BUS403: Negotiations and Conflict Management (2016.A.01)

6a. Explain how culture affects negotiations

• Explain how understanding cultural norms affect negotiations.
• Name some challenges to intercultural negotiation and describe some ways to overcome them.
• Define cultural intelligence (CQ).

Culture refers to the beliefs, values, mindset, and practices of a group of people. Due to these cultural norms, people who come from different cultures often behave in ways that are unfamiliar to us, unacceptable according to our cultural values, or they may interpret the facts and purposes of negotiation in different ways.

Finding a Common Language in Intercultural Negotiation states that language and recognizing different cultural norms are challenges inherent in negotiating across cultures. It offers advice on overcoming language barriers, recommends you read a guidebook to learn about the geography, history, and general practices in the other country, and recommends learning what the other country hopes to gain from the negotiation to create a winning solution for both sides.

6b. Identify characteristics of culture or national identity that negotiators should become familiar with before engaging in cross-cultural or international negotiations

Review the characteristics of culture or national identity negotiators should become familiar with before engaging in cross-cultural or international negotiations in learning outcome 6a above.

 

6c. Explain how Trompenaars' and Hofstede's theories of cultural dimensions can be applied to cross-cultural and international negotiations

• Define and explain how the seven dimensions of Trompenaars' Model of National Culture differences apply to cross-cultural and international negotiations.
• Define and explain how the six cultural dimensions in Geert Hofstede's Dimension of Culture Theory apply to cross-cultural and international negotiations.

Fons Trompenaars (1953–), a Dutch management consultant, created a model to compare national cultural differences that addresses the seven dimensions. Five of these dimensions address differences in the way people relate to each other. During global negotiations, these descriptions can help participants anticipate, recognize, and respond to various cultural values, beliefs, practices, and mindsets. Again, even if you do not believe or agree with some of these stereotypes, it is helpful to know the person you are negotiating with may hold them.

1. Universalism vs. particularism;
2. Individualism vs. communitarianism;
3. Neutral vs. emotional;
4. Specific vs. diffuse;
5. Achievement vs. ascription;
6. Sequential vs. synchronic;
7. Internal vs. external control.

Geert Hofstede (1928–), a Dutch social psychologist, created a cultural dimensions framework that examines cross-cultural communication to compare national cultures across six dimensions. Hofstede describes how culture affects individual values and how these values can affect human behavior.

1. Power distance;
2. Uncertainty avoidance;
3. Individualism vs. collectivism;
4. Masculinity vs. femininity;
5. Long-term orientation;
6. Indulgence vs. restraint.

To review, see Trompenaars' Model of National Culture Differences and the Interview with Fons Trompenaars. Review Geert Hofstede's Dimensions of Culture Theory in Types of Organizational Culture and Intercultural Communication.

 

6d. Describe the types of political and legal issues that might arise during the course of international negotiations

• What is the main purpose of the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO)?
• Why should business leaders try to understand the economic, political, and social culture of a country or region in which they wish to do business?

The General Agreement on Tariffs and Trade (GATT) was a legal agreement created in 1948 to promote international trade by reducing and eliminating trade barriers, such as tariffs or quotas. During their Uruguay Round negotiations, which spanned from 1986 to 1993, its member countries replaced GATT with the World Trade Organization (WTO), which first met on Jan. 1, 1995. The WTO's main purpose is to serve as a forum for member countries to negotiate and adjudicate trade agreements and participate in dispute resolution for trade in goods, services, and intellectual property.

Unit 6 Vocabulary

This vocabulary list includes some terms that may help you answer some of the review items above and some terms you should be familiar with to be successful in completing the final exam for this course.

• Achievement vs. ascription dimension
• Cultural intelligence (CQ)
• Fons Trompenaars' Theory of Cultural Dimensions
• Free trade
• Geert Hofstede's Dimensions of Culture Theory
• The General Agreement on Tariffs and Trade (GATT)
• Individualism vs. communitarianism dimension
• Individualism vs. collectivism dimension
• Internal control vs. external control dimension
• Long-term orientation and restraint dimension
• Masculinity vs. femininity dimension;
• Neutral vs. emotional dimension
• Power distance dimension
• Sequential vs. synchronic dimension
• Specific vs. diffuse dimension
• Tariff
• The Trans-Pacific Partnership (TPP)
• The Transatlantic Trade and Investment Partnership (TTIP)
• Uncertainty avoidance dimension
• Universalism vs. Particularism dimension
• The World Trade Organization (WTO)