Chapter 12

Chapter 12
International Negotiation and Cross-
Cultural Communication

Copyright© 2007 Thomson Learning All rights reserved

Learning Objectives

•• Understand the basics of verbal and nonverbal
Understand the basics of verbal and nonverbal
communication
communication
•• Understand the basic international negotiation
Understand the basic international negotiation
processes
processes
•• Understand the basic tactics of international
Understand the basic tactics of international
negotiations
negotiations
•• Recognize and respond to the “dirty tricks”
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
Know the difference between the problem-solving and
competitive approaches
competitive approaches
•• Identify the personal characteristics of the successful
Identify the personal characteristics of the successful
international negotiator
international negotiator


International Negotiation

•• Process of making business deals across cultures
Process of making business deals across cultures
•• Precedes any multinational project
Precedes any multinational project
•• Without successful negotiation and the accompanying
Without successful negotiation and the accompanying
cross-cultural communication, there are seldom
cross-cultural communication, there are seldom
successful business transactions
successful business transactions


The Basic of Cross-Cultural
Communication

•• Successful negotiation requires successful
Successful negotiation requires successful
communication
communication
•• Negotiators must understand all components of
Negotiators must understand all components of
culturally different communication styles (both verbal
culturally different communication styles (both verbal
and nonverbal)
and nonverbal)


Language and Culture

•• Whorf hypothesis: theory that language determines the
Whorf hypothesis: theory that language determines the
nature of culture
nature of culture
•• All languages have limited sets of words
All languages have limited sets of words
•• Words provide the concepts of understanding the
Words provide the concepts of understanding the
world
world
•• Restricted word sets constrain the ability to understand
Restricted word sets constrain the ability to understand
the world
the world


High- and Low-Context
Languages

•• Low-context language: people state things directly and
Low-context language: people state things directly and
explicitly
explicitly
-- Most northern European languages including
Most northern European languages including
German, English, and the Scandinavian languages
German, English, and the Scandinavian languages
•• High-context language: people state things indirectly
High-context language: people state things indirectly
and implicitly
and implicitly
-- Asian and Arabic languages
Asian and Arabic languages


Exhibit 13.1: Country Differences in
High-Context and Low-Context
Communication


Basic Communication Styles

•• Direct communication: communication that comes to
Direct communication: communication that comes to
the point and lacks ambiguity
the point and lacks ambiguity
•• Formal communication: communication that
Formal communication: communication that
acknowledges rank, titles, and ceremony in prescribed
acknowledges rank, titles, and ceremony in prescribed
social interaction
social interaction


Exhibit 13.2: Cultural Differences in
Communication Styles


Nonverbal Communication

•• Communication without words
Communication without words
•• Includes array of behaviors that enhance/supplement
Includes array of behaviors that enhance/supplement
spoken communication
spoken communication
•• Include
Include
-- Kinesics, proxemics, haptics, oculesics, and olfactics
Kinesics, proxemics, haptics, oculesics, and olfactics


Kinesics

•• Communication through body movements
Communication through body movements
-- E.g., facial expressions, body posture
E.g., facial expressions, body posture
-- Most Asian cultures use bowing to show respect
Most Asian cultures use bowing to show respect
-- No universal code for what body movements mean
No universal code for what body movements mean
-- Easy to misinterpret gestures
Easy to misinterpret gestures


Proxemics

•• Use of space to communicate
Use of space to communicate
-- Each culture has appropriate distances for
Each culture has appropriate distances for
communication
communication
-- The personal bubble of space may range from 9
The personal bubble of space may range from 9
inches to over 20 inches
inches to over 20 inches
-- North Americans prefer more distance than Latin
North Americans prefer more distance than Latin
and Arab cultures
and Arab cultures


Seating in a Typical Japanese Office


Haptics or Touching

•• Communication through body contact
Communication through body contact
•• Shaking hands, embracing, or kissing when greeting one
Shaking hands, embracing, or kissing when greeting one
another
another
--No touching
No touching
•• E.g., Japan, U.S., England, and many Northern
E.g., Japan, U.S., England, and many Northern
European countries
European countries
--Moderate touching
Moderate touching
•• E.g., Australia, China, Ireland, and India
E.g., Australia, China, Ireland, and India
--Touching
Touching
•• E.g., Latin American countries, Italy, and Greece
E.g., Latin American countries, Italy, and Greece

