Leadership and Negotiation: LVMH & Tiffany Case Analysis

This report provides an in-depth analysis of the LVMH and Tiffany & Co. negotiation, highlighting the crucial role of leadership in achieving successful outcomes. It examines the leadership style of Bernard Arnault, the CEO of LVMH, and his effective negotiation strategies, including his ability to assess market value, understand stakeholder interests, and employ emotional intelligence. The report explores various negotiation theories, such as compromising, collaborative, accommodation, and avoiding, and emphasizes the importance of active listening and value creation in reaching mutually beneficial agreements. It also discusses the application of negotiation tactics, such as asking questions, sharing information, and addressing biases. The report concludes with a self-reflection on the key leadership skills, including communication, critical thinking, and emotional intelligence, that contribute to successful negotiation outcomes, using the LVMH-Tiffany case as a practical example. The report also explores how leaders can apply transformational and authoritarian styles to achieve goals.

Leadership and Leading

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Admission process for James.......................................................................................................3
Nursing process for James...........................................................................................................3
Examination of physical health of James....................................................................................4
Ways of using effective communication and its importance.......................................................4
Guilt and shame...........................................................................................................................5
Biopsychosocial theories.............................................................................................................5
Motivational interviews...............................................................................................................6
Attachment theories that can help out James...............................................................................6
Care plan for James.....................................................................................................................7
Ways in which mental nurse can help in James’s recovery.........................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................1

INTRODUCTION
Leadership can be defined as a process and action that leaders do for leading a group of
people on right direction with the main aim of making them able to accomplish their goals. This
presentation is going to discuss negotiation case of LVMH and Tiffany & Co in which the great
leader of LVMH company played a masterstroke and by using his leadership skills, he made
negotiation case in his favour. Leaders and their styles of leading play an important role as it
makes them successful as well as boost their confidence. Further, it will discuss effective value
and negotiation strategy that can be used by leaders for making right judgement.
Negotiation case by considering ethics
In the case of LVMH & Tiffany: Master negotiator and leader of LVMH, Mr Arnault played
very interesting play in negotiation process with Tiffany. In this case, LVMH that is known as
the world leading luxury group, announced to acquire globally known luxury jewellery brand
Tiffany & Co shared for $135 per share in cash and this announcement was done in the year of
2019. This deal was much larger than US$13 billion as share value as per $135 was approximate
value of US$16.2 billion. It seemed very good acquisition for both LVMH and Tiffany & Co as
by acquiring this brand, LVMH can increase market share and will become the top luxury brand.
Tiffany can also solve financial challenges that it was suffering from some years.
After this acquisition and announcement, it was reported by Reuters in the year of 2019, October
that LVMH had approached Tiffany & Co. with an initial offer of buying shares for US$1200
per share. It was 22% premium over stock’s closing price but Tiffany’s shareholders rejected this
proposal by saying that this is too low as compared to values of its share. This news created
frenzy and share prices for Tiffany went up by 22.4% that was in range of around US$130. It
was predicted on this basis that Tiffany’s share has value and it could trade between US$140-
$160. But proposal price of LVMH was US$120 that was very low.
Mr. Arnault the best negotiator knew that this negotiation is going to be long and he used his
skills of negotiation and said that now he will buy each share at the price of US$130 and it binds
Tiffany to open their books. Both boards agreed that LVMH will purchase shares of Tiffany for
US$135. Now, by comparing its actual value of US$140-160, it can be said that, LVMH made
great negotiation and made a deal of profit.

Role of leaders in negotiation
In regard to leaders, it can be said that they play a vital role in negotiation process. Their
skills and experience make companies able in winning negotiation and making profitable deal. In
regard to Bernard Arnault, it can be said that he is an authoritarian and transformational leader
who made beneficial to LVMH by making a deal of acquiring Tiffany at US$135 per share but
its actual price was US$140-160 as per the analysis and reports. On the basis of this, it can be
said that he shown his responsibility as a leader.
Vision and mission was communicated to all stakeholders of LVMH and his style of
transformational of working collaboratively with others was the main reason of his success. His
masterstroke made him able to decrease hefty premium for Tiffany’s share price. In addition, it
can be said that emotional intelligence also plays a vital role as it makes leaders able in knowing
their own emotions and behaviours of others. On the basis of ability to manage emotions, people
can take better decision and they can know as what other people are thinking. This ability has
made Bernard Arnault able in making negotiation in his favour.
In regard to communication, it is found that Bernard Arnault communicated information to
stakeholders in concise and clear manner that made everyone able in knowing what they need to
do and what is going on. Overall, it can be said that leader is responsible in success of
negotiation process. Leaders must consider 7 C’s of communication model so that they can
deliver message and important information to stakeholders and involved parties in an effective
and clear manner.
Role play of this study
VLMH: We are thinking to acquire globally known luxury jewellery brand Tiffany & Co.
Tiffany & Co.: What will be your acquisition price of our shares.
VLMH: We are thinking to acquire for US$135 with an equality value of around US$16.2
billion.
Sources: It would be a great acquisition for both LVMH and Tiffany as LVMH can become the
market leader and Tiffany can protect it against financial crisis.
LVMH: On the basis of evaluation, we thought to give you proposal of buying your shares for
US$120 per share.
Tiffany & Co: I have discussed with my shareholders and they denied to accept this proposal as
they think that this price is too low.

