tips on negotiating better in cross-cultural relationships

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Tips on Negotiating Better in Cross-Cultural Relationships Track 3-World Class Negotiation Techniques The 63rd Annual Southwest Purchasing Conference By Thomas L. Tanel, C.P.M., CTL, CCA, CISCM , CATTAN Services Group, Inc. College Station, TX [email protected] Created by CATTAN Services Group, Inc. © 2009

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Nowadays, organizations of all sizes search for suppliers on a global level. International competition, foreign suppliers, and global sourcing may become a danger, but they may also create huge opportunities to develop your business. The increasingly global business environment requires purchasers to approach the negotiation process from the global business person’s point of view. When you understand the personal, national, or organizational culture of your negotiation counterpart, then you can seek to align with them and hence gain greater influence. In this presentation, we attempt to bring these patterns of awareness to your attention:  Cross Cultural Communications and Negotiations  Hall’s Context, Chronomics, and Proxemics  Hofstede’s Five Key Elements of Culture  Paralanguage and Tips on Negotiation Better So what?...you say. Given that cultural differences exist, the issue becomes how do they influence negotiations. Even though language molds thinking, other cultural classifications have a pervasive effect on how the world is perceived, how the self is experienced, and how life is organized. Learning to communicate and negotiate business across cultural boundaries is paramount as today’s workplace rapidly changes because:  The business environment expands to include various geographic locations and span numerous cultures and,  The United States becomes more multi-culturally and ethnically diverse.

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Page 1: Tips on Negotiating better in Cross-Cultural Relationships

Tips on Negotiating Better in Cross-Cultural Relationships

Track 3-World Class Negotiation Techniques

The 63rd Annual Southwest

Purchasing ConferenceBy

Thomas L. Tanel, C.P.M., CTL, CCA, CISCM ,

CATTAN Services Group, Inc.College Station, [email protected]

Created by CATTAN Services Group, Inc. © 2009

Page 2: Tips on Negotiating better in Cross-Cultural Relationships

Negotiating in the Global Arena

Page 3: Tips on Negotiating better in Cross-Cultural Relationships

The Importance of Culture• Culture comes from the Latin word "colere",

meaning to build on, to cultivate, to foster. • Culture is a set of accepted behavior patterns,

values, assumptions, and shared common experiences.

• Culture defines social structure, decision-making practices, and communication styles.  

• Culture dictates behavior, etiquette, and protocol.  

• Culture is something we learn.  • Culture is communication. 

Page 4: Tips on Negotiating better in Cross-Cultural Relationships

Cultural Sensitivity

• When negotiating make it a point to know your counterparts.

• Communicate in a form that will most likely be understood as it is intended.

• This means the negotiator must:– Be aware of their own culture– The recipient’s culture– The expectations surrounding the situation

Page 5: Tips on Negotiating better in Cross-Cultural Relationships

How Culture Impacts Negotiation

• By conditioning one’s perception of reality

• By blocking out information inconsistent or unfamiliar with culturally grounded assumptions

• By projecting meaning onto the other party’s words and actions

• By pushing the ethnocentric negotiator to an incorrect attribution of motive

Page 6: Tips on Negotiating better in Cross-Cultural Relationships

Cross-Cultural Negotiations Involve

Page 7: Tips on Negotiating better in Cross-Cultural Relationships

The Communication Process

Cultural communications are deeper and more complex

than spoken or written messages. The essence of

effective cross-cultural communication has more to do with releasing the right

responses than with sending the “right” messages.

—Hall and Hall

Page 8: Tips on Negotiating better in Cross-Cultural Relationships

Hall’s Cultural Factors

• Context

• Time

• Space

Page 9: Tips on Negotiating better in Cross-Cultural Relationships

High and Low Context

• In a high-context culture, there are many contextual elements that help people to understand the rules.

• As a result, much is taken for granted.

• In a low-context culture, very little is taken for granted.

• This means that more explanation is needed.

Page 10: Tips on Negotiating better in Cross-Cultural Relationships

High Context and Low Context Cultures

Source: Munter, M. ”Cross-cultural Communications for Managers”, Business Horizons, May/June 1993.

