“A must read for anyone operating within ‘global’ corporations. Catherine’s insights and experiences in helping companies negotiate their way to growth
around the world are second to none!”
—Michael Hortie, president, Motorola Canada
“Do you travel overseas in business? Does your company have partners in other countries? Do you feel sometimes confused about how to negotiate with
people from other cultures? Do you teach international business? If your answer to any of these questions is YES, this book is a must for you!
Comprehensive approach, first-hand experience, solid theoretical base, practical suggestions—everyone will find something valuable here.”
—Dr. Krzysztof Gluc, vice president, Wyzsza Szkola Biznesu, Poland
“I have personally witnessed Catherine Lee’s practical wisdom and insight as she helped Motorola University prepare professionals for joint ventures in the
global marketplace. This book is a compendium of invaluable advice for anyone embarking on a trans-cultural journey.”
—Bill Wiggenhorn, principal, Main Captiva, LLC, and founding president, Motorola University
Because of the fast-changing global marketplace and growing demand for cultural solutions, successfully negotiating across borders has become a
key for building business and increase revenues for most major companies. Most other countries embrace negotiating as part of their everyday activity;
outside the U.S., virtually everything is negotiable.
But many U.S. business professionals lack the skills to manage an interaction, identify the other party’s needs and reach an agreement that is
mutually beneficial. Trying to do all that in a foreign country just makes it more difficult! The aggressive, competitive, “shoot-from-the-hip” style of many
U.S. corporations is simply not appropriate to many other cultures.
The New Rules of International Negotiation addresses the commonalities, the differences and the barriers facing anyone trying
“Catherine Lee’s The New Rules for International Negotiation is a must-read for anyone who desires to become more effective in the global marketplace. This is neither a simplistic how-to book nor a long list of do’s and don’ts. Lee provides you with basic principles and models to will help you prepare and think through cross-cultural negotiations. The result will be more productive and successful longterm relationships.” —Ken G Kabira, Executive vice president, Lipman Hearne, former chief marketing officer, McDonald’s, Japan “I have personally witnessed Catherine Lee’s practical wisdom and insight as she helped Motorola University prepare professionals for joint ventures in the global marketplace. This book is a compendium of invaluable advice for anyone embarking on a trans-cultural journey.” —Bill Wiggenhorn, principal, Main Captiva, LLC and founding president, Motorola University “Do you travel overseas in business? Does your company have partners in other countries? Do you feel sometimes confused about how to negotiate with people from other cultures? Do you teach international business? If your answer to any of these questions is yes, this book is a must for you! Comprehensive approach, firsthand experience, solid theoretical base, practical suggestions—everyone will find something valuable here.” —Dr. Krzysztof Gluc, vice president, Wyzsza Szkola Biznesu, Poland “Carrying her multicultural experience, intuitiveness, and keen analysis, Lee successfully delivers innovative applicable techniques and practical behavior adjustments that lead to negotiation enhancement in a corporate and personal setting. The Rules for International Negotiation delivers the message loud and clear: build trust, earn the right to influence, and negotiate successfully!” —Hedy M. Ratner, president, Women’s Business Development Center “The New Rules for International Negotiation is an important read for anyone who desires a better understanding of the critical role that culture plays in negotiating internationally. Catherine Lee has handson experiences and personal successes in using this process in a variety of organizations and is a strong testimony for the complexity of not only the face-to-face negotiation process, but the intangible cultural aspects as well.” —Tom Menzel, business owner/investor and consultant “This book is bound to work for people who work in an environment of diversity of cultures. It provides wisdom that can benefit people who work with people from other countries. It is helpful to read from time to time.” —Charles Wang, a business consultant in China The New Rules of International Negotiation Rela Trust, Building Relationships, Earning Trust, Crea reating Influence and Creating Influence Around the World C atherine Lee Franklin Lakes, NJ Copyright© 2007 by Catherine Lee All rights reserved under the Pan-American and International Copyright Conventions. This book may not be reproduced, in whole or in part, in any form or by any means electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system now known or hereafter invented, without written permission from the publisher, The Career Press. THE NEW RULES OF INTERNATIONAL NEGOTIATION EDITED BY KATE HENCHES TYPESET BY MICHAEL FITZGIBBON Cover design by The Design Work Group Printed in the U.S.A. by Book-mart Press To order this title, please call toll-free 1-800-CAREER-1 (NJ and Canada: 201848-0310) to order using VISA or MasterCard, or for further information on books from Career Press. The Career Press, Inc., 3 Tice Road, PO Box 687, Franklin Lakes, NJ 07417 www.careerpress.com Library of Congress Cataloging-in-Publication Data Lee, Catherine, 1941The New rules of international negotiation : building relationships, earning trust and creating influence around the world / by Catherine Lee. p. cm. Includes index. ISBN-13: 978-1-56414-973-2 ISBN-10: 1-56414-973-0 1. Negotiation in business. 2. Cultural awareness. 3. Business etiquette. 4. International business enterprises—Management. I. Title. HD58.6.L43 2007 658.4’052—dc22 2007029046 Dedica Dedication This book is dedicated to my dear husband, Timothy, and to my children Stephen, Andrea, Cassie, and Moira. To Timothy for consistently giving a positive response to my every doubt or fear, and to my children for supporting every effort of mine as if it already was a success. And to Quin, John, Cortney, and Andy for being there with confidence in my work when I questioned its purpose. Without the caring of each of them, my contribution would be shallow and meaningless. Acknowledgments To Alicia Karapetian for her editing and support through the unknown. For their contribution to the snapshots of various countries, I’d like to thank: Dr. Sharon Badenhop, consultant and professor, Rochester Institute of Technology; Camilo Escobar, senior manager, BP, Bogota, Colombia; Dr. Krysztof Gluc, vice director, Wyzsza Szkola Biznesu [WSB], the business university in Novy Sacz and Krakow, Poland; Gary Jamison, principal, Jamison Group and affiliate, Japan Intercultural Consulting; Rasheed Ahmed, vice president, EXENSYS, India in the United States, Ramonda Talkie, colleague in development of the negotiation process, John Willig, a literary agent who reflects the best in the negotiating style, and Chang Lu Wang, business consultant, Beijing, China. Blank page Contents Foreword Introduction Part I: The Cowboy in a New Frontier Chapter 1: Crossing the Cultural Divide Close-Up of Asia Snap-shot of China Chapter 2: Competition is King…and Queen Snapshot of Japan Chapter 3: The Gated Community: Corporate America Lives Here Close-Up of Eastern Europe Snapshot of Russia Chapter 4: Superiority Complex: Sophomores of the Global Campus Snapshot of the United States Chapter 5: Values: A Matter of Priorities Snapshot of Poland Chapter 6: Build a Trustworthy Relationship: The Trust Model Snapshot of Hong Kong Chapter 7: The Business of Good Actions: Four Strategic Virtues Snapshot of India Chapter 8: The Charismatic Multi-national: Lending a Hand to Neighbors vs. Managing a Business Arrangement Close-Up of Latin America Snapshot of Colombia 119 103 85 73 49 39 25 9 13 139 Part II: Negotiating to Shi Chapter 9: Crossing the Cultural Divide Chapter 10: Recognizing the Needs of the Other Side: The Fastest Route to Getting What You Need Snapshot of Argentina Chapter 11: The Mandate: A Blueprint of the Dance Floor Snapshot of Chile Chapter 12: Common Ground: Cultural and Contextual Snapshot of Venezuela Chapter 13: Building Trust: Vulnerability and Consistency Chapter 14: A Nation of Superiority: Ask and Listen Chapter 15: John Wayne is Dead: The Most Difficult Negotiators—From Two Perspectives (Ours and Theirs) Chapter 16: Verbal Behaviors: What You Say and How You Say It Snapshot of Brazil Chapter 17: Getting Ahead of the Cultural Changes Index About the Author 205 219 187 173 163 157 231 239 259 267 272 Foreword Foreword Globalization is no longer a concept. It is a reality that speaks to the interdependence of countries through an increasing number of crossborder transactions, capital flows, and diffusion of technology. Business today is global and encompasses every corner of the world—from advanced economies to emerging markets. Executives working in this environment have to be nimble, knowledgeable, and open-minded. Business professionals may wake up one morning in New York and the next morning in New Delhi. The diversity of work and growth of cross-border business means that executives must be prepared to negotiate complex deals with different cultures whose priorities and perspectives differ greatly from their own. Markets in the United States may pulse to the beat of “time is money,” but other cultures, such as the Chinese, prefer to take time— a lot of time—to consider a deal and finalize it. More importantly, the Chinese want to take time to understand the people with whom they are negotiating and learn the motivations that are driving the team on the other side of the table. In such a culture, negotiations are about something more long-lasting than the signing of a contract. They are about relationships and respect. 