Chapter Copyright© 2007 Thomson Learning All rights reserved 13 International Negotiation and...
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Chapter
Copyright© 2007 Thomson Learning All rights reserved
13International Negotiation and Cross-Cultural Communication
Copyright© 2007 South-Western/Thomson Learning All rights reserved
Learning Objectives
• Understand the basics of verbal and nonverbal communication
• Understand the basic international negotiation processes
• Understand the basic tactics of international negotiations
• Recognize and respond to the “dirty tricks”
• Understand the basics of verbal and nonverbal communication
• Understand the basic international negotiation processes
• Understand the basic tactics of international negotiations
• Recognize and respond to the “dirty tricks”
Copyright© 2007 South-Western/Thomson Learning All rights reserved
Learning Objectives
• Know the difference between the problem-solving and competitive approaches
• Identify the personal characteristics of the successful international negotiator
• Know the difference between the problem-solving and competitive approaches
• Identify the personal characteristics of the successful international negotiator
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International Negotiation
• Process of making business deals across cultures• Precedes any multinational project• Without successful negotiation and the accompanying
cross-cultural communication, there are seldom successful business transactions
• Process of making business deals across cultures• Precedes any multinational project• Without successful negotiation and the accompanying
cross-cultural communication, there are seldom successful business transactions
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The Basic of Cross-Cultural Communication
• Successful negotiation requires successful communication
• Negotiators must understand all components of culturally different communication styles (both verbal and nonverbal)
• Successful negotiation requires successful communication
• Negotiators must understand all components of culturally different communication styles (both verbal and nonverbal)
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Language and Culture
• Whorf hypothesis: theory that language determines the nature of culture
• All languages have limited sets of words• Words provide the concepts of understanding the
world• Restricted word sets constrain the ability to understand
the world
• Whorf hypothesis: theory that language determines the nature of culture
• All languages have limited sets of words• Words provide the concepts of understanding the
world• Restricted word sets constrain the ability to understand
the world
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High- and Low-Context Languages
• Low-context language: people state things directly and explicitly- Most northern European languages including
German, English, and the Scandinavian languages• High-context language: people state things indirectly
and implicitly- Asian and Arabic languages
• Low-context language: people state things directly and explicitly- Most northern European languages including
German, English, and the Scandinavian languages• High-context language: people state things indirectly
and implicitly- Asian and Arabic languages
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Exhibit 13.1: Country Differences in High-Context and Low-Context Communication
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Basic Communication Styles
• Direct communication: communication that comes to the point and lacks ambiguity
• Formal communication: communication that acknowledges rank, titles, and ceremony in prescribed social interaction
• Direct communication: communication that comes to the point and lacks ambiguity
• Formal communication: communication that acknowledges rank, titles, and ceremony in prescribed social interaction
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Exhibit 13.2: Cultural Differences in Communication Styles
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Nonverbal Communication
• Communication without words• Includes array of behaviors that enhance/supplement
spoken communication• Include
- Kinesics, proxemics, haptics, oculesics, and olfactics
• Communication without words• Includes array of behaviors that enhance/supplement
spoken communication• Include
- Kinesics, proxemics, haptics, oculesics, and olfactics
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Kinesics
• Communication through body movements- E.g., facial expressions, body posture- Most Asian cultures use bowing to show respect - No universal code for what body movements mean- Easy to misinterpret gestures
