9-Step Model

Describe end state goals. Step3

The end state goals for USAuto are primarily based on securing their patent and also increasing profit. I believe that it is safe to say that the first one that owns the rights to a patent is usually the one that gains the most financially. Because of this, it is in the best interest of USAuto to secure their patent as best as possible. In the past American Patent laws were the best in the world, but because of the changes in the world the laws have become less effective. New aggressive legal scheme has put American inventers at a disadvantage to foreign competition. The American inventors would think that they have a potential patent secure but someone else could have already have the same or similar patent as secrets. In some cases, all it would take to defuse an inventor is a law suit challenging his patent; sometimes the inventors don't have the resource to compete so they will lose the fight to own their patent.

Based on the strict patent laws within the USA and the potential partnership between USAuto and AutoMex; it would be in the best interest for USAuto to keep the hybrid engine assembly within the united states, because it would provide more patent protection. AutoMex would have the opportunity to produce the non-engine parts of the auto. The idea of AutoMex wanting the opportunity to assemble some of the engines within Mexico is impressive because it show that they are excited about the potential partnership. However, too much risk is involved with turning over patent secrets to another company.

With regard to increasing profit USAuto will be able to so do by, cutting cost with labor and also by taking advantage of the short distance between the US and Mexico. If the partnership is completed USAuto can also gain access to the Central and South America markets to sell the hybrid cars. Based on the proposed recommendation from Ms. Henderson, AutoMex will receive 25 percent of the profit made and USAuto will get the other 75 percent. USAuto is leaning toward this percent break down because they want to recuperate the substantial up from money that they spent to develop the engine.

The end state goal for AutoMex is that they want a bigger stake with regards to the partnership. They clearly state that they want equal partnership, meaning that they want to share the profit 50-50. They also want to do some of the hard core engine assembly within Mexico. AutoMex know that they are a company of high value; so manufacturing most of the other car parts is not sufficient for them. They want a true partnership where thing is shared equally. USAuto will get a share of the profit for the investment it made and AutoMex will get their share for investment it now must make in training successful workers.

Since U.S. Auto and Auto Mex are having difficulties coming to a conclusion from negotiations, some alternatives may be needed to assist in making a decision. When attempting to reach consensus decision, it may sometimes take a great deal of time due to the effort expended for reasoning, debate or consensus building. However, once a decision has been reached using the appropriate tools, statistics and methods it is usually the best possible decision and all team members will usually work together to support it. By using logical decision making techniques Auto Mex and U.S. Auto can begin to tackle problems which might otherwise seem cumbersome, overwhelming and extremely complex.

One solution would be to share the patent. Let Auto Mex begin building the non engine parts of the auto at Auto Mex, while making negotiations with Central and South American countries. Then after they have gained access to the international market they can begin to build their own industry leading engines with the wealth of new technology information that they have. While evaluating this alternative we found that by allowing Auto Mex to build engines in a location that is convienent for them as well as the impression that the engine is almost entirely the work of Auto Mex. Thus, making Auto Mex want to work faster and continue to produce quality products in a short time frame.

Another alternative for U.S. Auto and Auto Mex would be to not share the patent, but share the profit 50-50. The building of the hybrid engine is just as important as the creation of the engine. With this alternative both parties are somewhat satisfied in their negotiations for building the hybrid engine. Although U.S. Auto will be receiving less of the profits that they wanted to receive, they will still have the worry free problem of having another country steal an idea that they have been working effortlessly on for years. Auto Mex on the other side will unfortunately still not have a patented product to call their own, but they will at least be recognized for their hard work and efforts.

Another alternative that U.S.Auto could go with is to increase their Sales team in other countries. Forget about Auto Mex, U.S. Auto is trying to expand into the international market anyway, so why not market the product as well as accept bids for builders who are able to assemble products at a low labor cost. With this alternative U.S. Auto can begin a fresh negotiation with other Central and South American countries to assist in building an industry leading engine and share the profits. Auto Mex is already aware of U.S. Auto's financial state, so it may help to start with a country or company that is almost equally financially stable but has not been able to patent a product.

Another alternative that Auto Mex could go with is to begin to hire their own intellectual property builders. Going with this alternative will allow Auto Mex to build, manufacture and market on their own terms and conditions as well as in their own country.

Identify and asses risk. Step6.

The risk for USAuto is substantially greater than the risk for AutoMex. With the possible partnership USAuto are taking the risk of exposing their patent to another company within another country. USAuto invested lots of money and did many hours of research to invent their hybrid engine and AutoMex did nothing. They also are taking a huge risk of expanding their business and product to another country where it might not be accepted by consumers and workers. Whenever cheap labor is involved there is always a risk of having low quality of work. The Mexican workers might decide that they don't want to work half way through the contract; that would be a great loss for USAuto. Also, being that AutoMex are being so strong about wanting more; what would stop them for breaching their contact with USAuto

...