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Chapter 12

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  • 1. Chapter 12International Negotiation and Cross-Cultural Communication Copyright© 2007 Thomson Learning All rights reserved
  • 2. Learning Objectives•• Understand the basics of verbal and nonverbal Understand the basics of verbal and nonverbal communication communication•• Understand the basic international negotiation Understand the basic international negotiation processes processes•• Understand the basic tactics of international Understand the basic tactics of international negotiations negotiations•• Recognize and respond to the “dirty tricks” Recognize and respond to the “dirty tricks” Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 3. Learning Objectives•• Know the difference between the problem-solving and Know the difference between the problem-solving and competitive approaches competitive approaches•• Identify the personal characteristics of the successful Identify the personal characteristics of the successful international negotiator international negotiator Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 4. International Negotiation•• Process of making business deals across cultures Process of making business deals across cultures•• Precedes any multinational project Precedes any multinational project•• Without successful negotiation and the accompanying Without successful negotiation and the accompanying cross-cultural communication, there are seldom cross-cultural communication, there are seldom successful business transactions successful business transactions Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 5. The Basic of Cross-Cultural Communication•• Successful negotiation requires successful Successful negotiation requires successful communication communication•• Negotiators must understand all components of Negotiators must understand all components of culturally different communication styles (both verbal culturally different communication styles (both verbal and nonverbal) and nonverbal) Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 6. Language and Culture•• Whorf hypothesis: theory that language determines the Whorf hypothesis: theory that language determines the nature of culture nature of culture•• All languages have limited sets of words All languages have limited sets of words•• Words provide the concepts of understanding the Words provide the concepts of understanding the world world•• Restricted word sets constrain the ability to understand Restricted word sets constrain the ability to understand the world the world Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 7. High- and Low-Context Languages•• Low-context language: people state things directly and Low-context language: people state things directly and explicitly explicitly -- Most northern European languages including Most northern European languages including German, English, and the Scandinavian languages German, English, and the Scandinavian languages•• High-context language: people state things indirectly High-context language: people state things indirectly and implicitly and implicitly -- Asian and Arabic languages Asian and Arabic languages Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 8. Exhibit 13.1: Country Differences inHigh-Context and Low-ContextCommunication Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 9. Basic Communication Styles•• Direct communication: communication that comes to Direct communication: communication that comes to the point and lacks ambiguity the point and lacks ambiguity•• Formal communication: communication that Formal communication: communication that acknowledges rank, titles, and ceremony in prescribed acknowledges rank, titles, and ceremony in prescribed social interaction social interaction Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 10. Exhibit 13.2: Cultural Differences inCommunication Styles Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 11. Nonverbal Communication•• Communication without words Communication without words•• Includes array of behaviors that enhance/supplement Includes array of behaviors that enhance/supplement spoken communication spoken communication•• Include Include -- Kinesics, proxemics, haptics, oculesics, and olfactics Kinesics, proxemics, haptics, oculesics, and olfactics Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 12. Kinesics•• Communication through body movements Communication through body movements -- E.g., facial expressions, body posture E.g., facial expressions, body posture -- Most Asian cultures use bowing to show respect Most Asian cultures use bowing to show respect -- No universal code for what body movements mean No universal code for what body movements mean -- Easy to misinterpret gestures Easy to misinterpret gestures Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 13. Proxemics•• Use of space to communicate Use of space to communicate -- Each culture has appropriate distances for Each culture has appropriate distances for communication communication -- The personal bubble of space may range from 9 The personal bubble of space may range from 9 inches to over 20 inches inches to over 20 inches -- North Americans prefer more distance than Latin North Americans prefer more distance than Latin and Arab cultures and Arab cultures Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 14. Seating in a Typical Japanese