Chapter 10
Intercultural
Negotiation Process
International Business Communication, 4th ed., Chaney & Martin
Topics
Steps in the Negotiation Process
Mistakes Commonly Made
During Negotiations
Intercultural Negotiation Models
Negotiation Strategies
Trade Agreements
International Business Communication, 4th ed., Chaney & Martin
Definition
Intercultural negotiation involves
discussions of common and conflicting
interests between persons of different
cultural backgrounds who work to reach
an agreement of mutual benefit.
International Business Communication, 4th ed., Chaney & Martin
“In business, you don't get what you
deserve, you get what you negotiate.”
Why take “no” for an answer? Successful
people don't. They get what they want by
negotiating better deals for both parties.
Dr. Chester L. Karrass, Leader in Negotiating
Steps in the Negotiation Process
Preparation and Site Selection
Team Selection
Relationship Building
Opening Talks
Discussions
Agreement
International Business Communication, 4th ed., Chaney & Martin
Preparation and Site Selection
Hire a consultant in the country.
Consult resource videos and written
materials on negotiation.
Choose a site—here or there can be
important.
International Business Communication, 4th ed., Chaney & Martin
Team Selection
• Consider number, age, gender, and
rank of team members.
• Consider background of players.
• Evaluate other negotiators - their
political affiliation, social class, age,
and risk-taking propensity.
International Business Communication, 4th ed., Chaney & Martin
Relationship Building
Time required
Intermediaries or agents
Friendship versus business relationship
International Business Communication, 4th ed., Chaney & Martin
Opening Talks and Discussions
Observe opening rituals - small talk, humor,
etc.
Consider the appropriateness of an agenda.
Expect a variety of behaviors.
Plan ahead for concessions.
Move to an informal location when
appropriate.
International Business Communication, 4th ed., Chaney & Martin
Agreement
Close negotiations properly.
Expect delays .
Get tax and legal advice.
Anticipate a long wait until final
approval.
Remember that contracts are not
always considered final.
International Business Communication, 4th ed., Chaney & Martin
Common Negotiation Mistakes
Making negative initial impression
Failing to listen and talking too much
Assuming understanding by the other culture
Failing to ask important questions
Showing discomfort with silence
Using unfamiliar and slang words
Interrupting the speaker
Failing to read the nonverbal cues
International Business Communication, 4th ed., Chaney & Martin
Failing to note key points
Making statements that are irritating or
contradictory
Failing to prepare a list of questions for discussion
Being easily distracted
Failing to start with conditional offers
Failing to summarize and restate to ensure
understanding
Hearing only what you want to hear
Failing to use first-class supporting materials
International Business Communication, 4th ed., Chaney & Martin
Intercultural Negotiation Models
Problem-solving approach — considers
national and organizational cultural differences
Competitive approach — individualistic and
persuasive orientation
Compromising — seeks a middle ground
Forcing — makes the other party comply
Legalism — uses legal documentation to force
the partner to comply
International Business Communication, 4th ed., Chaney & Martin
Four - Stage Negotiation Model
Investigative
Presentation
Bargaining
Agreement
Kozicki, Creative Negotiating
Negotiation Strategies
People act on the basis of their own best interests.
Truth in negotiations:
Faith
Fact
Feeling
U.S. negotiators make fewer adjustments to their
opponents.
Strategies include: preparation; tactics; conflict
resolution and mediation; and observation,
analysis, and evaluation.
International Business Communication, 4th ed., Chaney & Martin
Trade Agreements
General license – never actually issued
Validated license — allows specific
exporter to export specific products to
specific places
Free trade zones or trade blocs — products
enter without customs duties
International Business Communication, 4th ed., Chaney & Martin
NAFTA Benefits
To eliminate barriers to trade and facilitate
cross-border movement of goods and services
To promote fair competition
To increase investment opportunities
To provide adequate and effective protection
for intellectual property
To develop effective procedures to handle
disputes
To expand cooperation and increase benefits
to the three countries
International Business Communication, 4th ed., Chaney & Martin
The U.S. Negotiator’s Global Report Card
Competency
Preparation
Synergistic approach (win-win)
Cultural I.Q.