Page 11: Tips on Negotiating better in Cross-Cultural Relationships

 Factor High-Context

Culture 

 Low-Context Culture

 

Overtness of messages

Many covert and implicit messages, with use of metaphor and “reading between the lines”.

Many overt and explicit messages that are simple and clear.

 

 Locus of control and attribution

for failure

Inner locus of control and personal acceptance for failure.

Outer locus of control and blame of others for failure.

 Use of non-verbal communication

Much nonverbal communication.

More focus on verbal communication than body language.

Contrasting the Two Contexts

Page 12: Tips on Negotiating better in Cross-Cultural Relationships

 Factor High-Context

Culture 

 Low-Context Culture

 

Expression of reaction Reserved, inward reactions. Visible, external, outwardReaction.

Cohesion andseparation of groups

Strong distinction  between in-group and out-group. Strong sense of family.

Flexible and open grouping patterns, changing as needed.

 People bonds Strong people bonds withaffiliation to family and community

Fragile bonds betweenpeople with little sense of loyalty.

Level of commitment to relationships

High commitment to long-term relationships.Relationship more

important than task.

Low commitment to relationship. Task more important than relationships.

Flexibility of time

 

Time is open and flexible.Process is more important than product.

Time is highly organized.Product is more important than process.

Contrasting the Two Contexts

Page 13: Tips on Negotiating better in Cross-Cultural Relationships

Cultural Impact on Messages and Context in Negotiations

Source: Adapted from Edward Hall’s book Beyond Culture, 1976.

Page 14: Tips on Negotiating better in Cross-Cultural Relationships

Chronomics: Time Orientation and

Predictable Patterns • Monochronic or M-Time,

as Hall called it, means doing one thing at a time.

• Monochronic people tend also to be low context.

• In Polychronic cultures, human interaction is valued over time and material things, leading to a lesser concern for 'getting things done‘

• Polychronic people tend also to be high context.

Page 15: Tips on Negotiating better in Cross-Cultural Relationships

Chronomics—Country Comparison with

Differing Time Orientation Systems

Monochronic• Germany • Canada • Switzerland• Australia • United States • Scandinavia

Polychronic• Saudi Arabia • France• Egypt • Greece• Mexico • Philippines

Page 16: Tips on Negotiating better in Cross-Cultural Relationships

Culture & Chronomics Decision Making:“Process Time” versus “Implementation Time”

Process Implementation

Process Implementation

UNITED STATES

Process Implementation

JAPAN

Process Implementation

Page 17: Tips on Negotiating better in Cross-Cultural Relationships

Hall’s Cultural Space Orientation• Space also relates to comfort with

eye contact and attributions related to eye contact or lack of eye contact.

• There are large differences in spatial preferences according to gender, age, generation, socioeconomic class, and context.

• These differences vary by group, but should be considered in any exploration of space as a variable in negotiations.

Space orientations differ across cultures, according to Hall.

Page 18: Tips on Negotiating better in Cross-Cultural Relationships

Space and Proxemics

• Hall was concerned about space and our relationships within it.

• He called the study of such space-Proxemics.

• Some people need more space in all areas.

• People who encroach into that space are seen as a threat.

• Some people are more territorial than others with greater concern for ownership.

Page 19: Tips on Negotiating better in Cross-Cultural Relationships

Edward Hall's Definitions of Space

• Hall's most famous innovation has to do with the definition of the informal, or personal spaces that surround individuals:– Intimate space--the closest "bubble" of space

surrounding a person. – Social and consultative spaces--the spaces in which

people feel comfortable conducting routine social interactions with acquaintances as well as strangers.

– Public space--the area of space beyond which people will perceive interactions as impersonal and relatively anonymous.