9 The New Rules of International Negotiation Too often people focus on the deal that is currently being negotiated and fail to realize that if they get the relationship right, there will be multiple deals down the road. Establishing respect among different cultures is essential, particularly in emerging markets. In the end, people buy from other people, and they usually buy from people they trust. A confident swagger and self-promotion may score points in the United States, but, in many parts of the world, humility is the greatest virtue. These cultural differences necessitate that business professionals adapt their approach and show sensitivity to the people with whom they are negotiating and who they are hoping to call partners. Today, Motorola generates the majority of its revenues outside the U.S. While this is a recent phenomenon, it demonstrates that the company is becoming increasingly dependant on foreign markets and diverse cultures for its growth and future. Global companies, such as Motorola, have an obligation to adapt to foreign markets and operate, when possible, as a local business that relies on local managers for results. Organizational design in different countries cannot be conceived in a vacuum, and consideration must be given to the wants, needs, and culture of a particular market. Increasingly, the world is focused on two dominant emerging markets: China and India. With each country claiming more than a billion people and annual economic growth of close to 10 percent, China and India have truly become the new business frontier. For established North American companies in search of new ventures, these two countries offer big markets, big opportunities, and big risks. Although China and India are advancing at rates not seen since the industrial revolution, they are each struggling with developing financial markets, legal systems, and corporate governance regulations. In these countries, the best way to achieve business objectives is to understand Chinese and Indo cultures, and build long-term relationships. It is also important for executives to understand that the North American way of conducting business does not always translate well in these cultures. The straight-talking, shoot-from-the-hip approach to 10 Foreword negotiations that is valued in Chicago or Dallas may come across as arrogant and defeatist in the boardrooms of Shanghai or Bombay. This brings me to this excellent book by Catherine Lee, The Rules of International Negotiation: Building Relationships, Earning Trust, and Creating Influence Around the World. A top management consultant and negotiations expert who has provided senior counsel to global companies such as General Motors, Milwaukee Insurance, BP (Amoco), and Korea Telecom, Ms. Lee’s book correctly focuses on the need for business executives to bring cultural sensitivity and understanding to the negotiating table. This book, which grew out of a series of presentations Ms. Lee gave to Motorola’s World Wide Management Group, is timely and relevant given the increasingly global business environment in which people work. Having been fortunate enough to participate in Ms. Lee’s presentations and to have read this book, I can say that Ms. Lee injects some much needed empathy, insight, and thoughtfulness into the realm of Corporate America. Using a series of anecdotes that are familiar and relatable, Ms. Lee makes a compelling case for business professionals to look at the wants and needs of the customer before their own, and to see people with whom they’re negotiating as human beings rather then adversaries. The book looks long and hard at business practices and cultural priorities around the world including China, where Ms. Lee has spent much of her professional career and where many U.S. executives increasingly find themselves conducting business. The examination of China draws comparisons to U.S. business practices and negotiating techniques, and offers some valuable lessons. They key learnings I took away from this book are the importance of respecting customers enough to learn about their country, customs, and culture, and to focus on relationships that will lead to long-term success rather than a one-shot deal. In fact, without a solid relationship even a one-shot deal has a minimal chance of success. I strongly recommend this book, and encourage each of you to keep an open mind and learn from Ms. Lee’s experience and wisdom. Apart 11 The New Rules of International Negotiation from its business teachings, the book contains a great deal of humor, charm, and practical advice. As the world becomes more connected and the interdependence of countries grows, cultural sensitivities will become as valued as a focus on the bottom line. Globalization will continue to define the world in which we live and business will become increasingly international. In this environment, we each have an obligation to understand the people we work with and rely on for our success. By Michael Hortie President of Motorola, Canada 12 Introduction Introduction Negotiation is an ever-present aspect of business. Being elected and serving on the Board of Education for a consolidated school district in the Chicago suburbs was my introduction into business, politics, and diversity. The district encompassed 14 municipalities; the Barrington area, an affluent community; Hoffman Estates, also a most comfortable community for young people starting out, educated and skilled immigrants, and academic professionals; and Carpentersville, a bluecollar community with a growing, hard-working Hispanic population. Learning to work with the varied municipalities and with each elected ego, with the public while being public, and hearing the vastly different perspectives, made me uncomfortable with the enormous differences that had to be served or at least answered to. I wanted everything to be simpler and more categorized, not so threatening as with all those unknown and nonunderstood differences. If everyone’s need was the same, it would have been simpler and easier. Sameness seemed comforting and doable. Circumstances pushed me back into the paid workforce after a 20-year absence. My husband’s (mentor) advice was, “Whatever they ask you to do, say you can feel comfortable with that, and then come home and figure out how.” Motorola became my first contract—a threeday training program for their first level managers. In 1990, after a year 13 The New Rules of International Negotiation and a half of work with Motorola, I was asked if I would go to Beijing, China, to help set up some training. Once again, I thought I could feel comfortable with that. I knew they must have asked everyone else before me, but I had the freedom of little work. From that first trip in November of 1990 my education began, and I ultimately earned an onthe-job degree through experience in organizational development, training, and an MBA. My formal background was in the romance languages—a masters in the arts from the University of Michigan—and Ph.D. course work followed in medieval literatures at Wayne State University. All my practical education had come from the political arena. For the past 19 years, in international training and management development, I have been able to observe behaviors of businesspeople from different business cultures and different national cultures. I facilitated many executive team meetings and worked with numerous post-joint venture teams in negotiations and in on-the-job team building— multi-national team building. My purpose was and is to help U.S. businesspersons and others of Western culture work more effectively and more respectfully with the diversity of cultures. This goal kept me to an intensity of focus and was reinforced by the perspective of a westerner who values and understands the paradoxical mix of her country’s business style. Just as a member of a family feels they may criticize their own family but no one outside it can, I also feel, as a U.S. citizen and business person, that—I may critique my country but no one else better do it. Not all United States businesspeople fit into this description—it’s more a reflection of the accepted (not necessarily appropriate) behaviors of our business culture in general. Traveling to different countries and continents to work, I have had many lonely hours, especially on weekends, to observe, to listen, and to interpret. Every airport, hotel lobby, train station, open-air market, restaurant, and conference room became my laboratory. Occasional hotel tour buses would affirm the extremes for me. A person’s words, tone, and expression would either influence the other side to respond, to listen more, or to graciously retreat—or not so graciously shut down. For 11 years, I observed, noted, and documented. Motorola had trained me as a behavior analyst, so I had a framework for my data. My partner 14 Introduction trained me in assessments and their intended results. It was the best experience that anyone could have to formalize their learning—firsthand observation and an opportunity to elicit immediate feedback. In November 1990, I left for Hong Kong. I was petrified by the thought of standing in front of businessmen from every different country in the Pacific Rim and instructing them in leadership and management skills. I worried about whether they would understand me, or my off-center sense of humor. I didn’t know if my woman-ness would affront them, or if their cultural bias would offend me. I wanted to be knowledgeable in every aspect of their culture. I almost couldn’t talk the first day because my mouth had the dryness of fear, of ignorance, and of inexperience. Now, I have that