Question

1. 5-1. Discuss the stages in the negotiation process and how culturally based value systems influence these stages. Specifically, address the following.

   • Explain the role and relative importance of relationship-building in different countries.

   • Discuss the various styles and tactics that can be involved in exchanging task-related information.

   • Describe differences in culturally based styles of persuasion.

   • Discuss the kinds of concession strategies a negotiator might anticipate in various countries.

2. 5-2. Discuss the relative use of nonverbal behaviors, such as silent periods, interruptions, facial gazing, and touching, by people from various cultural backgrounds. How does this behavior affect the negotiation process in a cross-cultural context?

3. 5-3. Describe what you would expect in negotiations with the Chinese and how you would handle various situations.

4. 5-4. What are some of the differences in risk tolerance around the world? What is the role of risk propensity in the decision-making process?

5. 5-5. Explain differences in culturally based value systems relative to the amount of control a person feels he or she has over future outcomes. How does this belief influence the decision-making process?

Answer 1

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(5-1)

There are five stages • Preparation • Relationship building • The exchange of task-related information • Persuasion • Concessions and agreement

There may be overlap in the tasks involved in various stages. In the preparation stage, not only adequate research on the subject to be negotiated has to be carried out but also adequate background study on the culture of the negotiating team needs to be meticulously done. Proper understanding of their own styles and the areas of differences with the culture of the negotiating team would go a long way in avoiding unpleasant surprises. The second stage of the negotiation process which is relationship building involves getting to know the negotiating team members. This is essential and more elaborate in some cultures, such as countries in the Middle East. In some others such as in the U.S.A., it is likely that without too much preamble, the business topic to be discussed is brought to the forefront. Both parties to the negotiation should have an appreciation and understanding of each others' relationship building processes. Otherwise, the negotiation process can collapse quickly.

The third stage of the negotiation process is the exchange of task-related information. This normally involves one party making a presentation followed by a question and answer session. The other party follows the same procedure. This kind of straightforward approach is followed by team members from the U.S.A. Teams from some other countries such as Mexico, may have a style of presentation of minimal content. They are normally suspicious and indirect. Some others such as the French may interrupt the presentation at every stage, besides arguing and debating about even mere trivial details. Some others like the Chinese may ask very detailed and specific questions on the presentation which may require the negotiating team to comprise of requisite technical experts to answer all the queries. Even the Russians go into minute details. It may be a good idea for negotiators to practice reversal of roles, so that all aspects can be covered. Persuasion is the next stage of the negotiation process. This is a process of give and take and may take several rounds of meetings. Sometimes, mediators may be used for reaching an agreement. Understanding each others' positions and the "cut and thrust' employed for hammering out an agreement may be prolonged and arduous. Germans have a direct way of communicating their position. The Japanese have an indirect way of negotiation and persuasion. The verbal and nonverbal forms of communication become very important. Some negotiators try to wear down the other party by using various tactics including what are euphemistically termed as -dirty tactics". The key objective in persuasion is in making minimal concessions to arrive at an agreement.

The last stage of negotiation is Concessions and Agreements. The procedures and tactics used in different cultures is different. In some cultures such as Russian and Chinese cultures, extreme positions are taken to start with. In some others like Sweden, very clearly what is realistically feasible is proposed. In cultures such as the U.S.A., the individualism trait is the predominant feature in negotiations compared to the collectivism trait in Asian cultures. Similarly, cultures such as in U.S.A, the negotiations and agreements are reached point by point or clause by clause, whereas in Asian cultures negotiators approach issues in a holistic manner. The final contract is sacrosanct in U.S.A.and is taken seriously. Russians take the contracts casually and may often renege on signed contracts. In some other cultures such as the Japanese culture, once an agreement is reached, it is a word of honour. To follow up a verbally agreed contract with a written one may be considered an insult.