Resource Allocation Negotiation

The assignment content describes a negotiation scenario between two departments (Research and Development and Production) and the narrator, who is a negotiator, to allocate $2 million for important activities. Party 1 is less skilled in negotiations and focuses on marketing research, while Party 2 is skilled and emphasizes the importance of meeting customer demand and increasing production. The narrator proposes a solution where both parties take equal resources and proceed with their work, acknowledging the importance of each department's goals. With some persuasion, both parties agree to allocate the resources for the best interest of the company.

Head of Research and Development Department (Party 1 less skilled negotiator)
Head of Production Department (Party 2 Skilled negotiator)
Me (Negotiator)
Party 1: The manager has decided to allocate $2 million on important activities. Nothing
more is much important than market research in retail sector.
Party 2: I know, it is important to get things done based on research on any subject. However,
meeting the demand of the customer is equally important as attracting and retaining the. Our
department needs additional fund for enhancing production facility.
Party 1: But it is impossible to hand over the funds to you when there are actually no use.
You all were granted funds for meeting the production level. Why didn’t you say then you
need additional funds?
Party 2: How can you say that there is actually no use? We need it for increasing production
and keeping the funds ready for the production facilities in case of increase in customers.
Party 1: I have written a formal letter to the manager and he will decide what to do and what
not to.
Party 2: I am not asking for the entire fund, at least 60% of the fund could be used by our
department. W are ready to negotiate with your team for the remaining 40%.
Party 1: We are not. We need entire fund.
Me: Do you both mind if I explain my view:
Party 1 and Party 2: No. You may proceed.
Me: Why don’t you both take equal resource and proceed with your work.
Party 1: Do you think it would be adequate enough to proceed with only a nominal amount of
$ 1million in research and development? We require more funds for proceeding with
marketing and promotion. Being the member of the management team, how could you do not
know the importance of marketing?
Me: Even if I am aware of the facts, couldn’t you find out any other source for promoting the
products and services? Why being rigid towards the marketing strategy when you know that
you have been provided with a limited fund?

Party 2: I am ready to negotiate with the other team for equal resource. Please ask them to
sign the agreement for such.
Me: Being stubborn for making such a decision will not help any of us. Rather, please be
assured that allocation of resources will be for the best interest of the company and will
benefit all the members of the organization.
Party 1: Ok, then kindly proceed with resource allocation.
Party 2: Agreed.
Me: Let’s begin with the allocation.