Office Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 15. Haptics or Touching•• Communication through body contact Communication through body contact•• Shaking hands, embracing, or kissing when greeting one Shaking hands, embracing, or kissing when greeting one another another --No touching No touching •• E.g., Japan, U.S., England, and many Northern E.g., Japan, U.S., England, and many Northern European countries European countries --Moderate touching Moderate touching •• E.g., Australia, China, Ireland, and India E.g., Australia, China, Ireland, and India --Touching Touching •• E.g., Latin American countries, Italy, and Greece E.g., Latin American countries, Italy, and Greece Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 16. Oculesics•• Communication through eye contact or gaze Communication through eye contact or gaze -- U.S. and Canada: people are very comfortable and U.S. and Canada: people are very comfortable and expect eye contact to be maintained expect eye contact to be maintained -- China and Japan: eye contact is considered very China and Japan: eye contact is considered very rude and disrespectful rude and disrespectful Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 17. Olfactics•• The use of smells as means of nonverbal The use of smells as means of nonverbal communication communication -- U.S. and U.K: find body odor offensive U.S. and U.K: find body odor offensive -- Arab: consider body odors natural Arab: consider body odors natural Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 18. Practical Issues in Cross- Cultural Business Communication•• Interpreter’s role: to provide a simultaneous translation Interpreter’s role: to provide a simultaneous translation of a foreign language of a foreign language -- Require greater linguistic skills than speaking a Require greater linguistic skills than speaking a language or translating written documents language or translating written documents -- Have the technical knowledge and vocabulary to Have the technical knowledge and vocabulary to deal with technical details common in business deal with technical details common in business transactions transactions -- Have to ensure the accuracy and common Have to ensure the accuracy and common understanding of agreements understanding of agreements Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 19. Tips for Successful Use of Interpreters•• Spend time with the interpreter Spend time with the interpreter•• Go over technical and other issues with interpreter for Go over technical and other issues with interpreter for proper understanding proper understanding•• Insist on frequent interruptions when it’s necessary Insist on frequent interruptions when it’s necessary•• Look for feedback and comprehension by watching the Look for feedback and comprehension by watching the eyes eyes Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 20. Tips for Successful use of Interpreters (cont.)•• Discuss the message beforehand Discuss the message beforehand•• Request that your interpreter apologize for your Request that your interpreter apologize for your inability to speak in the local language inability to speak in the local language•• Confirm that all key components of the message have Confirm that all key components of the message have been properly comprehended been properly comprehended Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 21. Communication with Nonnative Speakers•• Use the most common words with most common Use the most common words with most common meanings meanings•• Select words with few alternative meanings Select words with few alternative meanings•• Follow rules of grammar strictly Follow rules of grammar strictly•• Speak with clear breaks between words Speak with clear breaks between words•• Avoid sports words or words borrowed from literature Avoid sports words or words borrowed from literature Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 22. Communication with Nonnative Speakers (cont.)•• Avoid words or expressions that are pictures Avoid words or expressions that are pictures•• Avoid slang Avoid slang•• Mimic the cultural flavor of the nonnative speaker’s Mimic the cultural flavor of the nonnative speaker’s language language•• summarize summarize•• Test your communication success Test your communication success•• Repeat basic ideas using different words when your Repeat basic ideas using different words when your counterpart does not understand counterpart does not understand•• Confirm important aspects in writing Confirm important aspects in writing Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 23. Avoiding Attribution Errors•• Attribution: process by which we interpret the meaning Attribution: process by which we interpret the meaning of spoken words or nonverbal exchanges of spoken words or nonverbal exchanges -- Attribute meaning based on our taken-for-granted Attribute meaning based on our taken-for-granted cultural expectations cultural expectations -- Easy to make mistakes of attribution Easy to make mistakes of attribution -- Need to observe carefully Need to observe carefully -- Avoid subtleties of a foreign language Avoid subtleties of a foreign language -- Avoid complex nonverbal behaviors Avoid complex nonverbal behaviors Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 24. International Negotiation•• More complex than domestic negotiations More complex than domestic negotiations•• Differences in national cultures