Homa Milani

Feb.2014
Negotiation
Article Review 2: Global Negotiations

Article #1
The Impact Of Culture in International Business Negotiation: SPECIAL
REFERENCE TO CHINA AND UNITED STATES OF AMERICA.
N.Shimutwikeni
This paper aims to use the ten elements as a framework for identifying the
cultural differences between China and the United States of America.
American and Chinese approaches often appear incompatible. All too often,
Americans see Chinese negotiators as inefficient, indirect, and even dishonest,
while the Chinese see American negotiators as aggressive, impersonal, and
excitable. These differences stem from their cultural backgrounds.
Chinese culture is greatly influenced by traditional philosophies including
Confucianism and Taoism. The philosophies place great importance on patience,
harmonious relationships and survival instinct.4 On the other hand, the
Americans are more individualists and they value networking and information.
Another difference is that most of the Chinese reside in the rural areas compared
to Americans who reside in the urban areas thus Chinese are more communal.
Thus an understanding of the differences can prevent misunderstanding between
individuals and thus create mutually beneficial business relationships.


From this study, we can see that there are marked differences in the American
and Chinese negotiation styles which stem from cultural differences among the
two countries. Knowledge of these differences will enable negotiators understand
the negotiation behavior of their counterparts with a view to making negotiations
proceed with more ease. However, it is also important not to allow cultural
stereotypes to determine the relationships with the potential business partners.
This is because individuals may have their own distinct culture which does not
always mirror the countrys perceived culture.
American Chinese
The basic cultural values and ways of thinking
Individualist collectivist
Egalitarian hierarchical
information oriented relationship oriented
reductionist holistic
sequential circular
seeks the truth seeks the way
the argument culture the haggling culture
How they approach the negotiation process
Non task sounding
quick meetings long courting process
informal formal
make cold calls draw on intermediaries
information exchange
full authority limited authority
direct indirect
proposals first explanations first
means of persuasion
aggressive questioning
impatient enduring
terms of agreement
forging a "good deal" forging a long term
relationship
Article # 2
Cross-Cultural Communication and Negotiation
Ch. Hooper, M.Pesantez, S.Rizvi

In this paper, authors examine how cultural differences play a role in the
outcomes of negotiations using Western culture as a basis for comparison. Article
begins by explaining what negotiation is, how it is carried out and describes
different types of negotiation. At the next part, the paper examines the cultural
aspects of individualism vs. collectivism, egalitarianism vs. hierarchy, and high vs.
low-context communication as well as the effect of culture and the contextual
effect of role on the different forms of negotiation. The importance of
information in the negotiating process is also discussed. It explains how
communication styles and cultural differences can lead to unfavorable outcomes
and how the opportunity for trade-offs in the negotiation process can be missed.
According to this article, Culture is the most important variable affecting
international negotiations and the values and norms that are encompassed by
culture can affect negotiations. Cultural values establish what members perceive
as important, while cultural norms outline what is considered proper and
improper behavior. Together, cultural values and norms influence how one
perceives situations and how one reacts to the behavior of others.

The cultural values of individualism versus collectivism, egalitarianism versus
hierarchy and direct vs. indirect communications are relevant to norms and
negotiation strategies.

individualism versus collectivism
Individualism vs. collectivism is said to indicate a cultures core preferences and
priorities concerning goals .This is important for negotiators because goals direct
behavior and goals are also basic motivators. For collectivists, it is important to
seek win-win outcomes whereas individualists tend to treat all negotiations as
win-lose. Individualistic negotiators, when compared to collectivistic negotiators,
tend to make more extreme offers and spend more time planning short-term
goals. Collectivistic negotiators tend to plan more for long-term goals than
individualists. It has been shown that individualists are more pragmatic because
they do not usually change their behavior in relation to whom they are
negotiating with, unless confronted with a stalemate. Collectivists are known to
alter their negotiating style from cooperative to competitive when confronted
with individualists. Nevertheless, even though collectivists are competitive, they
still remain sensitive to the others outcome.

A negotiator who is driven by self-interest may not be willing to continue the
negotiation once their goals have been satisfied, and the negotiation could end
too early to accomplish joint gains. Experiences with individualistic cultures such
as the United States and collectivists cultures like South Korea and Russia show
that in the United States, attainment of positive outcomes is emphasized and
valued, whereas in South Korea and Russia, avoiding negative outcome is
emphasized and valued.

