Conflict Management & Alternative Dispute Resolution Page 1 Making and Saving Deals in the Global...

Conflict Management &Alternative Dispute

Resolution www.adrcenter.it

Making and Saving Deals Making and Saving Deals in the Global Business Environmentin the Global Business Environment

Negotiating International Business TransacationsNegotiating International Business Transacations

Giuseppe De Palo

Vice-president, ADR Center

University of Rome “La Sapienza” – Interdepartmental Center “EuroSapienza”



Business Across Cultures

Learning ObjectivesLearning Objectives

• Describe the skills that global managers must Describe the skills that global managers must learn, practice, and refine to deal with foreign learn, practice, and refine to deal with foreign business culturesbusiness cultures

• Compare how the characteristics of culture can Compare how the characteristics of culture can influence the behavior and attitudes of managersinfluence the behavior and attitudes of managers

• Identify the Hofstede’s original cultural Identify the Hofstede’s original cultural dimensionsdimensions



Cross-Cultural Skills

International managers are now not International managers are now not only expected to be familiar with only expected to be familiar with country marketing reports but should country marketing reports but should also conduct research on their business also conduct research on their business partners’ culture and regional etiquette.partners’ culture and regional etiquette.

Stereotypes are the first source Stereotypes are the first source of information about cultures, of information about cultures, but every negotiator is still an but every negotiator is still an individual.individual.



Cross-Cultural Skills

Negotiators should accept the fact, Negotiators should accept the fact, that the members of the opposite that the members of the opposite party behave in different ways: it is party behave in different ways: it is not right or wrong, it is only not right or wrong, it is only different. different.

A lack of knowledge about A lack of knowledge about foreign cultures can lead to foreign cultures can lead to misunderstanding, frustrationmisunderstanding, frustration and even loss of business.and even loss of business.



Some examples

In the People’s Republic of China, In the People’s Republic of China, don’t write notes using red ink. This don’t write notes using red ink. This suggests that the writer will die soon.suggests that the writer will die soon.

Avoid using the number four at all Avoid using the number four at all costs because this, too, signifies costs because this, too, signifies death.death.

In India, the significance of a In India, the significance of a business arrangement is often business arrangement is often determined by the amount of time determined by the amount of time spent in negotiations.spent in negotiations.



DIMENSIONS THAT DIFFERENTIATE CULTURES

- People’s relationship to nature

- Individualism vs. collectivism

- Time orientation

- Decision making process

- Informality

- Language

- Religion



HOFSTEDE’SHOFSTEDE’S CULTURALCULTURAL DIMENSIONSDIMENSIONS

Uncertainty avoidance

Masculinity-femininity

Individualism-collectivism

Power distance

Degree to which people are comfortable with ambiguity & uncertainty.

Dominance, independence vs. compassion, interdependence, & openness.

Emphasis on individual goals, needs, & success vs. group needs, satisfaction, & performance.

Degree to which people accept power & status differences in society.

Conflict Management & Alternative Dispute Resolution Page 1 Making and Saving Deals in the Global...

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