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Chapter11 DifferentBusinessCulturesandNegotiations Introduction Internationalbusinessnegotiationstakeplaceacrossnationalboundaries Theycovervariouslevelsofnegotiatorsfrommulti nationsandmulti nationalities Duetodifferenthistory politics economics culturaltraditionsandcustomsofdifferentpartsoftheworld thereexistevidentdifferencesofvaluesandnegotiatingstylesamongpeopleallovertheworld Thereforeabusinessnegotiatorshouldhavesomeunderstandingofdifferentcultures customsandbusinessconventionsofdifferentcountries Thenonecangetbetternegotiatingresultsbycreatingafriendlynegotiatingatmosphere havingamoredefinitenegotiatingobjectinview adoptingappropriatenegotiatingstrategiesandusingflexiblenegotiatingtactics Butbecarefulnottoassumethateveryonefromanydifferentculturalmilieuistotallypredictable Whenmeetothercultures respectandpromote butnotbesubservienttothenegotiatingcustomsofthatculture Thischapterintroducesdifferencesofbusinesscultures globalbusinessprotocolandetiquetteanddifferentnegotiatingstylesofdifferentcultures Inthischapteryouwilllearn differencesofbusinesscultures globalbusinessprotocolandetiquette differentnegotiatingstylesofdifferentcultures 11 1Differencesofbusinesscultures Therearetwoironrulesofinternationalbusiness Ininternationalbusiness thesellerisexpectedtoadapttothebuyer Ininternationalbusiness thevisitorisexpectedtoobservelocalcustoms Ifoneisthebuyerinaninternationaltransaction culturaldifferencesarelessimportant unlessonewantstonegotiatethebestofall lt sbecauseofIronRuleNo 1 Whatifoneisnotinvolvedinabuy selltransaction Supposeoneisjusttravelingabroadtonegotiateajoint ventureagreement anacquisitionorastrategicalliance thenheisexpectedtoobservelocalcustoms That swhereIronRuleNo 2comesintoplay Toobservelocalcustomsdoesn tmeantomimicorcopylocalbehavior justbeyourself Butofcourse beingyourself shouldincludebeingawareoflocalsensitivitiesandgenerallyhonoringlocalcustoms habitsandtraditions Theskillednegotiator regularlymeetingmanyotherparties recognizesthateachhasitsowndistinctwayofnegotiation Heattunestothedifferencesandadjustshispreparationandhisconduct Weshallexaminedifferencesofstylewhichreflectthewaysinwhichdifferentorganizationswork 11 1 1Task centeredvspeople centered Oneclassificationoforganizationalstyledistinguishesbetweenpeoplewhoaretask orientedandpeoplewhoarepeople oriented Peoplewhoarepurelytask orientedareconcernedentirelywithachievingabusinessgoal Theyarenotatallconcernedabouttheeffectwhichtheirdeterminationwillhaveonthepeoplewithwhomtheycomeintocontact Theywillpursuetheirbusinessobjectivesrelentlessly theywillgotothelimitsofmorality asnegotiators theywillbeverytough veryfighting veryawareoftacticalploysandanxioustomakemaximumuseofthem ClassicallyAmericanbusinesscultureisverytaskorachievementoriented Peopledon twanttowastetimewiththesocialniceties theywanttogetdowntobusiness Anotherwayofclassifyingthistypeofapproachistosaythatitisveryspecific Peoplewhoadoptthisapproachtendtofocushardonspecificissues thisshouldmeanthattimeissavedandobjectivesreachedmosteffectively However thereisalwaysadangerthatthelargerpicturemaybemissedandthatpersonalissuescanbeignored Thesepersonalissuesmaybetheoneswhichmakeorbreakthedeal Peopleorientedmanagers ontheotherhand arehighlyconcernedaboutthewellbeingofthosewhoworkforthem oralongsidethemorabovethem Thisconcernaboutpeopledominatestheiractivity saysthetheory anditcanleadtoanalmosttotalneglectofthebusinessgoals Inthisrespect theygivetimetosomesmalltalkbeforethemeetingstartsbecausetheybelievesthiswillimprovecommunicationandlaythebasisforpossiblefuturerelationships Anotherwayoflookingatthisistocallitdiffuse Adiffuseapproachtobusinesswillplacegreatimportanceonalltheeventswhichsurroundtheactualdiscussionofthedeal