Instructor’s Notes on Text Cases
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Any woman contemplating using the new product was warned that tampons could rupture a
virgin’s hymen. From church pulpits, clerics denounced tampons as an evil invention
associated with abortion, masturbation and defloration.
But most women ignored this propaganda. They quickly educated themselves about the
being “environmentally friendly.” One brand, called The Keeper, which is priced under $60,
can be reused for as long as 10 years. But menstruation and its impact on women still
continues to present medical challenges.
In the 1970s, a feminist group in Los Angeles concluded it was time to find a way to
eliminate menstruation, and several members of the organization developed a technique
is, given the choice, most women would probably prefer to experience their monthly
menstrual period rather than face the risk of infection and tissue damage that many physicians
insist could result from menstrual extraction.
Dorothy Grant is a freelance writer in Halifax.
Dorothy Grant, From fig leaf to the ‘sanitary napkin.’ Vol. 3 5, Medical Post, 04/06/1999
customers; and to generate direct sales from the Web and make savings on promotional
literature.
Instructor’s Notes on Text Cases
“High-tech companies have done a lot of work in this area but have a much easier model to
2.0 percent in 1996. An analysis indicated that neither company considered the cultural the cultural
differences between napkin and tampon usage. In Hong Kong Chinese culture, respect for family and for
education has been found to be a strong influence on consumer behavior, which suggests that a woman is
likely to seek the advice of a family member, particularly a mother, about products. Since older Chinese
p.158.
Case 4-2 Futurama’s Risk Management Strategy
This case illustrates the controversial financial policies of Futuram, an American agricultural and biotech
company. The company was known for a cautious approach to risk management and conservative
Q1. Chapter 18, “Pricing for International Markets,” discusses the financial side of marketing, including
A1. Students might argue that international business, in particular, international marketing is a
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Q2. What do you think of the Gordon purchase? Does it help the Futuram international marketing effort?
A2. The Gordon purchase was made, it could be argued, to prevent a third party from doing the same
Q3. Futuram is a recognized leader in its field. Does making money in nonmarketing ways have a
negative impact on its image?
A3. If image is all about making money, some students may say, then why not use nonmarketing means
Q4. Finally, what do you think of Futuram’s financial decisions in this case? How do these decisions
matter to the company’s long-term success?
A4. A corollary to Q3, this question may again raise the marketing vs. nonmarketing debate in a
slightly different way, that is, internally vs. externally. Customers may not care whether the
Case 4-3 Sales Negotiations Abroad for MRIs*
Negotiation is the most frequently used means of resolving conflicts between organizations. Particularly
in international industrial marketing, when “big-ticket” and/or high technology products are involved,
Instructor’s Notes on Text Cases
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A Brief Description of the Simulation
The simulation and debriefing can be accomplished during a four-hour period. Two two-hour sessions are
ideal. The GM/MRI Negotiation Simulation involves a final sales negotiation between two industrial
concerns, one U.S. and the other a Japanese hospital group. The product is a $1.5 million Magnetic
Instructions for Participants
There are six roles to be played in the simulation (see the Appendix): three for the General Medical sales
team and three for the Ichikawa Hospitals purchasing team. Groups of six students (smaller groups also
simulation is designed to be a difficult negotiation. The purpose is not so much to compare outcomes, but
instead the focus of classroom discussions should be negotiation PROCESSES. The simulation has been
designed to provide an hour or so of negotiation interaction. Often students will ask for just “10 more
minutes.” However, that “10 more minutes” almost always turns into another 30, 40, or 50.
Debriefing Instructions
Instructor’s Notes on Text Cases
opposing team. The form consists of twelve dimensions of negotiator skills to be rated and includes room
for brief comments. The twelve five-point items are: (1) well prepared/unprepared; (2) high aspirations/
low aspirations; (3) good listener/poor listener; (4) asks good questions/doesn’t ask good questions; (5)
The instructor-led discussion includes four topics: (1) a comparison of the various groups’ results,
including disclosure of the purchasing objectives and a discussion about the reasons if no agreement is
reached; (2) a description of the different and conflicting motives for each of the six roles; (3) possible
effective bargaining strategies for each side; and (4) the special cultural nuances of the Japanese
personal and professional goals are typical of industrial sales negotiations.
The next topic to be discussed during the instructor debriefing is possible bargaining tactics. The list
can be revealed.
General Medical Tactics
The following are a few of the more important bargaining tactics which the General Medical team might
have employed during the simulation.
1. Market research at the negotiation table. Initially maximize questions and carefully sound out the
buyer’s position. Get them to make a counter offer.