Oculesics

•• Communication through eye contact or gaze
Communication through eye contact or gaze
-- U.S. and Canada: people are very comfortable and
U.S. and Canada: people are very comfortable and
expect eye contact to be maintained
expect eye contact to be maintained
-- China and Japan: eye contact is considered very
China and Japan: eye contact is considered very
rude and disrespectful
rude and disrespectful


Olfactics

•• The use of smells as means of nonverbal
The use of smells as means of nonverbal
communication
communication
-- U.S. and U.K: find body odor offensive
U.S. and U.K: find body odor offensive
-- Arab: consider body odors natural
Arab: consider body odors natural


Practical Issues in Cross-
Cultural Business
Communication
•• Interpreter’s role: to provide a simultaneous translation
Interpreter’s role: to provide a simultaneous translation
of a foreign language
of a foreign language
-- Require greater linguistic skills than speaking a
Require greater linguistic skills than speaking a
language or translating written documents
language or translating written documents
-- Have the technical knowledge and vocabulary to
Have the technical knowledge and vocabulary to
deal with technical details common in business
deal with technical details common in business
transactions
transactions
-- Have to ensure the accuracy and common
Have to ensure the accuracy and common
understanding of agreements
understanding of agreements

Tips for Successful Use of
Interpreters

•• Spend time with the interpreter
Spend time with the interpreter
•• Go over technical and other issues with interpreter for
Go over technical and other issues with interpreter for
proper understanding
proper understanding
•• Insist on frequent interruptions when it’s necessary
Insist on frequent interruptions when it’s necessary
•• Look for feedback and comprehension by watching the
Look for feedback and comprehension by watching the
eyes
eyes


Tips for Successful use of
Interpreters (cont.)

•• Discuss the message beforehand
Discuss the message beforehand
•• Request that your interpreter apologize for your
Request that your interpreter apologize for your
inability to speak in the local language
inability to speak in the local language
•• Confirm that all key components of the message have
Confirm that all key components of the message have
been properly comprehended
been properly comprehended


Communication with
Nonnative Speakers

•• Use the most common words with most common
Use the most common words with most common
meanings
meanings
•• Select words with few alternative meanings
Select words with few alternative meanings
•• Follow rules of grammar strictly
Follow rules of grammar strictly
•• Speak with clear breaks between words
Speak with clear breaks between words
•• Avoid sports words or words borrowed from literature
Avoid sports words or words borrowed from literature


Communication with
Nonnative Speakers (cont.)

•• Avoid words or expressions that are pictures
Avoid words or expressions that are pictures
•• Avoid slang
Avoid slang
•• Mimic the cultural flavor of the nonnative speaker’s
Mimic the cultural flavor of the nonnative speaker’s
language
language
•• summarize
summarize
•• Test your communication success
Test your communication success
•• Repeat basic ideas using different words when your
Repeat basic ideas using different words when your
counterpart does not understand
counterpart does not understand
•• Confirm important aspects in writing
Confirm important aspects in writing

Avoiding Attribution Errors

•• Attribution: process by which we interpret the meaning
Attribution: process by which we interpret the meaning
of spoken words or nonverbal exchanges
of spoken words or nonverbal exchanges
-- Attribute meaning based on our taken-for-granted
Attribute meaning based on our taken-for-granted
cultural expectations
cultural expectations
-- Easy to make mistakes of attribution
Easy to make mistakes of attribution
-- Need to observe carefully
Need to observe carefully
-- Avoid subtleties of a foreign language
Avoid subtleties of a foreign language
-- Avoid complex nonverbal behaviors
Avoid complex nonverbal behaviors

