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How Culture Affects Negotiations

Culture plays an important role in the negotiation process when people from different countries get involved.

 Here are some ways different cultural nuances impact the end result of reaching an agreement on different ideas and needs between the negotiating parties:

·        Negotiating Goal : Relationship versus contract

For many Americans a contract is a binding agreement between two or more parties who see it as “a deal is a deal”. The Japanese, on the other hand, view a contract as a document that is conducive change and open relationships.

·        Personal Style: Formal or Informal?

The American style is extremely informal and people address each other by their first names. The majority of Asian cultures prefer formality until they establish a comfort level to be informal in their negotiation process. American negotiators also prefer simple and direct communication styles and have hard time adapting to the ritualistic and hierarchical styles that are reflected in other cultures.

·        Communication: Direct or Indirect

Some cultures use a great amount of gestures, facial expressions and other kinds of body language to make their point during the negotiating process. Communication styles can be viewed within the framework of “high context” or “low context”. Asian cultures have communication styles which are considered as “high context”, which means that the message is embedded within the communication and it is the receiver’s responsibility to find out the true intent of the message being sent to them. Other countries, such as the United States, Canada and the most of the European countries, have “low- context” cultures. The meaning of the message is explicit in what and how it is stated, not within the context that is understood by the receiver. U.S. negotiators like direct and open communication and are very bottom-line oriented. People from “high context” cultures may find the American approach to be inconsiderate and insensitive.

Americans are also fond of their space in their organizational lives. Clichés such as “give me some space”, “get out of my face”, and “back off” are ways to demonstrate their preference of having room while they are communicating with others.

·        Sensitivity of time: high or low?

Americans are obsessed with time and see as time is money. Germans are always punctual, Japanese take more time in negotiating and people in Latin are usually late to their appointments.

·        Form of agreement: General or Specific?

Americans prefer a specific agreement that covers every contingency because the deal is the contract. The Chinese prefer a general contract that serves opening relationships.

·        Risk taking: High or Low?

Some cultures are open to uncertainties and different approaches. Japanese are generally risk-averse, while Americans are risk takers.

·        Gender Issues

International business is still dominated by men. The best way to get around the gender issue in a country where women are repressed is to have the woman negotiator introduced by a counterpart who is a respected and trusted person or authority in that country.

 

About the Author:
 
Ayse Oge is a business woman, author, public speaker and consultant, provides counseling for small and medium sized companies on international trade. She is author of books, “Go Global to Win” and “Global Business Guide” and currently serving as Vice-Chairwoman of Valley International Trade Association and Score Counselor on exporting at Glendale, California. Her website is www.goglobaltowin.com.
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