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5.The mouthpiece routine. Let the sales representative do the talking. This gives the sales manager the
Purchasing Team Tactics
The following bargaining tactics might have been used by the purchasing team.
1. Why so high? Have the General Medial side explain “why” on every item in the quotation. Explore
for weak points.
Usually 45 minutes is adequate to accomplish this second part of the debriefing.
The final step in the debriefing includes discussion of the various students’ evaluation forms within the
Variations in Usage and Structure of the Simulation
There are a number of ways in which the GM/MRI Negotiation Simulation might be changed. Below are
listed just a few of the possibilities.
Smaller groups. The simulation is ideally conducted with groups of six students. However, groups of five
students absent from class on the day of the simulation might be required to view one of the tapes and fill
Instructor’s Notes on Text Cases
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Instructor’s Notes on Text Cases
APPENDIX
STUDENT MATERIALS
Each of the six role descriptions requires a different set of support documents. See the bottom of each for
a list.
1. Materials for the Japanese (client is Ichikawa Hospitals) version of the simulation.
GENERAL MEDICAL PRODUCT SALES SPECIALIST (J)
You will be playing the role of a Product Sales Specialist working for General Medical, Inc. (GMI), a
manufacturer of a broad line of medical instruments and equipment. You have been selected by your firm
to participate in negotiations with representatives of Ichikawa Hospitals, a chain of nine hospitals
GMI engineering staff on its development. It provides much faster and more flexible manipulation of the
images and has wonderful ease of use qualities. However, since the package is new there may still be
bugs to worked out. Ichikawa Hospitals is also the first foreign client to which it has been offered, so the
price quoted for this option is relatively low.
You have thirty minutes to plan bargaining strategies with other members of your negotiation team. Feel
Instructor’s Notes on Text Cases
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GENERAL MEDICAL REGIONAL SALES MANAGER (J)
has been conducting preliminary sales and technical discussions. During this final session with the client
compensation depends on achieving profit objectives established at headquarters. Finally, according to
market research, GMI’s competitors have recently raised prices on comparable products, thus making
your bid very attractive.
Recently, several customers have requested an arbitration clause as part of the terms and conditions. Your
legal department feels that such clauses are not necessary. Indeed, in the past when GMI and client
team. You will have one hour to reach an agreement with the representatives of Ichikawa Hospitals. You
may make notes on these forms and ask questions if clarification of the instructions is needed.
(attach price quotation)
Instructor’s Notes on Text Cases
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GENERAL MEDICAL SALES REPRESENTATIVE (J)
You will be playing the role of a sales representative of General Medical, Inc. (GMI), a manufacturer of a
broad product line of medical instruments and equipment. You have arranged a meeting between
original quotes. You have the opportunity to “trade off” hardware price for other favorable terms and
conditions which are part of the standard agreement. GMI’s standard terms and conditions are listed as
part of the attached price quotation. In the past you have found that sticking to the standard warranty is
best of your abilities in order to maximize the learning of all participants. Although you can exchange
Instructor’s Notes on Text Cases
ICHIKAWA HOSPTIALS CHIEF FINANCIAL OFFICER (J)
You will be playing the role of the Chief Financial Officer for Ichikawa Hospitals, a chain of nine general
Japanese market and should be willing to make substantial price concessions.
to aid in the development of similar products which might be sold throughout Japan.
Finally, the Chief Radiologist has asked you to consider buying two systems, the second to be installed in
your central Yokohama hospital. Even though you are not sure about even one GMI system, you have
included a second one in the Purchasing Objectives you’ve supplied the others on your negotiation team.
You have thirty minutes to plan bargaining strategies with other members of your negotiation team. Feel
Instructor’s Notes on Text Cases
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ICHIKAWA HOSPITALS CHIEF RADIOLOGIST (J)
physicians and working with your administrative counterparts in the final negotiations for a Magnetic
previously. You would prefer to use the standard software, and not take a chance with the X2001.
Elatedly, you prefer that GMI train your own people to service the system. That would make the service
contract unnecessary and you don’t trust GMI to provide timely service in Japan anyway.
Finally, your fellow radiologists in Yokohama are also urging you to order a second MRI for their central
hospital. You mentioned it to your CFO previously, but s/he seemed quite distracted at the time.
(attach price quotation, purchasing objectives, negotiation style instructions)
Instructor’s Notes on Text Cases
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ICHIKAWA HOSPITALS RADIOLOGY DEPARTMENT MANAGER (J)
You will be playing the role of the Radiology Department Manager for Ichikawa Hospitals, a chain of
Hospitals radiologists (particularly the younger ones) and GMI in developing Japanese language software
for MRIs and a variety of other medical imaging instruments. Japanese manufacturers have been
generally lagging behind the Americans in software development, and you see this as a big future
opportunity for developing products for the entire Japanese health care market. You are quite concerned
that the X2001 was not included on the Purchasing Objectives distributed by the CFO.
if clarification of the instructions is needed.
