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16-1

CHAPTER SIXTEEN
International and
Cross-Cultural Negotiation

McGraw-

©2006 The McGraw-Hill
16-2

What Makes International
Negotiations Different?
Two overall contexts have an influence on
international negotiations:
• Environmental context
– Includes environmental forces that neither negotiator
controls that influence the negotiation

• Immediate context
– Includes factors over which negotiators appear to have
some control
McGraw-

©2006 The McGraw-Hill
16-3

Environmental Context
Factors that make international negotiations
more challenging than domestic
negotiations include:
•
•
•
•
•
•
•

Political and legal pluralism
International economics
Foreign governments and bureaucracies
Instability
Ideology
Culture
External stakeholders

McGraw-

©2006 The McGraw-Hill
16-4

Immediate Context
“Factors over which the negotiators have
influence and some measure of control”:
•
•
•
•
•

Relative bargaining power
Levels of conflict
Relationship between negotiators
Desired outcomes
Immediate stakeholders

McGraw-

©2006 The McGraw-Hill
16-5

The Contexts of
International Negotiations

McGraw-

©2006 The McGraw-Hill
16-6

How Do We Explain International
Negotiation Outcomes?
International negotiations can be much more
complicated
• Simple arguments cannot explain conflicting
international negotiation outcomes
• The challenge is to:
– Understand the multiple influences of several factors
on the negotiation process
– Update this understanding regularly as circumstances
change
McGraw-

©2006 The McGraw-Hill
16-7

Conceptualizing Culture
and Negotiation
• Culture as learned behavior
– A catalogue of behaviors the foreign negotiator should
expect

• Culture as shared values
– Understanding central values and norms
• Individualism/collectivism
• Power distance
• Career success/quality of life
• Uncertainty avoidance
McGraw-

©2006 The McGraw-Hill
16-8

Hofstede’s Dimensions
of Culture
•
•
•
•

Individualism/collectivism
Power distance
Masculinity/femininity
Uncertainty avoidance

McGraw-

©2006 The McGraw-Hill
16-9

Individualism/Collectivism
Definition: the extent to which the society is
organized around individuals or the group
• Individualism/collectivism orientation
influences a broad range of negotiation
processes, outcomes, and preferences
– Individualistic societies may be more likely to swap
negotiators, using whatever short-term criteria seem
appropriate
– Collectivistic societies focus on relationships and
will stay with the same negotiator for years
McGraw-

©2006 The McGraw-Hill
16-10

Power Distance
Definition: “The extent to which the less
powerful members of organizations and
institutions (like the family) accept and
expect that power is distributed
unequally”
• Cultures with stronger power distance will be
more likely to have decision-making
concentrated at the top of the culture.
McGraw-

©2006 The McGraw-Hill
16-11

Masculinity/Femininity
Definition: the extent cultures hold values
that are traditionally perceived as
masculine or feminine
• Influences negotiation by increasing the
competitiveness when negotiators from
masculine cultures meet

McGraw-

©2006 The McGraw-Hill
16-12

Uncertainty Avoidance
Definition: “Indicates to what extent a
culture programs its members to feel
either uncomfortable or comfortable in
unstructured situations”
• Negotiators from high uncertainty avoidance
cultures are less comfortable with ambiguous
situations--want more certainty on details, etc.

McGraw-

©2006 The McGraw-Hill
16-13

Hofstede’s Cultures Ranking in the Top 10

McGraw-

©2006 The McGraw-Hill
16-14

Conceptualizing Culture
and Negotiation
• Culture as dialectic
– All cultures contain dimensions or tensions that are
called dialectics
• Example: Judeo-Christian parables “too many
cooks spoil the broth” and “two heads are better
than one” offer conflicting guidance
• This can explain variations within cultures

• Culture in context
– No human behavior is determined by a single cause
– All behavior may be understood at many different
levels simultaneously
McGraw-

©2006 The McGraw-Hill
Culture as Values

McGraw-

16-15

©2006 The McGraw-Hill
16-16

The Influence of Culture on Negotiation:
Managerial Perspectives
•
•
•
•
•
•
•
•
•
•

Definitions of negotiation
Negotiation opportunity
Selection of negotiators
Protocol
Communication
Time sensitivity
Risk propensity
Groups versus individuals emphasis
Nature of agreements
Emotionalism

McGraw-

©2006 The McGraw-Hill
16-17

The Influence of Culture on Negotiation:
Research Perspectives
• Negotiation outcomes
– Research suggests that culture has an effect on
negotiation outcomes, although it may not be
direct and it likely has an influence through
differences in the negotiation process in different
cultures
– Some evidence suggests that cross-cultural
negotiations yield poorer outcomes than
intracultural negotiations

