Cultural Impact on Negotiation - Research Paper Example

 CROSS-CULTURAL NEGOTIATION: RESEARCH PAPER SITUATION DESCRIPTION: In this document I have been hired as a consultant by Mr. Wang, my Chinese clients to help me formulate his negotiating strategy with Mr. Ansel, who is French. Mr. Wang is the CEO of “Zhang & Co.” which is a growing global firm from China, and deals primarily with provision of electronics such as laptops, television sets, mobile phones and et cetera. He would be conducting a series of meetings, along with his 6 member team, with the CEO (Mr. ANSEL) and a team of “FEC”, a successful French company which is known for its technological advances, consultation and softwares. They intend to discuss a joint venture in which the softwares provided by FEC will be integrated with the hardware of Zhang & Co and will be marketed globally. It should be noted, that I have been hired as a consultant only by Mr. Wang. All the recommendations mentioned in the consulting document are meant for my client only. Mr. Ansel or his team would not have any access to my document. Cross-Cultural Negotiation Consulting Paper INTRODUCTION I would like to express my gratitude for your consideration to seek my help in order to devise your negotiation strategy with your French counterpart Mr. Ansel. I have put in a lot of effort to ensure that this consulting document proves to be helpful for you in order to identify the differences and similarities which lie between French and Chinese negotiating styles. After reading the provided comprehensive view of both the cultures, which entails detailed analysis of business culture, communication styles, societal culture and many other important aspects, you would be able to identify and understand the key distinctions and would have a fair idea of Mr. Ansel’s negotiating strategy. After provision of this basic comprehension of differences, I have identified various potential challenges that you might have to face while your negotiating process. The problems have been identified and listed so that you are cautious and pre-notified of potential pitfalls and can respond to them efficiently during actual settings. Lastly, I have listed specific recommendations for you, so that you can build a long-term relationship with Mr. Ansel which would ultimately benefit your joint venture. NEGOTIATION IN CHINESE CULTURE: Emic Considerations Tan pan is the Chinese word for negotiation, and is a combination of character meaning “to judge” and “to discuss” (Neidel). Most of the Westerners are often advised to speak short sentences, wear conservative suits or to bring their own interpreters to ace negotiations with Chinese counterparts. These advises might prove to be handy to get a good start but, in order to sustain a long term relationship with mutual understanding, comprehension of Chinese culture is of utmost importance. Unlike Westerners, Chinese are more relationship-oriented rather than just emphasizing on the results or on getting the job done. Chinese are patient by nature and do not like to be rushed into a business deal without proper introduction and without explaining the context of the situation. Certain values which are primarily focused by Chinese are include harmony, mutual respect, modesty, flexibility and equality. Chinese take time to understand the situation in a holistic manner and since they think long-term therefore, they are generally keen to understand the reasons and also the motivating factors. However, in terms of cultural priorities relationships are followed by reason and legality. Another important aspect of their negotiations includes the tendency to compromise. Chinese know what they want and the strategy of ‘Give and Take’ is often put into use. Keeping this behavioral pattern in mind, it is not unusual for Chinese businessmen to revisit the terms and conditions which were previously agreed upon. Chinese negotiation style involves a lot of listening and less talking. Some might infer Chinese people to be delaying but in actuality Chinese like to gather relevant information before getting into any commitment. Another important characteristic of Chinese negotiation style is to avoid confrontation. They work towards developing consensus in a group to uphold harmony. Another reason to avoid confrontation is to “save face”. For the very same reason, Chinese do not volunteer for providing feedback or information, particularly if the feedback is of negative nature. Chinese do not like to communicate bad news because is it considered to be blunt or a form of confrontation (Rodriguez). Similarly, they are also low on praising others for good work. Chinese also avoid self-glorification and excessive promotion of their accomplishments because they like to express humility. They believe that if any praise comes at all, then it should come from the second person. Etic Considerations When it comes to analyzing Chinese culture, Hofstede’s model is of inadequate use, since China was not a part of the first study which was conducted by Hofstede (Hofstede). Due to this the emic consideration will be used to analyze Chinese culture from an etic point of view. Following are some of the approaches; Yin Yang Yin Yang is a known cosmic symbol of unity and harmony and entails the philosophical principle of dualism. It offers a balanced approach to life underlines the philosophical foundation which “empowers Chinese people to follow different teachings and behave differently under different circumstances” (Fang). This principle is the key to comprehending the highly flexible, paradoxical and complex nature of Chinese way of negotiation. Confusian Dynamics This approach has influenced Chinese society, particularly the negotiation style, for more than 2500 years (Fang). It includes six different elements; Moral cultivation, family orientation, respect for age and hierarchy, concept of face, avoidance of conflict, importance of inter-personal relationship and need for harmony Guanxi This approach is a concerned with relationship building and is a part of Confusianism. Linking this to Hofstede’s dimensions, the closest association can be collectivism, power-distance dimension and long-term orientation. The hierarchal and in-group features of Guanxi are similar to those of Hofstede which suggests that collectivistic societies have stronger ties with in-groups which generally leads to reciprocity of favours. Also, these in-group members have preference over others. Hofstede’s Cultural Dimensions The four important Hofstede’s dimensions, with