Meetings and negotiations in the intercultural context

Beginnings:

Meetings are not begun in the same way as we move from culture to culture.  Some are opened punctually, briskly and in a “businesslike fashion.  Others start with chitchat, and some meetings have difficulty getting going at all. 

The following table gives some examples of different kinds of starts in a selection of countries.

Name of the country

Duration of warm up time

Custom

Germany

 A few minutes

Formal introduction. Sit down. Begin.

Finland

A few minutes

Formal introduction.  Cup of coffee. Sit down. Begin.

U. S

A few minutes

Informal introduction.  Cup of coffee. Wisecrack. Begin.

U. K.

10 minutes

Formal introduction.  Cup of tea and biscuits.  10 mins. Small talk (weather, comfort, sport). Casual beginning.

France

15 minutes

Formal introduction.  15 mins.  Small talk (politics, scandal, etc.) Begin.

Japan

15-20 minutes

Formal introduction.  Protocol seating. Green tea. Small talk (harmonious, pleasantries).  Sudden signal from senior Japanese. Begin.

Spain/Italy

20-30 minutes

Small talk (soccer, family matters) while others arrive.  Begin when all are there.

Structuring a meeting

Monochronic people are fond of strict agendas; others, more imaginative minds, (usually Latins) tend to wander, wishing to revisit or embellish, at will, points already discussed.  Asians, especially Japanese, concentrate on harmonizing general principles prior to examining any details. 

Guidelines for the chairperson to structure the meeting:

1.     Be sensitive to the expectations of various cultures and be quick to define a mutually shared aim. 

2.     Address contrasting requirements openly and analyse certain wishes; accommodate a few of these. 

3.     Cultivate tolerance and a sense of humor.

Meeting behaviour and comportment

The non-verbal and the physical comportment of participants is of utmost importance and varies to a great degree. You must pay attention to factors such as venue, comfortable seating arrangements, hierarchy of seating, dress (formal or informal), deliberate use of silence, listening habits and the importance given to protocol. 

Negotiating

Managing Cross-cultural negotiations:

Negotiation is the process of bargaining with one or more parties to arrive at a solution that is acceptable to all.  It has been estimated that managers can spend 50 percent or more of their time on negotiation processes.  Therefore, it is a learnable skill that is imperative not only for the international manager but for the domestic manager as well, since more and more domestic businesses are operating in multicultural environments.  Negotiation often follows assessing political environments and is a natural approach to conflict management.  Often the MNC must negotiate with the host country to secure the best possible arrangements.  The MNC and the host country will discuss the investment the MNC is prepared to make in return for certain guarantees or concessions.  The initial range of topics typically includes critical areas such as hiring practices, direct financial investment, taxes, and ownership control.  Negotiation also is used in creating joint ventures with local firms and in getting the operation off the ground.  After the firm is operating, additional areas of negotiation include expansion of facilities, use of more local managers, additional imports or exports of materials and finished goods, use of more local managers, additional imports or exports or materials and finished goods, and recapture of profits (Luthans & Doh, p.204)

When different cultures are involved in negotiations, the approach of each side will be defined or influenced by cultural characteristics.  Nationals of different cultures could negotiate in completely different ways.  For example, Germans will ask you all the difficult questions from the start.  You must convince them of your efficiency, quality of goods and promptness of service.  These are features Germans consider among their own strong cards and they expect the same from you, at the lowest possible price.  They will give you little business at first but will give you much more later when they have tested you – and if you prove trustworthy and your product of good quality.  The French tend to move much faster, but they may also withdraw their business more quickly.  Spaniards often seem not to appreciate the preparations you have made to facilitate a deal.  They do not study all the details of your proposal or play, but they do study you.  They will do business with you if they like you and think you are honourable.

Although the examples described above could help you categorize cultures in terms of negotiating behaviours, they could also mislead, making it difficult to “see” the priorities or intention pattern of others.  Stereotyping is one of the flaws in the master programming supplied by our culture that often leads us to make false assumptions.  Here are three examples:

1.     French refusal to compromise indicates obstinacy (Reality: The French see no reason to compromise if their logic stands undefeated)

2.     Japanese negotiators cannot make decisions (Reality: The decision was already made before the meeting, by consensus.  The Japanese see meetings as an occasion for presenting decisions, not changing them.)