Egalitarian vs. Hierarchy
Social structures within hierarchical cultures attribute social status to social
power. In hierarchy cultures, from Asia to Africa or the Middle East, respect is
demanded by those in senior positions.

Conflict between different status groups in hierarchical cultures becomes
incompatible to the social structure where the norm is for lower status members
not to challenge the directives of social superiors. For this reason, negotiators can
assume that conflict between members of different statuses will be less frequent
in hierarchical cultures as opposed to egalitarian cultures. During transactional
negotiations, egalitarian cultures rarely use BATNA as a source of power, unless
things are not progressing toward an agreement because they would rather
concentrate on the issues, priorities and interest relevant to the current
negotiations. On the other hand, cultures that are more hierarchical tend to use
all forms of power in negotiation, whether it is status, BATNA, and/or persuasion.

Americans are more inclined toward egalitarian traits, while Japanese are more
hierarchical. It is understood that the Japanese, more than the Americans, pay
more attention to power in regards to their preparation.

High vs. Low-Context Communication
In high-context cultures, a large part of the message is conveyed in the context or
background of the dialogue, while little information is actually being said. The
speaker relies on the receiver to have certain pre-existing knowledge about the
topic, as the gist of the communication is inferred as opposed to being directly
decipherable. On the other hand, in low-context cultures, information is explicitly
transmitted through clear and precise messages.

US negotiators share information in order to obtain similar data, while indirect
communicators like the Japanese, tend to conceal valuable information. There are
several reasons attributable to Japaneses tendency to give unclear, ambiguous
and incomplete answers. For Japanese people, for example, nonverbal behavior
and context are as important as direct communication, and they can be extremely
indirect when expressing a negative response. The Japanese may see conveying a
direct denial as unreasonably offensive and harsh.

Culture in Context
The theory, Culture in Context, covers the variations mentioned in the preceding
subsection. The Culture in Context theory treats negotiators not as passive
representatives of culture, but as regulators of a complex negotiation system.

Basically, this view says that contextual factors (personality, age, prior
relationship and experiences, organization culture, etc...) affect a negotiators
style as much as the culture they are from. The contextual factor that we will
focus our attention on is role, which is defined as a set of rights, obligations, and
normative expectations attached to social positions.

Interestingly, experienced negotiators are aware of the differences attributed to
buyer-seller roles. Russian, Chinese and Japanese tend to agree that role is an
important identifier in determining ones outcome, whereas Americans often do
not recognize role as a factor. In the culturally individualistic U.S. and in the
collectivistic cultures of Japan, Korea, and Mexico; buyers regularly receive higher
profits compared to sellers.Western culture concerns itself primarily with the
needs and goals of the individual. Autonomy is highly regarded and protected in
society.

By the end of this article, the authors have suggested that despite cultural
differences, optimal results in the negotiation process can still be achieved. They
suggested three key elements for success: parties to a negotiation must value the
sharing of information, there must be a means to search for information, and
finally, both parties in the negotiation process must be willing to search for the
information. When exercising these three key factors, both parties should be able
to walk away with acceptable outcomes.

Article #3
International Business Negotiation under the Impact of Cultural Distance
V. Danciu
At this article author suggested the cultural distance should be identified and
analyzed before the negotiation starts and it should be very much reduced
because the life style and group and organizational values and behavior could be
different from a country to another. The cultural distance in business is about
differences between the cultural profile of the exporter and that of the importer.

The cultural influences on communication during negotiation have various
sources. The national culture alone does not cause the style and behavior in the
negotiation process. The partners behavior is influenced by organizational
culture, international experience, professional background, gender and other
factors. These numerous and various influences could be found in the
communication differences when using verbal and nonverbal language.

The verbal behavior of the negotiators seams similar in all culture during the talks,
especially at the beginning of the talks researchers have found .

The author emphasize to know more about nonverbal language in different
nations: the differences regarding nonverbal language have to be very good
known particularly as the most messages that are communicated during talks are
nonverbal ones.

The negotiators from high context cultures have a message that cannot be
understood without a great deal of background information. Low context
communication of the negotiators spells out more of the information explicitly in
the message.

