Happy CEO

How to Negotiate across cultures

Stereotypes, prejudices, and subjectivity are inevitable responses to managing complexity.
These elements are natural responses to the complexities we encounter.

However, their destructive potential arises from their misapplication.

1. Understanding culture and its dimensions

The geopolitical context of your interlocutors’ countries plays a crucial role in negotiations. In the ever-evolving landscape of human interaction, the concept of “culture” stands as a multifaceted tapestry woven from the threads of distinct spiritual, material, intellectual, and emotional aspects.

“Culture encompasses, in addition to the arts, letters and sciences, the ways of life, laws, value systems, traditions and beliefs. This “common reservoir” evolves over time through and in the forms of exchanges. It is made up of multiple distinct ways of being, thinking, acting and communicating in society.”

UNESCO

It characterizes a society or social group.

2. Influence of Stereotypes on Negotiation

From a sociological perspective, it is evident that cultural practices vary across spaces and time, dependent on an individual’s societal position, gender, and occupation.

As each person, molded by their socio-historical background and accustomed to social practices they deem “normal,” creates their own perceptions of what is legitimate or illegitimate, beautiful or ugly, right or wrong.

Individuals do not exist in isolation but respond to often unnoticed societal demands.

“A field, however fertile it may be, cannot be productive without culture, and the same applies to humans without education.”

Cicero

To define culture, one must shed the shackles of value judgments and moral assessments.

We tend to think of culture as an unchanging core that only shifts through “periods” or “stages” of human evolution. However, culture is an everyday affair.

Culture is what people make of it. It is a dynamic force undergoing successive transformations throughout human history, closely tied to social changes and technological advancements.

3. Negotiator Strategies and Five Cultural Dimensions

1. Power Distance
2. Masculinity/Femininity
3. Communitarian/Individualistic Societies
4. Risk Orientation
5. Attitudes Towards Hedonism and Duty

Each of these dimensions significantly impacts the negotiation process for both parties.

4. Influence of sociocultural context and national stereotypes on negotiation

What story are you telling when you negotiate with someone from another country?

How do you want them to see you, and how do you see them?

These are the questions that matter in cross-cultural negotiations, because they shape the outcome.

Stereotypes are stories that we tell ourselves about other people, based on their nationality, culture, or appearance. Sometimes they are positive, sometimes they are negative. Sometimes they are true, sometimes they are false. But they always influence how we interact with others.

• Positive stereotypes can help us build rapport and trust with our counterparts, as we find common ground and shared values. We can use a cooperative approach, where we look for win-win solutions and focus on mutual interests.
  
  
• Negative stereotypes can hurt us by creating barriers and conflicts with our counterparts, as we judge them based on our assumptions and biases. We can use a competitive approach, where we try to win at all costs and ignore the other side’s needs.

Example : if you are an Australian negotiator, you might think that Italian negotiators are chaotic, unreliable, and unprofessional, while they might think that you are rude, cold, and insensitive. These stereotypes can make it hard for you to communicate effectively and reach a satisfactory agreement.

The problem with stereotypes is that they are self-fulfilling prophecies.
When we expect someone to behave in a certain way, we tend to act in ways that confirm our expectations. We ignore the evidence that contradicts our beliefs, and we reinforce the cycle of mistrust and hostility.

The solution is to challenge our stereotypes and replace them with stories that are more accurate, respectful, and empathetic. We need to learn about the other culture, understand their perspective, and appreciate their differences. We need to tell stories that connect us, not divide us.

That’s how we can succeed in cross-cultural negotiations. By telling better stories.

5. Negotiator tactics and Power dynamics

Negotiators often play a central role in two negotiation processes: interorganizational negotiation and intraorganizational negotiation.

In intraorganizational negotiation, conflicts may arise from differences in motivation, perceptions, and emotions, often stemming from past experiences.

Negotiators need a high degree of intellectual, emotional, and affective mastery.

They use various sources of power, including coercive power (to compel the other party), reward power, expert power, referent power, legitimate power, and power based on information.

In conflicts, coercive power is often the most frequently used source, and negative stereotypes can intensify the use of coercive tactics. The use of threats and ultimatums is a common feature of competitive negotiations.

6. Integrative solutions and Win-Win negotiations

1. The Integrative Solution in Export: The integrative solution reconciles the interests of all parties involved, taking into account their positions and objectives. It is an original, creative, and long-term solution that respects the interests at stake, leading to a win-win outcome. Instead of one party prevailing over the other, both parties win together.
   
   
2. The Rigid-Flexible Model: To achieve an integrative solution, negotiators need to balance rigidity in their goals (high aspirations) with flexibility in their means (a propensity to make numerous proposals). Negotiators who seek integrative solutions tend to exhibit non-aggressiveness, an investment in success, a positive evaluation of the group climate, and positive attitudes toward the adversary and their position, all of which contribute to performance.

7. Risks of conflict due to cultural differences and exaggerating cultural distances

Commercial relationships between companies from different cultures often involve divergent values and behaviors.

Culture becomes a lens through which we view and judge others. Individuals tend to assess others based on their own culture, creating a hierarchy of cultures. This hierarchy often exaggerates differences beyond reality, leading to stereotypes and negative generalizations about other cultures.

Cultural categorization, comparison, valuation of values, and the consequences of exaggerating cultural distances are all integral components of this theme.

The consequences of such behavior include:

1. A sense of continuous threat to one’s in-group interests.
2. The development of hostility toward the out-group.
3. Reinforced solidarity and loyalty to one’s in-group.
4. A desire to consolidate boundaries between groups.
5. The development of negative stereotypes about the out-group.

The presence of a higher authority that serves as an arbiter, ensuring the freedom of all parties, can reduce the risk of divisions between different groups.

In conclusion, we need to understand different cultures, be aware of our ideas about others, and use smart strategies.

By finding ways to work together and not let our assumptions get in the way, we can make these negotiations successful and bring people from different backgrounds closer together.

In summary, What you need to know about culture and negotiation

1. Understanding Culture and Its Dimensions:
   • Culture is like a complex tapestry made up of different aspects like art, laws, and beliefs.
   • It evolves over time and is crucial in negotiations.
     
     
2. Influence of Stereotypes on Negotiation:
   • Cultural practices vary based on societal position, gender, and occupation.
   • Our perceptions of right and wrong can vary among individuals.
   • Culture is dynamic and shaped by everyday interactions.
     
     
3. Negotiator Strategies and Power Dynamics:
   Negotiators use various sources of power, including coercion and rewards.
   Coercive tactics are common in conflicts.
   Five cultural dimensions significantly affect negotiation.
   • Power Distance
   • Masculinity/Femininity
   • Communitarian/Individualistic Societies
   • Risk Orientation
   • Attitudes Towards Hedonism and Duty
     
     
4. Influence of Sociocultural Context and National Stereotypes on Negotiation:
   • Stereotypes can be positive or negative.
   • They influence how we cooperate or compete in negotiations.
   • The solution is to challenge stereotypes and understand other cultures better.
     
     
5. Integrative Solutions and Win-Win Negotiations:
   • Integrative solutions focus on mutual interests and creative problem-solving.
   • Negotiators balance goals and flexibility for success.
     
     
6. Risks of Conflict Due to Cultural Differences and Exaggerating Cultural Distances:
   • Commercial relationships involve diverse values and behaviors.
   • Culture influences how we view others.
   • Exaggerating differences leads to stereotypes and negative judgments.

“Culture is like a complex tapestry made up of different aspects like art, laws, and beliefs. It evolves over time and is crucial in negotiations.”

Unknown author