• Communication through body movements- E.g., facial expressions, body posture- Most Asian cultures use bowing to show respect - No universal code for what body movements mean- Easy to misinterpret gestures
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Proxemics
• Use of space to communicate- Each culture has appropriate distances for
communication- The personal bubble of space may range from 9
inches to over 20 inches- North Americans prefer more distance than Latin
and Arab cultures
• Use of space to communicate- Each culture has appropriate distances for
communication- The personal bubble of space may range from 9
inches to over 20 inches- North Americans prefer more distance than Latin
and Arab cultures
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Seating in a Typical Japanese Office
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Haptics or Touching
• Communication through body contact• Shaking hands, embracing, or kissing when greeting one
another- No touching
• E.g., Japan, U.S., England, and many Northern European countries
- Moderate touching• E.g., Australia, China, Ireland, and India
- Touching• E.g., Latin American countries, Italy, and Greece
• Communication through body contact• Shaking hands, embracing, or kissing when greeting one
another- No touching
• E.g., Japan, U.S., England, and many Northern European countries
- Moderate touching• E.g., Australia, China, Ireland, and India
- Touching• E.g., Latin American countries, Italy, and Greece
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Oculesics
• Communication through eye contact or gaze- U.S. and Canada: people are very comfortable and
expect eye contact to be maintained - China and Japan: eye contact is considered very
rude and disrespectful
• Communication through eye contact or gaze- U.S. and Canada: people are very comfortable and
expect eye contact to be maintained - China and Japan: eye contact is considered very
rude and disrespectful
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Olfactics
• The use of smells as means of nonverbal communication- U.S. and U.K: find body odor offensive- Arab: consider body odors natural
• The use of smells as means of nonverbal communication- U.S. and U.K: find body odor offensive- Arab: consider body odors natural
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Practical Issues in Cross-Cultural Business Communication
• Interpreter’s role: to provide a simultaneous translation of a foreign language - Require greater linguistic skills than speaking a
language or translating written documents- Have the technical knowledge and vocabulary to
deal with technical details common in business transactions
- Have to ensure the accuracy and common understanding of agreements
• Interpreter’s role: to provide a simultaneous translation of a foreign language - Require greater linguistic skills than speaking a
language or translating written documents- Have the technical knowledge and vocabulary to
deal with technical details common in business transactions
- Have to ensure the accuracy and common understanding of agreements
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Tips for Successful Use of Interpreters
• Spend time with the interpreter • Go over technical and other issues with interpreter for
proper understanding• Insist on frequent interruptions when it’s necessary• Look for feedback and comprehension by watching the
eyes
• Spend time with the interpreter • Go over technical and other issues with interpreter for
proper understanding• Insist on frequent interruptions when it’s necessary• Look for feedback and comprehension by watching the
eyes
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Tips for Successful use of Interpreters (cont.)
• Discuss the message beforehand• Request that your interpreter apologize for your
inability to speak in the local language• Confirm that all key components of the message have
been properly comprehended
• Discuss the message beforehand• Request that your interpreter apologize for your
inability to speak in the local language• Confirm that all key components of the message have
been properly comprehended
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Communication with Nonnative Speakers
• Use the most common words with most common meanings
• Select words with few alternative meanings• Follow rules of grammar strictly• Speak with clear breaks between words• Avoid sports words or words borrowed from literature
• Use the most common words with most common meanings
• Select words with few alternative meanings• Follow rules of grammar strictly• Speak with clear breaks between words• Avoid sports words or words borrowed from literature
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Communication with Nonnative Speakers (cont.)