respect to China, are discussed below; Power Distance: China has scored 80 out of 100 in this dimension, which shows that in Chinese society inequalities are acceptable. Influence of authority is well received by Chinese masses, and there exists no defense against abuse committed by superiors. In organizational terms, in implies that important decisions will be taken by upper level management. Uncertainty Avoidance: China has scored 30 out 100 in this dimension, which implies low on uncertainty avoidance. According to Hofstede’s model, Chinese are comfortable with ambiguity and known to be adaptable and entrepreneurial by nature. Individualism: With a score of 20, Chinese society emerges as a highly collectivist society in which people are motivated to work of the benefit of the masses, rather than serving and fulfilling their own wants. In organizational settings, in group members share consideration and co-operation, also in- group members are known to have perks like favoritism and promotions. In case of out-group members, hostility often prevails. Masculinity: A score of 66 implies that Chinese society is triggered by values like achievement, competition and is success-oriented. A score on this dimension means that for a Chinese businessman, sacrifice of family or leisure time might not be an issue when it comes to work. They are okay with providing services till late night and do not avoid hard work to achieve their goals. NEGOTIATION IN FRENCH CULTURE Emic Considerations France has emerged as a powerful nation in the world and a lot can be attributed to its rich culture and heritage, which have contributed tremendously over the years. Considering the growing strategic importance of France, one can easily comprehend the significance of conducting business with such a country. French people generally know how to converse in English but even then, it has been strongly recommended by many that basic French phrases should be learnt and used as much as possible (executiveplanet.com). Also, if any mistake is pointed out by them then the best way to respond to it is to be gracious about it. French take pride in their language. French language is seen as a symbol therefore, its usage often becomes a sensitive issue. Inability to speak French can be counted against the foreign business counterpart (kwintessential.co.uk). French people focus upon relationship building and emphasize upon making long term relationship with the other negotiating party. However, they are not driven by building relationships only, rather, logic and rationale dominates French arguments. French are generally known to be quick to criticize anything that appears to be irrational and they prefer to argue from a critical or analytical perspective. The arguments are generally articulated with wit and expressiveness. They tend to maneuver every minute detail carefully before getting on any final decision. French people take a lot of pride in their cultural heritage and will not accept anything that deviates from their standard cultural norms. However, they are quite receptive to such new information which widens their mental horizons or which enhances the quality of the debate. French can be persuaded to change their opinions through tactful communication which relies on logic. French people are known to judge the second person based upon their ability to demonstrate their intellect, which the French try to examine through rigorous debate and by discussing confrontational ideas. Change of focus during any argument is a deviance which is characteristic of French business culture. In terms of negotiating style, French can be very inquisitive, direct and questioning. They treat a business negotiation like an intellectual exercise and there exists a high probability that they might ask about such terms or conditions in a proposal which need further explanation. French generally have a very passionate note, which might be perceived by many as a sign of “approving” but, this is not always the case. Business protocol in France requires constant formality and reservation in negotiation style. French people manifest in greetings and manners. Remaining polite and courteous throughout the business meeting is preferred. French people can get extremely suspicious if personal questions are asked. Also, luncheons are quite normal in French business culture, since French are passionate about food. Eating together is a time for relationship building, which French look forward to. One should not start eating before the famous words ‘bon appétit” are said by the host. France has an extremely hierarchical structure of the society and also, power is intrinsic. In organizational context, it implies that the person holding the highest designation will take the ultimate decision. However, dealing with lower level people of equal importance too because they will convey their opinion to the boss. When it comes to punctuality, it is a relaxed affair in France. Being twenty minutes late would not be a big deal for them. French will not make any concessions unless their logic has been defeated. Similarly, they are known to be risk-averse and are not that well receptive of drastic changes. Another important thing to note is that French people judge a lot based upon appearances. Appropriate dressing is a must because they see it a symbol of social status and class. Etic Considerations Hofstede’s Cultural Dimensions Four of Hofstede’s important cultural dimensions are considered by Lewicki namely; collectivism and individualism masculinity and femininity power distance uncertainty avoidance Individualism and collectivism: According to Hofstede France ranks 10th in individualism, in the world. However, this ideology might not always be preferred in France. Lewicki points out that “French may assert more on group rights then individual rights and public investment as a better allocation of resources than private investment” (Walt, p.6). The collectivist nature might imply that decisions would be agreed collectively and also, that a lot of consultation will go among the team before arriving to the final decision. Power distance: France ranks high in power distance dimension of Hofstede’s model. French negotiators are more likely to interrupt frequently while negotiating, in order to discuss matters with their superior. This also implies that the final decision might be taken by a single powerful authority. Masculinity and Femininity: According to Hofstede’s Model, France is not very masculine nation and has been rated as 40 out of 100. The feminine aspect in France can be associated to the collectivism which prevails, which entails greater care for others and the society. In a feminine society, like France, both men and women alike are responsible and concerned with quality of life. Their roles in the society generally overlap. Uncertainty avoidance: France is high on uncertainty avoidance of 80 out of 100. French are not that fond of ambiguity. They try to reduce it by establishing policies and avoiding behaviors which are not desirable. Also, this implies that French are more likely to steer away or to get uncomfortable when presented with novel or out-of-the-box ideas. French will have higher risk propensity in the environment to which they are accustomed to and comfortable in. Boughton carried a research in order to identify various distinctive aspects negotiating behavior of 15 cultural groups. It composed of nations like Japan, Korea, China, Russia, Israeal, UK, Spain, Brazil, Mexico, USA, French-Speaking Canada, English-Speaking Canada, Taiwan, Germany and France. Boughton states; “The style of French negotiators was perhaps the most aggressive of all the groups. In particular, they used the highest percentage of threats and warnings…they also used interruptions and facial gazing and no and you were very frequently compared with the other groups, and one of the French negotiators touched his partner on the arm while negotiating”. CHALLENGES THAT MIGHT ARISE IN CROSS CULTURAL NEGOTIATION BETWEEN CHINESE AND FRENCH CULTURE While engaging in a cross-cultural negotiation, a lot of problems might arise. Some might be quite apparent while others would be covert in nature. Language barrier is the main issue which might surface, since both French and Chinese languages belong to two entirely different geographic regions of the world. Effective dialogue might become a hindrance due to this. The counterparts might not be able to successful extend their ideas. So, the probability of misinterpretation and confusion is high. Secondly, cultural difference might cause a problem. Certain topics might be sensitive in Chinese culture to discuss; on the other hand, the French would want to an extensive argument on it because they are fond of debating. Since both Chinese and French individuals are known to take their time before committing to a decision, while they are assessing minute details. This might lead to prolonged delay and an unintended signal might be projected where one party might assume that the other party is not interested. Lastly, there also lies a probability that the Chinese counterpart might get offended to the critical and aggressive behavior of the French businessman. RECOMMENDATIONS FOR THE NEGOTIATORS Following are some of the recommendations for the client; Logic is respected and expected in French culture. Make sure to justify your demands or propositions on logical grounds, and support them through rigorous research. Learn basic French phrases and their appropriate usage. If anything has to be submitted in a written form, then it should be grammatically correct. Assistance of an individual who is well-versed in spoken and written French must be resorted to ensure accuracy. Maintain eye-contact and appear confident while conversing. Confrontational behavior and usage of pressure tactics must be avoided at all costs. Avoid being over-friendly or asking personal questions, since French are known to compartmentalize their professional and personal lives. Demonstrate a firm intellectual grasp of the current, potential and future situations and also, of the ramifications. Always maintain high degree of formality in business protocol. Ensure that the business proposal is planned and logically organized, structured and presented. Any loophole in the proposal will be noticed by the French counterpart, and expects questions on any part which needs further explanation. Do not appear to be irritated by long arguments and if the focus deviates from the main topic. Maintain your temperament throughout the conversation because performance in a discussion might affect the final decision. It is of utmost importance to identify the key roles of each individual, particularly spot the individual with whom the authority of taking the final decision lies with. Also, try to logically satisfy any queries which are put up by other members of the team, because they act as influencers on the decision maker. Make sure to think long-term. Do not present such ideas which are short spanned, if not required. Demonstrate commitment. Be careful of minute details. This is not limited to business aspects only rather, it extends to the demeanor as well. Dress appropriately and in a way which expresses your status. Also, be careful of non-verbal communication. Do not have offensive facial expressions or hand gestures, particularly during any argument, which might further aggravate, because then the tendency to offend increases. Capitalize on the similarity of cultures. Use relationship building, long term orientation, assessment of details, patience and use of rationale to your advantage. These dimensions are similar in French and Chinese culture. RECOMMENDATION FOR FURTHER RESEARCH It is highly recommended that you analyze the communication and negotiating style of your French counterparts. In order to gain information beforehand, pre-negotiate through e-mails or brief phone calls of relevant nature and try to build up a rapport, because this will create a relationship which French admire and look forward to. You can also refer to articles available on the internet or on social media websites, regarding your French counterpart, to equip yourself with all the relevant information. CONCLUSION I really appreciate your consideration to seek our help. I would like to exhibit my gratitude and well wishes for your upcoming negotiations. I hope that you successfully accomplish your goals and also hope that our consulting document would have been helpful to you. For any further queries or help you can contact me via e-mail or the phone number which was provided earlier. I would be glad to entertain you. Even if you require any assistance, in negotiation, while your stay at France you can always contact me, I ensure dedicated extension of services to my valued clients. 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"From"Onion"to"Ocean"" International Studies of Management and Organization. 2005. Web. March 7th, 2014. Hofstede, G.2001, Culture’s Consequences, 2nd edn, Sage Publications Read More