Negotiations and Decision-Making Across Borders and Cultures

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Chapter 13

• Negotiations and Decision-Making Across Borders
  and Cultures

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Negotiation
The process of verbal and non-verbal exchanges
between two or more parties with the goal of
reaching a mutually satisfactory agreement
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Bargaining
The process of arguing and haggling over prices
and other details involved in transactions of
goods and services, common in flea markets,
bazaars, and fairs all over the world
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Situational Characteristics Influencing
Cross-Border Negotiations

• Context of the negotiation
• Physical arrangements
• Time limits
• Status differences

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Fundamental Elements of the Negotiation Process

• Two or more parties involved in real or perceived
  conflict over important goals
• Shared interest in reaching an agreeable solution
• Background preparations leading to the process of
  negotiation
• A goal, but not a certainty, of reaching mutual
  agreement

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Ex. 13-1 Stages of Negotiation in International
Management
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Ex. 13-2 Differences in Negotiator Strategies
and Tactics in Three Countries
Individual Tactics as a Percentage of Total
Tactics
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
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Ex. 13-2 (contd.)
Occurrences in a 30-Minute Bargaining session
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
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Ex. 13-3 Comparison of Cultural Approaches to
Negotiation
American Negotiator Indian Negotiator Arab Negotiator
Accepts compromise when deadlock occurs Has firm initial and final stands Sets up principles but lets subordinates do detail work Has a maximum of options Respects other parties Is fully briefed Keeps position hidden as long as possible Relies on truth Trusts instincts Seeks compromises Is ready to alter position at any point Trusts opponent Respects other parties Learns from opponent Avoids use of secrets Protects face of other parties Avoids confrontation Uses a referent person to try to change others, e.g. Do it for your father Seeks creative alternatives to satisfy all parties Mediates through conferences Can keep secrets
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Ex. 13-3 (contd.)
Swedish Negotiator Italian Negotiator
Gets straight to the point of the discussion Avoids confrontation Time conscious Overly cautious Informal Flexible Reacts slowly to new propositions Quiet and thoughtful Dramatic Emotional Able to read context well Suspicious Intrigues Uses flattery Concerned about creating a good impression Indefinite
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Ex. 13-4 Differences Between American and
Chinese Culture and Approach to the Negotiation
Process
Contrast of Basic Cultural Values
American Task and information oriented Egalitaria
n Analytical Sequential, monochronic Seeks the
complete truth Individualist Confrontative,
argumentative
Chinese Relationship oriented Hierarchical Holist
ic Circular, polychronic Seeks the harmonious
way Collectivist Haggling, bargaining
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Ex. 13-4 (contd.)
Approach to the Negotiation Process
American Quick meetings Informal Make cold
calls Full authority Direct Proposals
first Aggressive Impatient A good deal
Chinese Long courting process Formal Draw on
intermediaries Limited authority Indirect Explana
tions first Questioning Patient A long-term
relationship
nontask sounding
information exchange
means of persuasion
terms of agreement
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Support for the Negotiation Process by Decision
Support Systems

• Reducing the amount of time that is necessary for
  feedback from headquarters in order to carry out
  effective negotiations
• Providing a large amount of data and information
  on alternative scenarios that may result from the
  negotiation process
• Increasing the likelihood that important data and
  information are available when needed

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Conflict
Conflict can be understood as a state of
disagreement or opposition between two parties,
where if party accomplishes their objectives, the
other party is unable to achieve its desired
outcomes