• Avoid words or expressions that are pictures• Avoid slang• Mimic the cultural flavor of the nonnative speaker’s
language• summarize• Test your communication success• Repeat basic ideas using different words when your
counterpart does not understand• Confirm important aspects in writing
• Avoid words or expressions that are pictures• Avoid slang• Mimic the cultural flavor of the nonnative speaker’s
language• summarize• Test your communication success• Repeat basic ideas using different words when your
counterpart does not understand• Confirm important aspects in writing
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Avoiding Attribution Errors
• Attribution: process by which we interpret the meaning of spoken words or nonverbal exchanges- Attribute meaning based on our taken-for-granted
cultural expectations- Easy to make mistakes of attribution- Need to observe carefully - Avoid subtleties of a foreign language- Avoid complex nonverbal behaviors
• Attribution: process by which we interpret the meaning of spoken words or nonverbal exchanges- Attribute meaning based on our taken-for-granted
cultural expectations- Easy to make mistakes of attribution- Need to observe carefully - Avoid subtleties of a foreign language- Avoid complex nonverbal behaviors
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International Negotiation
• More complex than domestic negotiations• Differences in national cultures and differences in
political, legal, and economic systems • Steps in international negotiation
- Preparation, building the relationship, exchanging information, first offer, persuasion, concessions, agreement, and post agreement
• More complex than domestic negotiations• Differences in national cultures and differences in
political, legal, and economic systems • Steps in international negotiation
- Preparation, building the relationship, exchanging information, first offer, persuasion, concessions, agreement, and post agreement
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Exhibit 13.3: Steps in International Negotiations
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Step 1: Preparation
• Determine if the negotiation is possible• Know what your company wants• Be aware of what can be compromised• Know the other side• Send the proper team• What is the agenda?• Prepare for long negotiation• What is the environment like?• Plan a strategy
• Determine if the negotiation is possible• Know what your company wants• Be aware of what can be compromised• Know the other side• Send the proper team• What is the agenda?• Prepare for long negotiation• What is the environment like?• Plan a strategy
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Cultural Differences in Key Negotiating Processes
• Negotiation goal—signing the contract or forming a relationship
• Formal or informal personal communication style• Direct or indirect communication style• Sensitivity to time—low or high• Forms of agreement—specific or general• Team organization—a team or one leader
• Negotiation goal—signing the contract or forming a relationship
• Formal or informal personal communication style• Direct or indirect communication style• Sensitivity to time—low or high• Forms of agreement—specific or general• Team organization—a team or one leader
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Cultural Differences in Key Negotiating Processes
• Attitude towards negotiation – win-lose or win-win• High or low emotions
• Latin Americans and the Spanish: show their emotions through negotiations
• Japanese and Germans: tend to be more reserved
• Attitude towards negotiation – win-lose or win-win• High or low emotions
• Latin Americans and the Spanish: show their emotions through negotiations
• Japanese and Germans: tend to be more reserved
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Exhibit 13.4: Cultural Differences in Preference for Broad Agreements
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Exhibit 13.5: Understanding Negotiators from Other Countries
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Step 2: Building the Relationship
• First stage of the actual negotiation process- No focus on business- Partners get to know each other - Social and interpersonal exchange- Duration and importance vary by culture
• First stage of the actual negotiation process- No focus on business- Partners get to know each other - Social and interpersonal exchange- Duration and importance vary by culture
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Step 3: Exchanging Information and the First Offer
• Both parties exchange information on their needs for the agreement
• Parties exchange task-related information and first offer- Task-related information: actual details or the
proposed agreement- First offer: first proposal by parties of what they
expect from the agreement
• Both parties exchange information on their needs for the agreement
• Parties exchange task-related information and first offer- Task-related information: actual details or the
proposed agreement- First offer: first proposal by parties of what they
expect from the agreement
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Exhibit 13.6: Information Exchange and First-Offer Strategies
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Step 4: Persuasion
• Stage when each side in the negotiation attempts to get the other side to agree to its position- Heart of the negotiation process- Numerous tactics used
• Stage when each side in the negotiation attempts to get the other side to agree to its position- Heart of the negotiation process- Numerous tactics used
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Verbal Negotiation Tactics
• Promise • Threat• Recommendation• Warning• Reward• Punishment
• Promise • Threat• Recommendation• Warning• Reward• Punishment
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Verbal Negotiation Tactics
• Normative appeal• Commitment• Question• Command• Refusal• Interruption
• Normative appeal• Commitment• Question• Command• Refusal• Interruption
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Exhibit 13.7: Comparison of Brazilian, U.S., and Japanese Negotiators (in half-hour bargaining session)