The style of communication in low context culture is rule based. The negotiators
from high context cultures have a relationship-based style of communication. The
distinction of relationship-based and rule-based culture also underlies differences
in negotiation styles. The frankness of rule-based cultures is possible because of
an underlying confidence that rules have objective validity and can therefore
serve as basis for resolving disputes. The absence of such confidence in
relationship based cultures requires that they fall back on courtesy and face
saving.

Some culture differences are relating to the perspective about time and its
management, for example: The North-Americans which belong to a low context
culture are thinking that the goal of the negotiation is to find a better and quicker
solution. The Japanese negotiators are thinking that the negotiation is a good
opportunity for developing business relationships that have as objective getting
mutual long term advantages.

The cultural distance is producing issues that could be found at the level of the
negotiation management. Most Western negotiators are splitting the problem in
smaller issues there are to be solved one by one. All the parts of the problem are
discussed at a time in Asia, without a precise hierarchy or order.

Since international business negotiation are more complex than domestic due
largely to this added dimension of cultural diversity one solution of the limitations
is the synergic approach: cross cultural differences are recognized, clearly
communicated and understood by the negotiator, they can be the basis for
constructing win-win agreements. Cultural empathy could be obtained by doing
so as the negotiation process is reaching its final and decisive stages.

At the end of article, the author suggested som solutions that could lead to the
reduction of cultural distance and to reaching the cultural empathy. The
multicultural research, analysis of cultural distance, interactive methods and
exposure at the culture of the negotiation partner are among the most
recommended and used methods.

Compare and Contrast of the Articles:
As we can understand in all three mentioned articles, International negotiation is
different in many aspects and much more complicated than domestic negotiation
and that is because cultural values have a noticeable influence on negotiation
interests and priorities, while cultural norms affect negotiation strategies and
patterns of interactions. If culture affects such basic elements of negotiation as:
interests, priorities or strategy selection and also given that the influence of
culture is mostly subconscious, all differences in any observable aspects of cross-
cultural negotiation can always be ascribed to cultural differences between the
negotiators. [1]

At the first article, The Impact Of Culture in International Business Negotiation,
paper aims to use the ten elements (Goals, Attitude, Personal Style) as a
framework for identifying the cultural differences between China and the United
States of America. The focus is on just these 2 countries and author proposed a
vast detail by referring those 10 factors. There is no more detail about the reason
and the finding of the article is just a comparison table of to culture in negotiation
subject.

The second article, Cross-Cultural Communication and Negotiation, authors
examined how cultural differences play a role in the outcomes of negotiations
using Western culture and Eastern culture. The comparison is based on cultural
values of individualism versus collectivism, egalitarianism versus hierarchy and
direct vs. indirect communications are relevant to norms and negotiation
strategies. It debates a great explanation of differences between negotiators by
high context and collectivism cultural background vs. low context and
individualism cultural background.

In this article the authors came to this conclusion that collectivism will lead
negotiators to engage in more integrative and less distributive bargaining.
Cultures that are more collective will have negotiations that are less inclined to
view negotiations as competitive and less likely to fall into the mythical fixed pie
belief. This Article bring up different examples of comparison between United
state of America and Japan mostly.

In other hand the last article, International Business Negotiation under The
Impact of Cultural Distance, has a great approach to cultural distance in
international negotiations not only included United states but also different
European countries, here is an example of their comparison:
The British model of organization seems to be that of a village market with no
decisive hierarchy, flexible rules and the resolution of problems of negotiation.
The German model is more like a well-oiled machine, where the exercise of
personal command is largely unnecessary because the rules settle everything. The
French model is more of a pyramidal hierarchy held together by a united
command issuing strong rules. Or the Israeli and Japanese seem to the least
willing to give information.
This article defines some solutions for reductions of cultural distance in
negotiation, the author mention cultural empathy for the improvement of the
negotiation process as one solution.
Theoretically, the second article I could say, has more scientific approach to the
subject rather than the other two but practically the last article has more example
that is easier for reader to get the point.
None of the articles following the standard format of research article which is :
Abstract
Introduction: Context, Research Problem, Review of Literature
Methods
Results
Discussion
References







Reference:


1-Fundamentals of International Negotiation by R.Smolinski
http://www.hhl.de/fileadmin/LS/micro/Download/smolinski_internat_negotiatio
n.pdf