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Unfortunately your last-hour attempt at productivity in Scenario #1 failed and the meeting adjourned for the day without finalizing price on a single contract line item. As you unhappily gather your documents, the lead negotiator for the OEM approaches you and requests that you meet one-on-one over dinner to determine how to proceed the next day. Anxious for a remedy, you eagerly agree. As you proceed with dinner, your contractor counterpart states that he is perplexed as to why negotiations are proceeding so poorly. He continues to explain that all of the material costs and labor rates are well within government limits. Furthermore, the only factors that need consideration are the overhead and profit percentages. After a half-hearted laugh you state that you wish that it were that easy. You explain your urgency to wrap up negotiations so that you can return home to help your daughter complete applications for desperately needed college tuition. You continue to explain that although her grades and test scores indicate a high potential of receiving a scholarship, it is unlikely that the scholarship will cover the $50K per year tuition required for the prestigious school that she has set her heart on. After a few moments of silence, your counterpart enthusiastically remembers that the OEM offers scholarship and internship opportunities to promising students in the defense community. He assures you that your daughter is virtually guaranteed a full scholarship. Not sure what to say, you return to the negotiation and ask about the final terms. Your counterpart states that he is willing to accept the government proposed profit percentage if you will accept an additional 2% on the overhead rate. He argues that this funding is absolutely required for the contractor to ensure technical and manufacturing capabilities during the 5-year delivery period. In less than two hours, it appears that you have obtained a viable solution to all of your problems. How will you proceed?
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