same feeling when I have to facilitate a group of white Americans from the corporate culture. With the diverse groups, I have the vast lenience of every other culture. The participants in many of the sessions, if asked respectfully, would tell me the agenda of a typical workday in their country. Many times in the cross-cultural groups we would use an agenda from a different country each day. It kept change a respectable force in our sessions. The unexpected benefit was often seeing more clearly the values of a new and different culture. I worked several times with a group of software developers in Turin, Italy. I once mentioned I would love to see the Shroud of Turin. It’s put on display for the public only every 25 years. The year was 2000! A couple of the engineers decided to take me. By the time word got out, about 27 of them went with me. Afterward, we all went to a restaurant to eat, drink, and discuss the validity of the shroud as that of Jesus Christ, or of any other man of 2,000 years ago. I realized later that evening that I was at the end of my fifties and no one in the group was older than 35 years old. The engineers had always included me in dinners after work, their regular Wednesday night parties, and at lunch. I began to see the differences in a culture’s values and their priority. Age wore a softer face in Turin, Italy, and young people searched out an older person’s opinion, judgment, and support. Later, I discovered firsthand that age is honored and loved in China. In China, I was more deserving of their respect because I was older. 15 The New Rules of International Negotiation My interest in another’s culture, religion, and people was the genesis of new relationships. Their interest in me expanded our understanding of each other and promoted the relationship. The artificial restrictions were not there—such as, no expression of feeling, of belief, or of humaneness. It was good to talk about spirituality and art and family. It was freeing for me, who was used to working in a U.S. business culture, where everything personal is regarded as not professional except for competition, aggression, and absolute confidence. A perceived offensive attitude of superiority and arrogance often accompanies a United States businessperson into the cross-cultural meetings. My job introduced me to the continents and to numerous islands, and my schedule allowed me time to contemplate and understand better the people. In training sessions such as Motorola’s Manager of Managers, a five-day work session, I had the opportunity to know better the men and their cultures. They were always eager to help me get better acquainted with their motherland. The unknown and the mystical of a culture can be alluring and influential in developing an interest into a fuller understanding of custom and tradition. As a grandchild of Russian/ Poilish immigrants I feel close to all ethnicities, from any non-English speaking country. There is instant, recognizable, common-ground of feeling and of placement or displacement. I always felt I was the protector of my mother, my grandmother, or my grandfather. I had to tell people their accent or the way they dressed didn’t mean they were bad or stupid, just different. I knew “different” was not always acceptable or respected. It gave good enough reason to exclude someone. This was my original impetus for writing the book—to bring back a dignity, respect, and value of difference to my ethnic heritage. From a professional perspective, working in Asia, South America, Europe, Canada, and Mexico during the past 17 years identified an urgent business need of my clients—how to be able to lead in this global market through a negotiating style. Working with a diversity of cultures introduced me to a myriad of customs, traditions, and foods. Interacting with the individuals convinced me that recognizing these differences is not what would support building a relationship. A knowledge and appreciation of these differences 16 Introduction was the beginning, yet the establishment of trust, the basis for a long term relationship required some behavioral modifications to the United States style for doing business. Negotiation is inherent to doing business globally. Today working side by side with four or five cultures has become the norm—in the United States and across the world. This study brought me back to a simple understanding that you can’t change someone else’s behavior. Being married for 40 years, dedicating every effort to change my spouse, should have chiseled this in my brain and my heart much earlier. One can only change one’s own behavior, and we do it many times in a day depending on who walks in the room or which child in the family we’re reprimanding. This book develops within an objective to make you aware enough to want to change your behaviors as a businessperson, so that you will be able to negotiate and influence in a veritable global marketplace. It’s not stating that other cultures don’t have their hang ups in the way they behave—it’s stating we can’t change their behavior, but we can certainly influence them by changing some of the ways we work with other cultures, including our own. This is not primarily a do-and-don’t book taking you through a variety of cultures. Although snapshots of regions and several countries they house are included, the emphasis is on how to work and negotiate well with all cultures. The background and cultural considerations of emerging markets serve as an introduction to the country and its customs. Most important, it is a guideline for how to work within different cultures, using a universal base for building trust and earning the right to influence. It doesn’t negate the value of the “do’s and don’ts,” yet it emphasizes the skills and behaviors that will convince someone to listen to you. It then includes stories and examples of what will show another culture that you value their traditions enough to clumsily and awkwardly bow or read their business card. It’s the “clumsy and the awkward” that are important. This book identifies ways to modify the accepted U.S. business style to a more universally and respectfully accepted style in order to better negotiate and influence in other more mature cultures. 17 The New Rules of International Negotiation The book is structured into two main parts. The first half describes a business style through examples and stories, which matured out of a culture of free enterprise, and a capitalistic, competitive society focused on business and sports—both recognized by the money involved. Many of the aggressive behaviors that are appealing and acceptable to organizations are not appropriate when working across cultures. In fact, these behaviors are also rude in this culture, but have evolved into being acceptable. The second part of the book focuses on negotiation processes and the Behavioral Approach Model that targets successful outcomes and agreements. This model illustrates how a person’s expectations of an individual create responding behaviors from that individual. Our expectations are set by our attitudes, beliefs, and values. Four Strategic Virtues: Consideration, Acceptance, Respect, and Empathy are developed within practical applications. Voltaire, the 18th-century philosopher, in his Philosophical Dictionary (1764) wrote, “Virtue between men is a commerce of good actions….” These Virtues become the processes for assuring success in the practice of the Virtues. Seven Influencing Verbal Behaviors are highlighted demonstrating how they build a better style for ensuring the consistent use of the Strategic Virtues. The behaviors reflect one’s expectation of another, and these influencing behaviors move one toward “confident expectations” or trust, as defined in this book. The emphasis then shifts to “how to modify one’s behaviors” to work more effectively with other cultures, build trust, and, ultimately, maintain long-term relationships. A Trans-cultural Alignment Model is introduced. The Four Strategic Virtues: Consideration, Acceptance, Respect, and Empathy are developed within practical applications. The practice of these Virtues becomes the processes for assuring success in working across the cultural diversities of the continents. The Seven Influencing Verbal Behaviors are highlighted in the Influencing Behaviors Model, delineating the behaviors by definition, example, and then interpersonal impact and business impact. These behaviors become action items you may put into use immediately and see the positive results of your behavior modification. The model introduces 18 Introduction you, the reader, to the most specific and smallest action to work on. The impact of these small behaviors on the other person is grand. This recognition of behavior and impact gives you something to do now, to generate change and to influence the other side to move toward solution. Trying to change your attitude or belief takes a lifetime, whereas changing your own behavior or expectation of another can be immediate and could eventually have a positive effect on your attitude or belief. The New Rules of International Negotiation focuses on the behavioral aspect of negotiating. Behaviors include both the planning and the strategic parts of negotiating. Behaviors are a strong part of strategy; in fact they often determine the effect of your strategy. In essence, asking, summarizing, and building become the rules for successfully negotiating. These influencing behaviors also solidify a style for working well in most business and social interactions. There are two standard rules that are constant and determine your level of success. The first rule is a consistent practice of the Strategic Virtues—“commerce of good actions,” which design the framework for trust. The second rule is to use the Influencing Behaviors, the specific, small verbal