Chap013 cross cultural negotiation 2

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Chap013 cross cultural negotiation 2

  1. 1. International Management Phatak, Bhagat, and Kashlak
  2. 2. Chapter 13 Negotiations and Decision-Making Across Borders and Cultures
  3. 3. Learning Objectives <ul><li>Understand the process of negotiation and decision-making and their significance for multinational and global corporations. </li></ul><ul><li>Understand the environmental context of international business negotiations and the concept of multinational negotiating strength. </li></ul><ul><li>Identify the various patterns of negotiation and conflict resolution in different national and cultural contexts. </li></ul><ul><li>Understand the influence of national and cultural variations in decision-making. </li></ul><ul><li>Discuss the importance of computer-mediated communication in negotiation and decision-making. </li></ul>13-
  4. 4. Chapter Topics <ul><li>What is Negotiation? </li></ul><ul><li>The Negotiation Process </li></ul><ul><li>Environmental Context of International Negotiations </li></ul><ul><li>Managing Negotiation and Conflict </li></ul><ul><li>Ethics in International Negotiations </li></ul><ul><li>What is Decision-Making? </li></ul><ul><li>The Decision-Making Process </li></ul><ul><li>Internal and External Factors </li></ul><ul><li>Implications for Managers </li></ul>13-
  5. 5. Negotiation 13- The process of verbal and non-verbal exchanges between two or more parties with the goal of reaching a mutually satisfactory agreement
  6. 6. Bargaining 13- The process of arguing and haggling over prices and other details involved in transactions of goods and services, common in flea markets, bazaars, and fairs all over the world
  7. 7. Situational Characteristics Influencing Cross-Border Negotiations <ul><li>Context of the negotiation </li></ul><ul><li>Physical arrangements </li></ul><ul><li>Time limits </li></ul><ul><li>Status differences </li></ul>13-
  8. 8. Fundamental Elements of the Negotiation Process 13- <ul><li>Two or more parties involved in real or perceived conflict over important goals </li></ul><ul><li>Shared interest in reaching an agreeable solution </li></ul><ul><li>Background preparations leading to the process of negotiation </li></ul><ul><li>A goal, but not a certainty, of reaching mutual agreement </li></ul>
  9. 9. Ex. 13-1: Stages of Negotiation in International Management 13-
  10. 10. Ex. 13-2: Differences in Negotiator Strategies and Tactics in Three Countries 13- Individual Tactics as a Percentage of Total Tactics Japanese N = 6 American N = 6 Brazilian N = 6 Promise Threat Recommendation Warning Reward Punishment Positive normative appeal Negative normative appeal Commitment Self-disclosure Question Command 7 4 7 2 1 1 1 3 15 34 20 8 8 4 4 1 2 3 1 1 13 36 20 6 3 2 5 1 2 3 0 1 8 39 22 14
  11. 11. Ex. 13-2 (contd.) 13- Occurrences in a 30-Minute Bargaining session Japanese N = 6 American N = 6 Brazilian N = 6 Number of times word “No” used Silent periods of 10 seconds or more Conversation overlaps (interruptions) Gazing (minutes per random 10 minute period) Touching 5.7 5.5 12.6 1.3 min. 0 9.0 3.5 10.3 3.3 min. 0 83.4 0 28.6 5.2 min. 4.7
  12. 12. Ex. 13-3: Comparison of Cultural Approaches to Negotiation 13- American Negotiator Indian Negotiator Arab Negotiator Accepts compromise when deadlock occurs Has firm initial and final stands Sets up principles but lets subordinates do detail work Has a maximum of options Respects other parties Is fully briefed Keeps position hidden as long as possible Relies on truth Trusts instincts Seeks compromises Is ready to alter position at any point Trusts opponent Respects other parties Learns from opponent Avoids use of secrets Protects “face” of other parties Avoids confrontation Uses a referent person to try to change others, e.g. “Do it for your father” Seeks creative alternatives to satisfy all parties Mediates through conferences Can keep secrets
