The interactions that take place between two businesses during the negotiation process of a deal can determine whether or not the deal runs smoothly and is successful. However, acting so that your potential partner is comfortable with you and happy with the proposal can sometimes rely on much more than just the hard details of a contract, especially when the other party involved is of a different culture. There are important cultural factors to keep in mind when negotiating internationally because they play a major role in how a person communicates and interprets others.
The importance of time. One of the most significant differences between some cultures is the emphasis that is placed on time. Americans typically negotiate on a contract-to-contract basis, strongly linking time and money; they make a point of being efficient, punctual, and finishing things quickly. However, operating this way with some Eastern cultures—who value inter-business relationships rather than one-time deals—may come across as an attempt to rush and thus hide things, so negotiations may end with distrust and on a subpar level.
The forces at play. In addition to how different cultures view time, there are many other culturally influenced negotiation and business styles to take into account when doing business internationally. To get a general idea of these behaviors, attitudes, and patterns, it may help to first look at the objective conditions governing a culture. Consider a country’s political system, any nationally significant religion(s), the relative structure and importance of the family unit, and the language. Some factors to think about:
- A culture’s emphasis on the importance of formality in communication
- How open a culture is to taking risks
- If a culture views rigid details and contract complexity to be important
- If your partner views the negotiation as a one-time deal or the beginning of a harmonious relationship
- One singular leader vs. group decision-making
- From this, one may be able to deduce the standards governing routine business negotiations.
Don’t stereotype. It is important to remember that this is a globalized economy where the world is figuratively “becoming smaller and smaller”. The differences between nations and cultures may be less obvious than we anticipate, and, as a result, the whole issue of cultural sensitivity during negotiation may be ignored. If we blindly accept certain standards as our guidelines, it can be easy to stereotype a culture and accidentally treat them inadequately. Remember also that even in one culture there can exist many differences between individuals. That being said, it may be helpful to be practical when negotiating internationally and follow a “whatever works” mindset. Ask questions so you can be sure of the situation, and avoid getting too technical or making assumptions. Take into consideration as many aspects and conditions as possible. Successful negotiations can be reached if both parties understand what is expected of the other.