MR Arnault: As on the basis of analysis, we thought to acquire your brand for US$130 per
share.
Tiffany & Co and boards of both parties: We agree on this proposal and your acquisition price
of our shares.
Negotiation theories
There are 4 types by which people can negotiate with other parties and people such as:
compromising, collaborative, accommodation and avoiding. An active listening is the main skill
that both parties need to possess while involving in negotiation process otherwise, negotiation
may lead conflicts. Negotiation theory believes that cooperative approach is one of the best ways
by which people can understand other parties and can discover new sources of value. As per this
theory, people needs to focus on three main aspects such as:
Focus on interests: As per this solution, leaders need to focus on interest on both parties as it
can help them out in identifying potential trade off as well as opportunities for joint gains.
Addressing source of bias: In group negotiation, there are high chances of biasness and it can
lead wrong judgement so, for protecting from negative impacts, people need to identify sources
of bias and accordingly need to make decisions.
To reach agreement with within across parties: A host of other agreements is required when
both parties reach an agreement. By having multilateral bargaining, companies can make
negotiation in their favour and can win the process.
Value creation in negotiation: Value theories also play a vital role in negotiation process.
People often see this negotiation process as win loss or they think that one party will win and
other will bear loss. But it does not happen all the time both parties can reach to an agreement
that can make beneficial to both parties to some extent. Value creation allow both parties to
integrate more than 1 sources of value via trade-offs and other deal making strategies. Some
value creation strategies that have used in negotiation process of LVMH and Tiffany & Co
include: asking lots of questions to know about what actually matters and shar8ing information
about interest as well as priorities.
Overall, it can be said that vision, values and persuasion are important in negotiation and all
these can be considered by making use of effective theories.

Self-reflection
On the basis of above case and secondary information, I can say that it increased my knowledge
regarding leadership and skills that required in making negotiation process successful. Some
common and important leadership skills that can make a leader successful include:
communication, critical thinking, emotional intelligence, planning, value creation, patience,
reflection and adaptability. These skills made Bernard Arnault successful and he did a great job
in negotiation with Tiffany & Co for acquisition of its goods.
There are number of strategies of negotiation that also plays a vital role in making negotiation
favourable. I found that an ability of leaders to understand behaviour and emotions of others
make them able in understanding interest of those that company is leading up. Accordingly, they
find ways to satisfy needs of other parties. In addition, I can say that I found importance of
having patience in the process of negotiation as it is the main key of success and by doing so, we
can make the whole case in our favour.
CONCLUSION
It has been summarised from the above presentation that leadership plays a vital role in
negotiation. They possess number of skills and abilities that make them able in making
negotiation related case in their favour. Further, it has shown effectiveness of Bernard Arnault
who was great leader. Transformational and authoritarian styles of leadership also play a vital
role as it makes discipline and keep everyone on track. Compromising, collaborative,
accommodation and competing are some common ways of negotiation. As per the case and on
the basis of critical analysis, leaders make decision regarding selecting effective ways of
negotiation.

REFERENCES
Books and journals
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price negotiation behavior. Journal of the Academy of Marketing Science, 46(4),
pp.703-724.
Attaran, M., Attaran, S. and Kirkland, D., 2020. Technology and organizational change:
harnessing the power of digital workplace. In Handbook of research on social and
organizational dynamics in the digital era (pp. 383-408). IGI Global.
Baoming, S., 2020. Research on the China's Motivation on Promoting the RCEP Negotiation.
Brunelli, M., 2021. The acquisition of Tiffany by Lvmh (Doctoral dissertation).
Eckersley, R., 2020. Rethinking leadership: understanding the roles of the US and China in the
negotiation of the Paris Agreement. European Journal of International Relations, 26(4),
pp.1178-1202.
Vaughn, C. and et.al., 2022. Tiffany & Co. and LVMH: How Much Is Enough?. In SAGE
Business Cases. SAGE Publications: SAGE Business Cases Originals.
Zhang, H. and et.al., 2021. Negotiation complexity: A review and an integrative
model. International Journal of Conflict Management, 32(4), pp.554-573.
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