CrossCultural Negotiation

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Cross-Cultural Negotiation

• Dr. Carol Reade
• Bus 162

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Importance of Negotiation

• As global business expands, negotiations between
  people from different countries and cultures
  becomes more prevalent
• Effective cross-cultural negotiation is an
  important global business skill
• Global managers spend about 50 of their time in
  negotiation
• Negotiation styles differ across cultures

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Definitions

• Negotiation is the process of back-and-forth
  communication aimed at reaching an agreement,
  when some of ones interests are shared and some
  are opposed.
• A negotiation becomes cross-cultural when the
  parties involved belong to different cultures and
  do not share the same ways of thinking, feeling,
  and behaving.

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Negotiation across Cultures

• There are a range of negotiating styles across
  cultures
• Negotiation styles vary on key aspects
• Amount and type of negotiation preparation
• Relative emphasis on task versus relationship
• Use of general principles versus specific details
• Number of people present
• Extent of negotiators authority

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Leveraging Differences

• Cultural diversity makes communicating
  effectively more difficult
• Yet, differences, rather than similarities, can
  form the basis of mutually beneficial solutions

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Negotiating Successfully

• The success of a negotiation depends on three
  areas
• Individual characteristics
• Situational contingencies
• Strategic and tactical processes
• These areas differ across cultures

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Qualities of a Good Negotiator

• Depends on the culture
• Americans believe that a good negotiator acts
  rationally, plans well, and works well under
  pressure
• Japanese believe that a good negotiator focuses
  on interpersonal relations, listens well, and
  wins respect
• Taiwanese believe that a good negotiator shows
  persistence and determination, wins confidence
  and respect, and should be an interesting person

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Negotiation Contingencies

• Effective negotiators recognize and manage the
  impact of the situation through the eyes of both
  cultural perspectives
• What do they need and want?
• What is important to them?
• What is their time frame?
• Where do they draw their personal and
  organizational bottom lines?
• Who has power?

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Negotiation Contingencies

• Location
• Their office, your office, or neutral place?
• Physical arrangements
• Across from parties, or side by side?
• Participants
• Who should attend the negotiation session?
• Time Limits
• Short-term vs. longer-term perspectives
• Status Differences
• Egalitarian vs. hierarchy and formality

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Negotiation Process

• Process is the single most important factor
  influencing the success or failure of a
  negotiation
• Traditional (competitive) approach
• Principled approach
• Separate the people from the problem
• Focus on interests, not on positions
• Insist on objective criteria
• Invent options for mutual gain
• Culturally synergistic approach

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Stages of a Negotiation

• Planning
• Interpersonal relationship building
• Exchanging task related information
• Persuading
• Making concessions and reaching agreement

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Summary

• Negotiation styles vary across cultures
• Need keen observation during cross-cultural
  negotiation
• Cannot jump to conclusions
• Use active listening
• Search for synergistic solutions

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For next class

• Read about Japanese negotiation etiquette at
• http//www.executiveplanet.com/index.php?titleJa
  pan