Here is a thought provoking piece that was originally published in our sister-website "The Executive Master Class in International Business" The training on cross-cultural negotiation in the Master Class is integrated into the Export Accelerator Training.

I spent many hours of my diplomatic career in negotiations. My first experiences were with the Japanese back when the US wanted to get aluminum baseball bats into Japan. One day, my big boss came in elated saying that he had achieved a breakthrough on aluminum bats that would open markets for all US companies wanting to sell to Japan.

About six months later, we were still trying to agree on final language and no aluminum baseball bats were being shipped to Japan. A friend then gave me a book by a Japanese author, Masaaki Imai, that gave me a radical new insight into cross cultural negotiations. The book was titled “Never Take Yes for an Answer.” The US thought it had an agreement. The Japanese were politely saying ‘Hai’ which can be translated as ‘yes’ or as “I hear what you are saying.’  In the end, we didn’t resolve the issue because we thought they were saying ‘yes’ and they were simply being polite.

There are many elements to successfully negotiating with someone from another culture. It requires the negotiator to step into the mindset of the other culture and look for ways to craft the win-win outcome that characterizes all successful negotiations. Here are three things that I recommend you consider as part of your preparation process:

1. What is the timing of the talks? The pace of the negotiations is a critical first factor. Does the counterpart normally expect a fast or slow pace? Some cultures require many meetings or social events before the start of negotiations in order to build trust. Others are more ‘businesslike’ in the American sense, willing to get down to immediate discussions. Another question is will there be continuous discussions or will there be breaks for more socializing or for the other party to confer with headquarters. I often see US businessmen becoming frustrated with a slower pace. That frustration can place the US negotiator in a weaker position
2. What kind of initial offer can you expect from the other party? In some cultures, it is expected that the initial offer will be far away from the expected outcome. There is no offense taken when such offers are made, and it is expected that in the back-and-forth of the negotiation an equitable solution will be found. On the other hand, in other cultures, particularly in Northern Europe and the US, such an opening stance would be taken as a sign that the other party is not serious about arriving at an agreement. Understanding how other cultures typically present initial offerings is key to avoiding breakdowns.
3. What is the pace of concessions? An old Soviet hand at the State Department once remarked to me that the US often ended up with poor outcomes in negotiating with the Russians because they played the poker-hand of concessions better than we did. The US negotiators, particularly the political appointees, were eager for an agreement and gave out concessions throughout the process, hoping that the Soviets would respond with their own concession. While the Soviets generally didn’t give a “nyet”, they would claim that they were waiting for a response from Moscow. We continued to give concessions despite the lack of reciprocity but when the final rounds arrived, we had given away many of our bargaining chips while the Soviets had given up little. When you are starting your negotiations, consider what is the style of the culture of your counterpart –  are there expectations of ‘fair play’ in reciprocating concessions or do they hold everything to the end.

The IBA Export Accelerator has negotiations training as part of its training.  Beyond the theory, the class gives participants additional insights through mock negotiations. Contact us if you want additional information.