intercultural negotiation

Browaeys & Price, Understanding Cross-Cultural Management, 2nd Edition © Pearson Education Limited 2011

Slide 15.1

Topic 7: Intercultural Negotiation

Negotiation: Process of discussion between two or more people aimed at reaching a mutually acceptable agreement International Negotiation More complex than domestic negotiationsDifferences in national cultures and differences in political, legal, and economic systems


Slide 15.2

The Negotiation Process


Slide 15.3


• Preparation

– What are the goals?

– How will I work with the other party?

• Relationship building – taking time to build mutual trust before starting business discussions

• Exchanging task related information – during this stage each side makes a presentation and states its position, normally followed by a question-and-answer session


Slide 15.4


• Persuasion – during this stage both parties try to persuade the other to accept more of their position while giving up some of their own; there are recognizable tactics for this stage

• Concessions and Agreements – at this point each side will make various concessions so that an agreement can be reached and signed


Slide 15.5

VERBAL AND NONVERBAL NEGOTIATION TACTICS

• Promise

• Threat

• Recommendation

• Warning

• Reward

• Punishment

• Normative appeal

• Commitment• Self disclosure• Refusal• Command• Interruption


Slide 15.6

Comparison of Brazilian, U.S., and Japanese Negotiators (in half-hour bargaining session)


Slide 15.7

“DIRTY TRICKS” IN INTERNATIONAL NEGOTIATIONS

• Dirty tricks are negotiation tactics that pressure opponents to accept unfair or undesirable agreements or concessions


Slide 15.8

PLOYS/DIRTY TRICKS - POSSIBLE RESPONSES

• Deliberate deception - point out what is happening

• Stalling - do not reveal when you plan to leave • Escalating authority - clarify decision making

authority

• Good guy, bad buy routine - do not make any concessions

• You are wealthy and we are poor - ignore the ploy

• Old friends - keep a psychological distance


Slide 15.9

Persuasion Tactics


Slide 15.10

Differences in Negotiator Strategies and Tactics in Three Countries

TACTIC Japanese N = 6 American N = 6 Brazilian N = 6

Promise

Threat

Recommendation

Warning

Reward

Punishment

Positive normative appeal

Negative normative appeal

Commitment

Self-disclosure

Question

Command

7

4

7

2

1

1

1

3

15

34

20

8

8

4

4

1

2

3

1

1

13

36

20

6

3

2

5

1

2

3

0

1

8

39

22

14

Individual Tactics as a Percentage of Total Tactics


Slide 15.11

13-11Differences in Negotiator Strategies and Tactics in Three Countries

TACTIC Japanese N = 6 American N = 6 Brazilian N = 6

Number of times word “No” used

Silent periods of 10 seconds or more

Conversation overlaps (interruptions)

Gazing (minutes per random 10 minute period)

Touching

5.7

5.5

12.6

1.3 min.

0

9.0

3.5

10.3

3.3 min.

0

83.4

0

28.6

5.2 min.

4.7

Occurrences in a 30-Minute Bargaining session


Slide 15.12

Basic Negotiation Strategies

• Competitive negotiation: each side tried to give as little as possible and tries to “win” for its side– The negotiation as a win-lose game

• Problem solving: negotiators seek out ground that is beneficial to both companies’ interests– Search for possible win-win

situationsMost experts recommend a problem

solving negotiation strategy


Slide 15.13

Preferences for Problem-Solving Negotiation

0

20

40

60

80

100

Japan

China

Argentina

France

IndiaUSA

UK Mexico

Germ

any

Nigeria

Brazil

Spain

% Win-Win


Slide 15.14

Understanding Negotiation Styles


Slide 15.15

Understanding Negotiation Styles

• For North Americans, negotiations are businesslike; their factual appeals are based on what they believe is objective information, presented with the assumption that it is understood by the other side on a logical basis.

• Arabs use affective appeals based on emotions and subjective feelings.

• Russians employ axiomatic appeals – that is, their appeals are based on the ideals generally accepted in their society.


