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Culture’ s impact on business neg
otiation
欧阳思思 Mr.Phongwarin Buranasathit
wong
• In business,you don’ t get what you deserve ;you get what you negotiate.Why take ‘no’ f
or an answer? Successful people don’ t .The y get what they want by negotiating better
deals for both parties. ---- Dr.Chester L.Karrass
• Negotiation is two-----CIs
They are common i nterests and
conflicting issues
Intercultral negotiat -----ion is four Cs
They are common i nterest,conflicting i
nterest ,compromis e and criteria.
Process in a negotiation
• Preparation before (before it)
• Negotiate (in it)
• After the process (a fter it)
Before IT
• Define our own interest• Investigate your counterpart and its cultural background• Decide who, where, how
IN IT
• Bring out your business interest• Arguing and persuasion, adaption• Outcome:Negotiation breaking down or rea
ching an agreement
AFTER IT
• Establishing a coop eration relationship
• No following things
Culture and Negotiations
As intercultural negotiations occur where neg otiating parties have different cultures and
do not share the same ways of thinking, fee ling, and behavior .The process is generally more complex . Culture has impact on every step in a negotia
tion, from negotiator’ s styles to ways of co mmunication, pursuation and making decis
ions, even after a whole process,it also mak es effect, especially in countries where peo - ple emphasize on long term relationship..
Cultural contrasts in negotiation
• Preparations and business introductions
• Presentations and information exchanges
• Argumentation and persuasion• Agreement and conflict resolution
Preparations and business introductions
Presentations and informationexchanges
Argumentation and persuation
Agreement and conflict resolution
How to achieve success
• Awarenes of cultural differences• Learn more about cultures• Choose proper negotiation style• Understanding deeds of people from
different cultural background• “ When in Rome,do as romans do” is no
t enough• To seek “ -win win” result
Awarenes of cultural differences
• Different groups ha ve their own particu lar etiquette associa ted with the negotia tion process and the
ir adherence to prot ocol varies accordin
g to its perceived importantance.
• bribery: what is a bribe in the US? In Afghanistan? In France? In China (贿
赂,行贿,开后门,塞红包) ? Be carefu l and be aware of Foreign Corrupt Pra
ctices Act, but be aware of local cultur e. Americans don’ t 塞红包 but Chines
e don’ t tip. Think about it.
Learn more about cultures
•知己知彼,百战百胜。• The more you know
about your enemy or your counterpart ,th
e more likely you willwin.
Choose proper negotiatio n style
• To be intuitive ,norm ative,ananalytic or fac
ual?• To send whom to wher
e ,how to communicat e and compromise?
• 1 or 2?
try to take advantege
• Your place or mine?• Home court advantage
=More comfortable and more familiar =more confident.
“ When in Rome,do as Roma ns do”?
• Not exactly!• Under different conditions one should d
o or shouldn’ t do as Romans do when in Rome do.
Based on different levels of familiarity wit h counterpart’ s culture, cases are difffe
rent. & Imagine what will happen when an Am
erican talk with an Arabian? ----- different results!
-How to win win?
• ---A new concept coopetition!• Five methods of reaching integrative
agreements. 1. Expanding the pie 2. Nonspecific compensation 3. logrolling 4. cost cutting 5 . bridging
-How to win win?
• 1. expanding resoures• 2. repaying parties who do not get what the
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• 3. , .2,variant of nonspecific different from No i t i nvol ves bot h par t s
• 4. reduction of one person’ s cost s whi l e t heyyyyy yyyy yyyy yy yyyyy
• 5. devising a new option for situations in whic h nei t her per son get s hi s i ni t i al demands
Something you should kn ow
• yy yyyyy yyy yy yyyy y yyy
•
Negotiation StylesNegotiation 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.
Negotiation Styles
Profile of an American Negotiator
• Knows when to compromiseKnows when to compromise• Takes a firm stand at the beginning of the Takes a firm stand at the beginning of the
negotiationnegotiation• Refuses to make concessions before handRefuses to make concessions before hand• Keeps his or her cards close to his or her Keeps his or her cards close to his or her
chestchest• Accepts compromises only when the Accepts compromises only when the
negotiation is deadlockednegotiation is deadlocked• Sets up the general principles and Sets up the general principles and
delegates the detail work to associatesdelegates the detail work to associates• Keeps a maximum of options open before Keeps a maximum of options open before
negotiationnegotiation• Operates in good faithOperates in good faith
• 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
Profile of an American Negotiator
Profile of an Indian Negotiator
• Looks for and says the truth• Is not afraid of speaking up and has no fears• Exercises self-control• Seeks solutions that will please all the parties
involved• Respects the other party• Neither uses violence nor insults• Is ready to change his or her mind and differ with
himself or herself at the risk of being seen as inconsistent and unpredictable
Profile of an Indian Negotiator
• Puts things into perspective and switches easily from the small picture to the big one
• Is humble and trusts the opponent• Is able to withdraw, use silence, and learn from within• Relies on himself or herself, his or her own resources
and strengths• Appeals to the other party’s spiritual identity• Is tenacious, patient, and persistent• Learns from the opponent and avoids the use of
secrets• Goes beyond logical reasoning and trusts his or her
instinct as well as faith
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
Profile of an Arab Negotiator• Is able to resist any kind of pressure that the
opponents could try to exercise on him• Use 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
Profile of a Successful Swedish Negotiator
• Very quiet and thoughtful• Punctual (concerned with time)• Extremely polite• Straightforward (they get straight down to
business)• Eager to be productive and efficient• Heavy-going• Down-to-earth and overcautious• Rather flexible• Able to and quite good at holding emotions and
feelings
Profile of a Successful Swedish Negotiator
(contd.)• Slow at reacting to new (unexpected)
proposals• Informal and familiar• Conceited• Perfectionist• Afraid of confrontations• Very private
Profile of a Successful Italian Negotiator
• Has a sense of drama (acting is a main part of the culture)• Does not hide his or her emotions (which are partly
sincere and partly feigned)• Reads facial expressions and gestures very well• Has a feeling for history• Does not trust anybody• Is concerned about the bella figura, or the “good
impression,” he or she can create among those who watch his or her behavior
• Believes in the individual’s initiatives, not so much in teamwork
• Is good at being obliging and simpatico at all times
Profile of a Successful Italian Negotiator
(contd.)
