Cross Cultural Negotiation

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International and Cross-Cultural Negotiation
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Punctuality
Western Asian
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What Makes International Negotiations Different?

Two overall contexts have an influence on international negotiations:
Environmental context
Includes environmental forces that neither negotiator controls that influence the negotiation
Immediate context
Includes factors over which negotiators appear to have some control
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Environmental Context
Factors that make international negotiations more challenging than domestic negotiations include:

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Political and legal pluralism International economics Foreign governments and bureaucracies Instability Ideology Culture External stakeholders
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Immediate Context
Factors over which the negotiators have influence and some measure of control:
Relative bargaining power Levels of conflict Relationship between negotiators Desired outcomes Immediate stakeholders
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The Contexts of International Negotiations
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How Do We Explain International Negotiation Outcomes?

International negotiations can be much more complicated
Simple arguments cannot explain conflicting international negotiation outcomes The challenge is to:
Understand the multiple influences of several factors on the negotiation process Update this understanding regularly as circumstances change
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Conceptualizing Culture and Negotiation

1. Culture as learned behavior
A catalogue of behaviors the foreign negotiator should expect
2. Culture as shared values

Understanding central values and norms Individualism/collectivism Power distance Career success/quality of life Uncertainty avoidance
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Hofstedes Dimensions of Culture

Individualism/collectivism Power distance Masculinity/femininity Uncertainty avoidance
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Way of Life
Individualism - Collectivism
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Individualism/Collectivism
Definition: the extent to which the society is organized around individuals or the group Individualism/collectivism orientation influences a broad range of negotiation processes, outcomes, and preferences
Individualistic societies may be more likely to swap negotiators, using whatever short-term criteria seem appropriate Collectivistic societies focus on relationships and will stay with the same negotiator for years
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The Boss at Work
Power Distance
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Power Distance
Definition: The extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally
Cultures with stronger power distance will be more likely to have decision-making concentrated at the top of the culture.
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Masculinity/Femininity
Definition: the extent cultures hold values that are traditionally perceived as masculine or feminine
Influences negotiation by increasing the competitiveness when negotiators from masculine cultures meet
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Uncertainty Avoidance
Definition: Indicates to what extent a culture programs its members to feel either uncomfortable or comfortable in unstructured situations
Negotiators from high uncertainty avoidance cultures are less comfortable with ambiguous situations--want more certainty on details, etc.
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Hofstedes Cultures Ranking in the Top 10
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Conceptualizing Culture and Negotiation

3. Culture as dialectic
All cultures contain dimensions or tensions that are called dialectics Example: Judeo-Christian parables too many cooks spoil the broth and two heads are better than one offer conflicting guidance This can explain variations within cultures
4. Culture in context
No human behavior is determined by a single cause All behavior may be understood at many different levels simultaneously
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5. Culture as Values
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The Influence of Culture on Negotiation: Managerial Perspectives

Definitions of negotiation Negotiation opportunity Selection of negotiators Protocol ( modus operendi) Communication Time sensitivity Risk propensity Groups versus individuals emphasis Nature of agreements Emotionalism
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The Influence of Culture on Negotiation: Research Perspectives
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The Influence of Culture on Negotiation: Managerial Perspectives

Definitions of negotiation Negotiation opportunity Selection of negotiators Protocol Communication Time sensitivity Risk propensity Groups versus individuals emphasis Nature of agreements Emotionalism
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Negotiation process
Culture has been found to have significant effects on the negotiation process, including:
How negotiators plan The offers made during negotiation The communication process How information is shared during negotiation
Effects of culture on negotiator cognition

Accountability to a constituent influenced negotiators from individualistic and collectivistic cultures differently
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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
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Culturally Responsive Negotiation Strategies

When choosing a strategy, negotiators should:
1. Be aware of their own and the other partys culture in general Understand the specific factors in the current relationship Predict or try to influence the other partys approach
2.
3.
4. Strategies are arranged based on the level of familiarity (low, moderate, high) that a negotiator has with the other partys culture
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Low Familiarity
Employ agents or advisers (unilateral strategy)
Useful for negotiators who have little awareness of the other partys culture
Bring in a mediator (joint strategy)

Encourages one side or the other to adopt one cultures approaches or mediator culture approach
Induce the other party to use your approach

(joint strategy)
The other party may become irritated or be insulted
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Moderate Familiarity
Adapt to the other negotiators approach (unilateral strategy)
Involves making conscious changes to your approach so it is more appealing to the other party
Coordinate adjustment (joint strategy)

Involves both parties making mutual adjustments to find a common process for negotiation
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High Familiarity
Embrace the other negotiators approach
(unilateral strategy)
Adopting completely the approach of the other negotiator (negotiator needs to completely bilingual and bicultural)
Improvise an approach (joint strategy)

Crafts an approach that is specifically tailored to the negotiation situation, other party, and circumstances
Effect symphony (joint strategy)

The parties create a new approach that may include aspects of either home culture or adopt practices from a third culture
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Planning For International Negotiations The following checklist ensures proper preparation and planning for international negotiations: 1. Assessment of the situation and the people Facts to confirm during the negotiation Agenda Best alternative to a negotiated agreement Concession strategies Team assignments
2. 3. 4.
5. 6.
Implications for Managers and Negotiators Four steps lead to more efficient and effective international business negotiations, which include: 1. 2. selection of the appropriate negotiation team; management of preliminaries, including training, preparations, and manipulation of negotiation settings; management of the process of negotiations, that is, what happens at the negotiation table; appropriate follow-up procedures and practices;
3.
4.

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16-1

International and Cross-Cultural Negotiation

What Makes International Negotiations Different?

The Contexts of International Negotiations

How Do We Explain International Negotiation Outcomes?

Conceptualizing Culture and Negotiation

2. Culture as shared values

Hofstedes Dimensions of Culture

The Boss at Work

Hofstedes Cultures Ranking in the Top 10

Conceptualizing Culture and Negotiation

The Influence of Culture on Negotiation: Managerial Perspectives

The Influence of Culture on Negotiation: Research Perspectives

The Influence of Culture on Negotiation: Managerial Perspectives

The Influence of Culture on Negotiation: Research Perspectives

Effects of culture on negotiator cognition

The Influence of Culture on Negotiation: Research Perspectives

Effects of culture on conflict resolution

Culturally Responsive Negotiation Strategies

Bring in a mediator (joint strategy)

Induce the other party to use your approach

Coordinate adjustment (joint strategy)

Improvise an approach (joint strategy)

Effect symphony (joint strategy)

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