international negotiation 2.1

Module 2

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• Asian Versus America• Iceberg• Saner

2

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3

Negotiation

The Impact of culture on Negotiation

Negotiation Factors

GoalAttitudesPersonal StylesCommunicationsTime SensitivityEmotionalismAgreement FormAgreement buildingTeam OrganizationRisk Taking

ContractWin/LoseInformalDirectHighHighSpecificBottom UpOne leaderHigh

RelationshipWin/Win

FormalIndirect

LowLow

GeneralTop

ConsensusLow

Western Asian

Source http://fletcher.tufts.edu/salacuse/topten.html

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4

The American Way

Communication Patterns in Negotiation

Messag

e Succes

s

All the information

on the table

All the information

on the table

ConfrontsprovokesBecomeVocal &

animated

ConfrontsprovokesBecomeVocal &

animated

Argument the way of Commu-nication

Argument the way of Commu-nication

ConcessionConciliationSummary

ConcessionConciliationSummary

Wishes to close the deal effectively on his terms (win-lose) Wishes to close the deal effectively on his terms (win-lose)

Express itall

directly

Express itall

directly

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Communication Patterns in Negotiation

Messag

e Succes

s

Some information

on the table

Some information

on the table

Express it implicitlyExpress it implicitly

ConfrontsChallenges Considers

options

ConfrontsChallenges Considers

options

Eatingand

Drinkingthe way

of commu-nication

Eatingand

Drinkingthe way

of commu-nication

MakingFriends

Concession

MakingFriends

Concession

Wishes to close the deal and establish long-term relationship (win-win)

The Chinese Way

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American

•Individualist orientation

•Informal and egalitarian

•Task orientation

•Willing to confront directly,

criticize, discuss controversial

topics, and press personal

opinions

•Written rules apply to everyone

American

•Individualist orientation

•Informal and egalitarian

•Task orientation

•Willing to confront directly,

criticize, discuss controversial

topics, and press personal

opinions

•Written rules apply to everyone

Chinese

•Collectivist orientation

•Formal and hierarchical

•Relationship-orientation

•Avoid direct confrontation,

open criticism, and

controversial topics.

•Faith in personal relationships

than in written rules

Chinese

•Collectivist orientation

•Formal and hierarchical

•Relationship-orientation

•Avoid direct confrontation,

open criticism, and

controversial topics.

•Faith in personal relationships

than in written rules

American vs. ChineseAmerican vs. Chinese

Asian business style vs. othersAsian business style vs. others

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Work Ethics

Rationale:• Fear of failure• Desire for familial betterment• Material gains• Social esteem• Security during old age

Work Ethics

Rationale:• Fear of failure• Desire for familial betterment• Material gains• Social esteem• Security during old age

Entrepreneurial Ethics

Attributes:•Trustworthiness• Reliability• Frugality• Building of relationships• Creativity

Entrepreneurial Ethics

Attributes:•Trustworthiness• Reliability• Frugality• Building of relationships• Creativity

Overseas ChineseBusiness Ethics

and Success

Overseas Chinese Business Ethics

Asian business style vs. others

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Culture A Culture B

BehaviorsComportamientos

CustomsCostumbres

BeliefsCreencias

ValuesValores

assumptionsSuposiciones

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ProfessionalProfesional

FunctionalFuncional

CompanyCompañía

IndustryIndustria

Regional/ NationalRegional/Nacional

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• Wall Street One– http://youtube.com/

watch?v=Pxsn5Mm6fzA

• Wall Street Two– http://youtube.com/

watch?v=RBKuESaGa00

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• Nature of decision -making: degree of risk vs speed of feedback (payoff). Naturaleza de la decisión tomada: Grado del riesgo versus la velocidad de la retroalimentación.

degr

ee o

f ri

skhigh

low

speed of feedbackhigh low

biotechnologybond trading

retailing Accountingconsultants

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22

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23

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24

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• High Uncertainty Avoidance (80).

