Course Project
HR 595
Negotiations

IUHealth North is a full service healthcare facility located in Hamilton County. It has just celebrated its 5th year as a leading health care provider in Central Indiana. IUHealth North is a small part of a bigger network that includes 16 other hospitals ranging from Northern Indiana (Laporte) all the way to Southern Central Indiana (Paoli). IUHealth is most known for its complex of hospitals in downtown Indianapolis that include Indiana University, Methodist and Riley Hospital for Children. According to US News and World Report, IUHealth is Indiana’s only healthcare system to be nationally ranked 14 years in a row. IUHealth has innovative technology, incredible amenities, and a service culture that goes above and beyond expectations. With all of these areas IU feels they create a totaling healing of a patients mind, body and spirit. IUHealth North provides a catering service for internal and external events. There are over twenty-five departments internally that have access to our service and to our department but choose to use both internal and external catering sources throughout the year for special occasions. The Nutrition and Food Service Department is incredibly talented and are able to create, copy, or mimic any outside catering vendor and at a portion of the price of an outside caterer. There are six associates that have graduated from culinary school with experience they have acquired from working at various locations in the city with top catering departments that include the JW Marriott, Conrad Hotel, Stone Creek and other top restaurants and hotels throughout the city. The executive chef has a resume with over 25 years experience from such locations like the LA Forum, Hilton Hawaiian Village and personal chef for John Travolta and wife Kelly Preston. The problem is that when an IUHealth Department uses an outside caterer the money spent is now sent outside of the company and thus we are spending more money and paying others for services we can provide internally. This is a problem more this year than years past since the hospital is being asked to reduce their budget by nine million dollars and increase their profit margin by 1% to and unheard of 13%. The average profit margin for a hospital is between 3-5% annually. By spending money internally we are only paying cost of goods and services without taxes, delivery, and separate overhead. This would save the hospital thousands of dollars a month by being able to keep the dollars spent inside of the system. When the money is kept inside of the system it is simply being moved from one cost center to another but is still staying inside of the same silo of money as it funnels up to the overall P & L.
The goal of the negotiation is to require all of the departments at IU Health North to be required to use Atrio Catering as the sole vendor unless deemed absolutely impossible by the Executive Team. The opposing party is the service council and department heads that choose to use all sources for catering including administrative assistants. When looking at when to use distributive or integrative negation strategies I have to decide what kind of situation I am in and the outcome. If I choose the distributive it will end up in a win lose situation and I would not like to be in a situation where I lose out on all of the revenue from outside caterers because I may lose the negotiation. If I choose to use integrative negotiation styles this situation could be a win win for both sides. I am focusing on a win win for the hospital and my departments revenue. In this particular case a win win would be for the hospital departments to use Atrio catering and at the same time the hospital will be saving money by being able to keep it internal and not sending our expenses outside of the company. With the integrative approach both sides will be able to achieve its goals. With an integrative approach both sides will be able to negotiate more from a catering needs and price that can accommodate each. The fundamental strategy of the integrative negotiation is to create a flow of dialogue with information for both sides. We will start by conducting some research through the administrative assistants, including my own, to determine the needs and objectives of the other departments and why they choose to go outside of the hospital. We will try to emphasize the commonalities of each area and how we can help each other out with their needs. What we will also do is asses the outcomes value and costs of catering internal and external for both sides all the while trying to think of alternate solutions to everyones special needs. The negotiation will be framed to try to manage the other parties impression of the catering departments customer service and catering skills by modifying their perceptions and manipulate the actual expenses as a whole for the Hospital. I will do this by making outcomes appear less attractive, make the cost of obtaining the goals appear higher linking the expenses of the hospital to the bottom line and this directly reflects everyones bonus at the end of the year. I want to depersonalize the goal of the catering department and make it more of a mutual problem and a solution to the problem for both sides and be flexible in decision making. We will back our facts up with real life situations of our catering department. For example, we will let the departments know Atrio catering is not your stereotypical hospital food afar and has been asked for the last 5 years to conduct food demonstrations for the Art & Antique shows private events, competed against other top restaurants that included Fleming's, Peterson's, St. Elmo and a list of other restaurants in the Flavors of Indianapolis benefiting the Liver Foundation and walked away with first prize for each event. The catering is employed by several physicians for their private parties at their homes all year long. These events range from weddings to bar mitzvahs. Using Integrative Negotiation is not going to guarantee a successful outcome. There may be situations where it may turn into a distributive situation but I will have to recognize this and pull the dialogue back to what will be a win win for all parties included in the discussion and what is best for the hospital as a whole. By building a strong relationship with the opposition keeping emotions apart from the desired outcome a trust will hopefully build that will continue to grow throughout the process. By increasing the use of the Atrio's catering department through the use of the twenty five internal departments a goal for the Atrio, the twenty-five departments needs and the hospital's profit margin will all be able to win in the negotiation.

References

Avery Camarow, (July 2010): US News and World Report http://currentincarmel.com/reveresing-the-stereotype, by Kevin Krane; Current in Carmel, February 2012
Negotiaion, 6th edition, by Roy Lewicki, Bruce Berry, and David Saunders, 2010 McGraw-Hill