Chapter 4

Cross-Cultural Communications, Negotiations and the Global Selling

Process, Part I

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Antecedents to Negotiation -– National Cultural Similarity:

• The more similar the cultural backgrounds of the parties involved, the greater the chance for understanding and agreement between the parties.

• If sales teams are utilized, then the more similar the members of the sales teams are to those of the prospective buying group, the greater the chance for understanding and agreement among all parties involved.

• The salesperson should never should never make assumptions about the thoughts and feelings of a cross-cultural customer.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Antecedents to Negotiation -– Past Negotiation Experience:

• The more experience the salesperson brings to cross-cultural negotiations, the greater their flexibility in dealing with guiding cross-cultural customers to successful negotiation outcomes.

• The global sales manager can provide training to compensate for lack of negotiation experience.

• Training should be done periodically and can include such mechanisms as shadowing and role playing.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Antecedents to Negotiation -– Individual Personal Differences:

• Personal characteristics contribute to each person’s individuality and include enduring characteristics like personality, intelligence, and creativity along with such transient characteristics as mood or emotion.

• The important issue is the ability of the individual to recognize inherent differences and to be sensitive about how these can affect the negotiation process.

• The salesperson should try to learn as much as possible about the particular customer as possible beforehand so that differences can be anticipated and conflicts avoided.

• Salespeople must also be aware of how their moods and emotions can negatively affect negotiations.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Antecedents to Negotiation -– Pre-Negotiation Expectations:

• Compromise is a necessity in most negotiation processes.• Some sizing up of the expectations of each of the parties to

negotiation is necessary so that potential conflict can be minimized.

• If the salesperson knows what the negotiations expectations are for the potential buyer, they will be in a better position to succeed in negotiation.

• Often salespeople enhance their chances of success in negotiations by spending time listening and acting as a problem solver for the cross-cultural buyer.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Antecedents to Negotiation -– Goal Compatibility:

• The closer that the goals of the two parties are in sync with each other, the greater the possibility of reaching a successful agreement.

• If the negotiations are in a B2B setting, the goals of the organizations normally take precedence over the personal goals of the buyer.

• National culture may have a significant effect on goal compatibility since buyers from collectivist countries are more focused on organizational goals than personal goals.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Antecedents to Negotiation -– Trust:

• The greater the amount of mutual trust that exists among the negotiating parties, the greater the chance for a successful agreement.

• Trust focuses on integrity among the individuals involved and their personal benevolence.

• If the salesperson has had prior dealings with the buyer, trust will be easier to establish.

• If there is no prior experience, the salesperson can develop trust through openness, honesty and a sharing of important information.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Information Variables -– Sense Making:

• The way in which an individual assigns meaning to the information presented by one or more parties involved in the sales negotiation process.

• The effective use of feedback is integral to sense making.

• When the salesperson has trouble understanding the logic of the buyer’s stance, clarity of logic can be established through further discussion.

• Sense making is enhanced by clear communications.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Information Variables -– Sense Giving:

• Involves how effectively the individual attempts to communicate the necessary information that allows the other party or parties to make sense of his or her position in the sales negotiation.

• When any of the negotiating parties withhold information, then it becomes more difficult to assign appropriate meaning to the extended offer.

• Clear cross-cultural communication must occur to effectively give meaning to the recipient of the conveyed information.

• Remember that communication involves both verbal and non-verbal components.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Practical Suggestions for Improving the Sales Negotiation Process:– James Sebenius at Harvard suggests that it is

important for the party entering the negotiation process to ascertain:

• Who the real players are in the negotiation.

• Who has the authority to make the necessary decisions.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Practical Suggestions for Improving the Sales Negotiation Process:– Herbig and Kramer (1992) present a series of Dos and Don’ts for

cross-cultural negotiations:• Do:

– Be well prepared– Specify clear objectives– Develop personal relationships– Have informal meetings in the beginning– Carefully follow protocol– Understand national sensitivities– Assess opponent’s flexibility and obstacles– Understand decision-making process– Pin down details

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Practical Suggestions for Improving the Sales Negotiation Process:– Herbig and Kramer (1992) present a series of Dos and Don’ts for cross-

cultural negotiations:• Don’t:

– Look at everything from your own definition of rational– Press a point others cannot accept– Look at things from a narrow self interest– Ask for sensitive concessions or compromises– Stick to your agenda if opponent has different priorities– Use confusing jargon– Skip authority levels when middle management is needed– Ask for an impossible decision– Differ with your own team members in public– Stake out extreme positions – remain consistent

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Steps of the Global Selling Process:– Finding Customers– Preparing– Relationship Building– Product Offering– Offer Clarification– Securing the Purchase– Maintaining the Relationship

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Step 1 – Finding Customers:– Involves identifying sales prospects and

insuring that these potential clients are worthy of additional effort to convert from prospects to customers.

– Depending upon the industry and local custom, global salespersons may devote a portion of their workday to searching for and contacting new customers.

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Step 1 – Finding Customers:– Methods that can be employed to locate

potential customers include:• Customer Recommendations• Centers of Influence• Lists• Publications• Referrals• Advertising Generated

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Step 1 – Finding Customers:– Methods that can be employed to qualify

potential customers include:• Money

• Authority

• Need

• Fit

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Step 2 – Preparing:– Successful salespersons spend significant time

preparing for meetings with potential customers.

– During the preparation stage, the salesperson can gain information from:

• Existing company files

• Customer relationship management (CRM) software

• The potential customer’s web site

• Commercial sources (e.g., magazines, newspapers)

Cross-Cultural Communications, Negotiations and the Global Selling Process, Part I

• Step 2 – Preparing:– Before meeting with the prospect, the salesperson should insure

that he or she can correctly pronounce the prospect’s name.

– Other information about the prospect, such as hobbies, interests, and likes/dislikes, also makes getting acquainted easier and may shed light upon the type of gift the prospect would value.

– The salesperson should also anticipate the types of products the prospect will need and how these products will satisfy those needs.

– Formal presentations should be compiled, using professional software or transparencies as dictated by technology and culture.