forexample lunchtogether socialconversationonthewaytotheairport orachancetomeetyourpartner sfamily Thereareintermediatepointsbetweentotaltask orientationandtotalpeopleorientation Itsplitsthiscentralareaintothreeparts 1 low orientationbothtotaskandtopeopleButofcoursesuchlowachieverswouldhardlybeexpectedtoreachthestatusofnegotiators 2 medium orientationbothtotaskandtopeopleThiscentergroupischaracterizedbythecontinualsearchforcompromise 3 high orientationbothtotaskandtopeopleThisstyleischaracterizedbytremendousopenness trustinformsofrelationship greatforethought soundcreativedecisions Fromthethreeparts werecognizealsothreestylesofnegotiatorswearelikelytomeetinpractice thefighter highlytask oriented thecollaborator aimingtogeteverythingintotheopen confrontissuesandmakeacreativedeal thecompromiser lookingalwaystocompromisetosettledeals Howshouldthesethreedistinctivestylesofnegotiationinfluencethewayweconductournegotiations First wemustrecognizethatthedifferentpatternsofbehavioraredeeplyingrainedinthepeoplewearelikelytomeet Theywilltendnaturallytofollowtheirsetwaysofdoingthings Theywillnoteasilyadapttoourapproach Thereforeifwewanttoadoptanapproachdifferentfromtheirs wemustbecomethemoreskillednegotiators moreskilledindoingitourwaythantheyareindoingittheirway Second wemusttakeaccountoftheotherparty sstyleinourpreparations Themostdifficultsituationiswhenwewanttonegotiatetoouradvantagebutweanticipateskilledfightersandfearbeingbeaten Thenwemustprepareourdefensesincludingbidsandtacticswhichwillgiveusampleroomformanoeuvre Havingpreparedinthisway wewillhaveahighdegreeofreadinesstoputforwardourbids andsubsequentlytodefendthemandtousethetacticswehavethoughtabout Morepositively ifweanticipatemeetingskilledfightersbuthaveconfidenceinourownskills ifwearenotafraidofbeingbeaten thenourpreparationandconductofthenegotiationwillnotneedtobebasedonpreparingourdefenses Ourpreparationsnowcanberestrictedtoobtainingacleardefinitionofpurposeandaims withoutyetgoinghardonouropeningbids 11 1 2Pioneervsbureaucrat Othertheoriesdistinguishbetweenpersonalandbureaucratictypes whichdrawourattentiontotwodifferentcategories the pioneer andthe bureaucrat The pioneer isthestrongindividual Heisprominentinhisownorganization Thesortofmanisgoodatseizinganopportunity spottingamarket makingaprofit Hetendstobeverydominating goodatimprovising intuitiveinhisthinking charismaticinhispersonality Anegotiatorofthistypewillbepushful forceful readytotakedecisionsandtocometoagreements Hewillbedistinguishableparticularlyinthewayinwhichheactsasateamleader thefocalpointoftheteam theonewhospeaksfortheteamonallissues theonewhouseshisteammemberstoobtaininformationforhimselfwhichhethentransmitstootherparty Suchateamleader thoughusuallybubbleswithenergy isevenabletohandleonlythecontentofanegotiation Hecannotatthesametimehaveconsciousconcernfortheproceduresofthemeeting Givensufficientpriorknowledgeoftheotherpartywhoareabouttomeet this pioneer negotiatorcanshapehispreparationaccordingly Someoftheissuestowhichtheteamwillneedtoattuneare tochooseateamleaderofcorrespondingpersonality theneedforitsownteamleadertobehighlybriefed teammembersareconstantlyalerttofeedtheteamleaderwithfactsandfigures Theywillneedtohelptheleaderduringthenegotiationastheotherparty pioneer developsanddemandsattention ateammembershouldbenominatedtotakeovertheroleofconcernfortheproceduraldevelopmentofthenegotiation promptingandhelpinghisteamleadertocontroltheplananddevelopmentofthenegotiation thepartywillneedfrequentrecessestoconsolidateitsowninformation inresponsetotheflowofdetailscomingfromthe pioneer negotiator Negotiatingwitha pioneer canbeexciting enjoyableandhighlyproductive Itdemandsthatweshouldrecognizehishighlyintuitiveandinstinctivenature