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Nonverbal Communication
• Body posture, facial expression, hand gestures, and the use of personal space are a natural part of any international negotiation
• Body posture, facial expression, hand gestures, and the use of personal space are a natural part of any international negotiation
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Dirty Tricks
• Negotiation tactics that pressure opponents to accept unfair or undesirable agreements or concessions
• Negotiation tactics that pressure opponents to accept unfair or undesirable agreements or concessions
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Ploys/Dirty Tricks and Responses
• Deliberate deception or bluffing—point out what you believe is happening
• Stalling—do not reveal when you plan to leave• Escalating authority—clarify decision making authority• Good-guy, bad-guy routine—do not make any
concessions
• Deliberate deception or bluffing—point out what you believe is happening
• Stalling—do not reveal when you plan to leave• Escalating authority—clarify decision making authority• Good-guy, bad-guy routine—do not make any
concessions
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Ploys/Dirty tricks and Responses
• You are wealthy and we are poor—ignore the ploy• Old friends—keep a psychological distance
• You are wealthy and we are poor—ignore the ploy• Old friends—keep a psychological distance
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Step 5 and 6: Concession and Agreement
• Final agreement: signed contract, agreeable to all sides
• Concession making: requires that each side relax some of its demands
• Final agreement: signed contract, agreeable to all sides
• Concession making: requires that each side relax some of its demands
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Styles of Concession
• Sequential approach: each side reciprocates concessions
• Holistic approach: each side makes very few concessions until the end of the negotiation
• Sequential approach: each side reciprocates concessions
• Holistic approach: each side makes very few concessions until the end of the negotiation
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Basic Negotiation Strategies
• Competitive negotiation: each side tried to give as little as possible and tries to “win” for its side- The negotiation as a win-lose game
• Problem solving: negotiators seek out ground that is beneficial to both companies’ interests- Search for possible win-win situations
• Competitive negotiation: each side tried to give as little as possible and tries to “win” for its side- The negotiation as a win-lose game
• Problem solving: negotiators seek out ground that is beneficial to both companies’ interests- Search for possible win-win situations
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Exhibit 13.8: Competitive and Problem-Solving Negotiation in the Negotiating Steps
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Exhibit 13.9: Cultural Differences in Preference for a Problem-Solving Negotiation Strategy
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Step 7: Post Agreement
• Commonly ignored step• Consists of an evaluation of the success of a
competed negotiation• Allows the garnering of insights from understanding
strengths and weaknesses of negotiation
• Commonly ignored step• Consists of an evaluation of the success of a
competed negotiation• Allows the garnering of insights from understanding
strengths and weaknesses of negotiation
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The Successful International Negotiator: Personal Characteristics
• Tolerance of ambiguity• Flexibility and creativity• Humor• Stamina• Empathy• Curiosity• Bilingualism
• Tolerance of ambiguity• Flexibility and creativity• Humor• Stamina• Empathy• Curiosity• Bilingualism
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Major Points Regarding Successful International Negotiation
• Few negotiations succeed without extensive preparation.
• Building personal relationships is a key step in a negotiation.
• Managers should be aware that first offers may differ by cultural background.
• Few negotiations succeed without extensive preparation.
• Building personal relationships is a key step in a negotiation.
• Managers should be aware that first offers may differ by cultural background.
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Major Points Regarding Successful International Negotiation
• Many tactics are used in persuasion.• Know how counterpart views the concession-making
process.• Culture and legal traditions influence the content and
force of law regarding business contracts.• Competitive negotiation seldom leads to long-term
relationships.
• Many tactics are used in persuasion.• Know how counterpart views the concession-making
process.• Culture and legal traditions influence the content and
force of law regarding business contracts.• Competitive negotiation seldom leads to long-term
relationships.
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Major Points Regarding Successful International Negotiation
• Problem-solving negotiation is more flexible and probably more successful strategy.
• Must be flexible, empathic, and physically tough.
• Problem-solving negotiation is more flexible and probably more successful strategy.
• Must be flexible, empathic, and physically tough.
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Conclusion
• Chapter examined the negotiating process and other elements of cross-cultural communication
• International negotiations involves several steps including: preparation, building the relationship, persuasion, making concessions and reaching agreement
• Successful negotiators prepare and understand these steps well
• Chapter examined the negotiating process and other elements of cross-cultural communication
• International negotiations involves several steps including: preparation, building the relationship, persuasion, making concessions and reaching agreement
• Successful negotiators prepare and understand these steps well