Negotiations chap011 international and cross cultural negotiation

International Negotiation:Art and Science International negotiations are much more complex than domestic negotiations.. Two overall contexts have an influence on international negotiatio

International and Cross-Cultural Negotiation

McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc All rights reserved.

International Negotiation:

Art and Science

International negotiations are much more complex than domestic negotiations They challenge the

negotiators to understand the science of negotiation while developing their artistry.

• The science of negotiation provides research evidence to

support broad trends that often, but not always, occur during negotiation

• The art of negotiation is deciding which strategy to apply

when, and choosing which models and perspectives to apply to increase cross-cultural understanding

What Makes International

Negotiations Different?

Two overall contexts have an influence on international

negotiations:

• Environmental context

– Includes environmental forces that neither negotiator

controls that influence the negotiation

• Immediate context

– Includes factors over which negotiators appear to have

some control

Environmental Context

Factors that make international negotiations more

challenging than domestic negotiations include:

• Political and legal pluralism

Immediate Context

“Factors over which the negotiators have influence and

some measure of control”:

• Relative bargaining power

• Levels of conflict

• Relationship between negotiators

• Desired outcomes

• Immediate stakeholders

The Contexts of International Negotiations

How Do We Explain International

Negotiation Outcomes?

International negotiations can be much more complicated

• Simple arguments cannot explain conflicting

international negotiation outcomes

• The challenge is to:

– Understand the multiple influences of several factors

on the negotiation process

– Update this understanding regularly as circumstances change

Conceptualizing Culture

and Negotiation

• Culture as learned behavior

– A catalogue of behaviors the foreign negotiator should

expect

• Culture as shared values

– Understanding central values and norms

• Individualism/collectivism

• Power distance

• Career success/quality of life

• Uncertainty avoidance

Hofstede’s Model of Cultural Dimensions

• Individualism/collectivism

• Power distance

• Career success/quality of life

• Uncertainty avoidance

Definition: the extent to which the society is

organized around individuals or the group

• Individualism/collectivism orientation

influences a broad range of negotiation

processes, outcomes, and preferences

– Individualistic societies may be more likely to swap

negotiators, using whatever short-term criteria seem

appropriate

– Collectivistic societies focus on relationships and

will stay with the same negotiator for years

Power Distance

Definition: “The extent to which the less powerful

members of organizations and institutions (like the

family) accept and expect that power is distributed

unequally”

• Cultures with stronger power distance will be

more likely to have decision making

concentrated at the top of the culture.

Career Success/Quality of Life

Definition: cultures differ in the extent to which they hold

values that promote career success or quality of life

• Cultures promoting career success are

characterized by the acquisition of money and

things, and not caring for others.

• Cultures promoting quality of life are

characterized by concern for relationships and

nurturing.

Uncertainty Avoidance

Definition: “Indicates to what extent a culture programs its

members to feel either uncomfortable or comfortable in

unstructured situations”

• Negotiators from high uncertainty avoidance

cultures are less comfortable with ambiguous

situations want more certainty on details, etc.

Hofstede’s Cultures Ranking in the Top 10

• This can explain variations within cultures

• Culture in context

– No human behavior is determined by a single cause

– All behavior may be understood at many different

levels simultaneously

Schwartz’s 10 Cultural Values

The Influence of Culture on Negotiation: Managerial Perspectives

Culturally Responsive Negotiation Strategies

• When choosing a strategy, negotiators should:

– Be aware of their own and the other party’s culture

in general– Understand the specific factors in the current

relationship– Predict or try to influence the other party’s

approach

• Strategies are arranged based on the level of

familiarity (low, moderate, high) that a

negotiator has with the other party’s culture

Low Familiarity

• Employ agents or advisers (unilateral strategy)

– Useful for negotiators who have little awareness of

the other party’s culture

• Bring in a mediator (joint strategy)

– Encourages one side or the other to adopt one

culture’s approaches or mediator culture approach

• Induce the other party to use your approach

(joint strategy)

– The other party may become irritated or be insulted

Moderate Familiarity

• Adapt to the other negotiator’s approach

(unilateral strategy)

– Involves making conscious changes to your approach

so it is more appealing to the other party

• Coordinate adjustment (joint strategy)

– Involves both parties making mutual adjustments to

find a common process for negotiation

High Familiarity

• Embrace the other negotiator’s approach

(unilateral strategy)

– Adopting completely the approach of the other negotiator

(negotiator needs to completely bilingual and bicultural)

• Improvise an approach (joint strategy)

– Crafts an approach that is specifically tailored to the

negotiation situation, other party, and circumstances

• Effect symphony (joint strategy)

– The parties create a new approach that may include aspects of

either home culture or adopt practices from a third culture