Case Study Analysis: Part A
“Successful negotiation is an art, not a science. The three most important concerns and elements in any negotiation are the relationship, the risk and the value. These concerns are the real decision criteria that underlie any business transaction” (Di Frances, 2005, para. 2). Capital Mortgage Insurance Corporation (CMI) was acquired by Northwest Equipment Corporation in 1978 and was a wholly owned subsidiary (Lewicki, Saunders, & Barry, 2005). Northwest Equipment Corporation acquired CMI when the parent company went into Chapter 11 bankruptcy. The company was developed to work with residential mortgage lenders in selling mortgage guaranty insurance policies throughout the United States.
The following paper will briefly describe the case at hand, what role social context will play in the negotiation process, and how the social relationship that Burr, Lehman, and Kupchak will affect the negotiation. The paper will end by describing the tangible and intangible benefits, cost, and risks associated with negotiating Corporate Transfer Services (CTS). Analyzing the case of Capital Mortgage Corporation will allow a reader to define how social relationships affect negotiations, and define the benefits, costs, and risks of the negotiation process.
CMI has an interest in broadening its financial services to strengthen the company. CMI primary goal is to be the leader in the financial services industry. CMI will have to stand against the current industry leader, Merrill Lynch, to take a large share of the market. CMI must acquire CTS at a reasonable price to achieve this goal.
CMI second goal is to keep the CTS key staff and maintain a good working relationship with the current owner of CTS, Elliot Burr. CMI wants to keep their relationship with Elliot Burr strong so that he will be willing to be flexible and collaborate with CMI throughout the long negotiation process. Maintaining a good relationship with Elliot Burr is...