Chapter 11 Different Business Culture and Negotiation

Understanding different cultures

How do cultures vary?

What are the implications of differences?

Adopting culture-specific strategies

in four types of cultures

Questions in focus

1. How do cultures vary?

2. What are the implications of cultural differences?

3. How to overcome the differences?

The culture differences are the major barriers to cross-culture negotiations

One of the biggest mistakes in any discussions of negotiation practices is to ignore differences between cultures, and different social groups have different ideas of what is proper protocol and procedure.

How do cultures vary?• Fons Tronpenaars’ research:• When a close friend is potential in serous

trouble with the law – North American and most North EuropeanNorth American and most North European think

they have no right or some right to protect their friends and lie to the police

• So do 70% of the French and the Japanesethe French and the Japanese people, while over 1/3 of the respondentsthe respondents think they have no right

– More than half of respondents in Russiain Russia, Venezuela, Indonesia and ChinaVenezuela, Indonesia and China would lie to police to protect their friends

How do cultures vary?

• Geert Hofstede’s study shows: people from different cultures have very different views of what is fair, reasonable and proper behavior – Four key factors to explainsFour key factors to explains::

• Power distance:– High: Portugal, Greece, France, and Belgium– Low : Denmark, Norway, UK

• Masculinity: – Feminine: Scandinavian countries – Moderate: USA– High masculine: Japan and Austria

How do cultures vary?

• Individualism: – High: Anglo-Saxon countries, Italy, Belgium– Low: Span, Greece, Portugal, France, Latin American

countries and Japan

• Uncertainty avoidance plotted against the Power distance index such as Latin American and European, but Singapore, Hong Kong and India combine lager power distance with weak uncertainty avoidance while Scandinavia and Anglo-Saxon countries combine small power distance and weak uncertainty avoidance

How do cultures vary?Typical countries

Power distance

Masculinity Individualism Uncertainty avoidance

Belgium High moderate high

Germany Low High High Low

Netherlands Low Low Low Low

France High Low High High

Italy Moderate High High

Denmark low High Low Low

UK low High high Low

How do cultures vary?• Andre Laurent’s survey:

• It is important for a manager to have at hand preciseprecise answeranswer to most of the questions that his subordinates may raise about their work– 13% of both Swedish and American

managers agreed– 59% of both French and Italian

mangers agreed– 30% and 50% of managers from UK,

Germany, Switzerland and Belgium agreed

How do cultures vary?

• Michael Bond: – Short-term: West European

and North America• And most short-term: UK,

Nigeria and Pakistan– Long-term: East Asian– Confucian dimension: Non-

Asian countries such as Brazil, Netherlands

How do cultures vary?• Trompenaars’ study on looking at time

• >: be more important than

• =: be equal to or connect – Russia: future>present>past– Belgium and British: present >>past– French : future=present=past– Germans: present = future

What are the implicationsthe implications of differences?

We are not aware of our cultural bias

We become blind to our own cultural norm

Other culture are implicitly perceived as unfortunate deviations from the norm

Stereotyping is common