International Negotiation

•• More complex than domestic negotiations
More complex than domestic negotiations
•• Differences in national cultures and differences in
Differences in national cultures and differences in
political, legal, and economic systems
political, legal, and economic systems
•• Steps in international negotiation
Steps in international negotiation
-- Preparation, building the relationship, exchanging
Preparation, building the relationship, exchanging
information, first offer, persuasion, concessions,
information, first offer, persuasion, concessions,
agreement, and post agreement
agreement, and post agreement


Exhibit 13.3: Steps in International
Negotiations


Step 1: Preparation

•• Determine ififthe negotiation is possible
Determine the negotiation is possible
•• Know what your company wants
Know what your company wants
•• Be aware of what can be compromised
Be aware of what can be compromised
•• Know the other side
Know the other side
•• Send the proper team
Send the proper team
•• What is the agenda?
What is the agenda?
•• Prepare for long negotiation
Prepare for long negotiation
•• What is the environment like?
What is the environment like?
•• Plan a strategy
Plan a strategy

Cultural Differences in Key
Negotiating Processes

•• Negotiation goal—signing the contract or forming a
Negotiation goal—signing the contract or forming a
relationship
relationship
•• Formal or informal personal communication style
Formal or informal personal communication style
•• Direct or indirect communication style
Direct or indirect communication style
•• Sensitivity to time—low or high
Sensitivity to time—low or high
•• Forms of agreement—specific or general
Forms of agreement—specific or general
•• Team organization—a team or one leader
Team organization—a team or one leader


Cultural Differences in Key
Negotiating Processes

•• Attitude towards negotiation – win-lose or win-win
Attitude towards negotiation – win-lose or win-win
•• High or low emotions
High or low emotions
•• Latin Americans and the Spanish: show their
Latin Americans and the Spanish: show their
emotions through negotiations
emotions through negotiations
•• Japanese and Germans: tend to be more reserved
Japanese and Germans: tend to be more reserved


Exhibit 13.4: Cultural Differences
in Preference for Broad
Agreements


Exhibit 13.5: Understanding
Negotiators from Other Countries


Step 2: Building the
Relationship

•• First stage of the actual negotiation process
First stage of the actual negotiation process
-- No focus on business
No focus on business
-- Partners get to know each other
Partners get to know each other
-- Social and interpersonal exchange
Social and interpersonal exchange
-- Duration and importance vary by culture
Duration and importance vary by culture


Step 3: Exchanging
Information and the First Offer

•• Both parties exchange information on their needs for
Both parties exchange information on their needs for
the agreement
the agreement
•• Parties exchange task-related information and first
Parties exchange task-related information and first
offer
offer
-- Task-related information: actual details or the
Task-related information: actual details or the
proposed agreement
proposed agreement
-- First offer: first proposal by parties of what they
First offer: first proposal by parties of what they
expect from the agreement
expect from the agreement

Exhibit 13.6: Information Exchange and
First-Offer Strategies


Step 4: Persuasion

•• Stage when each side in the negotiation attempts to
Stage when each side in the negotiation attempts to
get the other side to agree to its position
get the other side to agree to its position
-- Heart of the negotiation process
Heart of the negotiation process
-- Numerous tactics used
Numerous tactics used


Verbal Negotiation Tactics

•• Promise
Promise
•• Threat
Threat
•• Recommendation
Recommendation
•• Warning
Warning
•• Reward
Reward
•• Punishment
Punishment


Verbal Negotiation Tactics

•• Normative appeal
Normative appeal
•• Commitment
Commitment
•• Question
Question
•• Command
Command
•• Refusal
Refusal
•• Interruption
Interruption


Exhibit 13.7: Comparison of Brazilian,
U.S., and Japanese Negotiators (in
half-hour bargaining session)


Nonverbal Communication

•• Body posture, facial expression, hand gestures, and
Body posture, facial expression, hand gestures, and
the use of personal space are a natural part of any
the use of personal space are a natural part of any
international negotiation
international negotiation


Dirty Tricks

•• Negotiation tactics that pressure opponents to accept
Negotiation tactics that pressure opponents to accept
unfair or undesirable agreements or concessions
unfair or undesirable agreements or concessions


