The Art of Cross-Cultural Negotiation

This article was originally published on Procurious, based on a roundtable organised by Conti Advanced Business Learning (www.cabl.ch), a Swiss training company that specializes in Negotiation & Influencing training.

Negotiations can be tricky. A cross-cultural negotiation presents an entirely different challenge, one with countless pitfalls and potential faux-pas.

Negotiations in a business setting can be difficult at the best of times. Throw cross-cultural diversity into the mix, and the difficulty level rises again.

The way you speak, behave, control your body language, and operate can change hugely from culture to culture, increasing the chance of making a mistake, or accidentally offending the other party.

Some people may also make the mistake of assuming that when we talk about culture, we are limiting this to a purely geographical standpoint. When referring to cross-cultural negotiations we will often talk about different nationalities as a primary characterization, but this is not the only element that affects a culture.

Culture is about the unique characteristics of a social group, with the values and norms shared by its members. This social group may be a country, a corporation, a religion, gender, the function you are working, and many more factors.

Deal with Cross-Cultural Negotiations

So how can you prepare for cross-cultural negotiations? What tips do you need to know, what do you need to prepare in advance, and how should you approach negotiating with different cultures? This is where expert advice can help.

Procurious were lucky enough to be invited along to listen in on a ‘Cross-Cultural Negotiation Roundtable’, organised by Giuseppe Conti, Founder of Conti Advanced Business Learning (www.cabl.ch), which took place in July. With participants from a range of businesses, 8 different nationalities, and diverse backgrounds, the discussion was fascinating, and provided some great insights into a complex subject.

In this series of three articles, we will examine the key factors to be taken into consideration, and hear some real-world examples straight from our experts.

Power, Language Barriers and Coffee

Giuseppe kicked off the discussion by asking the participants to talk about their own experiences of cross-cultural negotiations.

Jonathan Hatfield, Director of Purchasing, EMEA at PPG Industries, talked about his early experience as a buyer, and his first trip to Russia to purchase chemicals. Supplier power played a large part in the negotiations, with Jonathan having to visit factories in Siberia, where no-one spoke any English, and dealing with several junior product managers before he could access more senior people, in line with the strong hierarchical culture of the country.

While Jonathan’s aim was to create a relationship with the supplier, the supplier cut straight to the point, only wanting to know what he wanted to buy, where it was going, and then what the price would be. Jonathan left Russia not even knowing if he had managed to secure any materials (happily he did!), but it also taught him to make sure that he had all his approvals lined up in advance.

Two other participants gave examples highlighting the difficulties of language barriers and body language. Thierry Blomet, Senior Vice President at Kemira, was taking part in a negotiation with an Indian customer, who appeared to be shaking their head from side to side at every argument that was presented, with Thierry feeling that his ideas were not accepted at all. When he questioned this with his local representative, he was told that he was doing fine, and the shake of the head was actually a sign of agreement with what he was saying.

On the other side of the coin, Matthias Manegold, Head of Procurement and Supply Chain Practice at Kinetic Consulting, talked about a situation where he was negotiating with an Asian business to bring new technology to Europe. Each statement in the negotiation was met with a “Hai” (Japanese for yes), but it wasn’t until later on that Matthias was told that this actually meant, “Yes, we hear you, but we don’t necessarily agree”.

One final example came from Jean-No?l Puissant, Head of Procurement EMEA at Monsanto International, highlighting the difference in how negotiations start in different cultures. In one negotiation in the South of Italy, the owner of the supplier arrived with his wife, listened to the agenda being laid out, then suggested everyone get a coffee. It was his way of starting the negotiation by getting to know the other party better with some conversation before the business discussions kicked off.

Company Cultures

The participants also reflected on company cultures, and how current or former employers’ cultures had shaped their own negotiation approaches.

Stephane Guelat, Senior Director – Supply Chain at Pentair Valves and Controls, spoke about one of the key factors for procurement and supply chain – ethics. Stephane said that, while many organisations will put employees through ethics training, the standards of ethics may be different across cultures. For instance, the exchange of services or gifts may be perceived as completely unethical in Western Europe, while fully normal in India.

Xin-jian Carlier Fu, Strategic Sourcing Commodity Manager at Honeywell, raised the point that there are likely to be many different cultures within the same organisation, something confirmed by Jonathan Hatfield, who said that this is ever more the case as organisations from different cultures and countries merge. He added that it was something buyers needed to be cognizant of when dealing with companies that have been taken over.

Finally, Giuseppe highlighted how his first job with a large multinational with a very competitive culture shaped his initial approach to negotiation. When working, later in his career, with a smaller family-owned organization, he learnt to adapt and broaden his approach to negotiation. According to Jean-No?l Puissant, we cannot assume that one-size-fits-all, we need to understand the specific culture of each large or small organisation. 

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Interested in Negotiation?

You may want to join one of Giuseppe's forthcoming workshops:

• Advanced Negotiation: Overcoming Tough Procurement Challenges, 23-24 January 2019, Geneva, CH: featuring senior guest speakers Alessandro De Luca- CIO – Merck Healthcare, Regina Roos- VP & Sales Segment Leader Mineral and Mining – Schneider Electric, Paul André- Director Reduced Risk Commercial Supply– JTI, and Thierry Blomet Senior VP, Global Sourcing and Procurement – Kemira.
• Webinar: Managing Internal & External Negotiations, 1 February, 2019.
• Masterclass: Influence and Persuasion with Oxford Academic Director Owen Darbishire, 26-27 June, 2019, Geneva, CH
• Masterclass: Strategic Negotiations with Harvard Prof. Francesca Gino, 19-20 November, 2019, Geneva, CH
• For other information on Conti Advanced Business Learning intensive workshops, visit https://bit.ly/CABLevents

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Participants to the roundtable: Ali Atasoy, Bérénice Bessière, Thierry Blomet, Xin-jian Carlier, Giuseppe Conti, Stéphane Guelat, Jon Hatfield, Carine Kaldalian, Matthias Manegold, Nicolas Passaquin, Laurence Pérot, Jean-No?l Puissant.

There’s much more to come on this topic, including tips on negotiating with different nationalities, and applications of cross-cultural research in negotiations. Next week I will publish the follow up article on this topic.

What’s your personal experience in cross-cultural negotiations? What challenges did you face? Please leave a comment below.

Giuseppe Conti, "The Creator of Master Negotiators", is a recognized expert in the field of Negotiation and a regular lecturer at top-ranked European Business Schools, including BMI, ESADE, HEC Lausanne, HEC Paris, IMD, INSEAD, Oxford, RSM, SDA Bocconi, and University of Geneva. Managers from over 90 different countries have attended his highly interactive and hands-on workshops. He is a seasoned negotiator combining academic content with a rich practitioner experience from his senior procurement and commercial leadership roles with blue chip multinationals (Procter & Gamble, Novartis, Firmenich, Merck). He runs custom negotiation workshops for leading corporations in Europe and Asia as well as open enrollment programs in English, French and Italian in Geneva (Switzerland), Zurich (Switzerland), and Milan (Italy). Please visit his website at www.cabl.ch for more information.