and differences in Differences in national cultures and differences in political, legal, and economic systems political, legal, and economic systems•• Steps in international negotiation Steps in international negotiation -- Preparation, building the relationship, exchanging Preparation, building the relationship, exchanging information, first offer, persuasion, concessions, information, first offer, persuasion, concessions, agreement, and post agreement agreement, and post agreement Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 25. Exhibit 13.3: Steps in InternationalNegotiations Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 26. Step 1: Preparation•• Determine ififthe negotiation is possible Determine the negotiation is possible•• Know what your company wants Know what your company wants•• Be aware of what can be compromised Be aware of what can be compromised•• Know the other side Know the other side•• Send the proper team Send the proper team•• What is the agenda? What is the agenda?•• Prepare for long negotiation Prepare for long negotiation•• What is the environment like? What is the environment like?•• Plan a strategy Plan a strategy Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 27. Cultural Differences in Key Negotiating Processes•• Negotiation goal—signing the contract or forming a Negotiation goal—signing the contract or forming a relationship relationship•• Formal or informal personal communication style Formal or informal personal communication style•• Direct or indirect communication style Direct or indirect communication style•• Sensitivity to time—low or high Sensitivity to time—low or high•• Forms of agreement—specific or general Forms of agreement—specific or general•• Team organization—a team or one leader Team organization—a team or one leader Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 28. Cultural Differences in Key Negotiating Processes•• Attitude towards negotiation – win-lose or win-win Attitude towards negotiation – win-lose or win-win•• High or low emotions High or low emotions •• Latin Americans and the Spanish: show their Latin Americans and the Spanish: show their emotions through negotiations emotions through negotiations •• Japanese and Germans: tend to be more reserved Japanese and Germans: tend to be more reserved Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 29. Exhibit 13.4: Cultural Differencesin Preference for BroadAgreements Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 30. Exhibit 13.5: UnderstandingNegotiators from Other Countries Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 31. Step 2: Building the Relationship•• First stage of the actual negotiation process First stage of the actual negotiation process -- No focus on business No focus on business -- Partners get to know each other Partners get to know each other -- Social and interpersonal exchange Social and interpersonal exchange -- Duration and importance vary by culture Duration and importance vary by culture Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 32. Step 3: Exchanging Information and the First Offer•• Both parties exchange information on their needs for Both parties exchange information on their needs for the agreement the agreement•• Parties exchange task-related information and first Parties exchange task-related information and first offer offer -- Task-related information: actual details or the Task-related information: actual details or the proposed agreement proposed agreement -- First offer: first proposal by parties of what they First offer: first proposal by parties of what they expect from the agreement expect from the agreement Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 33. Exhibit 13.6: Information Exchange andFirst-Offer Strategies Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 34. Step 4: Persuasion•• Stage when each side in the negotiation attempts to Stage when each side in the negotiation attempts to get the other side to agree to its position get the other side to agree to its position -- Heart of the negotiation process Heart of the negotiation process -- Numerous tactics used Numerous tactics used Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 35. Verbal Negotiation Tactics•• Promise Promise•• Threat Threat•• Recommendation Recommendation•• Warning Warning•• Reward Reward•• Punishment Punishment Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 36. Verbal Negotiation Tactics•• Normative appeal Normative appeal•• Commitment Commitment•• Question Question•• Command Command•• Refusal Refusal•• Interruption Interruption Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 37. Exhibit 13.7: Comparison of Brazilian,U.S., and Japanese Negotiators (inhalf-hour bargaining session) Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 38. Nonverbal Communication•• Body posture, facial expression, hand gestures, and Body posture, facial expression, hand gestures, and the use of personal space are a natural part of any the use of personal space are a natural part of any international negotiation international negotiation Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 39. Dirty Tricks•• Negotiation tactics that pressure opponents to accept Negotiation tactics that pressure opponents to accept unfair or undesirable agreements or concessions unfair or undesirable agreements or concessions Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 40. Ploys/Dirty Tricks and Responses•• Deliberate