you are Tokyo Saki, Outline the what your resistant point is and what, on the facts given, you consider the ZOPA of the

[answerhappygod]

you are Tokyo Saki, Outline the what your resistant point is andwhat, on the facts given, you consider the ZOPA of the negotiationto be.
Confidential Instructions for Tokyo Saki Role
Bacchus is a successful winery, with 63 fully owned vineyardsscattered throughout the US (although the majority are located inCalifornia). Bacchus was founded some 20 years ago, and appears tobe a successful and growing company, as they have maintained astrong market share, specializing predominantly in high-end wines,although they also produce some moderately priced wines. Bacchusconsistently wins prizes for their wines, both nationally andinternationally, with their wines holding up well to French winesin Western Europe, at least outside of France itself. Tokyo Sakiproduces sake and rice wines, various Asian beers, as well as aline of alcoholic ginseng products (previously acquired from aKorean company). Tokyo Saki has strong market share within Asia,and has been making inroads as a novelty product, especially withits ginseng lines, in Europe and North America. At least part ofthe success of the ginseng lines has been due to the common beliefthat the ginseng root prevents the negative effects of alcohol onthe system (such as liver damage due to over-consumption) and haslong been recognized for its medicinal and curative powers in Asia,and more recently in Europe and North America. Serbian Steins &Stems specializes in fine decanters, wine glasses, and accessories.More importantly, however, they recently patented a new processthat makes fine, delicate crystal and porcelain virtuallyindestructible, while maintaining its beauty and fragileappearance. This development has obvious customer appeal, but alsosignificantly reduces the expenses associated with shippingbreakage and the like. If costs can be reduced on the process, itmay even be feasible to use the technique for bottling, making itattractive as a virtually unbreakable bottle for wine and beer, aswell as other products. Tokyo Saki recently acquired a small stakein Serbian Steins & Stems, hoping to complement its offeringswith the accessories that would appeal to the North American andEuropean markets, thus bringing it into the merger talks in athree-way play. Last year, Bacchus management made overtures toTokyo Saki in an effort to acquire their full line. Tokyo Sakideclined, but encouraged a discussion of a possible merger betweenthe companies, including the possibility of Serbian Steins &Stems for contemplation. Such a three way merger might provideBacchus with complementary products and a presence inhigh-potential markets, while providing Tokyo Saki and SerbianSteins & Stems with product visibility and distribution systemsthat include the lucrative U.S. market. With the increasingpopularity of fine wines and accessories, as well as “New Age”herbal medicines, such a three-way merger provides a particularlyattractive opportunity. However, there are risks. For example,whether or not Bacchus has topped out in its market expansion isn’tclear. And the instability of the political situation in EasternEurope is cause for concern as well, in any deal involving SerbianSteins & Stems. Given the risks and possible benefits, Bacchushas expressed cautious interest in the possibility of a three-waymerger, and these discussions led to a satisfactory agreement onprice, however, there are several issues that are yet to beresolved. These unresolved issues have led to the present meetingbetween your executive groups. In preparation for the meeting, thethree companies have already exchanged appropriate information andfigures. Unfortunately, a merger between any two of the companiesloses significant synergy and is considerably less attractive;hence it is important to negotiate an agreement that issatisfactory to all parties, if there is to be an agreement at all.At this time, the remaining issues to be resolved include:  Stockownership of the combined company that would result from a merger.The division of stock influences the amount of the annual profitsthat would accrue to each of the three respective companies. Thisissue is, of course, of very high importance to you. You believethat the division of stock ownership should be driven by the factthat you are bringing a totally new product line to the table, andthat you have a much greater profit margin than anyone else does atthe table. However, you are also aware of the fact that Bacchus hasa considerably higher value, and that Serbian Steins & Stemsbrings something unique to the table. You believe that thesedifferences entitle you to a minimum of 25% ownership of thecombined company.  