Weshouldourselvesretainaconsciousnessofthenegotiatingprocessesthroughwhichwearegoing tryingtosustainournormaldegreesofcontrol Bureaucracyisthepatternmostoftenfoundinlargeorganizations Thestyleofworkingissystematized Therearebooksofrules standardizations planning numerouscommittees lotsofchecking doublecheckingandcrosschecking Theorganizationisgovernedwithaclearhierarchy Itiscompartmentalizedandco ordinatedbythesystem therules theproceduresandtheobjectives Advantagewithinabureaucraticorganizationcomestothepeoplewhoaremostcompetentatplayingthegameaccordingtotherules Thismeansthattheirnegotiatorsmaybeexpectedtohavebothobjectivesandstylesofworkingwhicharebureaucratic Insettingupadeal itismoreimportantforthebureaucraticnegotiatortofitintothebudgetaryprovisionsthanthetotalsumofmoneyinvolved Forstylizedbureaucrats formali shavetobedottedandt stobecrossed Precisestatementsaretobeagreedateachstep Eleganceandconformityaremaintainedastheygoalongthenegotiatingprocess Inanticipationofmeetingwithbureaucraticnegotiators theotherpartydoeswelltoselectateamwhichhasboththepersonalityandexperiencetohandlethismannerofoperating Theteamwillreadilyacceptthesystemofapproachwehaveadvocatedtonegotiations forexample theywillfollowtheproceduraldisciplineofagreeingpurpose planandpace Theirbehaviorwillbeimpeccable Buttheattitudeoflookingtogetherforjointadvantagedoesnotcomeeasilytothesystemsminded Theyseetwosidestoberepresentedbythenegotiatingparties notonegroupoftwopartiesworkingtowardsagreement Bureaucraticorganizationsthustendtohavedistinctiveobjectivesandtonegotiateinthepattern toouradvantage 11 1 3Relationshipfocusedvsdealfocusedcultures Thisisthe GreatDivide betweenbusinesscultures Deal focusedpeoplearefundamentallytaskorientedwhilerelationshipfocusedfolksaremorepeopleoriented Conflictsarisewhendeal focusedexportmarketerstrytodobusinesswithprospectsfromrelationship focusedmarkets Manyrelationship focusedpeoplefinddealfocusedtypespushy aggressiveandoffensivelyblunt Inreturn deal focusedtypesoftenconsidertheirrelationship focusedcounterpartsdilatory vagueandinscrutable Thefundamentaldifferencesbetweenrelationshipfocusedanddealfocusedmarketsimpactbusinesssuccessthroughouttheglobalmarketplace Thevastmajorityoftheworld smarketsarerelationshiporiented theArabworldandmostofAfrica LatinAmericaandtheAsia Pacificregion wherebusinesspeoplegetthingsdonethroughintricatenetworksofpersonalcontacts Theyprefertodealwithfriendsandpersonsorgroupswhoarewellknowntothemandcanbetrusted Theyareuncomfortabledoingbusinesswithstrangers especiallystrangerswhoalsohappentobeforeigners Likewise relationship orientedfirmstypicallywanttoknowtheirprospectivebusinesspartnersverywellbeforetalkingbusinesswiththem Incontrast thedeal focusedapproachiscommoninonlyasmallpartoftheworld Stronglydeal focusedculturesarefoundinnorthernEurope NorthAmerica AustraliaandNewZealand wherepeoplearerelativelyopentodoingbusinesswithstrangers ModeratelydealfocusedculturescouldbefoundinGreatBritain SouthAfrica LatinEurope CentralandEasternEurope Chile southernBrazil northernMexico andSingapore This GreatDivide betweentheworld sculturesaffectsthewayofbusinessconductedfromthebeginningtotheendofanycommercialrelationship Forstarters thewaythefirstapproachismadetopotentialbuyersorpartnersdependsuponwhethertheyareindeal focusedorrelationship focusedcultures Indeal focusedcultures peoplearerelativelyopentodealingwithstrangers Themarketercanmakeinitialcontactwiththeprospectivebuyerwithoutanypreviousrelationshiporconnection Havinganintroductionorreferralishelpfulbutnotessential Let staketheUnitedStatesasanexample Perhapsbecausetheyareraisedinahighlymobileimmigrantsociety mostAmericansareopentodiscussingbusinesspossibilitieswithpeopletheydon tknow EachyearAmericansbuyover 300billiondollarsworthofgoodsandservicesfromtotalstrangers