Best Negotiating Practices Applied Across Cultures

What You'll Learn
  • A win-win attitude is productive across cultures.
  • The value of patience cannot be overstated
  • Make full use of research and initial meetings to better understand hierarchy, authority, deadlines, teams, etc.; don't wait until bargaining to do your homework
  • Build rapport with recognition as to whether it is valued or devalued by the other culture 
  • Probing may require a nuanced approach depending on the culture

With the four key cultural concepts that impact negotiations in mind, let's explore some of the Best Negotiating Practices from a cross-cultural, safe skills perspective. The Best Negotiating Practices not discussed in this section may be assumed to be valid for any cross-cultural setting.

BNP 2: Believe in win-win, mutual gain

This holds true whether or not your counterpart is also using a win-win strategy or is still holding to positional bargaining. They may at first be unfamiliar with such a style, but may soon come to recognize it as a welcome change.

BNP 4: Build in time and be patient

When negotiating with those from cultures which are more relaxed about time (almost everyone except Anglo North Americans and northwest Europeans), the value of patience cannot be overstated. Not only do these cultures have a different perspective on time, they may also be dealing with other constraints that you may be unaware of, such as:

  • Consensus. In relationship-oriented cultures, the consensus-building process can be very time-consuming. Decisions are made slowly and once made, difficult to change.
  • Technology. There may be technological constraints. Perhaps they do not have access to email. Perhaps they are forced to turn off their fax machines at night because of the risk of power surges. Perhaps copy machines or computers are less available.

Aggressive attempts to force those from slower-paced cultures into a faster pace of doing business will be frustrating for both sides. There are also two dangers for those from cultures more urgent about time who mandate a fast pace: One danger is that you may lose some of the trust you have worked hard to build by rushing the other side. Another danger is that you will quickly be recognized as being too much in a hurry and thereafter taken advantage of. There are many anecdotes of impatient Westerners being manipulated in places such as China and Singapore. The hosts will spend the Westerners' entire visit sightseeing and avoiding serious talks, then wait until the visitors' last day to present an unacceptable agreement.

Conversely, when working with those from fast-paced countries, slower-paced teams often fail to understand the significance of the time pressure placed on their counterparts, who must deliver results to their stakeholders. Maintaining a fast pace is rarely just a particular individual's preference or style; it is a structural constraint beyond most people's control. Any attempt to meet the time constraints of this type of culture will be noticed and appreciated.

  • If you are from a faster-paced culture, build in extra time from the outset and don't reveal your deadlines.
  • If you are from a slower-paced culture, be cognizant that your more "urgent" counterparts are under pressure from their own companies.

BNP 6: Prepare, prepare, prepare.

If this is wise for negotiating in your home culture, it is 10 times wiser when negotiating outside your home culture, especially for task-oriented groups when dealing with relationship-oriented cultures (Russia, China, and especially Japan).

  • Start preparing from the first point of contact, if not before.

Waiting to prepare until a few days before an important meeting is risky at best. Most relationship-oriented cultures often focus a great deal of their energy on pre-negotiation preparation and in-depth research, then work hard to come to a consensus (not just with face-to-face negotiators, but with everyone remotely involved with the project) about their official position. They do not expect to modify their position during the meeting. Meetings often feel scripted, and task-oriented cultures often perceive this as inflexibility. Changes will have to be negotiated among them in private, consensus reached once again, and another meeting scheduled. This is time-consuming and tedious for all concerned. For this reason, assuming the agreement will emerge during the meeting is not always realistic. The most prudent course is to:

1) Make full use of initial meetings to better understand each other both professionally and socially and fully explore mutual goals, and 2) communicate frequently before the meeting, responding to requests for information promptly and thoughtfully and requesting information from them as well. Don't wait until the last minute!

Along with your standard negotiation preparation, at a minimum you should know the following:

  • What is the past history of their organization? What are their goals (long-term and short-term), strong points, and weak points? To which government agencies are they closely tied? With what other companies do they frequently work? What are their global aspirations and capabilities?
  • What are the salient points of their country and culture ? The basics here would include such items as political, historical and economic highlights, form of government and key leaders, religion, language (not always obvious!), geographical areas of interest and principal cities, cultural characteristics, and their relationships with key world powers and with other nations of their continent. For example, Mexico identifies itself strongly as a North American nation and is oriented away from much of Central America. Some Mexicans are likely to be offended to be lumped together with all of Central and South America. Similarly, Brazilians do not identify as "Hispanic" and do not speak Spanish—they speak Portuguese.
  • Who is who within the organization and what role do they play? Doing your social homework is far more important when dealing with a relationship-oriented than with a task-oriented culture. Often many people have to be taken into account who may not appear to a task-oriented person to be key players. For example, say you are working with an Indonesian company. Perhaps some of their people remain in the background in negotiations. It is nevertheless very important that you know who they are and demonstrate proper respect to them both in business meetings and during social functions. Or perhaps a person is involved who doesn't seem to have a particularly useful contribution, and you feel tempted to dismiss them mentally. If that person happens to have a great deal of social prestige or holds a certain rank regardless of his or her performance, it is important that they be shown as much respect as everyone else.

  • Some team members may have been selected based on their international experience and language ability rather than on their experience as negotiators, in business, or ability to commit the company.