behaviors become a strategy for maintaining trust and building relationships. Close-Ups and Snapshots of the Highlighted Countries The following regions have been targeted to highlight in the book. The countries were selected because of emerging markets in those areas. They are: Asia China India Korea Japan Hong Kong Eastern Europe Poland Russia 19 The New Rules of International Negotiation South America Colombia Venezuela Brazil Chile Argentina United States I have worked around the world and I have observed many richly different cultures. It has taken me 17 years to note well the classical norms of principles and values, and the exclusivity of cultural traditions and customs. It is difficult to isolate and recognize every country’s distinctions in culture, just as it is for me—a born citizen of the United States. The north, south, east, and west regions each have distinguishing, cultural characteristics. If I described one area as common for all areas, I would probably be wrong 75 percent of the time. Whatever I present about the countries, it is only a small piece of who they are, gleaned from my experiences, which further influences, one way or the other, the general statement of culture. It was easier for me to find the commonalities (such as common ground in a negotiation), get comfortable with what we shared, and then move together to an understanding of our differences. Once we got on the same side of the multicultural table, I could pursue the differences, discover their distinct values, and then together choose the best solution for the issue being negotiated. The benefits of the process were worth far more than the initial investment—peak in productivity, better relationships, and more long-term business. Every country has a culture exclusively its own—a culture rich in traditions and customs, that, when understood, can show different values, strengths, and purposes. To work in a collaborative effort requires an understanding of and appreciation for these cultural differences. It also requires the flexibility to use the others’ strengths when the situation is conducive and appropriate (or when the situation is low risk and perhaps not the best, but is worth forfeiting the best for adequate to show a willingness to do it “their way” to fortify the relationship). 20 Introduction Many of the suggestions that are given for how to work better with those in one country are appropriate and effective when working with many countries, including the United States. These suggestions are given on the assumption of sincerity. For example, one of the suggestions given for Colombia, South America: citizens are proud of their country, so compliment it. That would work for most countries. If you compliment a country for its natural beauty and substantiate it with a specific accolade, such as, “Bogota’s mountains and flora make it appealing year round” or, “Your weather keeps one motivated year round.” Your sincerity is felt. If you tell them, “Great country you have” or, “Nice country, seems to work well with so many different people” could be considered as patronizing. “Your accent is much easier to understand than many I’ve heard before”—ouch!! Sincerity stops you from being or from sounding patronizing. When you want to appear appreciative or accepting, it is easy to fall into sounding patronizing. Avoiding general statements and repetition of statements could prevent a perceived insincerity. Though I single out certain expectations of one country, the same expectations could easily apply to other countries. Having it become part of your demeanor could benefit you across the globe. The premise of this book is that the Influencing Behaviors, which are delineated and defined in Chapter XVI, are strategically effective across all continents. Recently, I was delivering a presentation to the Council of Supply Chain Management Conference and I took them through these behaviors and related how they affect the different cultures. Why a summary and a paraphrase are appreciated by audiences of different languages. One of the attendees then asked, “I understand how these behaviors would help those whose first language is not English, now which behaviors would work in the United States?” I then realized I had not fully explained the values or the affects of the behaviors. The behaviors influence human beings no matter the culture in which they lived. The behaviors uphold Respect, Consideration, Acceptance, and Empathy in all countries, and are not exclusive to any culture. The Four Strategic Virtues transcend all cultures and the Seven Influencing Behaviors support the virtues. 21 The New Rules of International Negotiation The cultural considerations I present in the book, introducing certain chapters, are my observations. I formed opinions based on what I frequently observed, on what others (including natives of their respective countries) related to me, and on everything I read prior to going to work in any of these countries. The considerations do not describe everyone in that country, just as the John Wayne style does not describe everyone in the United States. I interviewed individuals who live, and some who worked and lived, in the respective countries as a resource for my information. I also used two main resources for confirmation of what I observed and validation of those observations. They were: University Alliance, Superior Online Learning Executive Planet.com—“Let’s Make a Deal” Kiss, Bow, or Shake Hands: Latin America, by Terri Morrison and Wayne A. Conaway, 2007 Kiss, Bow, or Shake Hands: Europe, by Terri Morrison and Wayne A. Conaway, 2007 NOTE: When commenting on a specific global area or country, it is usually in generalizations—general comments, not personal absolutes. Please keep in mind that situations, individual social styles, circumstances, and interpersonal dynamics influence every exchange socially or in business. There is no category of behavior that describes everyone. 22 Foreword Part I: Cowbo owboy The Cowboy in a New Frontier 23 The New Rules Of International Negotiation Blank Page 24 Crossing the Cultural Divide CHAPTER 1: Crossing the tural ultur C ultural Divide “It’s an outlook, an attitude.” —John Wayne Agenda A. Small social courtesies with large business impacts. B. Barriers that prohibit relationships. C. Image—whose image is the right one? Mine or Theirs? Two waist-high, cloisonné Chinese vases filled with fresh flowers welcome guests into the meeting room. Inside, sculptured works of art are positioned proudly on enormous pillars on either side of the breakfast tables. Woven silk art lines the floor. Chinese rugs in magnificent colors exhibiting a history of traditional beauty and in a legacy of workmanship cover the floor on which I dare walk. Deep reds and burgundies, accented with varied shades of blue in a centered circle, burst into ancient designs to a border of twisting leaves—a work of carpet art. The expectation of the regal ambiance is one of respectful decorum. It has an air of importance that only Hong Kong could posture without words. 25 The New Rules of International Negotiation Thirty-two businessmen from all over Asia gather in this large conference room, seated at round tables, waiting for the morning’s session to begin. An assortment of sweets and savories fill gilded gold and red trays in complex and appealing geometric design, perfect in spacing and color. Angular and round pastries stuffed with varied sweet bean pastes are outlined by sprigs of violet and pastel pink orchids. It is so exquisitely presented that I am, at once, confident the taste will match the perfection of the display. Meat-filled pastries and skewered beef pieces extend an aromatic welcome with a mystifying arrangement. The scent alone pulls everyone to the table. Both the room and the food make the participants of this American Corporate Leadership Seminar feel valued. It is an environment inviting conversation and camaraderie. The men talk about family, current events, and business. As the program begins, attendees exhibit a focused attention, astute listening, and a somewhat guarded willingness to participate. Small group breakouts help illicit more contributions and the interactions become productive in outcome. By midday the men are feeling comfortable with each other and accomplished in their involvement. I turn to face them to begin the last activity before lunch. As I look out into the group, I notice three men boldly picking their noses. In fact, they are making a dedicated effort to the capture. They sit militarily, straight-backed in their chairs, at attention, heads held level and high, looking straight at me with their fingers industriously digging. Their attitude seems professional in all other regards, and even a bit defiant. Our eyes meet, and they don’t even flinch. They continue. I can’t watch. I look away embarrassed. They continue. I can’t guess what they ultimately did with their “find.” These men manage multi-million dollar operations. They are attentive and focused. They are targeted to succeed. They are well educated, smart, and considerate. They are nose-pickers. No one else seems bothered by this activity. Perhaps the others could not see them. I set my line of sight on the Chinese vases in the back of the room. I am disgusted, embarrassed, and arrogant. How gross for an adult man! I consider it insulting. I begin to look at those three men with a different 26 Crossing the Cultural Divide feeling. Where is their breeding? The remainder of the day, I can hardly talk with those men. It is the beginning of an almost two-year resistance to learning about the Chinese culture and valuing its historic differences. Why? I never left my own cultural frame of reference. It’s shameful to mention that nose picking could influence me into a destructive bias. To judge a person’s value