• Is always on the qui vive, the “lookout”• Never embraces definite opinions• Is able to come up with new ways to immobilize
and eventually destroy his or her opponents• Handles confrontation of power with subtlety and
tact• Has a flair for intrigue• Knows how to use flattery• Can involve other negotiators in complex
combinations
Comparative Management in Focus: Comparative Management in Focus: Negotiating with the ChineseNegotiating with the Chinese
• Business people have two major areas of Business people have two major areas of conflict when negotiating with the Chineseconflict when negotiating with the Chinese– Amount of detail about product Amount of detail about product
characteristicscharacteristics– Apparent insincerity about reaching an Apparent insincerity about reaching an
agreementagreement• Chinese negotiation process is affected by Chinese negotiation process is affected by
three cultural normsthree cultural norms– Politeness and emotional restraintPoliteness and emotional restraint– Emphasis on social obligationsEmphasis on social obligations– Belief in the interconnection of work, Belief in the interconnection of work,
family, and friendshipfamily, and friendship
Comparative Management in Focus: Comparative Management in Focus: Negotiating with the ChineseNegotiating 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
Comparative Management in Focus: Negotiating with the
Chinese
The Chinese think in terms of process that has no culmination.
Americans think in terms of concrete solutions to specific problems. . . .
The Chinese approach is impersonal, patient and aloof . . .
To Americans, Chinese leaders seem polite but aloof and condescending.
To the Chinese, Americans appear erratic and somewhat frivolous.
—Henry Kissinger,Newsweek, May, 2001
Differences Between American and Chinese Culture and Approach to
the Negotiation Process
Contrast of Basic Cultural ValuesAmerican
Task and information orientedEgalitarianAnalyticalSequential, monochronicSeeks the complete truthIndividualistConfrontative, argumentative
Chinese
Relationship orientedHierarchical
HolisticCircular, polychronic
Seeks the harmonious way
CollectivistHaggling, bargaining
Differences Between American and Chinese Culture and
Approach to the Negotiation Process(cont.)
Approach to the Negotiation ProcessAmeric
anQuick meetingsInformalMake cold callsFull authorityDirectProposals firstAggressiveImpatientA “good deal”
ChineseLong courting
processFormal
Draw on intermediaries
Limited authority
IndirectExplanations
firstQuestioning
PatientA long-term relationship
nontask sounding
information exchange
means of persuasion
terms of agreement
Comparison of Cultural Approaches to Negotiation
American NegotiatorAmerican Negotiator Indian NegotiatorIndian Negotiator Arab NegotiatorArab 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
Comparison of Cultural Approaches to Negotiation
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
Nature of Conflict Between Members of Low and High
Context CultureKey Key QuestionsQuestions
Low-Context ConflictLow-Context Conflict High-Context ConflictHigh-Context Conflict
Why Analytic, linear logic; instrumental oriented; dichotomy between conflict and conflict parties
Synthetic, spiral logic; expressive oriented; integration of conflict and conflict parties
When Individualistic oriented; low collective normative expectations; violations of individual expectations create conflict potentials
Group oriented; high collective normative expectations; violations of collective expectations create conflict potentials
What Revealment; direct, confrontational attitude; action and solution oriented
Concealment; indirect, nonconfrontational attitude; “face” and relationship oriented
How Explicit communication codes; line-logic style: rational-factual rhetoric; open, direct strategies
Implicit communication codes; point-logic style: intuitive-effective rhetoric; ambiguous, indirect strategies
Guidelines on Negotiation across Guidelines on Negotiation across CulturesCultures
• Check whether they think like you• Spend time on non-task sounding matters to establish
personal relationships• Know the differences between your opponent’s social,
political and economic systems and yours• Know how the above differences affect his thinking,
authority and negotiating methods• Know your opponent’s legal, technical and financial
systems• Know how the above will affect our choice of tactics• Know the effects of ethical standards (right, wrong,
reasonable)• Know the importance of face saving
• Recognize the role of status
• Understand the role of government in the affairs of your opponent
• Identify the levels of approval
• Ask questions, but don’t put pressure
• Ensure there is a suitable communication system with Head Office
• Identify the right leader for the situation
• Make sure when using an interpreter he is skilled in both languages and negotiation.
• Have a dummy run with him. Get him to translate gestures etc
• Avoid using jargon
• Confirm in writing and use words carefully to avoid ambiguity
• Use team approach by using experts
• Recognize differences in perceiving contractual differences and agreements
• Make concessions only after issues are discussed.
Guidelines on Negotiation across Cultures
Thank You!
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