NAFTA STANDOFF: A CROSS-CULTURAL NEGOTIATING ROLE PLAY Developments In Business Simulation & Experiential Exercises, Volume 22, 1995 NAFTA STANDOFF: A CROSS-CULTURAL NEGOTIATING ROLE-PLAY John K. Butler, Jr., Clemson University ABSTRACT The purposes of the symposium are to introduce NAFTA Standoff and to address some of the avenues that have opened up (and some that have not opened up) since the passage of NAFTA. The learning objectives of NAFTA Standoff are to illustrate two types of integrative negotiating agreement, logrolling and bridging, and their antecedents; and to show some differences between socialized power and personal power. INTRODUCTION NAFTA Standoff is designed for two participants to negotiate the location of a new manufacturing plant. The negotiators play the roles of mayors of adjacent towns, one on each side of the U.S. - Mexican border. Both mayors want the plant in their own towns, but each town meets only two of the three criteria for locating the plant. Also, both mayors have personal motives that are stronger than their desires to locate the plant in their towns. NAFTA Standoff offers two types of integrative (win-win) negotiated agreements, a logrolling solution and a bridging solution. The logrolling solution allows both mayors to lose a little to win big. The bridging solution requires both mayors to refocus on what they want most of all. In order to forge either one of these types of integrative agreement, the mayors must share certain information about their towns, about their personal goals, and about other things that they know. ROLE OF MAYOR MACDOUGAL OF LAKEVIEW, ARIZONA You are the mayor of Lakeview, AZ, a medium-sized, mostly working class town. Lakeview is right on the Mexican border. Unemployment in your town is currently near 15%. You have learned that the Kokishi Company, of Japan, is planning to build a new manufacturing plant in your area. Such a plant would provide jobs for all your townspeople who want to work and then some. Such full employment would make up for a number of very embarrassing things that have happened to you lately. During the last month it’s been one damned thing after another. Your chief of police has been publicly accused of fixing speeding tickets. Then the state auditors found over $20,000 of your town’s funds “unaccounted for,” and some of the townspeople have been looking suspiciously at you. Worse yet, your son, Joe, was caught breaking and entering into the local bar after hours. He and some of his friends were trying to steal two cases of beer. Consequently, you have fallen out of favor with your voters. Your term as Mayor expires in two months and you fear that your chances of winning the next election are slim. You want very much to win that election. You are quite certain that, if you can entice Kokishi to locate their plant in Lakeview, the reduction in unemployment will bring you enough popularity to win the election. However, your primary, number-one, life-long dream has always been for your son, Joe, to go to the University of Arizona. Joe is now a star offensive tackle for Lakeview High. You have been in touch with the University of Arizona about a football scholarship, but all they wanted to talk about was a medical school scholarship for a Hispanic student. Ironically, the person you talked with said that any premed college student with decent grades who applied for that scholarship would be quite certain to get it. You feel frustrated because that won’t help Joe at all. You would gladly trade your mayorship and forget all about the Kokishi plant if Joe could have a chance at a college education. One thing about Lakeview that Kokishi likes is Lakeview Technical College, which specializes in employee training. Lakeview Tech is denoted by an asterisk on your map. Lakeview also has five types of zones (see the map): open space, residential, woodlands, parks, and commercial. Locating the plant in some of these zones would cost the town a net loss in taxes and other costs per acre. Locating it in other zones would bring a net gain per acre. These cost and benefit figures are on the map. The problem is that Lakeview does not have an emergency facility with squad members trained in handling potential hazards from the chemicals that Kokishi will be using. It will cost Lakeview $300,000 to build an emergency facility and hire trained technicians. Another disadvantage is that Lakeland is a border town with restricted movement to the south. People have to clear customs every time they go into Mexico. However, under NAFTA, tariffs on the relevant goods will soon be phased out and trucks will soon be allowed to travel freely on routes across the border. Kokishi’s criteria for locating their plant are the following: 1. The plant must have at least 200 acres of land with some additional adjacent land for future expansion. 2. The plant must be located within two zones of an emergency facility. 3. The plant must be located within two zones of a technical college. 