on an American custom of “polite” contradicts every value—and business instinct—I have. Almost two years after the first of several incidents, a Chinese colleague of mine explained to me that the Chinese do not believe picking your nose is polite or impolite. It has never been a consideration of theirs. No Chinese child ever heard, “Don’t pick your nose” or, “Go get a tissue.” The Chinese do not share a code of behavior or manners that compliment our proprietary system. It’s not part of their culture. It’s not even considered. Social rules such as: “Don’t pick your teeth at the table,” do not apply. In China, a hand covering your mouth while the other hand cleans the teeth with a toothpick is most acceptable. In the United States, meals are dished out with serving utensils, but in China food rotates on a lazy Susan and each person uses his or her chop sticks to pick up pieces from the main serving platter. It’s nothing in China to clear your throat or nose at the table. It might happen stateside, but it’s certainly not appropriate. The Chinese find it rude and intimidating when someone consistently looks them in the eye, whereas, we, here in the United States, do not trust someone who doesn’t look us in the eye. We consider them “shifty,” dishonest, and insincere. Also, a person in China must refuse an invitation to pay for dinner several times before accepting it, but in the States it varies. One perceived misbehavior becomes a barrier to building a good relationship for doing business. Many times, I judged another’s competency based on American etiquette standards and not on his performance or idea. I questioned a person’s expertise based on his style of picking his nose. He certainly could not be as “smart” as someone who didn’t pick his nose in public. I often thought that a nose-picker could 27 The New Rules of International Negotiation not be good in sales because he’s insensitive to others needs. He would be offensive and, thus, destroy potential coalitions. I questioned his ability to manage, much less lead: Leaders do not pick their noses. The impact of this bias, bigotry, and ignorance costs an organization. An individual, annoyed or irritated by another’s behavior, builds a barrier that is difficult—sometimes impossible—to work around. We, as humans, make judgments based on our idea of what “civilized” means. Our judgments and perceptions toward “uncivilized” behavior generate disrespect, close-mindedness, and distrust. We begin to act as if the “offending” individual is incompetent or unreliable. These expectations impact productivity, outcome, quality, time, deadlines, and, eventually, the entire workplace environment. Decisions based on missed misunderstandings come at a high cost to an organization and generate a lack of commitment. With respect pushed aside, assumptions begin to determine assignments, and production slows. For that period of time, I was the judge. I only considered my own perspective. I determined that Chinese businessmen are strange because they had unexpected habits. I scrutinized their actions, but I also thought of my way as the norm. I thought, perhaps, they were being quiet while they were looking at me—the stranger—because they wanted to be like me. I never left my own cultural frame of reference. After working with the Chinese from 1990 to 1992, however, I finally came to a realization: I was the outsider, the stranger—strange in looks, carriage, clothing, and language. They sat in the judge’s seat and my behaviors were being assessed by the Chinese standards. Define Culture According to Webster’s Unabridged Dictionary, the definition of culture is “the behaviors and beliefs characteristic of a particular social, ethnic, or age group.” Culture embodies the rules that regulate basic patterns of behavior. They are the “shoulds” and the “should nots” of any group living in the same country, practicing the same religion, or of the same nationality. These “rules” create parameters or natural boundaries that make the people living within that culture feel comfortable. 28 Crossing the Cultural Divide One of the outcomes of these rules and regulations is inclusion or exclusion. Culture could be developed through neighborhood, religion, ethnicity, profession, or common interest. A business culture is much the same. Merriam-Webster’s Collegiate Dictionary says a business culture is “the set of shared attitudes, values, goals, and practices that characterizes a company or corporation.” Group behavior and beliefs are key components of a business culture. These “shared” attitudes become visible indicators of the “shoulds” and “should nots” of that work environment. For example, walking into corporate headquarters of a company usually reflects a more formal and cautious attitude versus a branch that is out in the field where it could be seen as more friendly and inviting. From the way a receptionist greets you to whether an executive offers you a cup of coffee, you can determine revealing parts of the work culture. Countries are the same. What can make you feel foreign? Be the Foreigner On a November morning in 1992, I was in the railway station in Beijing. I had just finished giving a seminar and had to be in TianJin, in the industrial zone, to give another workshop the next day. There was an unexpected snowstorm and I couldn’t get to my destination by car. My driver took me to the train station and instructed me to get a reserved seat, and then he drove off, leaving me alone with a million other people. Colossal and bleak, the station was a cement palace. It was packed with more than a million people, but the silence was deafening. People rippled 15 abreast subtly and smoothly through the corridors, as if their feet didn’t even touch the floor. They systematically filled every inch of space, and the undetected order was disturbing. I began to look for a familiar face, yet I knew I would recognize no one. I tried to make eye contact with someone—anyone—but their eyes looked past me. I desperately wanted to make eye contact so perhaps someone could help me find the ticket office. No one would look at me, but I could feel their stares when my eyes shifted. 29 The New Rules of International Negotiation I was the only westerner in the station. Standing 5 feet 7 inches tall, with dishwater blonde hair, my arms full of bags and pulling a suitcase, I was neither subtle nor quiet. The wheels of my suitcase rolled heavily, clanking across the cement floor like a tank moving in to attack. Feeling more and more like the “other,” I walked faster, but the sounds of the wheels became even more intense, almost symphonic. The heat of embarrassment rose within me, but not a head turned. As I looked for an information area, I realized I could see across the entire mass of standing people. It was as if I was standing in the middle of a classroom of young children and by size alone, I was the designated teacher. My usually confident carriage was being challenged by my confusion, frustration, and fear of missing my seminar. My appreciation of China made me forget that I looked any different than they do. I did not think about my ever-changing yellow hair or my square-jawed, first-generation Russian face. I had large feet, conspicuous hands, and an impatient habit of crossing and uncrossing my legs while moving my hands in uncontrollable repetition to smooth my wrinkled raincoat. The entire process made me look like a nervous horse circling and waiting for the race to start. I looked at the people in front of me and on the side of me: delicate and small, dark hair, wrinklefree skin, gently moving with a noncombative presence. I became aware of their fascination with my appearance and, of course, with my very presence—my very foreign presence. Examine Exclusion Feeling foreign damaged my confidence. My exterior excluded me from the group of one million. No word was exchanged, no thought or idea expressed. I just didn’t belong. I began to lumber rather than walk with purpose, my posture caved into the pressure of certain stares, and my confidence fell reflecting the discomfort of being different. This change in a person’s attitude and actions happens in the work place when an employee is made to feel strange or different and just doesn’t fit in. The exclusion reduces his confidence and promotes a feeling of inferiority. The individual is less likely to extend his efforts. Productivity and quality are directly impacted by this perceived loss of 30 Crossing the Cultural Divide value and integrity. One’s skin, clothes, accent, and mannerisms can each exclude an individual from a conversation, a meeting, or even business negotiations all together. The exclusion from a business culture limits an employee from reaching his full potential, and therefore limits the resource for the organization. There is no universal standard for the superficial, yet there is for the depth of a person. They are foreign to us and we are foreign to them. My perception of myself was just that—a presumptuous perception. Corporate, capitalistic arrogance convinced me that our way was the only way, the right way, and the best way. It led me into thinking that everyone would want to be us, look like us, and live like us. This attitude of superiority sets up a barrier that tells others that any different way of doing or acting is inferior to our way of doing or acting. Without asking or without exploring, we decide who fits and who does not. We judge based on our criteria and then try to make up for it with respectable excuses: “She’s so difficult to understand. I don’t want to embarrass her,” or, “He gets so emotional. He shouldn’t present at this meeting.” More common is the remark, “He has to get more aggressive if he wants to be heard.” The United States has often been called a melting pot, but we want everyone to jump into that pot and come out looking American. The definition of barrier is based on exclusion versus inclusion. A barrier limits access to information, to being together, to a facility, to a meeting. Outward appearance often limits access and social habits. These barriers can create confusion, misunderstandings, distrust, and a breakdown of communication. Understanding the barriers can afford opportunities for working together while focused on reaching the targeted outcomes and negotiating the best solution for both sides. Our ultimate goal is to build strong relationships that are grounded in trust. Identifying barriers, understanding the differences, and, ultimately, valuing a different way of doing, results in an influence of strength. Picking a nose or seeing only from my perspective, limits my access to the best of solutions and to quality and timely implementation of those solutions. 