  13. 13. Ex. 13-3 (contd.) 13- Swedish Negotiator Italian Negotiator Gets straight to the point of the discussion Avoids confrontation Time conscious Overly cautious Informal Flexible Reacts slowly to new propositions Quiet and thoughtful Dramatic Emotional Able to read context well Suspicious Intrigues Uses flattery Concerned about creating a good impression Indefinite
  14. 14. Ex. 13-4: Differences Between American and Chinese Culture and Approach to the Negotiation Process 13- Contrast of Basic Cultural Values American Task and information oriented Egalitarian Analytical Sequential, monochronic Seeks the complete truth Individualist Confrontative, argumentative Chinese Relationship oriented Hierarchical Holistic Circular, polychronic Seeks the harmonious way Collectivist Haggling, bargaining
  15. 15. Ex. 13-4 (contd.) 13- Approach to the Negotiation Process American Quick meetings Informal Make cold calls Full authority Direct Proposals first Aggressive Impatient A “good deal” Chinese Long courting process Formal Draw on intermediaries Limited authority Indirect Explanations first Questioning Patient A long-term relationship nontask sounding information exchange means of persuasion terms of agreement
  16. 16. Support for the Negotiation Process by Decision Support Systems <ul><li>Reducing the amount of time that is necessary for feedback from headquarters in order to carry out effective negotiations </li></ul><ul><li>Providing a large amount of data and information on alternative scenarios that may result from the negotiation process </li></ul><ul><li>Increasing the likelihood that important data and information are available when needed </li></ul>13-
  17. 17. Conflict 13- Conflict can be understood as a state of disagreement or opposition between two parties, where if party accomplishes their objectives, the other party is unable to achieve its desired outcomes
  18. 18. Ex. 13-5: Nature of Conflict Between Members of Low and High Context Culture 13- Key Questions Low-Context Conflict High-Context Conflict Why Analytic, linear logic; instrumental oriented; dichotomy between conflict and conflict parties Synthetic, spiral logic; expressive oriented; integration of conflict and conflict parties When Individualistic oriented; low collective normative expectations; violations of individual expectations create conflict potentials Group oriented; high collective normative expectations; violations of collective expectations create conflict potentials What Revealment; direct, confrontational attitude; action and solution oriented Concealment; indirect, nonconfrontational attitude; “face” and relationship oriented How Explicit communication codes; line-logic style: rational-factual rhetoric; open, direct strategies Implicit communication codes; point-logic style: intuitive-effective rhetoric; ambiguous, indirect strategies
  19. 19. Decision-Making 13- The conscious process of moving toward objectives after considering various alternatives. It is concerned with making an appropriate choice among a multitude of possible scenarios.
  20. 20. Ex. 13-6: Steps in the Decision-Making Process 13- 1. DEFINE THE PROBLEM 2. ANALYZE THE PROBLEM 3. IDENTIFY DECISION CRITERIA AND THEIR IMPORTANCE 4. DEVELOP AND EVALUATE ALTERNATIVE SOLUTIONS 5. CHOOSE THE BEST SOLUTION 6. IMPLEMENT THE SOLUTION 7. EVALUATE THE OUTCOMES
  21. 21. Ex. 13-7: Deductive Versus Inductive Style of Decision-Making 13- DEDUCTIVE DECISION-MAKING INDUCTIVE DECISION-MAKING DECISION General facts and objective observations Specific information and details Specific information and details General facts and objective observations
  22. 22. Key Terms and Concepts <ul><li>Negotiation </li></ul><ul><li>International negotiation </li></ul><ul><li>Bargaining </li></ul><ul><li>Relationship building </li></ul><ul><li>Difference in ideology </li></ul><ul><li>Conflict </li></ul><ul><li>Decision-making </li></ul><ul><li>Programmed decisions </li></ul><ul><li>Non-programmed decisions </li></ul><ul><li>Deductive decision-making style </li></ul><ul><li>Inductive decision-making style </li></ul>13-

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