Browaeys and Price, Understanding Cross-cultural Management, 1 st Edition, © Pearson Education...

Browaeys and Price, Understanding Cross-cultural Management, 1st Edition, © Pearson Education Limited 2009Slide 15.1

CHAPTER 15

NEGOTIATING INTERNATIONALLY

• Concept 15.1: Approaches to negotiating in an international context

Understanding Cross-cultural Management


The ‘western’ approach:• Negotiating is a problem-solving exercise

• Focus is on what happens between parties

• Two types of negotiation strategy predominate: – the distributive (win-lose) – the integrative (win-win) strategy

• Implicit is the assumption that the participants in negotiations share similar approaches, attitudes and principles

The nature of negotiation


The nature of negotiation (Continued)

• In an international context the assumptions and expectations of the west may not be shared

• Even if behaviour displayed by both parties is similar in nature, it may reflect different motives

• The very act of negotiating can be a concept which is fundamentally alien to other cultures, e.g. for Japanese negotiators.

• Meetings are to establish relationship_ceremonial. The real negotiation is behind the scene


Table 15.1 Facets of negotiation

Source: Usunier, 2003 (adapted)

Key facets of negotiation

Iron-cast deal or less explicit agreement

Outcome orientations

Work towards specific, concrete goals, or more towards principles, concepts

Styles of negotiation

Logical, finite process or ongoing dialogue

Strategic time-frame

Trust or mistrust as basisNegotiation strategiesUnderlying concept of negotiation

Negotiation party’s degree of delegated decision-making, and (lack of) uncertainty.

Willingness to take risks

Formal power, (informal) influence

Power orientation

Harmony, self-interestInterpersonal orientationBehavioural predispositions of the parties. Japan high uncertainty but not risk adverse

KEY CONCEPTSKEY ELEMENTSNEGOTIATION FACET

Negotiationprocess


Cross-cultural negotiation in practice: the USA and China (1)

• The USA sees the deal as the main objective of any negotiation

• Very focused bottom-line approach

• For the Chinese, a negotiation is just part of developing a life-long relationship

• Need to establish a good rapport before talking of a deal

Interpersonal orientation: fundamental opposition

Americans might feel that the wish by their Chinese counterparts to establish friendship is one way to get a better deal later on in the negotiation(s)



• Clear hierarchy in US team • Deference shown, even if

the language used is informal • The boss will probably be

given much leeway – already discussed with HQ • Risk-taking seen as inherent

to getting the best deal possible

• Often difficult to know who the Chinese team leader is

• The consensus-building process occurs also within the Chinese team (parties both from within as well as

outside company) • Will resist pressure from the American side until all Chinese parties satisfied. • Any risk-taking must be carefully orchestrated

Power orientation



• US concerned with specifics, the information which allows them to pursue their way of negotiating• Need to gain a clearer idea

of the other party’s concerns and interests to establish or modify their goals • Ready to give a lot of information if this part of an

exchange

• Gaining trust + confidence more important for Chinese than facts and figures

• May not have information asked for (possible face

loss) • Collection of information is

becoming more systematic • Younger managers more in

tune with western behaviour norms

Style of negotiation



• For US negotiators, a detailed contract is the ideal conclusion to a negotiation: signed, sealed and delivered

• In the final phase detailed points are hammered out:– Implementation– Legal aspects

• Chinese tend to avoid legalistic details

• Prefer short contracts which show commitment to project

• A contract is only a formal moment in development of a relationship

• Further negotiations will happen using the goodwill and friendship established

Outcome orientations



• The Chinese and American negotiators therefore face innumerable potential difficulties

• The opposition in expectations and attitudes are clear, the expected frustrations and irritations evident

• How can both sides resolve this dilemma? One possible way to deal with apparently conflicting cultural values is to use Weiss’s strategic framework


Background to Weiss’ framework

When in Rome, do as the Romans do?• To what extent should a negotiator adapt to the

cultural values of the other party. Are international negotiators expected to adapt totally?

• This is a simplistic approach – It does not account for the dominant role of one or the

other partner– Is it ever possible to ‘do as’ the Romans? – It wrongly assumes that a ‘Roman’ will always act as a

Roman with a non-Roman in Rome!


Background to Weiss’ framework (Continued)

• Stephen Weiss (1994) considers a ‘one-size-fits-all’ approach to be inappropriate

• Weiss proposes instead a range of strategies which are

–culturally responsive

–reflect the skills of the individuals involved

–take account of the circumstances in which they are working



• One basic aim in any communicative event: to make sense of the interaction

• In negotiations this means that the least both parties must be able to do is:– recognize each other’s ideas and the types of

behaviour evident– detect common and differing standpoints as

well as changes made to these during the negotiating process

– ensure that communication is maintained as the negotiation proceeds



• However, the knowledge and skills required to perform these crucial acts is often limited

• What is needed, Weiss says, is a strategic framework which allows the parties to

–make sense of the negotiating process as best as they can,

–use their own attributes

–(where necessary) use the skills of others


Table 15.2 Strategic frame for negotiating Weiss (1994a, Figure 2, p. 54) ‘Culturally responsive strategies and their feasibility’

Source: Source text here

Weiss’ Strategic Framework

Counterpart’s familiarity

with Negotiator’s

culture

High

Low

Induce counterpart to follow one’s own script

Improvise an approach(Effect symphony)

Adapt to thecounterpart’s script

(Co-ordinate adjustmentof both parties)

Employ agent or advisor(Involve mediator)

Embrace the counterpart’s script

Low High

Brackets indicate a joint strategy, which requires deliberate consultation with counterpart.At each level of familiarity, a negotiator can consider feasible strategies designated at that level and any lower level

Negotiator’sfamiliarity

with Counterpart’s

culture


Which strategies to use?

Which strategy is:• the most feasible, i.e. the extent to which it will fit

with the counterpart’s possible approach• the most appropriate in terms of the relationship

and circumstances surrounding the interaction• the most acceptable in terms of the manager’s

own values


Which strategies to use? (Continued)

Choosing the strategy therefore involves: • considerable reflection on one’s own culture as

well as careful investigation into the counterpart’s culture

• both parties considering their relationship as individuals as well as members of different cultures


The five steps

The five steps which Weiss proposes for selecting a negotiating strategy take account of these complexities 1. Reflect on your culture's negotiation script2. Learn the negotiation script of the counterpart's

culture3. Consider the relationship and circumstances4. Predict and influence the counterpart's approach5. Choose your strategy


Conclusion

One key facet of negotiating: what do participants consider important in the negotiating process?• Is it basically seen as a question of problem-

solving?• Is it seen as just one aspect of beginning or

continuing a harmonious, mutually beneficial relationship?

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