First Look

March 28, 2017

Among the highlights included in new research papers, case studies, articles, and books released this week by Harvard Business School faculty:

Countering misperceptions about negotiation 'BATNAs'

Bargainers often employ the concept of BATNA, or best alternative to a negotiated agreement, to increase one’s bargaining power when a negotiation is failing. James K. Sebenius argues that BATNAs are often misunderstood and misapplied. “This article offers robust correctives to these misimpressions and relates these to three different kinds of 'no' in negotiation: a 'tactical no,' a 'reset no' that permits away-from-the-table moves to favorably alter the underlying setup, and a 'final no,'” Sebenius writes. The paper is titled BATNAs in Negotiation: Common Errors and Three Kinds of 'No'.

A dairy cooperative’s battle with big brands

Amul, a dairy cooperative in India owned by 3 million farmers, is well-known for offering high-quality products at reasonable prices. The new case study India's Amul: Keeping Up with the Times discusses strategic options faced by the organization in the face of increasing competition from big brands. “Should Amul continue with the business model that has served it so well for decades, or should it change its strategy in order to keep up with India's changing social, political, and economic landscape?” ask case authors Rohit Deshpandé, Tarun Khanna, Namrata Arora, and Tanya Bijlani.

'Hub-and-spoke' flying versus 'out-and-back'

The airline industry’s classic hub-and-spoke model followed by many airlines is often the subject of experiments by carriers. In the case study United Airlines: More Out-and-Back Flying? readers ponder the pros and cons of out-and-back routes, which help isolate the effects of flight delays but may underutilize equipment deployments. The case was written by Ryan Buell, Willy Shih, and Mike Toffel.

A complete list of new research and publications from Harvard Business School faculty follows.

— Sean Silverthorne
 

Abstract—The best alternative to a negotiated agreement (“BATNA”) concept in negotiation has proven to be immensely useful. In tandem with its value in practice, BATNA has become a wildly successful acronym (with more than 14 million Google results). But the initial characterization of this concept in Getting to Yes (Fisher, Ury, and Patton 1991) as well as many later interpretations can be problematic, limiting, and even misleading in several ways, which this article analyzes and illustrates. First, early characterizations could be easily read to imply that one’s BATNA could not itself be a negotiated agreement. Second, and more seriously, common descriptions of one’s BATNA as the “best outside option, independent of the other side” needlessly limit its applicability, especially in the many bargaining relationships in which BATNAs are inherently interdependent. Third, BATNAs are often mistakenly described mainly as “last resorts” relevant only in case of impasse or “if the other side is more powerful.” Other uses of the term “BATNA” such as the common question, “How do I negotiate if I have no BATNA?” reflect misconceptions. Although savvy negotiators and analysts generally avoid these pitfalls, the less sophisticated can go astray. This article offers robust correctives to these misimpressions and relates these to three different kinds of “no” in negotiation: a “tactical no,” a “reset no” that permits away-from-the-table moves to favorably alter the underlying setup, and a “final no.”

Download working paper: http://www.hbs.edu/faculty/Pages/item.aspx?num=52030

  • Harvard Business School Case 717-028

Brexit

No abstract available.

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/717028-PDF-ENG

  • Harvard Business School Case 617-010

United Airlines: More Out-and-Back Flying?

This case looks at United Airlines when it is facing a decision on whether to shift its aircraft routing to more "out-and-back" routing in order to try to improve its on-time performance. As one of the world's largest airlines, United had a very large fleet and hub-and-spoke network that provided passengers with a wide range of destination choices, but as with any complex system unless everything ran perfectly all the time, it inevitably faced cascading delays and missed passenger connection problems. While out-and-back routing tended to isolate operational issues, more traditional linear routings tended to offer high equipment utilization. The case offers students an opportunity to examine the effects of variability on different routing strategies.