• PDI suggests inequality accepted

• MAS: Work to Live

• Low Individualism (13)

• Collectivist05/09/08

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• One – http://www.youtube.com/watch?v=WQnXJZXaxcI

• Two – http://www.youtube.com/watch?

v=Az0_2pGnOAA

• Three

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• High Individual.

• PDI suggests inequality accepted

• MAS: live to work

• Low Individualism (13)

• Collectivist05/09/08

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• One– http://www.youtube.com/watch?v=002AY4cb5uw

• Two– http://www.youtube.com/watch?v=e-5JA7Z8KLI

• Three– http://www.youtube.com/watch?v=avqLJ2DG0pA

• Four– http://www.youtube.com/watch?

v=Gr6PbjvSgEs&mode=related&search=

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• Highest PDI in world inequality accepted

• MAS, UAI, IDV middle

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• One– http://www.youtube.com/watch?v=ot9Jp6-mB-8– http://www.youtube.com/watch?

v=ci2D1ig4df4&mode=related&search=

• Two

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Mobile America

Foggy Japanese

Clinical French

Vague British

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• Apart from the Koreans (who seem to like everybody’s jokes), few Orientals are amused by American or (most) European jokes. The Confucian and Buddhist preoccupation with truth, sincerity, kindliness and politeness automatically eliminates humour techniques such as sarcasm, satire, exaggeration and parody, and finds little merit in crazy homour or jokes about religion, sex and underprivileged minorities. Sick or black humour is definitely out.

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Values

Symbols

Behaviors

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• One– http://www.youtube.com/

watch?v=dVcRecCk8sw• Two

– http://www.youtube.com/watch?v=UlAkOhH9eek

• Three– http://www.youtube.com/

watch?v=m9yFYnKF6D8• Four

– http://www.youtube.com/watch?v=D-B52PV876I&mode=related&search=

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• High Uncertainty.

• PDI average

• MAS: live to work

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• One– http://www.youtube.com/

watch?v=ahp8pyPuSEg&mode=related&search=

• Two– http://www.youtube.com/

watch?v=QzM0qgi-6hs

• Three– http://www.youtube.com/

watch?v=FpIXXkRDXzA&mode=related&search=

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• Long-term Orientation (LTO) highest-ranking factor (118)

• Individualism (IDV) lower than any other Asian country

• 20 compared to an average of 24

• Low Individualism ranking is manifest in a close and committed member 'group', – family, – extended family, – extended relationship 05/09/08

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• High Individual.

• PDI lover side

• MAS: Work to Live

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• High correlation between the Muslim religion with Power Distance (PDI) and Uncertainty Avoidance (UAI) scores

• High PDI – Lack of significant upward

mobility of its citizen • Combination of these two

create societies that are– highly rule-oriented with laws,

rules, regulations, and controls in order to reduce the amount of uncertainty,

– inequalities of power and wealth have been allowed to grow05/09/08

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• two highest rankings being equal at 64 - Power Distance (PDI) and Uncertainty Avoidance (UAI).

• Buddhist and Shinto countries have the closest correlation Uncertainty Avoidance Index (UAI)

• Same correlation that the majority of Catholic countries have demonstrated

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Edward HALL

3 variables of Culture

1- High-context and Low-context cultures

2- Dimensions of time3- Relationship of Man

with Nature and Space

Edward HALL

• 3 variables de la Cultura

1 Culturas de alto y bajo contexto

2 Dimensiones del tiempo3 Relaciones del hombre

con la naturaleza y el espacio.