278 Developments In Business Simulation & Experiential Exercises, Volume 22, 1995 You are thinking about asking the town finance committee to study the feasibility of building an emergency facility. But, before doing that, you decide to discuss the situation with Mayor Gonzalez of Las Aguas, Mex., the town just south of the Mexican border from Lakeview. You have heard that Mayor Gonzalez is trying to attract Kokishi to Las Aguas. ROLE OF MAYOR GONZALEZ OF LAS AGUAS, MEXICO You are the mayor of Las Aguas, Mex., a medium-sized, mostly working class town. Las Aguas is right on the Arizona border. Unemployment in your town is currently near 15%. You have learned that the Kokishi Company, of Japan, is planning to build a new manufacturing plant in your area. Such a plant would provide jobs for all your townspeople who want to work and then some. Such full employment would make up for a number of very embarrassing things that have happened to you lately. During the last month it’s been one damned thing after another. Your deputy mayor was just convicted of stuffing ballot boxes in the last election. Then the Mexican Federal Investigators discovered that 100,000 pesos (about 20,000 U.S. dollars) was missing from your town’s coffers, and some of the townspeople have been looking suspiciously at you. Worse yet, your daughter, Maria, was caught taking a joy ride in a stolen Corvette with some of her friends. Consequently, you have fallen out of favor with your voters. Your term as Mayor expires in two months and you fear that your chances of winning the next election are slim. You want very much to win that election. You are quite certain that, if you can entice Kokishi to locate their plant in Las Aguas, the reduction in unemployment will bring you enough popularity to win the election. However, your primary, number-one, life-long dream has always been for your daughter, Maria, to go to medical school. She has earned good grades as a premed student at the University of Mexico City. You have been in touch with the University of Arizona about medical school, but all they wanted to talk about was a football scholarship for an offensive guard. Ironically, the person you talked with said that any good high school guard who applied for that scholarship would be quite certain to get it. You feel frustrated because that won't help Maria at all. You would gladly trade your mayorship and forget all about the Kokishi plant if Maria could have a chance at medical school. One thing about Las Aguas that Kokishi likes is your fire department with squad members trained in handling potential hazards from the chemicals that Kokishi will be using. The location of the fire department is shown on the map by an asterisk. Las Aguas also has five types of zones (see the map): open space, residential, woodlands, parks, and commercial. Locating the plant in some of these zones would cost the town a net loss in taxes and other costs per acre. Locating it in other zones would bring a net gain per acre. These cost and benefit figures are on the map. The problem is that Las Aguas does not have a technical college that can assist in training Kokishi’s employees. It would cost Las Aguas $300,000 to build and staff such a school. Another disadvantage is that Las Aguas is a border town with restricted movement to the north. People have to clear customs every time they go into the U.S. However, under NAFTA, restrictions on immigration and job visas will soon be phased out. Kokishi’s criteria for locating their plant are the following: 1. The plant must have at least 200 acres of land with some additional adjacent land for future expansion. 2. The plant must be located within two zones of a technical college. 3. The plant must be located within two zones of an emergency facility. You are thinking about asking the town finance committee to study the feasibility of building a technical college. But, before doing that, you decide to discuss the situation with Mayor MacDougal of Lakeview, AZ, the town just north of the U.S. border from Las Aguas. You have heard that Mayor MacDougal is trying to attract Kokishi to Lakeview. MR. MACHAMUSHIS BRIEFING [Read the following briefing after the role players have had about five minutes to read and internalize their roles.] I am Mr. Machamushi, president and CEO of the Kokishi Manufacturing Company. Now that you have read about your roles, negotiate with the other mayor for 20 minutes and decide on the following: 1. Where would you like to have the Kokishi plant located? 2. What will be your total income (loss) from locating the plant in your town? 3. What else do you plan to do? That is, what are the other terms of the agreement? Remember, you will have no more than 20 minutes to answer these questions. If you have not answered the questions within 20 minutes, there will be severe consequences. Now you may begin negotiating with the other mayor. 