Impact of Culture on Business Negotiation

Negotiations are a common aspect of business. Parties engaged in a negotiation experience various difficulties in arriving at a successful conclusion. When the parties concerned have diverse cultural backgrounds the experienced difficulties become more intricate.

This study delves into for a perception of the negotiation and its impact on business negotiations.

Defining Negotiation

Negotiation is an exchange of ideas aimed to decide disagreements, to make an agreement upon guiding principles, to negotiate for individual or shared benefit, or to build results to fulfill different interests.

Negotiation takes place in business, non-profit firms, and government branches, legal actions, amongst nations and in personal affairs namely wedding, separation, parenting, and daily life. The study of the field is known as negotiation theory. Those who work in this profession are called negotiators.

The impact of culture on Business negotiations: An Introduction

It is noted that national culture does not decide negotiation performance. Relatively, national culture is one of many features that impact behavior at the negotiation table, although an essential one.

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For instance, gender, organizational culture, global experience, industry or regional setting can all be significant impacts also. In fact, negotiators must become acquainted with the people they are working with, not just their culture, country, or business.

Cultural differences generate four types of problems in business negotiations, at the levels of (Graham, 1980):

1.      Language

2.      Non-verbal behaviors

3.      Values

4.      Thinking and decision-making processes

The order is significant; the problems subordinate on the list are more critical for the reason that they are more delicate. For instance, two negotiators would observe at once if one were speaking Japanese and the other German.

The answer to the problem may be as straightforward as employing an interpreter or speaking in a common third language, or it may be as hard as learning a language. Irrespective of the way out, the difficulty is evident.

Cultural differences in nonverbal behaviors, in contrast, are almost always concealed below human awareness. Specifically, in a personal negotiation participants nonverbally and more cleverly impart and understand a lot of information. A few analysts argue that this information is more significant than spoken information. More or less all this indications continue below human levels of perception. When the non-verbal signals from foreign partners are dissimilar, negotiators are most likely to misunderstand them without even being aware of the mistake.

For instance, when a French customer constantly interrupts, Americans are likely to feel uneasy without knowing precisely the reason. In this way, interpersonal hostility generally affects business relationships, goes unnoticed, and, so, remains persistent. Dissimilarities in principles and ideas and decision-making processes are concealed even deeper and thus are even harder to identify and to remedy. These dissimilarities are discussed below:

Differences at the level of language

Translation difficulties are frequently significant in negotiations. Moreover, when languages are linguistically remote, more difficulties should be expected. It is especially daunting work in global negotiation. Generally the English language is employed; however it may be spoken as a second language by most managers at the table. In fact, local speakers from Britain, India, and the USA often have difficulty understanding one another. Precise translations in interactions are an objective that has never been realized.

In addition, language discrepancies are often misused in remarkable ways. A number of senior managers in foreign countries speak and comprehend some English, nevertheless choose to speak in their “stronger” national language and hire an interpreter. Thus, it has been observed that a senior Russian negotiator asking questions in Russian language.

The interpreter then translated the question for his American counterpart. While the interpreter talked, the American’s focus was given to the interpreter. However, the Russian’s focus was at the American. Thus, the Russian could watchfully and unassumingly study the American's facial expressions and non-verbal reactions. Moreover, when the American spoke, the senior Russian had twice the reply time. Since he understood English, he could prepare his replies in the translation process.

Simply bilingualism is not a familiar characteristic for Americans, and thus competitors with greater language abilities are given a usual benefit in commerce.

Furthermore, a common objection heard from American managers regarding foreign customers and partners breaking into side discussions in their national languages. Indeed, it is seen as ill-mannered, and fairly generally American negotiators are expected to ascribe something disturbing to the content of the foreign talk.

The common idea of such side discussion is to correct a translation problem. For example, one Korean may lean down to another and inquire, “What’d he say?” Or, the side discussion can view a difference among the foreign team members. Both conditions should be judged as affirmative signs by Americans—that is to say, getting translations straighten improves the effectiveness of the negotiations. However as most Americans speak only one language, neither situation is valued. Incidentally, people from other countries are recommended to give Americans a brief account of the content of their first few side discussions to tone down the disturbing reactions.

Nevertheless, there are difficulties at the level of language ahead of translations and interpreters. Data from cyber-negotiations are useful. In the study, the verbal behaviors of negotiators in 15 of the cultures were recorded.

Nonverbal behaviors

Anthropologist Ray L. Birdwhistell proved that below 35% of the message in conversations is communicated by the spoken word whilst 65% is conveyed nonverbally (Crockett, 2007). Albert Mehrabian (1980), a psychologist, reports that:

·         7% of the meaning comes from the words uttered

·         38% from pitch of voice, loudness, and other characteristics of how things are spoken

·         55% from facial expression

Certainly, some might protest with the precise percentages, however the work also supports the belief that non-verbal behaviors are decisive.

Managerial values pertinent to Negotiations

There are four managerial values namely objectivity, competitiveness, equality, and punctuality that are held firmly and profoundly by most Americans and appears to normally cause misinterpretations and bitterness in business negotiations.

Objectivity

“Americans make decisions founded on the end result and on cold, solid details.” “They don’t play favorites.” “Economics and performance are significant, not the people.” Such statements in fact reveal American concepts of the importance of objectivity.

Competitiveness and Equality

Americans have little perception of the Japanese observation of granting comprehensive regard to the requirements and needs of customers. This practice does not work in America. American traders have a tendency to regard American customers more as equals, and the democratic principles of American society support this conduct.

The American stress on competition and individuality signify here is fairly in agreement with the work of Hofstede (2001), who pointed out that Americans achieved the maximum amongst all the cultural groups on the individualism scale. In addition standards for individualism or collectivism have been seen to directly impact negotiation manners in many other countries.

Lastly, not only do Japanese customers get higher results than American customers. In other words, although the American traders make lesser profits than the Japanese, a number of American managers in fact favor lesser profits if those profits are produced from a more equal division of the combined profits.

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