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Cultures influence on negotiation

In its basic form, negotiation is a method of conflict resolution. It is a problem-solving process in which two or more parties attempt to resolve their disagreement or conflict in amanner, and through a process, that is mutually agreeable. Whereas the general concept of negotiation is easy enough to understand, in practice it can be an extremely difficult proposition.Opposing views about what is right and wrong, disagreement on what is fair and equitable,understanding each others message and form of communication, and even the procedures thatwill be used to conduct negoiations are but a few of the hurdles that negotiators will encounter.

Negotiation is further complicated when the parties find themselves negotiating across dissimilar cultures. Culture is a powerful factor in shaping how people think, communicate and behave. Ittherefore affects how they negotiate .

Negotiators from different cultures have the tendency to view the purpose of a negotiationdifferently. That is why for some cultures the goal of a business negotiation, first and foremost,is a signed contract between the parties, and for other cultures the goal of a negotiation is not asigned contract but rather the creation of a relationship between the two sides. Although thewritten contact expresses the relationship, the essence of the business is the relationship itself.For example a survey conducted on over 400 persons from 12 nationalities, spotlighted in TheGlobal Negotiator (is a knowledgeable and practical guide for any business that is either considering or already involved with the formation of international relationships and

partnerships) that 74 percent of the Spanish respondents claimed their goal in a negotiation was a

contract and only 33 percent of the Indian executives had a similar view. The difference inapproach may explain why certain Asian negotiators, whose negotiating goal is often the creationof a relationship, have the tendency to give more time and effort to negotiation preliminaries,while North Americans often want to rush through this first phase of a business.

Culture also strongly influences the personal style of negotiators. It has been observed,for example, that Germans have a more formal style than Americans. A negotiator with a formalstyle insists on addressing counterparts by their titles, avoids personal anecdotes, and refrainsfrom questions touching on the private or family life of members of the other negotiating team.

Each culture has its own formalities with their own special meanings. They are another means of communication among the persons sharing that culture, another form of adhesive that

binds them together as a community. For an American, calling someone by the first name is anact of friendship and therefore a good thing. For a Japanese, the use of the first name at a firstmeeting is an act of disrespect and therefore bad. Negotiators in foreign cultures must respectappropriate formalities. As a general rule, it is always safer to adopt a formal posture and moveto an informal stance, if the situation warrants it, than to assume an informal style too quickly.

Regarding the negotiating attitude, because of the differences from a cultural point of view, or from a personality point of view, business persons appear to approach a business with

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one of two basic attitudes: that a negotiation is either a process in which both can gain (win-win)or a struggle in which, of necessity, one side wins and the other side loses (win-lose). Incommunication, the methods also vary among cultures. Some emphasize direct and simplemethods of communication; others rely heavily on indirect and complex methods. The latter mayuse circumlocutions, figurative forms of speech, facial expressions, gestures and other kinds of

body language. In a culture that values directness, such as the American or the Israeli, one canexpect to receive a clear and definite response to proposals and questions. In cultures that rely onindirect communication, such as the Japanese, reaction to proposals may be gained byinterpreting seemingly vague comments, gestures, and other signs. What one will not receive at afirst meeting is a definite commitment or rejection. The confrontation of these styles of communication in the same negotiation can lead to friction. For example, the indirect waysJapanese negotiators express disapproval have often led foreign business executives to believethat their proposals were still under consideration when in fact the Japanese side had rejectedthem.

Discussions of national negotiating styles invariably treat a particular culture's attitudestoward time. It is said that Germans are always punctual, Latins are habitually late, Japanesenegotiate slowly, and Americans are quick to make a deal. Commentators sometimes claim thatsome cultures value time more than others, but this observation may not be an accuratecharacterization of the situation. Rather, negotiators may value differently the amount of timedevoted to and measured against the goal pursued. For example, in one case that receivedsignificant media attention in 1990, a long-term electricity supply contract between an ENRONsubsidiary, the Dabhol Power Company, and the Maharashtra state government in India, wassubject to significant challenge and was ultimately cancelled on the grounds that it wasconcluded in "unseemly haste" and had been subject to "fast track procedures" that circumvented

established practice for developing such projects in the past. Important segments of the Indian public automatically assumed that the government had failed to protect the public interest because the negotiations were so quick. In the company's defense, Rebecca Mark, chairman andCEO of Enron International, pointed out to the press: "We were extremely concerned with time,

because time is money for us.Accounts of negotiating behavior in other cultures almost always point to a particular

group's tendency to act emotionally. According to the stereotype, Latin Americans show their emotions at the negotiating table, while the Japanese and many other Asians hide their feelings.Obviously, individual personality plays a role here. There are passive Latins and hot-headedJapanese. Nonetheless, various cultures have different rules as to the appropriateness and form of displaying emotions, and these rules are brought to the negotiating table as well. AmongEuropeans, the Germans and English ranked as least emotional, while among Asians theJapanese held that position, but to a lesser degree.

Whether a negotiator's goal is a contract or a relationship, the negotiated transaction inalmost all cases will be encapsulated in some sort of written agreement. Cultural factors alsoinfluence the form of the written agreement that the parties make. Generally, Americans prefer

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very detailed contracts that attempt to anticipate all possible circumstances and eventualities, nomatter how unlikely. That is because the deal is the contract itself, and one must refer to thecontract to handle new situations that may arise. Other cultures, such as the Chinese prefer acontract in the form of general principles rather than detailed rules. That is because, it is claimed,that the essence of the deal is the relationship between the parties. If unexpected circumstancesarise, the parties should look primarily to their relationship, not the contract, to solve the

problem.Culture influences also the organization of a group. From this point of view, In any

negotiation, it is important to know how the other side is organized, who has the authority tomake commitments, and how decisions are made. Culture is one important factor that affectshow executives organize themselves to negotiate a deal. Some cultures emphasize the individualwhile others stress the group. These values may influence the organization of each side in anegotiation. One extreme is the negotiating team with a supreme leader who has completeauthority to decide all matters. Many American teams tend to follow this approach. Other

cultures, notably the Japanese and the Chinese, stress team negotiation and consensus decisionmaking. In the first type, the negotiating team is usually small; in the second it is often large. For example, in negotiations in China on a major deal, it would not be uncommon for the Americansto arrive at the table with three people and for the Chinese to show up with ten.

Another example to illustrate the influence culture has on a negotiation, is related tocultures which do not allow women to play a role in certain negotiation settings. This could beindicative of a culture that exhibits a high power distance where inequalities among people are

both expected and encouraged.In conclusion, Negotiation is an important and valuable tool for resolving conflicts when

all parties involved have a shared commitment to reaching a collaborative, joint outcome that

satisfies both parties needs and interests. Cultural considerations play an important role in thenegotiation process as all of the actors bring with them their own specific cultural behaviors; thatis their patterns of thinking, feeling, acting and most importantly, their own set of culturallyshared values.

Balan Andreea-Iuliana, MCA, grupa 1