Page 20: Tips on Negotiating better in Cross-Cultural Relationships

Edward Hall's Theory of Proxemics and Personal Space

The nature of the message communicated also affects interaction distances.  Average comfortable distances among North Americans are shown below:

  Distance Between Faces Tone of Voice Type of Message

  Very close (3-6")   Soft whisper   Top secret or Sensual

  Close (8-12")   Audible whisper   Very confidential

  Neutral (20-36")  Soft voice

Low volume    Personal subject matter

  Neutral (4.5-5')   Full voice   Non-personal information 

  Across the room (8-20')   Loud voice   Talking to a group

  Stretching the limits  (20-24' indoors and  up to 100' outdoors)

  Loud hailing voice   Departures and arrivals

Derived from The Silent Language by Edward Hall (1959)

Page 21: Tips on Negotiating better in Cross-Cultural Relationships

Proxemics: High Territoriality Versus Low Territoriality

• High territoriality people seek to mark out the areas which are theirs.

• Territoriality also extends to anything that is 'mine' and ownership concerns extend to material things.

• Security thus becomes a subject of great concern for people with a high need for ownership.

• People with high territoriality tend also to be low context.

• People with lower territoriality have less ownership of space and boundaries are less important to them.

• They will share territory and ownership with little thought.

• They also have less concern for material ownership.

• People with low territoriality tend also to be high context.

Page 22: Tips on Negotiating better in Cross-Cultural Relationships

Proxemics: High Territoriality Versus Low Territoriality

Typical American Office

Typical Japanese Office

Page 23: Tips on Negotiating better in Cross-Cultural Relationships

Geert Hofstede Model of Cultural Dimension Analysis

• Dr. Geert Hofstede conducted perhaps the most comprehensive study of how values in the workplace are influenced by culture.

• From 1967 to 1973, while working at IBM as a psychologist, he collected and analyzed data from over 100,000 individuals from forty countries.

Page 24: Tips on Negotiating better in Cross-Cultural Relationships

Geert Hofstede Dimension Analysis

“Culture is more often a source of conflict than of synergy.

Cultural differences are a nuisance at best and often a disaster." --Dr. Geert Hofstede

Page 25: Tips on Negotiating better in Cross-Cultural Relationships

Professor Geert Hofstede’s—The Five Dimensions of Culture

• Power/Distance (PD)

• Individualism (IDV)

• Masculinity (MAS)

• Uncertainty Avoidance Index (UAI)

• Long Term Orientation (LTO)

Page 26: Tips on Negotiating better in Cross-Cultural Relationships

Hofstede’s Model—Power/Distance (PD)

  Characteristics Tips

High PD

Centralized companies. Strong hierarchies. Large gaps in compensation,

authority, and respect.

Acknowledge a leader's power.

Be aware that you may need to go to the top for answers

Low PD

Flatter organizations. Supervisors and employees

are considered almost as equals.

Use teamwork Involve as many people as

possible in decision making.

Page 27: Tips on Negotiating better in Cross-Cultural Relationships

Culture Dimension Score for 10 Countries—Power/Distance (PD)

Page 28: Tips on Negotiating better in Cross-Cultural Relationships

Hofstede’s Model—Individualism (IDV)

  Characteristics Tips

High IDV

High valuation on people's time and their need for freedom.

An enjoyment of challenges, and an expectation of rewards for hard work.

Respect for privacy.

Acknowledge accomplishments. Don't ask for too much personal

information. Encourage debate and expression

of own ideas.

Low IDV

Emphasis on building skills and becoming masters of something.

Work for intrinsic rewards. Harmony more important than

honesty.

Show respect for age and wisdom. Suppress feelings and emotions to

work in harmony. Respect traditions and introduce

change slowly.

Page 29: Tips on Negotiating better in Cross-Cultural Relationships

Culture Dimension Score for 10 Countries—Individualism (IDV)

Page 30: Tips on Negotiating better in Cross-Cultural Relationships

Hofstede’s Model—Masculinity (MAS)

  Characteristics Tips

High MAS

Men are masculine and women are feminine.

There is a well defined distinction between men's work and women's work.

Be aware that people may expect male and female roles to be distinct.

Advise men to avoid discussing emotions or making emotionally based decisions or arguments.

Low MAS

A woman can do anything a man can do.

Powerful and successful women are admired and respected.

Avoid an "old boys' club" mentality. Ensure job design and practices are

not discriminatory to either gender. Treat men and women equally.

