Lecture International marketing (14/e) - Chapter 19

Chapter 19 - Negotiating with international customers, partners, and regulators. After studying this chapter you will be able to understand: The problems associated with cultural stereotypes, how culture influences behaviors at the negotiation table, common kinds of problems that crop up during international business negotiations, the similarities and differences in communication behaviors in several countries,...

I n t e r n a t i o n a l M a r k e t i

n g

Negotiating with International Customers, Partners,

What Should You Learn?

• The problems associated with cultural

stereotypes

• How culture influences behaviors at the

negotiation table

• Common kinds of problems that crop up during

international business negotiations

• The similarities and differences in

What Should You Learn?

• How differences in values and thinking

processes affect international negotiations

• The important factors in selecting a negotiation

team

• How to prepare for international negotiations

• Managing all aspects of the negotiation process

• The important of follow-up communications and

• Negotiation of the original agreement

• Taking cultural differences into account

The Dangers of Stereotypes

• The aggressive American, the quite Japanese, the pushy

Brazilian

• Negotiations

– Are conducted between people, not national stereotypes

• Cultural factors often make huge differences

• Negotiation behaviors are different

– Across regions, genders, and type of industry

• Age and experience also make important differences

The Pervasive Impact of Culture

on Negotiation Behavior

• Cultural differences cause four kinds of

problems in international business negotiations

– Language

– Nonverbal behaviors

► Facial Expression, Silent, Side talk

– Values:

► Objectivity and Time

– Thinking and decision-making processes

Implications for Managers

and Negotiators

• Four steps for more efficient and effective

international business negotiations

1 Selection of the appropriate negotiation team

2 Management of preliminaries, including training,

preparations, and manipulation of negotiation settings

3 Management of the process of negotiations

4 Appropriate follow-up procedures and practices

Negotiation Teams

• Willingness to use team assistance

• Listening skills

• Influence at headquarters (senior executive)

• Gender should not be used as a selection

criterion for international negotiation teams

Negotiation Preliminaries

• Checklist for planning international

negotiations

1 Assessment of the situation and the people

2 Facts to confirm during the negotiation

3 Agenda

4 Best alternative to a negotiated agreement (BATNA)

5 Concession strategies

6 Team assignments

At the Negotiation Table

• Business negotiations proceed through four

Nontask Sounding

• Learn the mood of the other side

• Learn about the client’s background and interest

for cues about appropriate communication styles

• Judgments about the “kind” of person in the

negotiation

Differences in Language and Nonverbal Behaviors

• Americans are near the bottom of the languages

skills list

• Americans don’t like side conversations by

foreigners in their native language

• The variation across cultures is greater when

comparing linguistic aspects of language and

nonverbal behaviors than when the verbal

content of negotiations is considered

Differences in Values

• Objectivity

• Competitiveness and equality

Differences in Thinking and Decision-Making Processes

• Western approach – sequential

• Eastern approach – holistic

• Americans – business negotiation is a

problem-solving activity

• Japanese – a business negotiation is a time to

develop a business relationship with the goal of long-term mutual benefit

Task-Related Information Exchange

• Let the foreign counterparts bring up business

• Expect a large number of questions but little

feedback

• Allow periods of silence

• Use multiple communication channels

• Understand the lack of, or the bluntness

of negative feedback

• Avoid emotional outbursts

• Ask more questions

• Use third parties and information channels of

Concessions and Agreement

• Write down concession-making strategies

• Understand differences in decision-making

styles

• In many cultures, no concessions are made until

the end of the negotiations

After Negotiations

• In most countries other than America

• Japan

relationship

• China

their respective responsibilities to be

• Many foreign CEOs expect a formal contract

• Experience levels are going up worldwide

• Culture still counts

• Differences between countries and cultures, no

matter how difficult, can be worked out when

people talk to each other in face-to-face setting

Verbal Negotiation Tactics

(The “What” of Communications)

Linguistic Aspect of Language and Nonverbal Behavior (“How” Things are Said)

Cultural Differences

in Competitiveness and Equality

Summary of Japanese and American Negotiation Styles

• It is important to take cultural differences into

account when meeting clients, customers, and

business partners across the international

negotiation table

• Negotiators’ personalities and backgrounds

influence their behavior

client and customer companies

• Four kinds of problems frequently arise during

international business negotiations

• Much care must be taken in selecting

negotiating teams

• The time spent on each step can vary

considerably from country to country

• Americans tend to be deal oriented