The many different negotiation styles you might encounter when making a deal across the globe may seem overwhelming. Don’t be discouraged.
The following steps will help you negotiate more effectively with international partners.
Step 1: Define success for all party
Begin by establishing each party’s definition of “success.”
What would a successful outcome look like to you? For example, if you’re negotiating a deal with an overseas vendor, a successful outcome might include a specific date for work completion and an agreed-upon quality standard.
What would a successful outcome look like to the other party? Accept that “success” may not mean the same thing to your negotiation counterpart. For example, the overseas vendor with whom you are negotiating might define success as agreement on a product delivery in stages, reduction on raw material cost or even different project payment scheme.
Step 2: Research negotiation partners
Gaining a basic understanding of your negotiation partners’ backgrounds and biases is a prerequisite for a successful negotiation. To uncover this information:
- Research your counterparts.Find out as much as you can about their experience, skills, personalities, and communication styles. Learn about conventions regarding when to socialize and when to talk business, how much haggling over terms of the deal is acceptable, and how people in your counterparts’ culture demonstrate trust. Identify the preferred business language, and hire a translator if necessary.
- Identify all the players.Learn who typically has a say in business negotiations in the country where your counterpart is from. For instance, in some countries, these “extra players” might include labor leaders, local political officials, or government ministries.
- Find out who decides what.For each player you’ve identified, determine which decisions he or she can make during the negotiation. If your counterpart can’t make decisions, find out who can.
- Don’t lose sight of the individual.While understanding another culture’s negotiation style is important, don’t lose sight of you counterparts as individuals. People who come from the same culture don’t always behave and think the same. Treat an individual’s culture as background, but also learn as much as you can about the person’s personality and communication style.
Step 3: Consider expectations
You may enter the negotiation only to find that the other party’s expectations are very different from your own. Differing cultural expectations regarding the negotiation’s process and outcome often occur in four areas:
- View of process.Some people view the negotiation process as a win-win collaboration, while others may see it as a win-lose competition. Don’t assume that your partner shares your view. Seek clarification on everyone view or clearly state your own view beforehand.
- Approach to reaching agreement.Different cultures have different ways of reaching agreements. U.S. negotiators often seek agreement on specifics first, building up toward an overall deal. In contrast, Chinese negotiators tend to first seek agreement on the overarching deal, followed by negotiating the details.
- Form of agreement.The level of detail required in a negotiated agreement varies by culture. In many parts of the world, negotiators are comfortable with an agreement that focuses on general principles. In contrast, many North American and European negotiators require detailed contracts, which include as many contingencies as possible.
- Implementation of the agreement.S. negotiators generally expect rigid compliance to the precise specifics of the original contract and avoid renegotiation. In other cultures, an agreement is merely a starting point of an ever-evolving relationship and set of expectations. Renegotiation is common, since the precise terms are expected to unfold along with the relationship.
Step 4: Establish trust
It is essential to establish trust with negotiation partners. Building trust can help you surmount the “people” problems that often arise during a cross-cultural negotiation. To build trust:
- Find and establish common ground.Personal and business relationships are more intertwined in some cultures than in others. In North America, two people don’t have to like each other in order to do business. However, in other cultures it is customary to develop a personal relationship with the other person first before doing business. When negotiating with people from other countries, try to find things that you and the other person have in common, such as hobbies, favorite movies, or music.
- Take your time to build rapport and trust.Don’t talk business right away. That could demonstrate anxiety or disrespect on your part. Show that you’re in no hurry to reach a deal. If possible, invite your counterparts to join you for lunch or dinner. After you’ve spent time getting to know one another, casually bring up the business at hand. Discuss the issues, but don’t push for a quick conclusion.
- Get the details and facts right.Many cultures emphasize details when negotiating. In many parts of the world, negotiators will expect you to have extensive knowledge about your specific business area, as well as the financials. If you can’t answer every question they ask about your business or proposition in a negotiation, trust suffers.
Step 5: Customize your approach
Adapt your approach to the deal at hand based on what you’ve learned about your counterparts and negotiation practices in their cultures.
Step 6: Stay flexible
No matter how thoroughly you prepare for a negotiation, things may not go as planned. Stay calm and learn as you go. Pay attention to the dynamics of the negotiation as they unfold, and make adjustments as needed. And the most important thing is don’t lose your temper or go backward on the discussion.
To do this, listen carefully during discussions. Be sure to speak up if you are:
- Unsatisfied with the answers you receive.Reframe your questions and try again. For example, if you propose something and get no reaction from your counterpart, try making the proposal more specific.
- Unsure about what the other side said.Repeat what you think you heard. Ask if you’ve understood correctly, then listen for an affirmation or a correction from the other person.