3.     Mexican senior negotiators are too “personal” in conducting negotiations.  (Reality: Their personal position reflects their level of authority within the power structure back home).

It is important to note the cultural differences in terms of various aspects of negotiations:

1.     Values : The following table shows how different cultures place emphasis on different values and rituals:

Americans

Statistical data and personal drive to compress as much action and decision making as possible into the hours available

Germans

Emphasis on thoroughness, punctuality and meeting deadlines, require full information and context

French

Pride of place to logic, rational argument, aesthetics of the discussion; so imaginative debating style and preoccupation with the proper form

Japanese

Have their own aesthetic norms; value the creation of harmony and quiet “groupthink”

British

Priority to quiet, reasonable, diplomatic discussion; preoccupation with “fair play” and using it as a yardstick for decision making

Latins

Emphasis on personal relationships, honourable confidences and the development of trust between parties

2.     Compromise:

When negotiations enter a difficult stage (for example, a deadlock), each culture will use a well-tried mechanism: changing negotiators or the venue, adjourning the session or “repackaging the deal” to regain momentum and save loss of face for either side.  For instance, the Arabs teams will take a recess for prayer, Japanese delegations will bring in senior executives to “see what the problem is”; Swedish opponents will go out drinking together; Finns will retire to the sauna.

However, such mutually agreeable mechanisms are not available in international negotiations.  Anglo-Saxons and Scandinavians may use compromise as a mechanism for breaking a deadlock.  Other cultures may view compromise in an unfavourable light and remain unconvinced of its merit.  For the French, it may be an inelegant, crude tactic for chiselling away at the legitimate edifice of reason they have so painstakingly constructed.  The Japanese prefer an adjournment to compromise during a negotiation as it is a departure from a company-backed consensus.  The Spaniards and South Americans see compromise as a threat to their dignity; several nations, including Argentina, Mexico and Panama, display obstinacy in conceding anything to “insensitive, arrogant Americans”. 

Intelligent, meaningful compromise is only possible when one is able to see how the other side prioritizes its goals and views the related concepts of dignity, conciliation and reasonableness.  These are culturally relative concepts and an effort to accommodate them form the unfailing means of unblocking the impasse.  These moves require knowledge and understanding of the traditions, cultural characteristics and ways of thinking of the other side.

3.     Decision making: Negotiations lead to decisions.  How these are made, how long they take to be made and how final they are once made are all factors that will depend on the cultural groups involved.  Americans love making decisions because they usually lead to action and Americans are primarily action oriented.  The French love talking about decisions, which may or may not be made in the future.  If their reasoned arguments do not produce what in their eyes is a logical solution, then they will delay decisions for days or weeks if necessary.  The Japanese hate making decisions and prefer to let decisions be made for them by gradually building up a weighty consensus.  This exasperates Americans and many North Europeans, but the Japanese insist that big decisions take time.  They see American negotiators as technicians making a series of small decisions to expedite one (perhaps relatively unimportant) deal.  Once the Japanese have made their decisions, however, they expect their American partner to move like lightning toward implementation.  This leads to further exasperation. 

Mediterranean and Latin American teams look to their leader to make decisions and do not question his or her personal authority.  The leader’s decision making, however, will not be as impromptu or arbitrary as it seems.  Latins, like the Japanese, tend to bring a cemented-in position to the negotiating table, which is that of the power structure back home.  This contrasts strongly with the Anglo-Saxon and Scandinavian willingness to modify stances continuously during the talk if new openings are perceived.  Once a decision has been made, the question arises as to how final and binding it is.  Anglo-Saxons and Germans see a decision, once it has been entered into the minutes of a meeting, as an oral contract that will shortly be formalized in a written, legal document.  Ethically, one sticks to one’s decisions.  Agenda items that have been agreed on are not to be resurrected or discussed again.  Neither Japanese nor Southern Europeans see anything wrong, ethically, in going back to items previously agreed on.  “Chop and change” (anathema in Anglo-Saxons) holds no terrors for many cultures.

