the proposal for several weeks before the meeting and had multiple opportunities for elaboration of the specs and other elements. The team left Mexico empty-handed. Later they found that the contract was awarded to the Swedish firm.
1. Summarize how the reactions of each side may have been influenced by cultural differences, including the culture issues at work here and the typical Mexican and U.S. approaches to this issue. Put differently, what is your diagnosis of the problems here and the reasons for the breakdown in the process?
2. Provide suggestions about how each side could have responded better and adapted to the other side in a more functional way.
3. How could each side have been better prepared for the negotiation?
4. Given the problems that emerged, what could the parties have done to keep them to a minimum or reduce their impact so that progress could be made? Could the Americans have done anything to salvage the situation—even after the minister took offense?
Write a 3-4 page paper in APA format (not including the cover page and reference page). Respond to all the question using an essay format. Note that you must conduct research and your paper must have 3 scholarly references. This means that you must locate peer-reviewed articles.