Page 31: Tips on Negotiating better in Cross-Cultural Relationships

Culture Dimension Score for 10 Countries—Masculinity (MAS)

Page 32: Tips on Negotiating better in Cross-Cultural Relationships

Hofstede’s Model—Uncertainty Avoidance Index (UAI)

  Characteristics Tips

High UAI

Very formal business conduct with lots of rules and policies.

Need and expect structure. Sense of nervousness spurns high

levels of emotion and expression. Differences are avoided.

Be clear and concise about your expectations and parameters.

Plan and prepare, communicate often and early, provide detailed plans and focus on the tactical aspects of a job or project.

Express your emotions through hand gestures and raised voices.

Low UAI

Informal business attitude. More concern with long term strategy

than what is happening on a daily basis.

Accepting of change and risk.

Do not impose rules or structure unnecessarily.

Minimize your emotional response by being calm and contemplating situations before speaking.

Express curiosity when you discover differences.

Page 33: Tips on Negotiating better in Cross-Cultural Relationships

Culture Dimension Score for 10 Countries—Uncertainty Avoidance Index (UAI)

Page 34: Tips on Negotiating better in Cross-Cultural Relationships

Hofstede’s Model—Long Term Orientation (LTO)

  Characteristics Tips

High LTO

Family is the basis of society. Parents and men have more

authority than young people and women.

Strong work ethic. High value placed on education

and training.

Show respect for traditions. Do not display extravagance or

act frivolously. Reward perseverance, loyalty,

and commitment. Avoid doing anything that would

cause another to "lose face".

Low LTO

Promotion of equality. High creativity, individualism. Treat others as you would like to

be treated. Self-actualization is sought.

Expect to live by the same standards and rules you create.

Be respectful of others. Do not hesitate to introduce

necessary changes.

Page 35: Tips on Negotiating better in Cross-Cultural Relationships

Culture Dimension Score for 10 Countries—Long Term Orientation (LTO)

Page 36: Tips on Negotiating better in Cross-Cultural Relationships

West versus East Cultural Values:Hall’s and Hofstede’s Data Applied

Dimensions United

States

United

Kingdom

Singapore Korea

Power

Distance

Small Small Large Large

Individualism Individualist Individualist Collectivist Collectivist

Masculinity Masculine Masculine Feminine Feminine

Uncertainty

Avoidance

Weak Weak Strong Strong

Time Perspective

& Orientation

Monochronic

Short-term

Monochronic

Short-term

Polychronic

Long-term

Polychronic

Long-term

Communication

Context

Low

Context

Low

Context

High

Context

High

Context

Page 37: Tips on Negotiating better in Cross-Cultural Relationships

Principles of Paralanguage

• Paralanguage refers to  the vocal

aspect of communication.

• Vocal elements of language vocal

elements involve sound and its

manipulation for certain desired or

undesired effects.

• Verbal elements are the particular

words we choose when speaking.

Page 38: Tips on Negotiating better in Cross-Cultural Relationships

Ingredients of Paralanguage: Voice Qualifiers and Segregates

Voice Qualifier Examples:

• Intensity • Pitch• Resonance • Tempo

Voice Segregate Examples:

• “Uh" • “Um" • “Uh-huh" • Silent pauses

Page 39: Tips on Negotiating better in Cross-Cultural Relationships

Messages in the Voice—Infer Emotional States

Feeling Intensity Pitch Resonance Tempo Enunciation

Anger Loud High Blaring Fast Clipped

Joy Loud High Moderately Blaring

Fast Somewhat Clipped

Sadness Soft Low Booming Slow Slurred

Page 40: Tips on Negotiating better in Cross-Cultural Relationships

Nonverbal Communication: Kinesics and Proxemics Acts

• Kinesics: The study of nonverbal gestures, facial expressions, eye contact, and body posture.

• Proxemics: The study of the use of space, touch, and distance as features of nonverbal communication.