  • How many people will they be sending to negotiate and who are they? Many countries send larger negotiating teams as a display of their serious intentions or of their prestige. Find out in advance who they plan to send and then create a team with parity in size and rank. Needless to say, it is also good to include on your team people who have an understanding of different cultures. Do not be misled, however, if a task-oriented country, such as the Netherlands, Australia, or the U.S., sends only 2 or 3 people to an important meeting. This is not meant to imply disrespect either for the company or the country visited; it is thought to be an efficient use of resources, and the people who do attend generally have authority and responsibility.

EXAMPLE

A small but fast-growing French firm set a goal of developing a solid client base in Mexico within 12 months. The CEO wisely recruited an expert agent who was intimately familiar with Mexican culture, language and business practices to go and develop relationships. During repeated trips to Mexico to have lunch and dinner, play golf, and attend receptions (see BNP 9 below), he made a point of doing detailed homework on the targeted clients. When the time came to sit down and conduct negotiations, the French firm was well prepared, rapport had been established, and negotiations were greatly facilitated.


BNP 9: Don't forget the warm-up – start s l o w l y.

Building real rapport is perhaps the most important part of doing business with relationship-oriented cultures. Task-oriented cultures tend to rely heavily on the logic and inherent attractiveness of their proposals and even strive to keep "personal" feelings out of the negotiation process. The critical misunderstanding that often takes place at this point is that task-oriented negotiators, for example Dutch and U.S. Americans, tend to feel that more than half an hour of relationship-building is irrelevant and even distracting from the process (and also a poor use of time), while their counterparts from relationship-oriented cultures such as Venezuela, Egypt, and Hungary find this the key step in deciding whether or not to proceed. In relationship-oriented cultures one does not do business with strangers, no matter how attractive their offer or how airtight their logic.

Building rapport may take an evening out, a week of visiting, or months of back-and-forth communication. For Russians and East Europeans, it may take long nights of eating, drinking, and saunas together. For Arabs, it may take days of conversation over coffee and meals. For Japanese, it may take many slow-moving meetings, dinners out, and golf or karaoke.

For those from task-oriented countries working with collectivists, always remember to:

  • plan extra time in your schedule for this important process;
  • follow their lead; and
  • accept all social invitations with enthusiasm. This holds for everyone on your team, not just the adventurous or gregarious. (Citing family responsibilities or excuses about jet lag and having to call home can be disappointing to your counterparts.)

When working with task-oriented countries, those from relationship-oriented countries should remember to:

  • not interpret a lack of extensive socializing as a lack of sincere intentions. People from task-oriented cultures often have important family or other commitments after working hours that they must attend to. Individualists typically show their sincere intentions by working intently during business hours.

BNP 14: Never say "No"…or "Yes." Use the Negotiated Yes: "Yes, if…"


A U.S. manufacturer had come to Russia to negotiate a deal and discuss the possibility of expanding their collaboration. The two teams worked hard all day, and the Russians invited the Americans for an elaborate luncheon and a dinner banquet every day. After several days of this, the exhausted, jet-lagged Americans were beginning to tire of what they felt to be excessive recreation. Toward the end of the trip, the Russians had planned a night of feasting on shashik and enjoying a traditional sauna, immediately following an excursion of several hours to a restored church on a mountaintop. The Americans had had enough and decided to beg off, unaware that their host had already purchased an enormous quantity of food and reserved the facilities. The Russians persistently encouraged them to come, but the Americans declined. They could not sense the growing frustration of their hosts. Finally, the translator whispered to the Americans that they should go in order not to damage the feeling of trust and cooperation that had been carefully built in the preceding week. The event was a success: the Americans had a memorable evening, the Russians were relieved and reassured, and the relationship was cemented.


EXAMPLE

Using the "Negotiated Yes" is an especially successful strategy in cross-cultural negotiations. Direct, bald-faced "no's" can be offensive and embarrassing in cultures which have an indirect communication strategy, such as Vietnamese and Japanese, who tend to become vague and evasive rather than spelling out what they mean. On the other hand, in some cultures with expressive styles, such as Russian, Greek, or Italian, "No" is sometimes used not simply to say "No" but to provoke concessions (as Crunches) or to Bluff.


  • Using the "Negotiated Yes" helps you to be appropriately polite when working with indirect people, and to provide a more controlled response when working with those who are more verbally expressive.

Another issue is how to recognize an "indirect no" or to interpret an "expressive no." People often wonder how to figure out if "the Japanese are saying no." Of course the Japanese say no -- they use hedging phrases such as "I'll do my best," "It might be difficult," or "Hmmm, that sounds like a good idea...." It is important to understand that these are not necessarily Crunches. They are courteous ways of saying "No." A polite Probe is acceptable as a response to this, but do not put them on the spot by repeatedly attempting to counter or by demanding to know when they will answer or why they cannot answer right now. Another situation that may appear to Westerners to be a hedge or vague excuse is the statement by Japanese, Chinese, Russians or others from relationship-oriented cultures that they need to consult with others before moving forward. This is usually in fact true – they do need to consult with others.

On the opposite end of the scale, one may hear a firm, even dramatic "No!" from a member of an expressive culture at what may seem to be an early point in the negotiations. There is a saying that the Russian word for no, nyet, really means "not yet." These types of no's are not meant to put an end to the conversation, but rather to stimulate it. Counter Crunch.