deception or bluffing—point out what you Deliberate deception or bluffing—point out what you believe is happening believe is happening•• Stalling—do not reveal when you plan to leave Stalling—do not reveal when you plan to leave•• Escalating authority—clarify decision making authority Escalating authority—clarify decision making authority•• Good-guy, bad-guy routine—do not make any Good-guy, bad-guy routine—do not make any concessions concessions Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 41. Ploys/Dirty tricks and Responses•• You are wealthy and we are poor—ignore the ploy You are wealthy and we are poor—ignore the ploy•• Old friends—keep a psychological distance Old friends—keep a psychological distance Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 42. Step 5 and 6: Concession and Agreement•• Final agreement: signed contract, agreeable to all Final agreement: signed contract, agreeable to all sides sides•• Concession making: requires that each side relax Concession making: requires that each side relax some of its demands some of its demands Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 43. Styles of Concession•• Sequential approach: each side reciprocates Sequential approach: each side reciprocates concessions concessions•• Holistic approach: each side makes very few Holistic approach: each side makes very few concessions until the end of the negotiation concessions until the end of the negotiation Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 44. Basic Negotiation Strategies•• Competitive negotiation: each side tried to give as little Competitive negotiation: each side tried to give as little as possible and tries to “win” for its side as possible and tries to “win” for its side -- The negotiation as a win-lose game The negotiation as a win-lose game•• Problem solving: negotiators seek out ground that is Problem solving: negotiators seek out ground that is beneficial to both companies’ interests beneficial to both companies’ interests -- Search for possible win-win situations Search for possible win-win situations Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 45. Exhibit 13.8: Competitive and Problem-Solving Negotiation in the NegotiatingSteps Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 46. Exhibit 13.9: Cultural Differences inPreference for a Problem-SolvingNegotiation Strategy Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 47. Step 7: Post Agreement•• Commonly ignored step Commonly ignored step•• Consists of an evaluation of the success of a Consists of an evaluation of the success of a competed negotiation competed negotiation•• Allows the garnering of insights from understanding Allows the garnering of insights from understanding strengths and weaknesses of negotiation strengths and weaknesses of negotiation Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 48. The Successful International Negotiator: Personal Characteristics•• Tolerance of ambiguity Tolerance of ambiguity•• Flexibility and creativity Flexibility and creativity•• Humor Humor•• Stamina Stamina•• Empathy Empathy•• Curiosity Curiosity•• Bilingualism Bilingualism Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 49. Major Points Regarding Successful International Negotiation•• Few negotiations succeed without extensive Few negotiations succeed without extensive preparation. preparation.•• Building personal relationships is a key step in a Building personal relationships is a key step in a negotiation. negotiation.•• Managers should be aware that first offers may differ Managers should be aware that first offers may differ by cultural background. by cultural background. Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 50. Major Points Regarding Successful International Negotiation•• Many tactics are used in persuasion. Many tactics are used in persuasion.•• Know how counterpart views the concession-making Know how counterpart views the concession-making process. process.•• Culture and legal traditions influence the content and Culture and legal traditions influence the content and force of law regarding business contracts. force of law regarding business contracts.•• Competitive negotiation seldom leads to long-term Competitive negotiation seldom leads to long-term relationships. relationships. Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 51. Major Points Regarding Successful International Negotiation•• Problem-solving negotiation is more flexible and Problem-solving negotiation is more flexible and probably more successful strategy. probably more successful strategy.•• Must be flexible, empathic, and physically tough. Must be flexible, empathic, and physically tough. Copyright© 2007 South-Western/Thomson Learning All rights reserved
  • 52. Conclusion•• Chapter examined the negotiating process and other Chapter examined the negotiating process and other elements of cross-cultural communication elements of cross-cultural communication•• International negotiations involves several steps International negotiations involves several steps including: preparation, building the relationship, including: preparation, building the relationship, persuasion, making concessions and reaching persuasion, making concessions and reaching agreement agreement•• Successful negotiators prepare and understand these Successful negotiators prepare and understand these steps well steps well Copyright© 2007 South-Western/Thomson Learning All rights reserved