McGraw-

©2006 The McGraw-Hill
16-18

The Influence of Culture on Negotiation:
Research Perspectives

McGraw-

©2006 The McGraw-Hill
16-19

The Influence of Culture on Negotiation:
Research Perspectives
• Negotiation process
– Culture has been found to have significant effects on
the negotiation process, including:
•
•
•
•

How negotiators plan
The offers made during negotiation
The communication process
How information is shared during negotiation

• Effects of culture on negotiator cognition
– Accountability to a constituent influenced
negotiators from individualistic and collectivistic
cultures differently
McGraw-

©2006 The McGraw-Hill
16-20

The Influence of Culture on Negotiation:
Research Perspectives
• Effect of culture on negotiator ethics and tactics
– Differences exist in the tolerance of different
negotiation tactics in different cultures
– Negotiators who trusted the other party were less
likely to use questionable negotiation tactics

• Effects of culture on conflict resolution
– Within collectivistic countries, disagreements are
resolved based on rules, whereas in individualistic
countries, conflicts tend to be resolved through
personal experience and training

McGraw-

©2006 The McGraw-Hill
16-21

Culturally Responsive
Negotiation Strategies
•

When choosing a strategy, negotiators should:
–

Be aware of their own and the other party’s culture
in general
Understand the specific factors in the current
relationship
Predict or try to influence the other party’s
approach

–
–

•

Strategies are arranged based on the level of
familiarity (low, moderate, high) that a
negotiator has with the other party’s culture

McGraw-

©2006 The McGraw-Hill
16-22

Low Familiarity
• Employ agents or advisers (unilateral strategy)
– Useful for negotiators who have little awareness of
the other party’s culture

• Bring in a mediator (joint strategy)
– Encourages one side or the other to adopt one
culture’s approaches or mediator culture approach

• Induce the other party to use your approach
(joint strategy)
– The other party may become irritated or be insulted
McGraw-

©2006 The McGraw-Hill
16-23

Moderate Familiarity
• Adapt to the other negotiator’s approach
(unilateral strategy)
– Involves making conscious changes to your approach
so it is more appealing to the other party

• Coordinate adjustment (joint strategy)
– Involves both parties making mutual adjustments to
find a common process for negotiation

McGraw-

©2006 The McGraw-Hill
16-24

High Familiarity
• Embrace the other negotiator’s approach
(unilateral strategy)
– Adopting completely the approach of the other negotiator
(negotiator needs to completely bilingual and bicultural)

• Improvise an approach (joint strategy)
– Crafts an approach that is specifically tailored to the negotiation
situation, other party, and circumstances

• Effect symphony (joint strategy)
– The parties create a new approach that may include aspects of
either home culture or adopt practices from a third culture

McGraw-

©2006 The McGraw-Hill

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international and cross-culture Negotiation

