|
Requejo and Graham set out to explore how businesses in different countries negotiate agreements and business partnerships with each other and particularly why some negotiations are spectacularly successful while others are colossal failures. An important obstacle is the cultures the different partners bring to the table, but this very diversity "can also produce new ideas and new perspectives on those ideas that can be exploited for mutual benefit by patient and creative negotiators on both sides of the table." (p. 1).
Culture includes the different values, languages, aspirations, and communication styles that negotiators from different countries bring to the table. Societies can be individualistic; ties are loose and everyone looks after himself or herself. Other societies are collectivistic; people are integrated into groups that support them in return for loyalty. In egalitarian societies, knowledge, skills, respect, and reputation are sources of power; while in hierarchical societies, social roles, personal connections, and inheritance are more important. Difference in language is an obvious obstacle. Other less obvious causes of misunderstanding and miscommunication are rituals, symbols, and beliefs, all of which unconsciously influence behavior and are unfamiliar to others.
Decision making in different enterprises can be centralized in one individual, delegated to persons throughout the organization, or vested in committees and groups. Individuals' objectives and aspirations also vary. For some, security means training and the ability to move between jobs; for others, it means lifetime employment or retirement and welfare benefits. Social acceptance is more important in one country, achieving social and political leadership in another, and accumulating wealth in a third.
Communication styles are strongly influenced by culture. In high-context cultures, much information is implicit and nonverbal, and depends on contextual cues such as the rank and position of the speaker. Preserving harmony in the relationship is more important than frankness. In low-context cultures, communication is more explicit, verbal, and frank.
Time is experienced differently. Monochronic time is linear and can be saved, spent, wasted, and lost. Punctuality is important, and people are impatient to get things done. Polychronic time leads to looser schedules, more involvement with people, and more patience to see how things develop.
For Requejo and Graham, these various elements tend to cluster together to yield cultures that are more information-oriented, such as the United States, or more relationship-oriented, such as Japan. An information-oriented culture is individualistic, egalitarian, low-context, linguistically direct, and monochronic time-oriented. These societies achieve efficiency through competition, tend to focus on the deal at hand, build up the final agreement by a series of smaller agreements on individual issues, and value objectivity and data in decision making. Relationships among business, labor, and government are adversarial.
A relationship-oriented culture is collectivistic, hierarchical, high context, linguistically oblique, and polychronic time-oriented. These societies achieve efficiency by reducing transaction costs, take a holistic view of negotiations emphasizing the building of long-term relationships, and settle individual issues as part of the final agreement. Personal relationships are important influences on decision making. Relationships among business, labor, and government are cooperative.
Some features of the American information-oriented negotiation style are bound to cause difficulties with partners from relationship-oriented cultures. Americans quickly get to the point without taking time to build relationships. Prizing informality and equality, they attempt to persuade with objective arguments and data, ignoring the importance of personal connections. They are impatient and often make unnecessary concessions to move things along.
The negotiation process that the authors recommend begins with scanning the environment—the external factors that might influence the negotiation—through published sources. The environment includes the political, legal and regulatory, physical geographic, demographic, economic, and other conditions that will impact the negotiation and the ensuing business partnership. Choose negotiators with key characteristics—such as listening ability, social intelligence, self-confidence, influence at headquarters, and language skills. Assess in more detail the people with whom you will be dealing. Develop an agenda for the negotiation and a strategy for the timing and order of concessions you will offer. Determine your best alternative to a negotiated agreement (BATNA) in case there is no agreement. Evaluate the negotiation setting. Is it home or away? If it is away, mitigate the disadvantages by, for example, suggesting some meetings at your hotel or a neutral site, rather than the other side's offices. Be sure your negotiating team is not outnumbered by the other side. Be aware of time limits—yours and theirs.
The negotiation process itself has four steps. Non-task sounding is essential for building trust and relationships. Do not try to skip over this step to get down to real business; in many cultures it may last for days or weeks. Next comes the exchange of information. It is normal in many countries to provide extensive background and context before presenting your actual proposal. Conversely, executives from relationship cultures are reluctant to provide frank feedback about proposals, as they are more concerned with maintaining harmony. Persuasion should not overemphasize objective arguments based on data and analysis; trust and personal relations are often more important. Finally, make no concessions until all issues have been discussed (the holistic approach), then start with minor ones.
For the authors and business executives in much of the world, the goal of international negotiations is not simply "concluding business deals," but, more importantly, "establishing business relationships" to be maintained and nurtured over the long term. This requires keeping personal relationships warm through repeated contacts and visits to develop an atmosphere of trust and harmony. Each partner should routinely consider the interests of the other. Over time, changing circumstances will make modifications in the agreement inevitable. Since it is important to preserve the relationship for future dealings, the partners should try to resolve any conflicts through conferring in a spirit of mutual accommodation.
Successful global negotiations facilitate international trade that fosters world peace, innovation, and progress. Innovation requires creating new ideas and then diffusing them. Creativity and diffusion are both enhanced by diversity. People from different backgrounds working together generate more new ideas. When diverse people overcome the difficulties of communicating with each other, ideas spread from group to group more rapidly. For businesses, therefore, open innovation, or working with partners, both as sources of ideas and as marketers and diffusers, takes advantage of diversity and generates more innovation than the old method of doing it all in-house.
The key to the future is to act as if interdependence is fundamental to success. Treat negotiations as opportunities for innovation and mutual gain, rather than as competitions to be won. Develop negotiation skills in your staff. Groom "relationship managers" whose primary job is to work with international partners. Finally, "create and manage strategic relationships in which boundaries between companies, countries, and cultures begin to dissolve." (p. 250).
Back to Contents
|