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CS Professional · Arbitration, Mediation and Conciliation · Negotiation Skills and Communication

A mediator is assisting two Gujarat textile firms in a supply dispute. Firm A wants the lowest price; Firm B wants a long-term, assured order volume. The mediator helps them agree on a three-year contract with a modestly lower price in exchange for guaranteed minimum volumes. Which description best fits the outcome and approach?

This is integrative negotiation that creates value through trade-offs. Firm A prioritised price and Firm B prioritised assured volume, so each conceded on its lesser priority to gain on its greater one. That differs from distributive splitting of a fixed amount or from avoidance.

  1. AIntegrative negotiation creating value through trade-offs of differing prioritiesCorrect
  2. BDistributive bargaining splitting a fixed sum equally
  3. CAvoiding style leaving the issue unresolved
  4. DCompetitive style where Firm A prevailed

Explanation

The parties valued different things (price versus volume), so each conceded on a lower-priority issue to gain on a higher one. This expands the value available and is integrative negotiation. Splitting a fixed sum would be distributive, which does not match the trade of dissimilar interests.

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