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Negotiating Across Cultures
Presenter:
Richard R. Gesteland
Global Management LLC
Partnering Across Cultures
The Two Iron Rules of International Negotiation:
• The seller adapts to the buyer.
• Before starting negotiations, understand the business culture.
And what is a Business Culture?
“A set of expectations and assumptions about how people should do business.”
Negotiating Across Cultures -Five Key Variables:
• Deal-Focus vs Relationship-Focus
• Direct vs Indirect Communication
• Informal vs Formal Business Behavior
• Monochronic vs Polychronic Time
• Reserved vs Expressive Communication
Comparing Deal-Focused and Relationship-Focused Negotiating Behavior
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Deal-Focused Business Cultures:
• The Anglo Cultures: North America, UK, Australia and New Zealand.
• The Germanic Cultures: Germany, Netherlands, Nordic Countries
Moderately Deal-Focused Cultures:
• France, Belgium, Southern Europe
• Russia, Eastern Europe, Central Europe
• Hong Kong and Singapore
Relationship-Focused Cultures:
• Asia except Hong Kong and Singapore
• Middle-East, most of Africa
• Latin America
• (= most of the world!)
D-F Behavior: R-F Behavior:
• Direct contact often works.
• Face-to-face meetings less frequent.
• Usually use direct language.
• Indirect contact is expected.
• More frequent.
• Often use indirect language.
Communication and Context:
• Relationship-oriented people often use High-Context (indirect) language.
• Deal-oriented people mostly use Low-Context (direct) language.
Some reasons R-F negotiators
avoid saying „no‟
• To avoid disappointing you.
• To avoid losing face.
• To avoid causing loss of face.
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D-F Behavior: R-F Behavior:
• Maintaining harmony is not a big issue.
• People depend on the legal system.
• Written agreements are considered final.
• Maintaining harmony is VERY important.
• People depend on relationships.
• Contracts are considered to be renegotiable.
Comparing Egalitarian and Hierarchical Negotiating Behavior
Egalitarian: More Hierarchical:
• Nordic countries
• North America
• Australia, New Zealand
• Britain
• Most of Continental Europe
• Asia, Africa, Latin
America, Middle East
Egalitarian: Hierarchical:
• Informal behavior.
• Status differences are small.
• Protocol rituals are
simpler.
• Formal behavior.
• Status differences are large.
• Protocol rituals are
more elaborate.
Comparing Monochronic and
Polychronic Negotiating BehaviorMonochronic Business Cultures:
• Germans and German-Swiss (very monochronic)
• Northern Europeans, North Americans
• Czech Republic, Hungary, Japan
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Polychronic Business Cultures:
• Southern and Eastern Europe, East Asia
• Latin America
• South and Southeast Asia, Middle East, most of Africa (very polychronic)
Monochronic: Polychronic:
• Punctuality is expected.
• Meetings usually follow an agenda.
• It is rude to interrupt meetings.
• People tend to be less punctual.
• Meetings may not follow an agenda.
• Meetings are often interrupted.
Comparing Reserved and Expressive Negotiating Behavior
Emotionally Reserved Cultures:
• Northern Europe, Britain
• East and Southeast Asia (very reserved)
Moderately/Variably Expressive:
• North America, Australia, New Zealand
• Eastern and Central Europe
• South Asia
Very Expressive Cultures:
• Southern Europe
• Middle East, Mediterranean region
• Latin America
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Reserved and Expressive Nonverbal Communication – Four Key Variables:
• Interpersonal distance
• Eye contact
• Touch behavior
• Gestures
Interpersonal Distance:
• Close: Middle East, Latin America, Southern Europe.
• Variable: North America, East and Central Europe, South Asia, Australia/NZ
• Distant: Northern Europe, East Asia
Eye Contact:
• Intense: Middle East, Southern Europe, Latin America
• Moderate: Northern Europe, North America, East-Central Europe.
• Indirect: East and Southeast Asia
Touch Behavior:
• High Contact: Middle East, France, Southern Europe, Latin America.
• Moderate: Eastern and Central Europe, North America.
• Low Contact: Northern Europe.
• Very Low Contact: East and Southeast Asia.
Ambiguous Gestures:
• Use of left hand
• Showing sole of shoe
• ‘Thumbs up’ sign
• ‘Peace’ sign
• ‘A-OK’ sign
• Pointing/beckoning with index finger.
To Achieve Lasting
Partnerships Across Cultures:
• Learn your partner’s business culture.
• Build strong personal relationships.
• Work to develop a Third Culture with your partners.
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Thank you…and best of luck in
your International Negotiations!
Richard R. Gesteland
Global Management USA