Ploys/Dirty Tricks and
Responses

•• Deliberate deception or bluffing—point out what you
Deliberate deception or bluffing—point out what you
believe is happening
believe is happening
•• Stalling—do not reveal when you plan to leave
Stalling—do not reveal when you plan to leave
•• Escalating authority—clarify decision making authority
Escalating authority—clarify decision making authority
•• Good-guy, bad-guy routine—do not make any
Good-guy, bad-guy routine—do not make any
concessions
concessions


Ploys/Dirty tricks and
Responses

•• You are wealthy and we are poor—ignore the ploy
You are wealthy and we are poor—ignore the ploy
•• Old friends—keep a psychological distance
Old friends—keep a psychological distance


Step 5 and 6: Concession and
Agreement

•• Final agreement: signed contract, agreeable to all
Final agreement: signed contract, agreeable to all
sides
sides
•• Concession making: requires that each side relax
Concession making: requires that each side relax
some of its demands
some of its demands


Styles of Concession

•• Sequential approach: each side reciprocates
Sequential approach: each side reciprocates
concessions
concessions
•• Holistic approach: each side makes very few
Holistic approach: each side makes very few
concessions until the end of the negotiation
concessions until the end of the negotiation


Basic Negotiation Strategies

•• Competitive negotiation: each side tried to give as little
Competitive negotiation: each side tried to give as little
as possible and tries to “win” for its side
as possible and tries to “win” for its side
-- The negotiation as a win-lose game
The negotiation as a win-lose game
•• Problem solving: negotiators seek out ground that is
Problem solving: negotiators seek out ground that is
beneficial to both companies’ interests
beneficial to both companies’ interests
-- Search for possible win-win situations
Search for possible win-win situations


Exhibit 13.8: Competitive and Problem-
Solving Negotiation in the Negotiating
Steps


Exhibit 13.9: Cultural Differences in
Preference for a Problem-Solving
Negotiation Strategy


Step 7: Post Agreement

•• Commonly ignored step
Commonly ignored step
•• Consists of an evaluation of the success of a
Consists of an evaluation of the success of a
competed negotiation
competed negotiation
•• Allows the garnering of insights from understanding
Allows the garnering of insights from understanding
strengths and weaknesses of negotiation
strengths and weaknesses of negotiation


The Successful International
Negotiator: Personal
Characteristics
•• Tolerance of ambiguity
Tolerance of ambiguity
•• Flexibility and creativity
Flexibility and creativity
•• Humor
Humor
•• Stamina
Stamina
•• Empathy
Empathy
•• Curiosity
Curiosity
•• Bilingualism
Bilingualism


Major Points Regarding
Successful International
Negotiation
•• Few negotiations succeed without extensive
Few negotiations succeed without extensive
preparation.
preparation.
•• Building personal relationships is a key step in a
Building personal relationships is a key step in a
negotiation.
negotiation.
•• Managers should be aware that first offers may differ
Managers should be aware that first offers may differ
by cultural background.
by cultural background.


Negotiation
•• Many tactics are used in persuasion.
Many tactics are used in persuasion.
•• Know how counterpart views the concession-making
Know how counterpart views the concession-making
process.
process.
•• Culture and legal traditions influence the content and
Culture and legal traditions influence the content and
force of law regarding business contracts.
force of law regarding business contracts.
•• Competitive negotiation seldom leads to long-term
Competitive negotiation seldom leads to long-term
relationships.
relationships.


Negotiation
•• Problem-solving negotiation is more flexible and
Problem-solving negotiation is more flexible and
probably more successful strategy.
probably more successful strategy.
•• Must be flexible, empathic, and physically tough.
Must be flexible, empathic, and physically tough.


Conclusion

•• Chapter examined the negotiating process and other
Chapter examined the negotiating process and other
elements of cross-cultural communication
elements of cross-cultural communication
•• International negotiations involves several steps
International negotiations involves several steps
including: preparation, building the relationship,
including: preparation, building the relationship,
persuasion, making concessions and reaching
persuasion, making concessions and reaching
agreement
agreement
•• Successful negotiators prepare and understand these
Successful negotiators prepare and understand these
steps well
steps well


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