(attach price quotation, purchasing objectives, negotiation style instructions)
Instructor’s Notes on Text Cases
Price Quotations
Deep Vision 2000 MRI (basic unit)
$1,200,000
Product options:
• 2D and 3D Time-of-flight (TOF) angiography for capturing fast flow
150,000
• Flow analysis for quantification of cardiovascular studies
70,000
• X2001 Software Package
20,000
Service contract (2 years normal maintenance, parts, and labor)
60,000
Total price
$1,500,000
Delivery
6 months
Penalty for late delivery
$10,000/month
Cancellation charges
10% of contract price
Warranty (for defective machinery)
parts, one year
Terms of payment
COD
Instructor’s Notes on Text Cases
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Ichikawa Hospitals Purchasing Objectives (J)
Two (2) Deep Vision 2000 MRIs
226 million yen
2D and 3D TOF Angiography (2)
28 million yen
Flow Analysis (2)
13 million yen
Service Contract (3 years)
11 million yen
TOTAL PRICE
278 million yen
Delivery
3 months
Penalty for late delivery
$12,000/month
Cancellation charges
2% of contract
Warranty
parts and labor, 2 years
Terms of payment
4 equal payments:
1st at delivery,
2nd at start-up,
3rd and 4th at 90-day intervals
Third Party Arbitration Clause
included
Instructor’s Notes on Text Cases
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Final Contract (J)
Deep Vision 2000 MRI
Product Options (circle those selected)
Angiography
Flow analysis
X2001 Software
TOTAL Price $ ______________
Service Contact (list conditions)
_________________________________
_________________________________
Price $ ______________
_____________________________________________________________________
Terms and conditions
________________
Delivery
________________
Penalty
________________
Cancellation Charges
________________
Terms of Payment
________________
________________
Warranty
Parts _____ Labor _____ Years _____
Arbitration clause
Yes _____ No ____
_____________________________________________________________________
Signatures
_________________________________________
_________________________________________
Ichikawa Hospitals Representative
General Medical, Inc. Representative
Instructor’s Notes on Text Cases
JAPANESE NEGOTIATION STYLE INSTRUCTIONS
The simulation becomes much more interesting for everyone if a little culture is brought into the game.
Please try to incorporate the following three aspects of Japanese negotiation style into your behavior at
the negotiation table.
Instructor’s Notes on Text Cases
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APPENDIX
STUDENT MATERIALS
2. Materials for the Brazilian (client is Corcovado Hospital) version of the simulation.
GENERAL MEDICAL PRODUCT SALES SPECIALIST (B)
You will be playing the role of a Product Sales Specialist working for General Medical, Inc. (GMI), a
done at Corcovado Hospital. The X2001 Software Package you are particularly proud of since you
advised GMI engineering staff on its development. It provides much faster and more flexible
manipulation of the images and has wonderful ease of use qualities. However, since the package is new
there may still be bugs to be worked out. Corcovado Hospital is also the first foreign client to which it has
been offered, so the price quoted for this option is relatively low. There have been some questions asked
(attach price quotation)
Instructor’s Notes on Text Cases
GENERAL MEDICAL REGIONAL SALES MANAGER (B)
You will be playing the role of a regional sales manager for General Medical, Inc. (GMI), a manufacturer
advanced operating systems in English.
Your sales person has already submitted a price quotation to Corcovado (see the attached copy).
Company policy allows up to a 10 percent price reduction at your discretion. Any further reduction in
price will require substantial justification upon your return to headquarters. Additionally, a large part of
your annual compensation depends on achieving profit objectives established at headquarters. Finally,
free to use part or all of the information provided above in shaping your strategies. Create additional
arguments to bolster your position if you so desire. It is important that you play the assigned role to the
best of your abilities in order to maximize the learning of all participants. Although you can exchange
information from these forms, please do not exchange forms with the other members of your negotiation
team. You will have one hour to reach an agreement with the representatives of Corcovado Hospital. You
Instructor’s Notes on Text Cases
GENERAL MEDICAL SALES REPRESENTATIVE (B)
You will be playing the role of a sales representative of General Medical, Inc. (GMI), a manufacturer of a
broad product line of medical instruments and equipment. You have arranged a meeting between
compensation.
Your Corcovado Hospital counterparts have been hinting that an agreement written in reals is preferable.
free to use part or all of the information provided above in shaping your strategies. Create additional