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/617010-PDF-ENG

  • Harvard Business School Case 817-002

Classtivity: Payal's Pirouette

A few months after launching a new fitness technology product, the small staff of New York startup Classtivity gathers on a Saturday in April 2013 to take stock. With one successful pivot under its belt, Classtivity is finally generating revenue and enthusiasm among customers. But cofounder and CEO Payal Kadakia has some doubts. There are signs that customers love the offering, but studios are less enthusiastic. Efforts to get customers to return to the studios after their monthly packs expire have largely failed. Kadakia must decide, preserve the product or pivot to a new business model?

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/817002-PDF-ENG

  • Harvard Business School Case 817-065

Delivering the Goods at Shippo

Laura Behrens Wu, CEO of software start-up Shippo, prepares her pitch for a Series A funding round following a successful seed round. Customer adoption of Shippo’s e-commerce dashboard application, which allows small and medium retailers to compare delivery rates between shipping providers and print package labels, has been steady in the nine months since it went live. But traction with the firm’s developer friendly product, an API that allows large enterprise customers to automate their shipping needs, had initially been slow until one customer single handedly tripled the API label volume in late August. Now in November 2014, with nine months of runway remaining, Behrens Wu must decide where to direct the company’s limited resources. Should Shippo stay focused on the app while raising the next round of funding, pivot to an API-focused strategy, or pursue both products?

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/817065-PDF-ENG

  • Harvard Business School Case 516-116

India's Amul: Keeping Up with the Times

Amul is an Indian dairy cooperative founded in 1947—eight months before India's independence from British rule—and owned by over three million farmers in the state of Gujarat. It is India's largest food product marketing organization, selling 46 products, including pouched milk, cheese, butter, ice cream, and infant food through a million retailers across the country, and is the market leader in almost all the categories in which it operates. Amul is well known among Indian consumers for offering high-quality products at reasonable prices, and runs a highly popular advertising campaign that spoofs current events. It offers its farmers 80% of the consumer's dollar for milk, compared with 35%–40% typical in some Western markets. Amul's cooperative dairy model has been replicated across several Indian states, thereby helping increase the incomes of 80–100 million farmer families across the country. However, despite its success, Amul is beginning to come under increasing pressure. Multinationals like Nestlé and Unilever are increasing their presence in India and competing fiercely with Amul in value-added products like yogurt. The entry of large multi-brand retailers like Walmart and Carrefour in the Indian market threatens to squeeze Amul's margins and undermine its low-cost distribution network. India's large young rural population is shying away from dairy farming in favor of urban jobs, leaving questions about future procurement. Finally, Amul's farmers form a large vote bank in the state of Gujarat, and its cooperative structure risks being compromised by vested political interests. Should Amul continue with the business model that has served it so well for decades, or should it change its strategy in order to keep up with India's changing social, political, and economic landscape?

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/516116-PDF-ENG

  • Harvard Business School Case PEL-079

Uncommon Schools (A): A Network of Networks

In 2013, Brett Peiser, CEO of the charter school management organization (CMO) Uncommon Schools, is reassessing the nonprofit’s strategy. For nearly 10 years, Uncommon had fulfilled its mission to bring high-quality education to students in low-income, urban areas using a “network of networks” structure, where regional networks of charter schools operated independently, guided by Uncommon’s shared beliefs and practices. The autonomy built into the structure had allowed teachers and school leaders to develop innovative and effective practices that could then be rolled out throughout the network. But in the 2012–2013 school year, this strategy comes into question when students take the first standardized test aligned with the more rigorous Common Core State Standards. While the test results show that, on average, Uncommon’s students still perform well compared to their district peers, they also reveal a disparity in achievement across the schools and regions. The case gives students the opportunity to assess the benefits and challenges of Uncommon’s strategy so far, determine the best way to address the inconsistency in academic achievement, and consider the best way to consistently scale excellence.

Purchase this case:
http://www.hbs.edu/faculty/Pages/item.aspx?num=52436

  • Harvard Business School Case 216-066

Dan Gilbert, Crazy or Crazy Like a Fox?

No abstract available.

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/216066-PDF-ENG

  • Harvard Business School Case 617-044

Floodgate: On the Hunt for 'Thunder Lizards'

No abstract available.

Purchase this case:
https://cb.hbsp.harvard.edu/cbmp/product/617044-PDF-ENG