Cross-Cultural Negotiations

							Cross-Cultural Negotiations

          Dr. Daly
         MGT 3660
        What makes cross-cultural
         negotiations different?
• International economic factors
• Foreign governments and bureaucracies
• Instability
   – cancellation clauses
   – neutral arb.
   – Insurance
• Ideology (individual vs. group rights, public vs.
  private investment)
• culture
   Approaches to understanding
            culture
• Culture as shared values/assumptions
  Hofstede:
  --Individualism vs. collectivism
  --Power distance
  --Uncertainty avoidance
  --Quantity vs. quality of life
• Culture as dialectic: tensions (maxims)
   – explain variation within cultures
     How do cultural differences
      influence negotiations?
•   Definition of negotiation
•   Selection of negotiators
•   Degree of formality
•   Non-verbal communication
•   Time
•   Risk propensity
•   Groups vs. individuals
   Some cultural idiosyncrasies
• Japan
  – long term perspective
  – when is “yes” a yes?
• Chinese
  – use pressure tactics
  – patience is needed
  – Memorandum of Agreement is the beginning,
    not the end
   Strategies for Cross-Cultural
            Bargaining
• Low Familiarity
  – Employ agents, advisors
  – Bring in a mediator
• Moderate Familiarity
  – Adapt to Other Party’s Approach
  – Find a common process (e.g., language)
              More strategies
• High Familiarity
  – Embrace OP’s approach (stressful)
  – Improvise an approach specific to the situation
    (if the OP is also highly familiar)
  – Go beyond either home culture
     • Need a structure (e.g., diplomats)