31 The New Rules of International Negotiation Arriving at a strong awareness of differences creates a discomfort that often produces a willingness to change the situation. These initial chapters help build that discomfort of “what is,” and then the later chapters will address “how to” change in order to have better working relationships and “how to” negotiate effectively with the new global customers and partners. As an assertive American businesswoman, I often speak in the absolute. The Chinese frequently begin to respond to a question with “it depends.” The premises and conclusions asserted in the next several chapters should each begin with “It depends”: It depends on the circumstances; it depends on the situation; it depends on the traditions; and, most importantly, it depends on each, distinct individual. Close-Up of Asia In the June 28, 2006 issue of Working Knowledge for Business Leaders (a weekly newsletter for business executives put out by the Harvard Business School) an article titled, “What the New Asia Means for Multinationals,” stated that “[I]n the Asian competitive environment of tomorrow, it won’t be enough for the managers of Western multinationals to be able to think global, act local. The reason is that being an expert at taking a global business formula and adapting it to a local market largely ignores the opportunity to take learning from a local Asian market and apply it to reshaping the company’s strategy across Asia (or for that matter, the world).” This excerpt from a Harvard Business School article pinpoints the essence of succeeding in Asia—recognize and learn from the exceptional business practices of local businesses so that you can use them across your global market. This strategy will keep you competitive with the rest of local Asian businesses who will capture the best practices of other locals. This was written in 2006, and that “tomorrow” is now. This centers on the controversial discussion of whether it is a trend or not. Will the way of doing business remain the Western way of doing business? Asia is an enormous continent that includes major markets—China, Hong Kong, Japan, Korea, Taiwan, and India. Unlike North or South 32 Crossing the Cultural Divide America, Asia hosts a wide variety of languages, races, religions, and distinct cultures. Though the countries hold some commonalities in values, they have very distinct business styles and individual customs, traditions, and behaviors—from passive to assertive. Chindia: How China and India Are Revolutionizing Global Business Edited by Pete Engardio Senior Writer, Business Week China’s growth and manufacturing dominance are two of the biggest global trends of the last 10 years. India’s technology, service, and outsourcing industries make it a valued partner, as well as a formidable competitor. The stunning rise of China and India makes it clear: to survive and thrive in the new global market, you have to engage with China and India. All of Asia places relationships as their top priority in doing business. In fact, in most Asian countries, trust is more important than the quality and durability of the product. The relationship is more important than the final agreement. The countries share this same value, yet they do not share it with the same degree or intensity of trustworthiness. Generally, Asian countries consider meetings as an opportunity to get to know you and better understand who you are and what your organization represents. Many times the real negotiations begin after the agreement is reached or the contract is signed. Trust is established and the relationship initiated—a good assurance of beneficial outcomes. Harmony, which essentially is the objective of negotiation, is the goal of every Asian country and “saving face”’ is the guideline. So it appears appropriate to continue to negotiate after you have reached the agreement. Working within this goal of harmony, Asians will often acknowledge with a “Yes” or a nod of approval, without meaning “I agree,” but only meaning “I see.” This cultural consideration reinforces planning effective, Open and Innovative or Experience-based questions and not the Closed questions that require a yes or a no. When negotiating with your Asian clients, it is best to use the initial meetings to get to know them. There are three major guidelines to follow: 33 The New Rules of International Negotiation Ask them first—ask background questions, both personal and business, come over-prepared with support data, and observe and listen with a focused intensity to words and actions. Know who will be attending by name and authority. Patience and “saving face” should set the tone for the exchange. Knowing your Asian clients and their products, as well as them knowing you, is the beginning of a long, beneficial relationship. Snapshot of China China is a major player in today’s global market. Believed to be the oldest civilization, its prehistory dates back 12,000 years (the Neolithic Age). China’s population is now close to 1.5 billion, and the predominant language is Mandarin. Today the Communist Party governs China from Beijing, the capital, but, the communist constitution does allow freedom of religion. The majority of people in China follow the Analects of Confucius, which is more of a philosophy as opposed to a religion. Confucius spent his life dedicated to learning—learning how to become a benevolent, virtuous man. A small portion of the Chinese population (about 20 percent), follows the teachings of Buddha. In fact, some Chinese only follow Buddha’s teachings as a safeguard, just in case the Buddhists are right. China also has a long history of dynasties and emperors—beginning with the Xia Dynasty about 1994 B.C.E. and ending with the Manchu or Qing Dynasty, which ruled from A.D. 1644 to 1912. As the dates indicate, the dynasties historically endured. Chairman Mao Zedong brought communism to China in the late 1940s. China is a collectivist culture valuing relationships, the group, and its members, and counters the individualist thinking of a democracy. The following list is not an absolute statement of good or bad, right or wrong, or effective or offensive. It does not describe every person in China who embodies all of these characteristics. Instead, the list describes “what is.” The businessperson who determines how best to work within a different culture is the one who will be effective and efficient, building the relationships needed for long-term success. 34 Crossing the Cultural Divide DO Ask open questions. Give specific guidelines. Expect reliability and competency. Compliment sincerely and specifically. Clarify/Summarize/Ask. Include socially and professionally. Include early in problem-finding and decision-making processes. Read business card immediately and make comments. Show interest in their history, art, and way of doing business. Mentor. Affirm/acknowledge their input. Express an interest in their family. Show a recognition of their background. Begin work sessions with interpersonal exchanges. DON’T Order or insist. Criticize. “Tell” (ask instead). Copy a superior in e-mails. Ask, “Do you understand?” Exclude from lunch, information, and so on. Think of a nod as a sign of agreement or understanding. Project attitude of superiority. Only be aggressive. Assume. Disregard how you say something. Constantly look them in the eye. Give casual feedback. Start a meeting, conference call, or discussion with “time” as the key issue. 35 The New Rules of International Negotiation Cultural Considerations Relationships are the foundation of the Chinese culture. Relationships, either within one culture or across cultures, involve many aspects of a person. The Chinese person is there to support others. It is easier to build trust from the beginning than to try to undo what’s been done before. If you establish an ineffective relationship—or one of necessity—it is even more difficult to change it into a trusting one. It is better to start building trust from the first encounter. Decision-Making Collective decision-making takes more time and is recognized. Decisive could be considered deliberative in China. Decisions are weighed as strongly by feelings as by data, much like the Latin American cultures. In hierarchical tradition, the decision-maker generally will not speak directly to the project manager of the other side, nor will all of the decision-makers meet at the same time. The top-ranking authority will take time to hear all the input of those working on or impacted by the negotiation. Chinese colleagues who have not developed a good relationship may intentionally not cooperate at work. This becomes an issue of respect and trust. Building Relationships Saving Face is fundamental to the Chinese. Challenge and/or confrontation are avoided at all costs for the sake of harmony. Time taken to gradually build a relationship with managers is well invested. Generally, the Chinese prefer to not touch. Know the background, education, and experience of the managers. Strong, aggressive behavior is often seen as disrespect. 