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This case is about the deadlock created between three parties because of business conflict
and how this conflict was resolved through negotiations.
THE PROBLEM
There were number of reasons that created problems among the parties. One of the most
important reasons was communication gap. Failure to communicate effectively often leads
to conflict, which can harm an organization. This is what happened to the parties involved.
Creating Uncertainty
A lack of communication can create uncertainty that leads to stress and conflict. As in this
case, Sheryar khurshid who was the marketing manager at CCT was waiting for a Chiara, the
contact person at Texitalia to deliver key information so he can complete a task on time.
When Chiara did not not respond to the Shehryar's request for a status report and when she
neglected to keep the work "in the loop". As a result, conflict between the two occurred.
Poor Teamwork
This was what happened with CCT. It was the responsibility of CCT to conduct quality audit
of the AZ textiles before dispatching the shipment as AZ textiles rely on CCT team to
complete the projects or even to carry out the routine functions of a department. The
members of the team did not spot the problem and communicated with each other. So it
was overlooked completely, leading to confusion and conflict between the companies and
the ultimate failure to achieve objectives.
Misunderstanding
A lack of communication can lead to misunderstanding, which in turn can lead to mistakes,
missed deadlines and altered project directions. Texitalia felt that their work and time has
been wasted whereas AZ textiles blamed Chiara for not conveying the proper information in
a timely manner, which resulted in frustration. Misunderstanding arose when instructions
were not clearly communicated; updates and status reports were not shared right away.
This resulted in misinterpreted facts and details that prompted AZ textiles to work from one
set of perceived facts and information and both parties believed that they are right and
other party is wrong.
Non-responsiveness
Another source of conflict is non- responsiveness from Chiara to a request for information,
clarification or opinion. AZ textile awaiting a response felt that other party is being
intentionally no communicative and is overworked. This situation created a toxic, non-
collaborative environment.
Different Communication Styles
People communicate differently, in different languages and when no defined
communication strategies are in place, those different styles clash and create conflict. As in
this case, Chiara was reluctant and did not enjoy dealing with suppliers in Pakistan because
of the language barriers, as all other clients of texitalia communicated in Italy, where as
medium for AZ textiles to communicate with them was English which Chiara did not
understand. Both parties came to feel the other is being difficult, and this caused a
communication breakdown.
WHO WAS INVOLVED? WHO ARE THE MAIN PARTIES?
Three companies are involved. Creative clothing and textiles is a buying house in
Lahore, Pakistan. Iftikhar khurshid was the managing director of CCT and his role was
to removing the deadlock in negotiation between other two parties.
Texitalia is an Italian retailer brand based in Florence. The contact person at texitalia
was Chiara and Baresi was the chief buyer of texitalia.
AZ textile is a woven garment stitching unit of very high repute in Pakistan. The company
had setup its own sakes offices in UK, Germany and Belgium. Imran Saeed was the
marketing manager and an account executive who handled texitalia account at AZ textiles.



WHAT ACTUALLY HAPPENED?
CCT is a buying house acting as middlemen between AZ textiles and texitalia, its customer.
The issue aroused from the quality problems when one of the orders delivered to texitalia
had quality problems and texitalia raised claim for the defects. AZ textile do not want to pay
the full claim so they offered different options to texitalia to agree on but texitalia did not
accept any of the offer and demanded the full claim. Ac CCT is the middleman so Khurshid
tried to convince AZ textiles to pay off the claim because texitalia was a huge client for CCT
and 80% of the business was dependent on texitalia so they did not want to lose their
potential customers. Whereas Saeed was unable to make the decision because the owner of
AZ textiles was not present in the country so Saeed could not take decision on his own.
These issues got prolonged and worsen the situation. Texitalia refused to continue its
business with AZ textiles because according to them it is very important for them to make
sure they have a clear history with their suppliers. AZ textiles at first hand offered them 10%
discount until their claim of 30000 us$ is clear but the condition is to continue operations
with them, they rejected the offer by linking the discount as a blackmail technique. In
response to AZ textiles offer, texitalia's counter offer was to help AZ textiles find customer
for their rejected items for 2.5-3 US$ per item but AZ spoiled the situation more by bluffing
that they got the customers for rejected items in Germany for 4 US $ per item. So what
happened next was the termination of Baresi from texitalia by top management and
appointment of Andenna who was quite introvert and it was very difficult for AZ textiles to
communicate with him further because he clearly said his company is not going to keep the
business with AZ until and unless AZ pay them their claim. Khurshid forced AZ to pay off but
at the end he had to think of paying texitalia by himself because texitalia was big customers
for CCT.

WHAT DID YOU WANT TO HAPPEN?
When there is a continuing relationship between disputants, helping them find a settlement
for their current disagreement is often not enough. New conflicts may arise or deeper issues
resurface.
Conflict can also be negative and adversely affect the success of the group. The solution is
for the group to deal with its conflict constructively, before it becomes embedded, spreads
and erodes the foundation to the point where it cannot carry on any longer.
Underneath incompatible positions lie compatible interests.
Dig for and reach the compatible interests.
Every side usually has something valuable to say.
Listen to both sides equally, and hear the valuable contributions. CCT should not
have prolonged this issue. And as this issue surfaced they should have taken action.
Issues become polarized when there is little or no dialogue.
Initiate discussion and dialogue, encouraging participation.
High emotions charge the issue.
Create an environment where both parties can express their feelings and concerns.
As khursheed and saeed went there at the end to meet Andiana, it must be done in
the beginning.
Parties will focus on differences
Ask them to identify areas they have in common, remind them and express progress.
CCT must remind both parties what is beneficial for both of them.
Parties may become defensive and protect, justify or explain their position.
Search for solutions: seek to understand but remind them of the need to move on.
Identifying and understanding the desired outcomes will result in progress.
Step back - ask the parties what they want the outcome to be, and list the desired
outcomes.

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