The newly relaunched Negotiator Magazine has a great article by Charles Craver on the impact of culture on transnational interactions that is a great read for anyone looking to improve their CQ (Cultural Quotient). It’s a great companion article to SI’s 2009 series on Overcoming Cultural Differences in International Trade and SI’s 2010 series on Cultural Intelligence (which were both edited by SI’s resident expert on Global Trade, Dick Locke).
In SI’s classic series on overcoming cultural differences, we introduced you to Dick Locke’s eight key factors that govern the differences between your culture and that of your potential business partner (supplier, service provider, customer, etc.), which were:
- power distance
- uncertainty avoidance
- individualism
- polychronic vs monochronic time
- personal/impersonal
- buyer/seller rank
- importance of harmony
- importance of face
Charles reviews the common cultural differences of time (and punctuality), personal/impersonal (including the exchange of gifts), the importance of face and harmony, and individualism (and the difference between the approaches taken to negotiations by individualistic cultures and group cultures) as well as the importance of distance (as some cultures will need at least two feet, while others will want to be in your face), respect (including the exchange of business cards in some cultures), social events and cultural exchange (and the need for some cultures to build a rapport through bonding activitis before beginning negotiations), and wealth (and the need for the wealthier party to bring quick benefits to the poorer party) and provides some unique insights that not all Global Sourcing professionals are aware of.
In addition to explaining some key cultural differences that newly minted global supply management professionals may not be aware of, such as:
- how it is unusual for people in Latin American or Middle Eastern countries to show up on time (as delays of thirty or forty minutes are acceptable)
- how people from Middle Eastern countries want to be less than one foot away from you when they talk
- how people from cultures that place great importance on saving face find displays of power to be crude and inappropriate and will hesitiate to initiate law suits or break off negotiations
the article makes a point of noting that a negotiator who speaks the language isn’t enough. The organization needs someone who also understands the culture and the nuances of the language. For example, when the Japanese say that “it would be difficult”, they are really saying they can’t do it. Since they can’t say no and save face, which is important in their culture, they have to convince you that what you are asking is difficult and hope that you will ask for something else instead.
The article also makes a great point of emphasizing the Preliminary Stage where the participants first work to establish a rapport with each other. In this stage, the participants should engage in non-controversial small talk to get to know each other and take advantage of any opportunities presented by the host to explore the city, history, and culture of the country they are visiting. This helps to dispel negative preconceptions and stereotypes on both sides of the table and increases the chances of a mutually beneficial relationship.