Harvard Case - Honda-Rover (A): Crafting an Alliance
"Honda-Rover (A): Crafting an Alliance" Harvard business case study is written by James K. Sebenius, Ashish Nanda, Ron S. Fortgang. It deals with the challenges in the field of Negotiation. The case study is 28 page(s) long and it was first published on : Mar 1, 1999
FFU is a leading research university with a strong track record in automotive engineering. The university has been approached by Rover to provide technical assistance in the development of a new line of cars. FFU is interested in pursuing this opportunity, but it is also aware of the challenges that the alliance could present.
3. Analysis of the Case Study
The main protagonists of the case study are:- Honda: A Japanese automaker that is one of the world's largest car manufacturers.
- Rover: A British automaker that was once one of the UK's largest car manufacturers.
- FFU: A leading research university with a strong track record in automotive engineering.
The case study presents a number of challenges and opportunities for FFU. The challenges include:
- The potential for conflict between Honda and Rover.
- The risk that FFU could lose its independence if it becomes too closely aligned with Rover.
- The difficulty of managing the cultural differences between Honda and Rover.
The opportunities include:
- The potential to gain access to Honda's technology and expertise.
- The opportunity to help Rover develop a new line of cars that could be successful in the global market.
- The chance to enhance FFU's reputation as a leading research university.
In order to address these challenges and opportunities, FFU should adopt a collaborative negotiation strategy with Rover. This strategy should be based on the following principles:
- Mutual respect: FFU should respect Rover's culture and traditions, and Rover should respect FFU's academic freedom and independence.
- Open communication: FFU and Rover should communicate openly and honestly with each other, even when there are disagreements.
- Shared goals: FFU and Rover should work together to achieve shared goals, such as the development of a successful new line of cars.
- Win-win solutions: FFU and Rover should strive to find solutions that are beneficial to both parties.
By adopting a collaborative negotiation strategy, FFU can increase the chances of success for the alliance.
4. Recommendaations
FFU should take the following steps to implement a collaborative negotiation strategy with Rover:- Establish a clear understanding of the goals of the alliance. FFU and Rover should agree on the specific goals that they want to achieve through the alliance. This will help to ensure that both parties are working towards the same objectives.
- Develop a communication plan. FFU and Rover should develop a communication plan that outlines how they will communicate with each other. This plan should include regular meetings, phone calls, and email correspondence.
- Build trust. FFU and Rover should work to build trust between each other. This can be done by being honest and transparent, and by fulfilling their commitments.
- Be flexible. FFU and Rover should be willing to be flexible in their negotiations. This means being willing to compromise and to find solutions that are acceptable to both parties.
- Seek professional help if necessary. If FFU and Rover are unable to resolve their differences on their own, they should consider seeking professional help from a mediator or arbitrator.
5. Basis of Recommendaations
The recommendations in this case study solution are based on the following:- Core competencies and consistency with mission: FFU's core competencies are in automotive engineering and research. The alliance with Rover is consistent with FFU's mission of providing education and research in the field of automotive engineering.
- External customers and internal clients: The external customers for the alliance are the consumers who will purchase the new line of cars. The internal clients are the students and faculty at FFU who will be involved in the development of the new cars.
- Competitors: The main competitors for the alliance are other automakers, such as Toyota, Ford, and General Motors.
- Attractiveness ' quantitative measures if applicable (e.g., NPV, ROI, break-even, payback): The attractiveness of the alliance is difficult to quantify. However, the potential benefits of the alliance, such as access to Honda's technology and expertise, could be significant.
- All assumptions explicitly stated (e.g., needs, technology trends): The assumptions in this case study solution are that FFU and Rover will be able to work together effectively, and that the new line of cars will be successful in the global market.
6. Conclusion
By adopting a collaborative negotiation strategy, FFU can increase the chances of success for the alliance with Rover. This strategy will help to ensure that both parties are working towards the same goals, that they are communicating effectively, and that they are building trust.7. Discussion
**Other alternatives not selected:**- FFU could reject Rover's offer of assistance. This would be a risky option, as it could damage FFU's reputation and its relationship with Rover.
- FFU could accept Rover's offer of assistance without negotiating a formal agreement. This would also be a risky option, as it could lead to misunderstandings and conflict between the two parties.
Risks and key assumptions:
- The main risk of the alliance is that FFU could lose its independence if it becomes too closely aligned with Rover. To mitigate this risk, FFU should ensure that it retains control over its own research and development activities.
- Another risk is that the new line of cars could be unsuccessful in the global market. To mitigate this risk, FFU should work with Rover to develop a car that meets the needs of consumers.
Options Grid:
| Option | Pros | Cons |
|---|---|---|
| Reject Rover's offer of assistance | Low risk | Damage to reputation and relationship with Rover |
| Accept Rover's offer of assistance without negotiating a formal agreement | High risk of misunderstandings and conflict | Potential for benefits |
| Negotiate a formal agreement with Rover | Moderate risk | Potential for benefits |
8. Next Steps
FFU should take the following steps to implement the recommendations in this case study solution:- Develop a communication plan.
- Build trust.
- Be flexible.
- Seek professional help if necessary.
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Case Description
Faced with vexing financial challenges in 1993, British Aerospace (BAe) is determined to shed its loss-making automaker, Rover. It offers to sell its stake in Rover to Honda, Rover's partner since 1979, but Honda is reluctant to raise its stake in Rover. Meanwhile, BMW approaches BAe with a confidential bid to buy out Rover. This case places these developments within the context of the history of the British auto industry, Rover's heritage, evolution of the Honda-Rover partnership, and the rationale for BMW's interest in Rover. The case series describes subsequent developments.
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