Step 2 Understand business practicesAlthough there’s increasingly a common core to conducting business internationally, there are certain important conventions and habits that distinguish one culture’s way of doing business from another. If you’re working in new markets you need to make sure that you’re aware of any cultural differences that might have an impact on the outcome of your negotiations.
a) National characteristics Since the end of the Cold War many new countries have been created – and new markets opened up for business. Some of these countries have no recent history of dealing with foreigners and little experience of international trade, so doing business there can be very tough. Try to find out what you can about cultural attitudes and be ready to deal with them patiently. Look particularly at: their understanding and acceptance of outsiders who controls business and how it works how decisions are made. Is the culture one where compromise is sought or is it more competitive? How their legal, technical and financial systems differ from your own, Are there any special conditions that will have to be met? Whether support systems (transport, banking arrangements, and so on) are adequate to deliver the deal, and does the other party have reasonable control of them?
b) Language Negotiate in your own language if you can: fluency gives power, but be aware that the other side has already made a concession to you! If you work in your own language, check regularly that the other party has understood you properly. Use questions or summaries to do this. Confirm all concessions: check for accidental misunderstanding Don’t underestimate the dangers of missing subtle points when you have to work in another language. Use this to your advantage: slow things down, ask for clarification frequently. In most cultures you will ‘gain points’ for speaking their language – but many will be less forgiving of ‘cultural errors’ if you do. You might decide not to disclose your knowledge of their language if it isn’t fluent.
3.Dealing with difficult situations Confrontation.
Exercise 1. What is «confrontation»? Read the following information to find out the answer to this question.
Sometimes one side is in stronger position that the other: they have more baigaining power. For example, during a recent strike at Lamda Inc., the company was in financial difficulty and the public was on the workers’ side, so Landa was negotiating from weakness. The strikers’ union new this: they were negotiating from strengh. The union made demands: objectives that were so important that they were unwilling to change them. They wanted a 15 per cent pay increase. Later they moderated these demands, and said they would accept ten per cent. However, their demand for a week’s extra holiday was non-negotiable: they would not accept less. Lamda said they were being forced to accept something that did not want. They accused the union of making them negotiate under duress. Eventually Lamda conceded to most of the union’s demands and gave them what they wanted. The media said that Lamda had backed down, climbed down andgive in. The feelings had been very strong on each side: the dispute was bitter, and the negotiations were confrontational and adversarial.
Exercise 2. Read the following words and phrases (they are all from the text above) and do the translation.
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Part 2. CONFRONTATIONAL NEGOTIATING TACTICS.
Exercise 1. Before reading the information on negotiating tactics, use your dictionary to find out the meaning of the following words:
Although using tricks isn’t recommended, there are negotiators who: a) issue threats, final offers or ultimatums: they say that the other side must accept something, with very bad consequences for them if they refuse. b) lie and bluff: they threaten to do something that they do not intend to do, or are not able to do. Of course, you can always call someone’s bluff: pretend to believe them, when you know they are bluffing. Dealing with problems. When negotiations get stuck, and don’t progress, there are a number of things you can do. c) Underline common ground: the areas where agreement has been reached. d) Reassure: the other side on the points that have been decided: confirm that you have not changed your mind. e) Be willing to compromise on your original objectives: be ready to accept less than you wanted in exchange for compromises from the other side. f) Identify the exact obstacles or sticking points: the problems that are causing negotiations to become difficult. g) Postpone discussions until later so that each side can reconsider its position.
Exercise 2. What causes conflicts in a negotiation? Make a list of your ideas about it. Then discuss your ideas in the classroom. My list of conflicts:
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Exercise 3. Read the text below. Then do the following tasks: Answer the question: «How many ways are suggested in the text to reduce conflict in a negotiation?» Match each of the following to a phrase in the text with a similar meaning: a) highlight the disadvantages of failing to reach a deal..………………………….…. b) think of new benefits for both sides.…………………………………………….…. c) alter parts of what is on offer.…………………………………………………...….. d) take a break to consider positions.…………………………………………….…… e) have the negotiation in a different place ….…………………………..……………. f) change the individuals involved ……….…………………………………………… g) ask an independent person to come and help you reach agreement ……………....... h) have an informal meeting to talk things over.……………………………...……….
Conflicts may sometimes be an unavoidable step on the road towards agreement. However, in some cases conflict leads to the breakdown of negotiations as one or both sides realise that agreement is not possible. In many cases this is better than agreeing to something which would be against the interests of the people concerned. When conflict arises, there are several possible actions which may help to resolve conflict in a negotiation: 1) leave the problem, go to a different topic and return later o the point at issue; 2) summarise progress and areas of agreement; 3) emphasise the benefits available to both sides; 4) emphasise the loss to both sides of not reaching agreement; 5) restate the issue and wait for a response; 6) charge the package; 7) invent new options for mutual gain; 8) offer conditional concessions; 9) adjourn to think and reflect; 10) fix an off-the-record meeting; 11) change location; 12) change negotiator (personal chemistry?); 13) bring in a third party (mediator?); 14) consider walking away. (From «The Pocket Negotiator», published by Gottschalk Hartley-Brewer.)
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Exercise 4. Read the following five different statements. All of these are ways of dealing with conflict. Match each statement with one of the following extracts. a) Adjourn to think and reflect. b) Summarise progress and areas of agreement. c) Leave the problem, discuss something else, come back later to the problem d) Emphasise the loss to both sides of not reaching agreement. e) Offer a conditional concession.
Extract 1. I think we’ve not really making progress. Perhaps it would be better to leave this point for a while and come back to it later. Could we talk about a different aspect to the deal, perhaps the question of delivery? Extract 2. I think it is important to think about what could happen if do not reach agreement. The most obvious consequence will be that we will both lose market share. The only winners will be our competitors. It could be serious for both of us. Extract 3. There seem to be a number of problems, but I’d like to summarise the positive elements – issues where we have made progress. First, we agree that we have to settle the dispute between us; we understand how important this is. Second, we agree that the terms of our original agreement need to be changed. Third, we also agree that the change will depend on the different market conditions which affect out products. These are important points of progress. Extract 4. Can I suggest we take a short break here? I think it will help if we look at some of the issues that are dividing us. Perhaps, we will see areas where we can make a fresh offer. Extract 5. The point at issue, Mr Davis, is quite simple. We can offer you extra 5% discount, but only if the order is increased by 20% over the next three years.
Exercise 5. Which of the following are good ways of dealing with conflict in a negotiation?
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Part 3. NEGOTIATING WITH POWERFUL PEOPLE.
Exercise 1. What do you think is the best way to negotiate with someone who has a stronger bargaining position than you? Or with someone who is bigger and richer than yourself? Tick the strategies which you would choose. Then discuss your choices with the rest of the group. 1. Threaten them. 2. Let them see that you are in a weak position. 3. Refer to fair standards and fair procedures. 4. Have a good alternative plan in case you can’t get them to agree. 5. Offer them something that they want or need. 6. Find examples of similar cases where people in your position have won. 7. Get support from another party (such as a mediator or consultant).
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