36 Crossing the Cultural Divide The Chinese will shut down or retreat and take their time. The Chinese highly value humility—no self-praise; it must come from others. Interest in Chinese art, history, and land builds and maintains strong relationships. It is appropriate to give gifts to an organization and, at times, to an individual. Red and gold signify good fortune and long life. Age is honored and highly respected. Once a relationship is established, you may ask almost anything of your colleague. Loyalty is a guarantee. These cultural considerations and those on the previous pages were collected from interviews, questionnaires, and focus groups. The Chinese participants were businesspeople who have worked in Chinese and U.S. companies/corporations. This information took 11 years to compile. Chinese Companies/Business Managers become managers because of years of service or because of the relationship with their supervisors.The Chinese are very sensitive to titles and status. The majority of Chinese companies are still governmentowned. Individuals have no sense of ownership. Time is not a priority in the Chinese culture. Skill and knowledge alone are not reasons for promotion. A common Chinese perspective is “work well and speak less.” The Chinese have little training in customer care, management skills, and processes or efficiency. The top priority of Chinese companies is “good relationships.” Second is solving technical problems, followed by training. 37 The New Rules of International Negotiation Managers value communication, even when there is no business issue to address. They value face-to-face discussions on a regular and frequent basis. Find the Chinese manager who has the most experience working with the United States and ask for assistance. Chinese companies still operate under China’s “planned economy” culture, not “free enterprise.” Their management sense is deeply rooted in the past. The Chinese do not have a sense of Western management style or process. They do appreciate Western processes. Motivation for a Chinese professional is job recognition and advancement/promotion. The Chinese do not yet understand the concept of ownership— the growth of the company helps them progress—because their income is not yet high and training is limited. Americans focus on the bottom line. The Chinese focus on keeping people employed. To build a relationship takes time, but while you’re building it there are many benefits. Once it is established, it is a longterm commitment and is valuable to any organization. 38 Competition Is King...and Queen CHAPTER 2: Competition Is King... and Queen “We must scrunch or be scrunched.” —Charles Dickens, Our Mutual Friend, 1865 Agenda A. A society led by business and sports B. Vulnerability and empathy put “competitive” in jeopardy. Round up time—corral those creatures and brand them the U.S. brand. Don’t stop until you get them all. Mountains, oceans, and rivers are natural barriers that often create boundaries and distinguish different cultures. These cultural borders are easily identified and offer concrete options for working across borders. When a customary way of doing business is introduced, the accepted style and attitude can also put up a barrier to building a trusting relationship. The John Wayne style—to conquer, to win, to defeat—often influences Western business interactions. It is a cowboys-and-Indians attitude, and the cowboys must always win. To compete becomes: to win or to 39 The New Rules of International Negotiation lose, to rule or to serve. The idea of a winner or a loser often is the established platform for a global exchange. We compete for jobs or for advancement in sports and in possessions. The winner gets to make the rules. With U.S. companies in China it becomes, “Do it our way.” The business culture presides and dictates the way to do business. Capitalism validates our competitive posture, but it also keeps us from being vulnerable in needed relationships with foreign partners. We feed our aggressions so that we can lead. Being competitive and aggressive is good—these characteristics help us secure the customer. Yet a respectful balance of competition with collaboration, leading by serving, will help us retain our customers. A pow-wow with peace pipes could be introduced in the negotiation sessions, supporting a peaceful agreement. Every negotiation builds the steps to the next negotiation and the next agreement, with the same players. Keeping the process open and receptive produces an excellent environment for problemsolving. When a negotiation is more competitive in tone and coercive in strategy, it takes more time to implement the agreement. This posture also limits your opportunity for a long-term relationship because, for our foreign partners, trust is questioned. In a successful family business, you cannot easily get rid of the immediate family—each member works from a personal sense of honor. Besides, they’re family. The members are vulnerable and trust that one another will not take advantage of their vulnerability. This trust facilitates working with the external customer in an effective, efficient, and productive manner. In this type of business, the family views every customer as earned. When his or her needs are well-served, it creates a loyal and long-lasting customer. While this case is both familial and professional, the commitment supports the organization and, in turn, the organization freely rewards its relatives. In 1991, I was giving a five-day work session for production-plant managers, primarily in the Pacific Rim. These manufacturing facilities excelled in quality, cycle time, and customer satisfaction. There were 31 participants, 30 men, and only one woman, S.K. Her factory ranked the best overall. The participants knew her plant performed the best and this knowledge created a guarded atmosphere in the work session— 40 Competition Is King...and Queen a bit formal and stiff. S.K. and I knew each other from previous professional workshops. On the third day I posed the question, “In one sentence tell us, in your opinion, the major reason for your plant’s superior rating.” We went around the room and everyone gave the question serious thought and the answers were building a good foundation for the next discussion. S.K. was last and she said, “I treat everyone in my factory as if they were my family, and they protect me as if I was their mother.” Her humble, familial statement unified the group in focus and in spirit. The analogy could be carried easily to every aspect of their business and it made S.K. an approachable woman colleague whose priority of values, as a woman and mother, were in the correct cultural ranking. S.K. did not place business success before her role, as woman and mother. Compete and Collaborate As business people, we are looking for ways to simplify the process of working across borders. Together we have to work hard in an organization, as a family, while competing as if in a race. Similar to any other relationship, at some point, we must decide if we’re going to get serious—partnering ideas, solutions, and plans. Being both competitive and collaborative, which is accepted in the United States, is counter to most cultures abroad. If you choose to go from one approach to the other, with frequency, trust will likely be eroded in your foreign partner. The best and most consistent approach would be to be collaborative in relationships and competitive in product and service. The balance will support the bottom line and long-term business relationships. Competition is healthy for the community, and for doing business and staying in business. It’s what stops one organization from taking advantage of its customers and it forces every organization to continually improve, so it won’t be squeezed out of the marketplace. But at the same time, it reinforces aggressive behaviors and often undermines partnering, internally or externally, with a customer. If the focus was problem-solving within a negotiation, however, then a competitive spirit could enhance the solutions. 41 The New Rules of International Negotiation Be Open to Gain Trust The problem is competition can easily keep one in an adversarial posture, without vulnerability and, therefore, without trust. To Americans, divulging a weakness lessens any competitive advantage—making vulnerability counter-competitive. But to divulge such a weakness is a vulnerable declaration of trust. Essentially, you believe that the other party will not use it against you. At the beginning of my marriage, it took us three years to expose all of our warts—physical and intellectual—trusting the other would still love. When one party is willing to say, “It appears we lose time using the current system,” in negotiations, people move into problem-solving mode. I have witnessed it. This simple statement says, “I trust you can and will help me.” It also implies that you will not use this against me. To think of long-term relationships and results, one has to balance the competitive personality with the benevolent confidence of a strong partner. It requires astute strategic planning and a commitment in policies to a long-term plan. The organization’s support gives credence to the values reflected in the plan, and an employee can then confidently and strategically reveal a need. A relentless competitive posture often comes across as ruthless and arrogant. similar to any sport, it is a race to win. Lily Tomlin said it best when she declared, “The trouble with the rat race is that even if you win, you’re still a rat.” It’s difficult to partner at your partner’s expense and without trust. Negotiating with other cultures adds another dimension, which often requires a consideration of difference in