  • 1. 16-1 CHAPTER SIXTEEN International and Cross-Cultural Negotiation McGraw- ©2006 The McGraw-Hill
  • 2. 16-2 What Makes International Negotiations Different? Two overall contexts have an influence on international negotiations: • Environmental context – Includes environmental forces that neither negotiator controls that influence the negotiation • Immediate context – Includes factors over which negotiators appear to have some control McGraw- ©2006 The McGraw-Hill
  • 3. 16-3 Environmental Context Factors that make international negotiations more challenging than domestic negotiations include: • • • • • • • Political and legal pluralism International economics Foreign governments and bureaucracies Instability Ideology Culture External stakeholders McGraw- ©2006 The McGraw-Hill
  • 4. 16-4 Immediate Context “Factors over which the negotiators have influence and some measure of control”: • • • • • Relative bargaining power Levels of conflict Relationship between negotiators Desired outcomes Immediate stakeholders McGraw- ©2006 The McGraw-Hill
  • 5. 16-5 The Contexts of International Negotiations McGraw- ©2006 The McGraw-Hill
  • 6. 16-6 How Do We Explain International Negotiation Outcomes? International negotiations can be much more complicated • Simple arguments cannot explain conflicting international negotiation outcomes • The challenge is to: – Understand the multiple influences of several factors on the negotiation process – Update this understanding regularly as circumstances change McGraw- ©2006 The McGraw-Hill
  • 7. 16-7 Conceptualizing Culture and Negotiation • Culture as learned behavior – A catalogue of behaviors the foreign negotiator should expect • Culture as shared values – Understanding central values and norms • Individualism/collectivism • Power distance • Career success/quality of life • Uncertainty avoidance McGraw- ©2006 The McGraw-Hill
  • 8. 16-8 Hofstede’s Dimensions of Culture • • • • Individualism/collectivism Power distance Masculinity/femininity Uncertainty avoidance McGraw- ©2006 The McGraw-Hill
  • 9. 16-9 Individualism/Collectivism Definition: the extent to which the society is organized around individuals or the group • Individualism/collectivism orientation influences a broad range of negotiation processes, outcomes, and preferences – Individualistic societies may be more likely to swap negotiators, using whatever short-term criteria seem appropriate – Collectivistic societies focus on relationships and will stay with the same negotiator for years McGraw- ©2006 The McGraw-Hill
  • 10. 16-10 Power Distance Definition: “The extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally” • Cultures with stronger power distance will be more likely to have decision-making concentrated at the top of the culture. McGraw- ©2006 The McGraw-Hill
  • 11. 16-11 Masculinity/Femininity Definition: the extent cultures hold values that are traditionally perceived as masculine or feminine • Influences negotiation by increasing the competitiveness when negotiators from masculine cultures meet McGraw- ©2006 The McGraw-Hill
  • 12. 16-12 Uncertainty Avoidance Definition: “Indicates to what extent a culture programs its members to feel either uncomfortable or comfortable in unstructured situations” • Negotiators from high uncertainty avoidance cultures are less comfortable with ambiguous situations--want more certainty on details, etc. McGraw- ©2006 The McGraw-Hill
  • 13. 16-13 Hofstede’s Cultures Ranking in the Top 10 McGraw- ©2006 The McGraw-Hill
  • 14. 16-14 Conceptualizing Culture and Negotiation • Culture as dialectic – All cultures contain dimensions or tensions that are called dialectics • Example: Judeo-Christian parables “too many cooks spoil the broth” and “two heads are better than one” offer conflicting guidance • This can explain variations within cultures • Culture in context – No human behavior is determined by a single cause – All behavior may be understood at many different levels simultaneously McGraw- ©2006 The McGraw-Hill
  • 16. 16-16 The Influence of Culture on Negotiation: Managerial Perspectives • • • • • • • • • • Definitions of negotiation Negotiation opportunity Selection of negotiators Protocol Communication Time sensitivity Risk propensity Groups versus individuals emphasis Nature of agreements Emotionalism McGraw- ©2006 The McGraw-Hill
  • 17. 16-17 The Influence of Culture on Negotiation: Research Perspectives • Negotiation outcomes – Research suggests that culture has an effect on negotiation outcomes, although it may not be direct and it likely has an influence through differences in the negotiation process in different cultures – Some evidence suggests that cross-cultural negotiations yield poorer outcomes than intracultural negotiations McGraw- ©2006 The McGraw-Hill
  • 18. 16-18 The Influence of Culture on Negotiation: Research Perspectives McGraw- ©2006 The McGraw-Hill
  • 19. 16-19 The Influence of Culture on Negotiation: Research Perspectives • Negotiation process – Culture has been found to have significant effects on the negotiation process, including: • • • • How negotiators plan The offers made during negotiation The communication process How information is shared during negotiation • Effects of culture on negotiator cognition – Accountability to a constituent influenced negotiators from individualistic and collectivistic cultures differently McGraw- ©2006 The McGraw-Hill
  • 20. 16-20 The Influence of Culture on Negotiation: Research Perspectives • Effect of culture on negotiator ethics and tactics – Differences exist in the tolerance of different negotiation tactics in different cultures – Negotiators who trusted the other party were less likely to use questionable negotiation tactics • Effects of culture on conflict resolution – Within collectivistic countries, disagreements are resolved based on rules, whereas in individualistic countries, conflicts tend to be resolved through personal experience and training McGraw- ©2006 The McGraw-Hill
  • 21. 16-21 Culturally Responsive Negotiation Strategies • When choosing a strategy, negotiators should: – Be aware of their own and the other party’s culture in general Understand the specific factors in the current relationship Predict or try to influence the other party’s approach – – • Strategies are arranged based on the level of familiarity (low, moderate, high) that a negotiator has with the other party’s culture McGraw- ©2006 The McGraw-Hill
  • 22. 16-22 Low Familiarity • Employ agents or advisers (unilateral strategy) – Useful for negotiators who have little awareness of the other party’s culture • Bring in a mediator (joint strategy) – Encourages one side or the other to adopt one culture’s approaches or mediator culture approach • Induce the other party to use your approach (joint strategy) – The other party may become irritated or be insulted McGraw- ©2006 The McGraw-Hill
  • 23. 16-23 Moderate Familiarity • Adapt to the other negotiator’s approach (unilateral strategy) – Involves making conscious changes to your approach so it is more appealing to the other party • Coordinate adjustment (joint strategy) – Involves both parties making mutual adjustments to find a common process for negotiation McGraw- ©2006 The McGraw-Hill
  • 24. 16-24 High Familiarity • Embrace the other negotiator’s approach (unilateral strategy) – Adopting completely the approach of the other negotiator (negotiator needs to completely bilingual and bicultural) • Improvise an approach (joint strategy) – Crafts an approach that is specifically tailored to the negotiation situation, other party, and circumstances • Effect symphony (joint strategy) – The parties create a new approach that may include aspects of either home culture or adopt practices from a third culture McGraw- ©2006 The McGraw-Hill

Editor's Notes

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