International and Cross-Cultural Negotiation

Aug 21, 2019

3 min read

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When you prepare for a cross-cultural negotiation, you often think thoroughly about how the culture of your counterpart might affect communication. You need to predict what will they say and how will they act during the negotiation, so you can respond appropriately and lead the meeting in the desired direction. It is quite common for entrepreneurs to analyse their partners during cross-cultural communication and negotiation in international business.

Cross-cultural business communication has different success rating and rules compared to negotiation between two parties from the same culture. One particular study conducted by Harvard University looked through the nature and quality of communication between American and Chinese subjects. The final result showed that culture differences are indeed fertile soil for bad communication, proving that problems in cross-cultural negotiations are a real obstacle.

On the other hand, the study also showed that cross-cultural negotiations lead by individuals who succeeded to find common ground and maintain good communication, were more fruitful and satisfactory for both sides, compared to those from the same cultural background.

Why though? 

Because both parties spoke English very well, and they didn’t ignore their differences, but rather used them to gain common advantage and capitalise. Overall, the study showed that there are many benefits to be gained from cross-cultural international negotiation and the only way to success is breaking down the barriers with respect for each other.

One thing is for sure, if you understand cultural differences, you will have the upper hand when negotiating. Everything from your personal life can help – movies, TV documentaries, books or previous experience. Doing research beforehand can save you a lot of embarrassment and money.

Another interesting example we want to investigate is the one between U.S and Japanese negotiators. They were asked to explain how they prepared for meetings with companies from their own culture and companies from a different culture. The study showed that participants went too far with the adaption process. Practically, they expected from the other side to negotiate like they do at home, not predicting that the other side would adjust their own negotiating strategy the same way they did. In the end, both sides tried to adopt a strategy that was stereotypical and they failed gloriously with their international and cross-cultural negotiation. Cultural stereotypes led to culture clashes, hence failed negotiations.

Conclusion

International and cross-cultural negotiation is a complex and hard task for inexperienced entrepreneurs. If you try too hard, you will fail. Alternatively, if you don’t prepare enough you will fail again. That’s why a balanced negotiating strategy must be developed. One that wouldn’t offend your counterpart with a stereotypical approach while respecting their cultures and traditions.

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