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Edward HALL

1- High-context and Low-context cultures

• High-context communication style– Vagueness common (implicit

style)– Tact & diplomacy prioritised – Important to read between the

lines/pick up signals– Harmony and “face” important

• Low-context communication style– Directness common (explicit

style)– Clarity & honesty appreciated – Things can be taken on face

value

1. Culturas de alto y bajo contexto

• Estilo de comunicación de alto contexto

-La ambigüedad es común (estilo implícito)

-Táctica y diplomacia priorizada-Importancia de leer entre líneas-Armonía

• Estilo de comunicación de bajo contexto

-Lo directo es lo común (estilo explicito)

-Claridad y honestidad es apreciada-Las cosas pueden ser tomadas por su

“face value”

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Edward HALL

2- Dimensions of time

* Time orientation toward the Past, Present, or Future

* Time is linear or circular* Monochronic and

polychronic time

2 Dimensiones del tiempo

• Orientación en el tiempo dirigida hacia el pasado, presento o futuro

• El tiempo es lineal o circular

• Tiempo mono-crónico o poli-crónico.

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• Polychronic/Synchronic cultures• fluid time, circular• including past, present and

future• relationships more important

than deadlines• do several things at once

• Monochronic/Sequential cultures• fixed time, linear• deadlines, tight schedules,

systematic• do one thing at a time

• Culturas poli-crónicas/sincrónicas

-Tiempo fluido, circular-incluyendo pasado, presente y

futuro.-Hacer varias cosas al tiempo

• Culturas mono-crónicas/secuenciales

-Tiempo fijo, lineal-Plazos, agendas apretadas,

sistemáticas-Hacer una sola cosa al tiempo

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The U.S., British, German, Swiss, and Scandinavian cultures are relatively monochronic,

Latin American, African, Middle Eastern, and Southern European societies are polychronic.

Las culturas norteamericanas, británicas, alemanas y escandinavas son relativamente mono-crónicas.

Las culturas Latinoamericanas, africanas, el medio este y de europa del sur son sociedades poli-crónicas.

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Edward HALL

3- Relationship of man with Nature and Space

* Mastery, Harmony, Subjugation to nature

* Proxemic : Intimity, Personnal or Social areas

• 3 Relaciones del hombre con la naturaleza y el espacio

-”Mastery”, armonía, subyugación de la naturaleza.

-”Proxemic”: intimidad, áreas personal y social.

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• Deal-focused cultures

• direct approach to customer possible

• the best product gets the order

• contract protects the two parties

• Relationship-focused cultures

• introduction by third party essential

• time needed to develop relationship

• mutual trust is essential 05/09/08 49

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• Ascription-based cultures– Status ascribed (given) to

certain groups• Older males• Members of important

families• People with the right

background• Achievement-based cultures

– Status has to be won/earned/achieved• Young people in high

positions • People evaluated on results

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• Formal communication style– Use of titles (academic or

professional)– Politeness & protocol

important– Common in ascriptive cultures

• Informal communication style– Little use of titles or polite

forms– Speaking plainly is encouraged– Common in achievement-based cultures

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• Cultural Chauvinism

• Ethnocentrity

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Cultural Chauvinism

Level of Cultural Awareness

Ethnocentrism

Tolerance

Minimization

Understanding

Description

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Complete unawareness of other cultures, which leads negotiators to attribute ignorance and bad

intentions to other side

Cultural Chauvinism

Level of Cultural Awareness

Ethnocentrism

Tolerance

Description

Minimization

Understanding

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Awareness of ethnic, religious, racial, or national differences,

along with a conviction that one’s own way is the “right” one

Cultural Chauvinism

Level of Cultural Awareness

Ethnocentrism

Tolerance

Description

Minimization

Understanding

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Awareness and appreciation of differences, still feeling one’s own

way is more “realistic” - leads negotiators to try to “educate” or

“develop” other side

Cultural Chauvinism

Level of Cultural Awareness

Ethnocentrism

Tolerance

Description

Minimization

Understanding

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Awareness of other cultures, with focus on similarities across

cultures, may lead negotiator to ignore important difference

relevant to a negotiation

Cultural Chauvinism

Level of Cultural Awareness

Ethnocentrism

Tolerance

Description

Minimization

Understanding

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Realization that one’s own way is only one of many, and that others

are not abnormal in any way

Cultural Chauvinism

Level of Cultural Awareness

Ethnocentrism

Tolerance

Description

Minimization

Understanding