279 Table of Contents Volume 22, 1995 Simulation Performance, Learning and Struggle Are Good Simulation Performers Consistently Good? Cognitive and Behavioral Consistency in a Computer-Based Marketing-Simulation-Game Environment: An Empirical Investigation of the Decision-Making Process Chalk & Cheese: Executive Short-Course vs. Academic Simulations Revisiting Personality Bias in Total Enterprise Simulations Are Good Strategies Consistently Good? Investigating the Use of a Computer Simulation as an Effective Pedagogical Tool for the Application of a Strategic Model The Problem of determining an Individualized Simulation's Validity as an Assessment Tool A Simulation Based Analysis of the Value of Information in the Hrebiniak Joyce Typology of Adaptation Relative to Porter's Generic Strategies The Impact of Sales and Income Growth on Profitability and Market Measures in Actual and Simulated Industries A Comparison of a Stand Alone Version of a Simulation with the Traditional Competitive Version Computer-Assisted Gaming of International Business Analyzing Simulations with Computer-Based Programs and Applying the Experience to a Real-World Business A Preliminary Investigation of the Use of a Bankruptcy Indicator in a Simulation Environment Graduates' Views on the Use of Computer Simulation Games Versus Cases as Pedagogical Tools An Analytical Advertising Model Approach to the Determination of Market Demand Dealing with the Complexity Paradox in Business Simulation Games A Prototyping Approach for Incorporating Large Data Bases into Media Planning Simulations: An Example Using Magazine Media Through the Looking Glass, Inc: Superior-Subordinate Personality Type and the Leniency effect Evaluating the Effectiveness of Role Playing Simulation and Other Methods in Teaching Managerial Skills Student and Teacher Perceptions of a Management Simulation Course Performance Evaluation: The Effect on the Propensity to Create Budgetary Slack Management Team Formation for Large Scale Simulations Comparative Static Analysis with the Complete PPA Package: A Strategic Market Planning Tool Consistency in Intent: Learning Objectives at the 1994 Intercollegiate Business Policy Competition A New Twist on an Old Game: The Business Strategy Game: A Global Industry Simulation 3ed Evaluation of Performance in Management Simulation: A Management Coefficients Model Building SimuWorlds: Strategic Management Games of the Future Bulls and Bears: A Stock Market Simulation A Systems Thinking Paradigm and Think Computer Simulation Model of Broadcast and Cable Television Industry Competition Jacket Factory The Sales Management Simulation The Marketing Management Simulation A Demonstration of Promodel Demonstrating A New, Cross-Functional Business Simulation: Vision+ A Cost Chain For The Business Strategy Game Simulation Special Session On Experiential Teaching Compensation Dilemmas: An Exercise In Ethical Decision-Making Organizational Storytelling: Telling Tales In The Business Classroom Evaluating Experiential Training: Case Study And Recommendations The Internship Portfolio: An Innovative Tool For Experiential Learning, Critical Thinking, And Communication An Ethnographic Analysis Of The Pedagogical Impact Of Cooperative Communicating Consumer Behavior: A Long-Term Integrated Exercise Using Personal Consumption Journals And Consumer Analysis Papers An Experiential Paradigm For Teaching Business Problem Solving Developing Leadership Skills The Spss® Student Assistant: The Integration of A Statistical Analysis Program Into A Marketing Research Textbook Negotiating With Your Students Using TQM Principles To Transform Accounting Systems Into An Experiential Exercise Enhancing The Effectiveness Of Outdoor-Based Experiential Training Using Virtual Reality Concepts Case Writing In A Developing Country: An Indonesian Example Experiential Learning Using Focus Groups How Real Should Experiential Pedagogy Be? A Viewpoint From Our Students Reengineering The Internship: A New Approach To Experiential Learning Utilizing The Cosmopolitan/Local And Marginal Man Constructs To Measure Students' Propensity For Creativity Developing Experiential Processes For Teaching Quantitative Techniques For Business Team Learning Roles: A Cooperative Learning Technique Creating the Ultimate Small Business Student Experience: Melding Score/Ace with SBI The Development of Trust in Work Teams: The Impact of Touch Some Outcomes of Experiential Learning: How the Cultural Dynamics of Different Countries are reflected in Workplace Norms & Values Incorporation of Job Analysis Results in Various Forms of Selection Interviews Chudesno, Inc.: An Evaluation of an Experiential Training and Development Simulation An Exercise for Exploring the Relationship between Jungian Psychological Types and Organizational Dynamics Partnership: A Radical Approach to Experiential Learning Partnership: A Nice Idea, But How Do I Get Started? Recognizing Discrimination at Work Using Critical Incident Skills Questions to Help Students Become More Successful at Job Interviewing The Video Project Introduction to Psychological Type Theory Come On Down Understanding Facilitation for Development and Continuous Learning: A Micro-Workshop Leadership and Empowerment: An Experiential Exercise in Decision Making Experiential Exercises and Pedagogy Track Workshop: Selecting a Manager for Maquiladora, Inc. Experiential Training In Multi-Cultural Corporate Settings The Role of Facilitation as an Aid to Complete Learning An Experiential Exercise to Illustrate Difference in Information Processing Behaviors and Styles How to Deliver Accessible Survey Results Age Diversity in the Workplace- Family Feud Style Nafta Standoff: A Cross-Cultural negotiating Role-Play Three Strikes and You're Out!: A Downsizing Experiential Exercise