Page 41: Tips on Negotiating better in Cross-Cultural Relationships

Other Non-Verbal Communication

1. Haptics Touch, Arm and Hand Movements

2. Paralanguage Non-Verbal Elements of Speech

3. Paraverbal Non-Lexical Aspects of Verbal Communication

4. Olfactory Smells

Page 42: Tips on Negotiating better in Cross-Cultural Relationships

Non-Verbal Communication— Dangers of Overgeneralizations• We cannot assume everybody in a culture behaves the

same way

• Infrequent actions should not be used to characterize a culture

• We should not ignore that nonverbal behaviors are part of complex communication processes

Page 43: Tips on Negotiating better in Cross-Cultural Relationships

Silence: Is Also Part of Nonverbal Communication

• Sends nonverbal clues during communication

• Culturally determined

• Igbos Tribe of Nigeria adage: It’s not the sound you hear that I will have

to dance to.

Page 44: Tips on Negotiating better in Cross-Cultural Relationships

Silence As A Part of Cultural Communication

• The distribution of speaking and silence in conversations is influenced by the specific individual participants.

• But it is also something which is observed and interpreted very differently in different cultures.

• Silence can shape sequences of speech, carry meaning, and organize the social relationships between speakers.

Page 45: Tips on Negotiating better in Cross-Cultural Relationships

Recent Cross-Cultural Negotiation Lessons Learned

• Greeks: Relationships are the linchpin of business dealings, since Greeks prefer to do business with those they know and trust. Greeks prefer face-to-face meetings rather than doing business by telephone or in writing. Business is conducted slowly. Greeks are skilled negotiators and they love to argue and debate.

• Malaysians: Focus on the credibility of your organization and its management and leadership. Negotiations will be lengthy and you should have every detail of your proposal worked out before presenting it. Building long-term relationships with individuals from Malaysia is a long-term process. Remember to remind them frequently of your offer---the repetition of key points in your proposal.

• Argentineans: Decisions are made at the top and you often need several meetings and extensive discussion to make deals. Argentines are tough negotiators. Concessions will not come quickly or easily. Good relationships with counterparts will shorten negotiations. Be punctual for business appointments, but be prepared to wait for your counterpart. Spanish is heavily influenced by Italian and is unlike Spanish spoken anywhere else.

Page 46: Tips on Negotiating better in Cross-Cultural Relationships

Recent Cross-Cultural Negotiation Lessons Learned

• Indians: The pace of business meetings in India is comparatively far more relaxed than in the United States. Indians are somewhat lax about time. The word “No" has harsh implications in India. Remember that hierarchy, titles and degrees are very important. More open to unstructured ideas and situations but very literal in some respects.

• Chinese: Be aware of their non-verbal messages and provide them with enough information for their decision-making process which is slow. Allow them to “save face”. The most important member of your negotiation team should lead important meetings. Chinese value rank and status as well as a long-term approach.

• Arabs: Communications occur at a slow pace. "Yes" usually means "possibly". Arabs will also employ some body contact to emphasize a point or confirm that they have your attention. It is important not to draw back, however. This may be interpreted as a rebuff or rejection of what is being said. Respect is a value that is held very highly by the Arab people. Be aware that they may use deceptive price-negotiation strategies––don't give away your minimum acceptable position too soon or be taken in by their flattery.

Page 47: Tips on Negotiating better in Cross-Cultural Relationships

Cross-Cultural Tips—Not Everyone Negotiates Like Americans• Cultural differences influence negotiations

• Intercultural differences may cause misperception and misunderstandings

• Body language is important at the local cultural level

• Subculture issues may be present

• Moderate adaptation to a counterpart’s culture is perceived positively

Page 48: Tips on Negotiating better in Cross-Cultural Relationships

Cross-Cultural Negotiation Degree of Difficulty for Americans

• Africa• Middle East• Far East• South America• Eastern Europe/Russia• Western Europe/Scandinavia• Australia/New Zealand

Highest

Lowest

Page 49: Tips on Negotiating better in Cross-Cultural Relationships

Cross-Cultural Tips—Perceptions & Negotiations

• Discovering the other side’s interests is an exercise in discovering perceptions.

• Appreciating perceptions helps us distinguish between people and problems.

• Understanding perceptions can expand the range of possible solutions to achieve negotiations rapport with the other side.

Page 50: Tips on Negotiating better in Cross-Cultural Relationships

THANKS—Questions???