Control, as represented by the number of votingseats on the 12-person executive board to be controlled by eachcompany. It is extremely important to you that you have multiplemembers represented – enough to wield some level of power – on theexecutive board. This issue is a point of pride, as you explicitlydo not want to be “taken over” by Bacchus — you desire a mergerthat is respectful of your identity and accomplishments. You worrythat minimal representation could easily be intimidated andsilenced on the board and would become “tokens” with little or noactual influence. You bring a unique product line – especially withthe ginseng products, one that is highly saleable in multiplemarkets. This will invigorate Bacchus’ currently rather stalelines. In addition, given your small ownership in Serbian Steins& Stems, you are clearly bringing a great deal to the table andyour contributions should not be minimized.  Management. There arethree management issues. First, is the management of the company ineach country? In order to capitalize on the strategic synergies,management issues are key, and it will be critical to staff eachlocation appropriately. It has not yet been established whethereach location would continue to run as they have been running, orwhether the Americans will try to select and send general managers,or whether there will be some form of exchange program orcross-training of managers. However, it is extremely important thatyou have at least one Japanese manager in each location, otherwiseyou will be unable to appropriately monitor other components ofyour business and react quickly and appropriately to decisions thatare not in Tokyo Saki’s best interests. Your preference, of course,is to staff with Japanese mangers, but you realize that is notrealistic. Yet, you also understand the importance of workingwithin a socio-cultural network, and know that the locals havecontact that your managers might lack. Hence, in lieu of Japaneserepresentation, you will accept local management. The second issueis more troubling. That is what to do about Nikko Raspovliac, theson of the founder of Serbian Steins & Stems. It is yourunderstanding that he is an unrepentant womaniser, and there areeven rumors that he may be involved with the drug trade.Unfortunately, you learned of all this after you originallypurchased a stake in their business. Raspolivac’s negativereputation will result in significant loss of face for your companyin any public liaison (and you have debated ending the existing oneif you can find a way out!). It is simply not acceptable to havesomeone at the helm whose reputation is so sullied. Finally, thethird issue is management incentives, or how to motivate themanagement teams towards the common goals of the merged companies.You have always paid your managers an attractive salary, yetBacchus has suggested that they be paid contingent on performance.Although you are willing to provide a small contingent incentive,you know there are clearly differences in the different foci of thecompanies and that some are simply easier to make a profit at, andany manager accepting a “difficult” assignment would be penalized.In addition, you know that such differences will create status andpower differences among the managers of the different divisions,which is simply unacceptable You strongly prefer no contingentincentives, as you want to continue the culture you have developedat Tokyo Saki, a culture that has served you very well indeed. If acompetitive culture were instantiated, your past experience in Asiasuggests that they refuse to help one another, or lobby forspecific interests, which clearly could be to your detriment. Inaddition you know well that such a plan will substantially reducethe morale among the management team and create conflict andtension.  Form of the agreement is also quite important. In yourprevious negotiations with Bacchus, it seemed as if they werecompletely unwilling to build any flexibility into the agreement.Yet, in merging the three companies, you are charting newterritory, and having some flexibility – to accommodate theunexpected as it arises – is not only essential, but makes goodbusiness sense. Thus, it is important to you that any agreementstruck be flexible, with adequate safeguards for accommodating theunexpected. In addition, you find Bacchus’ insistence on penaltiesfor minor accommodations in the contract to be repugnant andinsulting, and will clearly damage the relationship among allparties. Your preference is for a contract that avoids threateningtrust by specifying penalties that may never be needed.  A finalissue is status. It is quite important that you negotiate withthose who are of equal (or greater) status to yourself; otherwise,it is clear that the other parties are not taking you seriously, ifnot insulting you. Negotiator status is an important indicator ofthe respect with which you and the company are viewed. If they sendnegotiators of superior status, then that indicates that the futurerelationship will be one of respect and in which parties willattempt to accommodate our company and its issues. If, however, thenegotiators sent by Bacchus and Serbian Steins & Stems are oflesser status, it suggests that the long-term relationship will beone in which you and the company will be discounted andmarginalized. You should use job experience rank as a proxy forstatus, such that a negotiator with no job experience has a statusof zero; if they only had “odd job” experience, their status wouldbe 1; seasonal experience would be 2, part time experience 3, fulltime experience 4, and management 5. To compute your status score,you should use the following formula: