Common Cultural Clashes And How They Undermine Negotiation
After a few days with Italian clients and Russian opponents, I’ve had time to reflect on how differently the two cultures communicate. Regional differences within countries and personality types can also influence whether we trust enough to disclose valuable information and how we express ourselves.
These are considerations which need to be taken into account when preparing for a successful negotiation.
What is culture?
In short, it’s the shared beliefs, meanings and values that are collectively held by a group. This can be characterised in terms of a country, a community, an ethnicity or even small groups of people such as a company. It’s about acceptable behaviour, attitudes and how we interpret this.
Italy vs. Russia
As I observed the Italians communicate with their Russian former contractual partners, there was a very clear difference in how they approached the negotiations. Southern Italians like to build social relationships with their contractual partners, usually in the form of lavish hospitality which usually revolves around food. They insist on paying and see it very much as a way to bond, especially with lawyers, experts and sometimes, opponents. It’s almost seen as a courtship ritual.
They like to discuss openly and express their emotions by telling you how they feel directly or by raising their voice, changing their tone and using body language in a way that conveys their frustration, anger, or on the flip side, happiness. It’s more acceptable to be expressive with emotions and that connection is important to them.
Contrast that with the Russian approach. The hierarchy was evident as was the level of distrust. They weren’t giving anything away and neither were they willing to consider creative options to enlarge the pie. They left the room on two occasions to talk privately about proposals we made and when they came back into the room, all we got was a head nod and a gesture to accept. Their lawyers would draft the settlement agreement. They weren’t willing to compromise, that was for sure, and so the idea of settlement had to be presented as a power battle that they would win because it was in their interests. That wasn’t easy when you have clients who want to win too.
I’m making no comment about which one is better, it’s just a cultural preference that negotiators need to be aware of prior to negotiations!
High Context and Low Context Cultures
J.M. Brett, in her book “Negotiating Globally”, refers to some cultures as high or low context.
Japan can be classified as high context because they do not communicate directly and are not likely to use the integrative approach because it relies on open discussion of interests and which solutions can satisfy all the parties.
Instead, the Japanese tend to prefer the distributive approach. Information disclosure is limited, usually to offers only. They do not ask directly for information but interpret it based on, for example, making a series of offers and seeing which are rejected. This type of competitive, win/lose negotiation is often preferred by cultures that have structured hierarchies.
The USA, on the other hand, would be a low context culture. American negotiators are more likely to openly communicate and rely on direct communication. They may also use distributive techniques in some stages of the negotiation but they like to build trust and can be creative in finding solutions to mutual problems.
Common Culture Clashes
- Communication is the most important aspect of negotiation. It’s essentially, what negotiation is! When negotiating with different cultures, you may come across different interpretations of words, different use of words and if the dialogue is being translated, nuances may be lost. Body language will most certainly differ as will rules about interruption, shouting and the meaning of certain gestures. In some Asian countries, for example, it’s rude to say the word “no”. Several phrases may be used instead which can, for a Western negotiator, be confusing.
- Time. Different cultures will allocate more or less time to negotiations. Some may wish to get the negotiations over and done with and move on whilst others show the opponents as much hospitality as possible. Punctuality is also interpreted differently by different cultures.
- The object of the negotiations may be interpreted differently. For the Spanish, the point of negotiations is to settle. For the Indians, it’s to rebuild broken relationships.
- Different processes. It’s important to understand how different cultures organise their hierarchy so that you know who is able to agree proposals and who ultimately makes the final decision
- Gift giving. Some cultures like to receive gifts or give gifts as a trust building exercise prior to negotiations. It may seem obvious, but some gifts are totally unacceptable. Giving a pig skin leather binder to a Muslim or Jewish counterparty would be disastrous!
- Although not a culture clash, be aware of laws that affect your negotiation. For example, in England you are not contractually bound to negotiate (except under certain circumstances) and in specific areas, you are under legal obligations to disclose certain types of information. If you do not or you lie about something which the other party relies on, you could be liable for any loss, as a result. Not all countries have these rules and in some jurisdictions, you may also be under more severe obligations to tell the truth and disclose information. I always advocate honest communication as it can seriously damage your professional reputation if you are found out to have lied. It can damage trust and destroy negotiations.
In my next blog post, I’ll be giving you some tips on how to prepare yourself for international negotiations and to minimise culture clashes. The truth is, you are never going to be an expert in somebody else’s culture unless you share it. However, there are steps you can take so that you avoid the most common pitfalls.
What are your experiences? Please let me know about what you learnt from different cultures and how they negotiate!