Adapting the negotiating process
to the host country environment
Patience
Listening
Linguistic abilities
Using language that is simple
and accessible
High aspirations
Personal integrity
Building solid relationships
Grade
BD
D
D
D
D
F
C
B+
AD
International Business Communication, 4th ed., Chaney & Martin
Statements Characteristic of
U.S. Negotiating Style
"I can handle this myself" (to express individualism).
"Please call me Steve" (to make people feel relaxed by
being informal).
"Pardon my French" (to excuse profanity).
"Let's get to the point" (to speed up decisions).
"Speak up; what do you think?" (to avoid silence).
"A deal is a deal" (to indicate an expectation that the
agreement will be honored).
International Business Communication, 4th ed., Chaney & Martin
China
Reserved; known for hospitality and good manners
Give small, inexpensive presents
Do not like to be touched
Consider mutual relationships and trust very
important
Technical competence of negotiators necessary
Prefer to use an intermediary
Rarely use lawyers
Ample room for compromise
International Business Communication, 4th ed., Chaney & Martin
France
Have a sense of pride sometimes interpreted as
supremacy
French logic ("Cartesian" logic) proceeds from what is
known in a point-by-point fashion until agreement is
reached
Protocol, manners, status, education, family, and
individual accomplishments are keys to success with
the French
International Business Communication, 4th ed., Chaney & Martin
Germany
Protocol is important
Dress is conservative; correct posture and manners are
required
Use titles when addressing members of the negotiating
team
Prefer keeping a distance between themselves and the
other team
Have technical people as part of the negotiation team as
Germans are detail oriented
Punctuality is expected
Contracts are firm guidelines to be followed exactly
International Business Communication, 4th ed., Chaney & Martin
India
Bribery is common; having connections is important
Avoid using the left hand in greetings and eating
Request permission before smoking, entering, or
sitting
Building relationships is important; an introduction is
necessary
Intermediaries are common
Use titles to convey respect
Knowledge of local affairs is important
Negotiation process can be long
International Business Communication, 4th ed., Chaney & Martin
Japan
Business etiquette is very important, including
business card exchange
Meeting should be arranged by an intermediary
Subtle and complex verbal and nonverbal cues are
used to avoid having someone lose face or lose the
group harmony
The Japanese use more silence and less eye contact
than U.S. persons
Consider contracts as flexible instruments
Are suspicious of a negotiating team that includes
lawyers
International Business Communication, 4th ed., Chaney & Martin
Latin America
Relationships are important
Bribery is common
Government is very involved in business
Negotiators chosen based on family connections,
political influence, education, and gender (females
should be in the background)
Social competence is important
Most agreements are consummated over lunch
Numerous meetings is the norm; time is not seen as
important
Avoid gestures
International Business Communication, 4th ed., Chaney & Martin
Nigeria
Nigerians are skillful negotiators; they view negotiation as a
competitive process
When selecting negotiators, consider age (equated with wisdom),
gender, cultural background, and educational credentials
Developing a personal relationship is important
Time is not particularly important so negotiations may be lengthy
Use titles and last names
Use an intermediary to make initial introductions
Being well dressed is important; courtesy and consideration are
also expected
Contracts (oral or written) are flexible
A bribe may be needed to expedite business
International Business Communication, 4th ed., Chaney & Martin
Russian States
In the past, negotiation sessions have been long, with
Russians controlling the agenda
Are concerned with age, rank, and protocol
Tend to be formal
Friendships are not crucial to business
Contracts interpreted rigidly
Concerned with maximizing their profits
International Business Communication, 4th ed., Chaney & Martin
Negotiating globally can present many
opportunities. Corporations can expand
their markets, increase their markets,
increase their profits and productivity,
and lower their costs by negotiating
globally.
International Business Communication, 4th ed., Chaney & Martin