Slide 15.16

Profile of an American Negotiator

• Knows when to compromise• Takes a firm stand at the beginning of the

negotiation• Refuses to make concessions beforehand• Keeps his or her cards close to his or her chest• Accepts compromises only when the negotiation is

deadlocked• Sets up the general principles and delegates the

detail work to associates• Keeps a maximum of options open before

negotiation• Operates in good faith


Slide 15.17

Profile of an American Negotiator

• Respects the “opponents”• States his or her position as clearly as possible• Knows when he or she wishes a negotiation to

move on• Is fully briefed about the negotiated issues• Has a good sense of timing and is consistent• Makes the other party reveal his or her position

while keeping his or her own position hidden as long as possible

• Lets the other negotiator come forward first and looks for the best deal


Slide 15.18

Profile of an Arab Negotiator

• Is able to resist any kind of pressure that the opponents could try to exercise on him

• Uses references to people who are highly respected by the opponents to persuade them to change their minds on some issues

• Can keep secrets and in so doing gains the confidence of the negotiating parties

• Controls his temper and emotions• Can use conference as mediating devices• Knows that the opponent will have problems in carrying

out the decisions made during the negotiation• Is able to cope with the Arab disregard for time


Slide 15.19

Profile of an Arab Negotiator

• Protects all the parties’ honor, self-respect, and dignity

• Avoids direct confrontation between opponents• Is respected and trusted by all• Does not put the parties involved in a situation

where they have to show weakness or admit defeat• Has the necessary prestige to be listened to• Is creative enough to come up with honorable

solutions for all parties• Is impartial and can understand the positions of the

various parties without leaning toward one or the other


Slide 15.20

Negotiating with the Chinese

• Business people have two major areas of conflict when negotiating with the Chinese– Amount of detail about product characteristics– Apparent insincerity about reaching an agreement

• Chinese negotiation process is affected by three cultural norms– Politeness and emotional restraint– Emphasis on social obligations– Belief in the interconnection of work, family, and

friendship


Slide 15.21

Negotiating with the Chinese

• Tips to foreigners conducting business in China– Practice patience– Accept prolonged periods of stalemate– Refrain from exaggerated expectations– Discount Chinese rhetoric about future prospects– Expect the Chinese to try to manipulate by shaming– Resist the temptation to believe that difficulties are

your fault– Try to understand Chinese cultural traits


Slide 15.22

Differences Between American and Chinese Culture and Approach to the Negotiation Process

Contrast of Basic Cultural Values

American

Task and information orientedEgalitarianAnalyticalSequential, monochronicSeeks the complete truthIndividualistConfrontative, argumentative

Chinese

Relationship orientedHierarchical

HolisticCircular, polychronic

Seeks the harmonious wayCollectivist

Haggling, bargaining


Slide 15.23

13-23Differences Between American and Chinese Culture and

Approach to the Negotiation Process

Approach to the Negotiation Process

American

Quick meetingsInformalMake cold calls

Full authorityDirectProposals first

AggressiveImpatient

A “good deal”

Chinese

Long courting processFormal

Draw on intermediaries

Limited authorityIndirect

Explanations first

QuestioningPatient

A long-term relationship

nontask sounding

information exchange

means of persuasion

terms of agreement


Slide 15.24

Conceptualizing Culture and Negotiation

• Culture as learned behavior– A catalogue of behaviors the foreign negotiator should

expect

• Culture as shared values– Understanding central values and norms

• Individualism/collectivism• Power distance• Career success/quality of life• Uncertainty avoidance


Slide 15.25

Impact of Culture on Negotiation

Negotiation FactorGoal Contract Relationship

Attitudes Win/Lose Win/Win

Personal Styles Informal Formal

Communication Direct Indirect

Time Sensitivity High Low

Emotionalism High Low

Agreement Form Specific General

Agreement building Bottom Up Top Down

Team Organization One Leader Consensus

Risk Taking High Low


Slide 15.26

Managing Negotiation

• Successful management of intercultural negotiations requires the manager– To gain specific knowledge of the parties in the

upcoming meeting– To prepare accordingly to adjust to and control

the situation– To be innovative


Slide 15.27

Managing Conflict


Slide 15.28

Twelve Variables in the Negotiation Process


Slide 15.29

The Influence of Culture on Negotiation

• Effect of culture on negotiator ethics and tactics– Differences exist in the tolerance of different

negotiation tactics in different cultures – Negotiators who trusted the other party were

less likely to use questionable negotiation tactics

• Effects of culture on conflict resolution– Within collectivistic countries, disagreements

are resolved based on rules, whereas in individualistic countries, conflicts tend to be resolved through personal experience and training


Slide 15.30

Major Points Regarding Successful International Negotiation

1. Few negotiations succeed without extensive preparation.

2. Building personal relationships is a key step in a negotiation.

3. Managers should be aware that first offers may differ by cultural background.

4. Many tactics are used in persuasion.

5. Know how counterpart views the concession-making process.

6. Culture and legal traditions influence the content and force of law regarding business contracts.

7. Competitive negotiation seldom leads to long-term relationships.

8. Problem-solving negotiation is more flexible and probably more successful strategy.

9. Must be flexible, empathic, and physically tough.

intercultural negotiation

Education

crosscultural management

browaeys price

nonverbal negotiation

negotiation process

persuasion tactics

stage concessions

recognizable tactics

brazilian n