The French show a lack of respect for adherence to agenda points or early mini-decisions.  This is due not so much to their concern about changing circumstances as to the possibility (even likelihood) that, as the discussions progress, Latin imagination will spawn clever new ideas, uncover new avenues of approach, improve and embellish accords that later may seem naïve or rudimentary.  For them a negotiation is often a brainstorming exercise.  Brainwaves must be accommodated!  Italians, Spanish, Portuguese and South Americans all share this attitude.

4.     Contracts:

Diverse ethical approaches or standards reveal themselves in the way diverse cultures view written contracts.  Americans, Germans, Swiss and Finns are among those who regard a written agreement as something that, if not holy, is certainly final. 

For the Japanese, on the other hand, the contract they were uncomfortable in signing anyway, is merely a statement of intent.  They will adhere to it as best as they can but will not feel bound by it if market conditions suddenly change, if anything in it contradicts common sense, or if they feel cheated or legally trapped by it.  New tax laws, currency devaluations or drastic political changes can make previous accords meaningless.  If the small print turns out to be rather nasty, they will ignore or contravene it without qualms of conscience.  Many problems arise between Japanese and U. S firms on account of this attitude. 

The French tend to precise in the drawing up of contracts, but other Latins require more flexibility in adhering to them.  An Italian or Argentinean sees the contract as either an ideal scheme in the best of worlds, which sets out the prices, delivery dates, standards of quality and expected gain, or as a fine project that has been discussed.  But the way they see it, we do not live in the best of worlds, and the outcome we can realistically expect will fall somewhat short of the actual terms agreed.  Italian flexibility in business often leads Anglo-Saxons to think they are dishonest.  They frequently bend rules, break or get around some laws and put a very flexible interpretation on certain agreements, controls and regulations.  There are many gray areas where shortcuts are, in Italian eyes, a matter of common sense.  In a country where excessive bureaucracy can hold “business up” for months, smoothing the palm of an official or even being related to a minister is not a sin.  It is done in most countries, but in Italy they talk about it. 

Solutions

Cross cultural factors will continue to influence international negotiation and there is no general panacea of strategies which ensure quick understanding.  The only possible solutions lie in a close analysis of the likely problem.  These will vary in the case of each negotiation; therefore, the combination of strategies required to facilitate the discussions will be specific on each occasion.  Before the first meeting is entered into, the following questions should be answered:

1.     How much protocol does the other side expect? (Formality, dress, agenda)

2.     Which debating style does the other side expect? (Deductive, inductive, free-wheeling, aggressive, courteous)

3.     Who on their side is the decision maker? (One person, several, or only consensus?)

4.     How much flexibility can be expected during negotiation? (Give-and-take, moderation, fixed positions?)

5.     How sensitive is the other side? (National, personal?)

6.     How much posturing and body language can be expected? (Facial expressions, impassivity, gestures, emotion?)

7.     What are the likely priorities of the other side? (Profit, long-term relationship, harmony, victory?)

8.     How wide is the cultural gap between the two sides? (Logic, religion, political, emotional?)

9.     How acceptable are their ethics to us? (Observance of contracts, time frame?)

10.           Will there be a language problem? (common language, interpreters)

11.           What mechanisms exist for breaking deadlocks or smoothing over difficulties?

12.           To what extent may such factors as humor, sarcasm, wit, wisecracking and impatience be allowed to spice the proceedings?

Good answers to the questions in the checklist will help to clear the decks for a meeting that will have a reasonable chance of a smooth passage.  It is to be hoped that the other side has made an attempt to clarify the same issues. 

Sources: Richard Lewis: When Cultures Collide: Leading Across Cultures, 3^rd edition, Boston: Nicholas Brealey Publishing, 2006

 

Fred Luthans & Jonathan P. Doh, International Management: Culture, Strategy, and Behaviour, 7^th edition, New Delhi: McGraw Hill Education (India) Private Limited, 2009