Chapter 19 Negotiating with International Customers, Partners, and Regulators

1. International Marketing 15th edition Chapter 19 Negotiating with International Customers, Partners, and Regulators Philip R. Cateora, Mary C. Gilly, and John L. Graham

2. Differences in Language and Nonverbal Behaviors • Americans are near the bottom of the languages skills list • Americans don’t like side conversations by foreigners in their native language • The variation across cultures is greater when comparing linguistic aspects of language and nonverbal behaviors than when the verbal content of negotiations is considered • 15 cultural groups were videotaped and their cultural differences are explained in the next few slides Roy Philip

3. Verbal Negotiation Tactics(The “What” of Communications) Exhibit 19.1 Roy Philip

4. Linguistic Aspect of Language and Nonverbal Behavior (“How” Things are Said) Exhibit 19.2 Roy Philip

5. Differences in Values • Objectivity • “Separating people from the problem” • Competitiveness and equality • Japanese appear to be the best negotiators with the highest profits • Japanese appear to be more equitable with buyers • Time • The passage of time is viewed differently across cultures • These differences most often hurt Americans Roy Philip

6. Differences in Thinking and Decision-Making Processes • Western approach – sequential • Eastern approach – holistic • Americans – business negotiation is a problem-solving activity • Japanese – a business negotiation is a time to develop a business relationship with the goal of long-term mutual benefit • American buyers should anticipate such a holistic approach and be prepared to discuss all issues simultaneously and in an apparently haphazard order Roy Philip

7. Negotiation Preliminaries(1 of 2) • Checklist for planning international negotiations • Assessment of the situation and the people • Facts to confirm during the negotiation • Agenda • Best alternative to a negotiated agreement (BATNA) • Concession strategies • Team assignments Roy Philip

8. Negotiation Preliminaries(2 of 2) • Aspects of the negotiation setting that should be pre-manipulated • Location • Physical arrangements • Number of parties • Number of participants • Audiences (news media, competitors, fellow vendors, etc.) • Communications channels • Time limits Roy Philip

9. Summary of Japanese, American, and Chinese Negotiation Styles Exhibit 19.4 Roy Philip

10. At the Negotiation Table • Business negotiations proceed through four stages • Nontask sounding • Task-related exchange of information • Persuasion • Concessions and agreement Roy Philip

11. Task-Related Information Exchange • Let the foreign counterparts bring up business • Expect a large number of questions but little feedback • Allow periods of silence • Use multiple communication channels • Understand the lack of, or the bluntness of negative feedback • Meet aggressive first offers with questions, not anger Roy Philip

12. Persuasion • Task-related information exchange versus persuasion • Avoid threats, warnings, and other aggressive negotiation tactics • Avoid emotional outbursts • Ask more questions • Use third parties and information channels of communication Roy Philip

13. Concessions and Agreement • Write down concession-making strategies • Understand differences in decision-making styles • In many cultures, no concessions are made until the end of the negotiations Roy Philip

14. After Negotiations • In most countries other than America legal systems are not depended upon to settle disputes • Japan • Contacts primarily contain comments on principles of the relationship • China • Contracts are more a description of what business partners view their respective responsibilities to be • Many foreign CEOs expect a formal contract signing ceremony • Follow-up communications are very important Roy Philip