How does culture affect the negotiation process?

Question

What will be an ideal response?

Answer 1

Negotiating in international business starts by building relations, a process which is highly influenced by the cultural differences. Such differences may occur at the individual level of the organization, since people are affected by different norms within their national culture, social culture as well as organizational culture inadvertently. Then, the international negotiator is faced with the challenge of understanding the counterparty free from cultural biases (Rudd and Lawson, 2007).

To communicate efficiently, negotiators need to understand the culture of the other parties. Such understanding also entails the nuances stemming from silent language displayed through manners, gestures, and customs. As such, negotiators need to prepare and learn about the host’s culture from their values, ethics, religion to the political structure (Ghauri and Cateora, 2010).

A familiarity with social and cultural conventions of a given country will prevent you from inadvertently offending your partner during negotiations and will also facilitate the methods and strategies you might employ (Adair et al., 2004). An international business executive quickly learns that business in one country is simply not like business in another country. Despite the universality of basic business motives and methods, culture plays a large role in how people perceive and evaluate things.

Culture and belief systems affect how we perceive, judge, think, and decide about the world. Normally, culture plays only a very subtle influence in our daily communications because we are surrounded by people of the same culture. However, when we are placed within the vicinity of another culture, negotiating these differences becomes a very dynamic process. Human beings tend to project cognitive similarity onto other people. This means that we assume that other people will think the way we do, which is not always the case (Ferraro, 2002).

For example, given the emphasis on teamwork and social harmony in Japan, the role of the individual is often downplayed. In cultures like this, direct confrontation will probably be avoided and found distasteful or uncomfortable. Rather than give a direct “no” to a proposal, a Japanese negotiator might sidestep giving an answer, stall, or simply fall silent. In contrast, Americans are very often outgoing and direct. Not hearing a definite “no” might be interpreted as a “yes” or perhaps not be acknowledged as an impasse. In order to mitigate issues stemming from misunderstandings, it is pertinent for negotiators to familiarize themselves with the business customs and the culture of the counterparties. Some of the main concepts that need to be understood in thinking about cross-cultural negotiations are time, focus on the decision making, communication patterns and emphasis on personal relations (Ghauri and Cateora, 2010).

A main cultural factor which needs to be highlighted within the context of international business negotiations is the perception of time. Time has a different meaning in different cultures as identified by Hall, as previously discussed. Cultures may view time differently. They can have a ‘monochromic’ or a linear approach to time and prioritize the task at hand. Then, members of such cultures focus on timeliness, and adhere to schedules.

In most emerging markets, time must be set aside to establish personal relations and get acquainted prior to the negotiation. On the other hand, many Western businessmen view time as a resource which should not be wasted and they try to minimize the time in building relations which is viewed as a necessity in many cultures.

Communication patterns of different countries differ due to cultural characteristics as well. Communication types will be discussed further within this chapter. In terms of pattern, cultures may lean towards explicit/implicit and direct/indirect methods which can create difficulties in communicating with members of other cultures. Some cultures may make use of implicit communication which is rather vague, and failure to interpret the vagueness appropriately can lead negotiators to the wrong conclusions.