This CAW/Chrysler/Fiat item is a great study of clashing negotiating strategies, and Ken Lewenza and C0. are very likely looking back instead of looking forward (which seems to be common with U.S. automakers). I confess that my perspective is shaped by this article in today’s Financial Post, a conservative (anti-union?) publication. For full disclosure, my education is heavily in business, and I teach in the MBA program at Schulich Business School.

If everyone has it in for the CAW, as Lewenza claims (”[the Canadian Government is] interfering in our negotiations [with Chrysler), then he needs to fight back with some pretty powerful evidence. The fundamental premise of the “other side’s” argument is that CAW workers are paid much more than Toyota and Honda workers, so the wages need to come down to competitive levels.

Lewenza challenges that argument directly (although it is at the very end of the article; damn right-wing editors!). He says that “Canadian executives at Toyota and Honda have described many times their strategy of essentially matching wages, pensions and core benefits to those paid in CAW-represented facilities.” So, I guess, it is just a shell game, and CAW workers and workers at Toyota and Honda are ALREADY paid the same wages, right? If that is the case, then there must be another reason that Chrysler is so unable to compete. Such as, no one buys the cars. This is not good news for CAW workers in Chrysler facilities.

This situation is a clear example of an entity (CAW) or at least a person (Ken Lewenza) so heavy with history that they cannot shed a combative/competitive mindset that has no place in competitive industries where stakeholdes (including government) need to work together to beat the real competition. I feel sorry for the people who are being mislead so badly by Mr. Lewenza. This will be a powerful lesson for organized labour.

Tags: Tags: Chrysler, Ken Lewenza, Negotiations —

You won’t need a link to find references to Ken Lewenza’s response to Fiat’s “take-it-or-leave-it” offer (on April 16, 2009). This story is moving quickly,  so my thoughts may quickly be irrelevant. Mr. Lewenza cried foul that Fiat CEO Sergio Marchionne was not taking the time to “build the relationship” with Chrysler and its employees before embarking on this joint venture.

I am all about the “relationship” side of the business. There is a place for relationships in the Fiat/Chrysler landscape, and I think that Mr. Marchionne is familiar with the value of relationships, as well. I suspect, he has simply opted to put results first. If my guess is right, this is a strategic direction given that his company is operating in a fiercely competitive environment and cannot afford to make any concessions that are disproportionate to added value. I think that his shareholders (and business partners) would applaud that.

Relationships are absolutely necessary, but in some instances, it will have to be compromised. I think this is one of those situations. Maybe it is a dose of “tough love” to an entity who no longer has a competitive wage structure.

Tags: Tags: Chrysler, Fiat, Ken Lewenza, Negotiations, relationships in business, Sergio Marchionne —

What happens when you get a deal that is too good? I think that we are trained to be suspicious of the “too good to be true”, but here are a couple of recent instances where there may be some excess sweetness: 1 – city workers in Toronto and 2 – Chrysler Canada’s employees. Both of these deals were conceivably negotiated in good faith, so a deal is a deal, right?

Would you really give back what you won?

Topping the list of “don’t even go there” would be the danger of setting a precedent: “they” will take more or give less in the future. I might, however, suggest that mutual interests over the long-term could prevail if these “winners” concede to the “losers” so that there is a bigger “win” (or smaller loss) for both parties.

In both instances there is a sustainability argument to be made. Many people in very different positions have a stake in both the City of Toronto and Chrysler (and other automotive entities) surviving, succeeding and flourishing. The competition in the auto sector better illustrates how the “take what you can” attitude is misplaced.

When the going is good you don’t notice (can handle?) an extra load, so a company/organization can carry more than its share. When competition ramps up to the extent where “placing near the top” is no longer good enough, everybody has a responsibility to work together to “win.” If winning the marathon really matters, non ones cares that you finished in the top ten while carrying your kids on your back.

Chrysler and company (including unionized workers) should be focussed on proving that the current problems are not due to producing cars no one wants. They will need to be unburdened to prove that point. Once proven, let them carry as much as they can. If they can’t live the balance of provide fair wages and remain competitive, they should not be in business. Workers need to look at “fair” in the context of the bigger picture.

And I would not be too concerned about the precedents. One of the few certainties today appears to be that we are living in “unprecedented times.” Desperate times may call for collaborative measures.

Tags: Tags: Chrysler, City of Toronto, collaboration, In-group/out-group, Negotiations —

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