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4 TIPS TO SUCCESSFULLY NEGOTIATE INTERNATIONAL BUSINESS

Negotiating is simply the process you follow to get somebody else to do what you want him/her to do. A successful negotiation has to follow a certain process with seven main stages:

  1. Pre-negotiation
  2. Entry
  3. Establishing relationships
  4. Review of strategies
  5. Bargaining
  6. Agreement
  7. Post-agreement

The process will pretty much keep the same structure in both domestic and overseas environments; many new factors will need to be taken into consideration when negotiating across borders such as the language difference, cultural sensitivities, legal systems, tax regimes, labour laws and business practices.

Moreover, government-led bureaucracy, restrictive regulations and direct government interferences could further complicate the negotiating, as well as the need to analyse political and economic instability, currency fluctuations and ideological differences before starting any overseas negotiations.

At the end of the day, even if the stages of the negotiation process remain the same in theory, international business negotiations and the negotiator that engages in this should be aware of those differences and appropriately trained to ensure a successful negotiation.

This technique seeks to give you some general recommendations, tips and facts that you may want to know dealing with foreign businesses to expand your own company.

The following four tips will help to negotiate international business successfully.

1. Communicate Effectively with Your International Negotiator

With the globalization and the multiplication of business transactions across borders, English became the main international language used in negotiating across cultures.

This is more precisely described as ‘international English’ or ‘off-shore English’ that became the official business language: a form of ‘low-risk English’ using words, phrases and grammatical structures which can be easily understood, avoiding idioms, slang, jargon and complex structures.

When starting contact with a foreign negotiator who may not be a native speaker, make sure you adapt your speaking and writing style to your counterpart to avoid misunderstandings.

If your negotiator cannot speak English, the use of an interpreter becomes essential. Before starting any direct conversation with the counterpart, the interpreter should always be briefed and provided with any notes you may have on the proposals you intend to make.

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During the negotiation, you should express your main points in several different ways so that the meaning is clear and helpful for the interpreter.

Moreover, you should always look at the negotiator while corresponding, not the interpreter, since it could be perceived as a lack of respect in some cultures.

2. Adapt Your Approach to Your Negotiator’s Culture

The ‘getting to know you’ phase could be crucial in determining the success of a negotiation. The ‘shared experience’ is a form of cultural shorthand and is extremely helpful in preliminary and informal discussions, as ‘ice-breakers covering interests like sport, art, etc.

In some cultures, building relationship and mutual trust are initially more important than proceeding to detailed negotiations.

If your company is dealing with organisations from, India, Middle East or Africa, showing interest and respect towards your counterpart’s family could be vital for successful relationship since the family unit is highly valued in those regions.

Such questions about building a family could be judged as private and not appropriate to the situation in some other cultures. (e.g. France, Germany).

In any case, those ‘small talks’ should avoid contentious subjects such as political, cultural or religious sensitivities, when their appropriateness or not is in doubt.

The use of humour could also be used as an ‘ice-breaker’. Humour was described as ‘the shortest distance between two people’ by the comedian, Victor Borge.

However, in an international context, humour could be something of a double-edged sword, as it does not always translate well across cultures and could cause embarrassment, offence or confusion through misunderstanding.

While humour is often used in British business presentations, Germans would judge it as a lack of seriousness.

Developing good listening skills is really important to succeed in international negotiations, because it enables you to pick up the various subtle cultural nuances.

Silence is often used by the Japanese to mull over what has been said and thought of the alternatives, but it could be mistaken by westerners as showing a lack of understanding.

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Do not feel uncomfortable and jump in, or worse make concessions, if you encounter this situation.

The concept ‘face’, defined as the regard in which one is held by others, is of a vital importance in the Chinese, Thai and Japanese cultures. This could explain why Chinese business people use indirectness and prefer intermediaries for negotiations.

In order to save and give ‘face’ because of the importance they attach to the establishment and maintenance of long-term relationships. Keep in mind that Westerners separate business life from personal life but this distinction is less significant for Eastern cultures.

3. Adopt the Right Negotiations Practices

The business etiquette differs greatly across cultures, especially the exchange of business cards. In the Japanese culture, the ‘Meishi’ is treated with great respect because Japanese consider the business card as the manifestation of the person’s persona.

They will give you their business cards directly after the initial formal introduction: make sure you analyse the cards before carefully placing them in the front pocket of your wallet or on your desk in front of you.

Concerning your own card, the best would be to print one side in your own language and the other in the other culture’s language.

When making business in Hong Kong, you will meet many Westerners with business cards on which they even have their names translated into Chinese characters. Another aspect of business etiquette which differs cultures is the level of familiarity in the approach. \

In Germany, The Netherlands and Italy, people address each other by their academic titles, calling doctors’ people with doctorates, as opposed as the more family approach used by Americans and increasingly by the British.

Greetings can also be more formal for some cultures, including Germany and Russia. When dealing with women from other cultures, always wait for them to initiate the handshake.

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Socialising plays an important role in negotiating successfully across borders. Due regard to seniority is essential with strict attention at formal dinners, order of speeches, giving and receiving gifts.

Try to give gifts that symbolize the status of your company and the importance of an impending deal, such as an item characteristic of your local area, or one that displays your company logo.

4. Understand Your Counterpart’s Negotiation Process

In an international context, your negotiator will probably not use the same negotiation steps and methodology like the ones you are used to dealing with in the domestic market.

Agreeing on an agenda is probably the best way to clarify the stages of the negotiations and determine what has been agreed on at a certain stage of the negotiation process.

This agenda takes even more importance when dealing with foreign organisations, and you should try to follow it as much as possible, since surprises and hidden items could affect long-term trust in some cultures.

Another aspect that is influenced by culture is the attitude to time. The existence of different attitudes to time could cause concern. There are two types of culture concerning time: the monochromic and the polychromic cultures.

Negotiation from North America, Germany, Scandinavia and Japan, are part of monochromic cultures, so they will like strict time-keeping, punctuality and keeping schedules.

Negotiations from Latin America, Southern Europe, Africa and Arabic countries, are part of polychromic cultures: they may arrive late deal with several issues and activities at the same time and engage in multiple conversations.

This attitude cause frustration, be perceived irritating and unhelpful for people from monochromic cultures.

If you find yourself uncomfortable dealing with people with such behavior, you will then need a high level of patience in order to ensure the success of your business deal.

 

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