approach and in exchange. To begin the negotiation with a strong command of need and of requirement could push the other side to retreat or to resist—either of which results in wasting valuable time. Ego-centered, cutthroat, self-seeking, guarded, superior—hang some of these adjectives on varied members of a group and the result is rivalry at best and war at worst. It blocks creativity, listening, and observing. In the global market, these attitudes restrict the use of cultural differences to the advantage of each side. We must discover the right way to do business and negotiate in a specific culture, and how to support 42 Competition Is King...and Queen a long-term plan, rather than doing everything possible to be certain the negotiation is done “our way.” Competitive posture is part of how we do business. But it is more important that we remain aggressively competitive in product development, and to seek out new business in a principled and collaborative manner. It is similar to the thinking of politicians who state, “I am fiscally conservative, and socially more moderate.” Keep competition to the product and collaboration to the relationship. How we do business across cultural barriers requires more of a family-owned-business process in order to develop the long-term relationships needed to continue to compete. Within the global client arena, businesswomen appear, at times, to be more effective. Many cultures, including the United States, breed women to develop and maintain relationships. Maintaining relationships is one of the determinants of business success as we know it. It will determine the difference between satisfaction and retention of our global customers. When negotiating, often one party suggests that he or she has more value to offer and more money than the other party, thereby suggesting that he or she has more power. There is a distinction between a competitive posture and a confident presence: one promotes the self and the other promotes ideas and solutions. But the guidelines for how we do business are standard for all cultures, because they’re dependent on Four Strategic Virtues: Respect, Acceptance, Open-mindedness, and Empathy. Our research showed that these virtues are universally valued, and, in fact, are essential to every good relationship. A Chinese businessperson might admire a shrewd American businessman if he is, at the same time, principled in his criteria for doing business—in essence, building a strong foundation for trust. If you bow just the right way or hand your business card with both hands you’ll be invited into the house. If you show the respect for their time, their opinion, and their arts, you’ll be asked to stay for the first of many meals. In 1998, I had been working with a joint venture of a large American corporation and a Chinese partner. The joint venture was conceived in 1989, and the facility was not yet built. Chinese regulations, at the time, 43 The New Rules of International Negotiation required foreign business to include a Chinese joint venture partner that was invested at least 20 percent. I worked with the joint venture team representative of both partners. The American group felt they held all the power because they had the most money invested. By extension, the Americans thought their opinions, plan, and suggestions for implementation were more important than all others—80-percent more important. Respect was a commodity they owned, because of all the money they invested. The venture was nine years old, and the factory was not yet built. I tried to convince the American vice-president that the Chinese partners could help facilitate the process because they were politically well connected with the government and the town council. The politics were very important because the town’s mayor decided if the zoning board would allow the project. Eventually, the Americans learned that one of the Chinese executives on the joint-venture team was related to the mayor. The American team leader had been too focused on saving money and time. He could not understand that in China, roles and relationships are a top priority and link directly to the bottom line. For the American, he assumed playing hardball would meet the success it had so many times before this. Leadership changed several times in the nine years and each new manager brought with him or her, an arrogant ignorance that pushed the negotiations back further. It was 10 years before the joint venture contract and implementation was completed—one year shorter than the average Western and China joint venture at the time. Talk. Don’t Tell. Every time the leader of the U.S. contingency told the others what had to be done and by what date, the Chinese felt the disrespect of his edict. As one of the Chinese managers told me, “They give us orders and then expect us to obey.” Whenever the U.S. group said they were wasting time—and dollars—they disrespectfully ignored the Chinese priority of value. Telling them versus asking them what their approach would be delayed the purchase of land for several months. The Americans criticized the slow, deliberate, and confusing ways of the Chinese instead of 44 Competition Is King...and Queen looking into their culture to understand the reasons for their way of doing things. It’s difficult to have a partnership within a joint venture without respect. The competitive attitude, because of its intensity here in the United States, seems to permeate every business issue and activity. Partnering is key to a successful joint venture and its base is respect, not winning at your partner’s expense. Competition, aggression, and politics are three powerful resources that, if appropriately employed, will bear a well-synchronized organization. In team sports, individual players and their talents are key to winning the game, but winning isn’t possible without teamwork. Many times business opportunities are missed because they have to be negotiated with contributions from the other side, the other culture. Aggression is valued more than compliance, and the short-term bottom line more than the long-term, valuable relationships. If the negotiation process encourages the relationship, long-term results become part of the process. If negotiation behaviors reinforce the value of a diverse point of view or build on the suggestions of the others, both sides can implement a better agreement. Practicing the Four Strategic Virtues results in a modification of behavior that assures long-term success and personal development. The competitive posture, many times, leads to a bearing of superiority, because you must be better or best to win, while a competitive talent or product can bring attention and notice to a beneficial solution. Snapshot of Japan Japan is a small island of great strength that protects its culture from the strong influence of foreign cultures. Generally a more reserved culture, Japan’s position in the Pacific Ocean has allowed it to remain aloof when it comes to other cultures. Its language is Japanese and is spoken only in Japan. The country’s form of government is a parliamentarian democracy with a prime minister who serves as the ruling officer. With the Japanese you must build credibility during a very long time—perhaps two to three years. As your credibility increases, it may bring you into the inner circle—a private culture. 45 The New Rules of International Negotiation Team is an inherent part of the Japanese culture. I was in Hong Kong working with a group of men from Beijing. We were in a commercial building, waiting for an elevator. The small elevator reached the main floor and seven or eight of us got on the elevator. It began to buzz, signifying too much weight. So one gentleman stepped out and it stopped buzzing. The three others stepped out and joined the first man. The elevator doors closed, the elevator continued going up, and my Chinese colleague turned to me and said, “Japanese,” meaning they stay together. Cultural Considerations The less senior person bows lower and then often shakes hands. Try to do a comparable bow. It is very important to affirm the pride of the Japanese in their culture. Learn as much as you can about their culture. The Japanese prefer to eat only Japanese food. Relationships are key, along with team considerations before individual considerations. The Japanese have “sharp antennae” because they have developed their intuitive skills. Business Considerations Find someone to make an introduction or referral. Meet in the office and later for dinner to build a social relationship, so that they can get to know more about you. Dinner out, but drinks at a different establishment. For some reason they don’t drink in the same place. If you don’t wish to join them for drinks after dinner, you could excuse yourself by telling them you are tired from the travel. When conducting an introduction with a business card, take your card out with both hands. Take their card, look at it, but do not comment or put it away into your case or coat pocket. Be patient. We are seen as an impatient culture with a cowboy attitude. This can be a bit of an advantage, however, 46 Competition Is King...and Queen because the Japanese see the United States as a “take action” society. The Japanese business community does have to have every contingency possible drawn up when planning. When they “agree to consider your idea,” this does not mean they agree with you. Instead, it means they will consider it and more than likely disagree with you. The Japanese are consistently thinking long term. It takes a long time to build credibility with the Japanese. You must never mislead and always be forthright even though the Japanese are not always forthright with you. You may slowly build layers of credibility with consistent honesty. Language is
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