Magic Carpet Airlines Case Study

Magic Carpet Airlines (MCA) failed to properly prepare a negotiating plan, realistic proposal, or effective negotiating team structure. MCA had utilized “ad-hoc” members for their negotiating team who were neither prepared for the negotiations or represented transitional appointments within the company. An example of this would be Bill Orleans and Ross Irving serving on the team together. Bill had recently been demoted within the company, and Ross had succeeded him. Ross was hired from an outside company, and was uncomfortable in working with his predecessor. Uncomfortable, and unprepared by not being familiar with the previous negotiations, Ross was not able to make contributions in the planning or willing to take part in the negotiations themselves. There was no prior preparation between the MCA members, and their initial strategy seemed to be aimed around keeping the status quo. Other members did not contribute or prepare due to time constraints or lack of commitment (or both). Not only did the MCA team fail to prepare their strategy and define their expected negotiation points, they failed to anticipate and prepare for the possible LFA discussion points.

In the first negotiation session, the MCA team had not even bothered to show up on time, and was visibly concerned when they saw Tom Windham already there speaking to the LFA team. Picking up on this, the LFA team began to question the MCA team’s credibility and good faith commitment. The MCA initial “strategy” was to let LFA present a major proposal, which they would automatically dismiss, and then caucus, and then postpone talks - creating frustration. When they returned, it seemed their goal was to beat LFA back as far as possible from their original proposal, instead of proposing new unique alternatives. Furthermore, the MCA team failed to benchmark company positions, and was unable to target reasonable alternatives to LFA counter-proposals. The MCA dysfunctional team dynamics created...