andhalfofitisbusiness to businessselling Inrelationship focusedcultures firmsdonotdobusinesswithstrangers Theproperwaytoapproachsomeonewhoisn tyetknownistoarrangefortherightpersonororganizationtomakeanintroduction Athirdpartyintroductionbridgestherelationshipgapbetweenoneandthepersonorcompanyonewantstotalkto Theidealintroducerisahigh statuspersonororganizationknowntobothparties Agoodsecondbestmightbethecommercialsectionofone scountry sembassyinthetargetmarket Embassyofficialstendtobeaccordedhighstatusinrelationshiporientedcultures andofcourseitispartoftheirjobtopromoteexports Chambersofcommerceandtradeassociationsareotherpotentialintroducers Inoneword inrelationship orientedmarketplantoapproachindirectlytothepotentialcustomerorpartner whetherviaatradeshow atrademissionorathird partyintroduction 11 1 4Formalvsinformalbusinesscultures Formalculturestendtobeorganizedinsteephierarchieswhichreflectmajordifferencesinstatusandpower Incontrast informalculturesvaluemoreegalitarianorganizationswithsmallerdifferencesinstatusandpower Manypromisinginternationaldealshavefallenthroughwhenanegotiatorfromaninformalcultureconfrontscounterpartsfrommoreformalculturesbecausethesecontrastingvaluescauseconflictattheconferencetable Businesspeoplefromformal hierarchicalculturesmaybeoffendedbythebreezyfamiliarityofcounterpartsfrominformal relativelyegalitariansocieties Ontheotherhand thosefrominformalculturesmayseetheirformalcounterpartsasstuffy distant pompousorarrogant Formalityactuallyisaboutstatus hierarchies powerandrespect Whereasinformalculturesaresupposedtovaluestatusequality formalculturesvaluehierarchiesandstatusdifferences Ignoranceofthisdistinctioncancauseseriousproblemsacrossthebargainingtable Suchmisunderstandingscanbeavoidedifbothsidesareawarethatdifferingbusinessbehaviorsaretheresultofdifferingculturalvaluesratherthanindividualidiosyncracies Finallylet stakealookat whoiswho Informalcultures Australia USA Canada NewZealand Denmark Norway IcelandFormalcultures MostofEuropeandAsia theMediterraneanRegionandtheArabWorld LatinAmerica 11 1 5Rigidtimevsfluidtimecultures Peoplelookattimeandschedulingdifferentlyindifferentpartsoftheworld Inrigid timesocieties punctualityiscritical schedulesaresetinstone agendasarefixedandbusinessmeetingsarerarelyinterrupted EdwardT Hallinventedtheterm monochronic fortheseclock obsessed scheduleworshippingcultures Indirectcontrastare polychronic cultures wherepeopleplacelessemphasisonstrictpunctualityandarenotobsessedwithdeadlines Polychronicculturesvaluelooseschedulingaswellasbusinessmeetingswheremeetingswithinmeetingsmaybetakingplacesimultaneously Conflictarisesbecausesomerigid timevisitorsregardtheirfluid timebrothersandsistersaslazy undisciplinedandrudewhilethelatteroftenregardtheformerasarrogantmartinetsenslavedbyarbitrarydeadlines Monochromicbusinesscultures NordicandGermanicEurope NorthAmerica Japan Moderatelymonochromic Australia NewZealand RussiaandmostofEast CentralEurope SouthernEurope Singapore China Korea SouthAfrica Polychronicbusinesscultures TheArab World mostofAfrica LatinAmerica SouthandSoutheastAsia JapanwasclassifiedaspolychronicbyEdwardT Hallinthe1960 s ButtodaytheJapaneseareasschedule obsessedandclock consciousastheSwiss Singapore apolychronicSoutheastAsianentrepotjust30yearsagoisnowamoderatelymonochronicbusinessculture Bothcountriesareproofthatculturedoeschange albeitslowly Orientationtotimevariesnotonlyamongdifferentcountriesbutoftenwithinagivencountryaswell InBrazil SaoPauloisrelativelymonochronicwhereasRioisstronglypolychronic Similarly peopleinthemoreindustrializedsoutherncoastalprovincesofChinaaremoreclock consciousthanthoseinthelessdevelopedinterior AndaKoreanmeetingismorelikelytostartontimeifittakesplaceinSeoulratherthaninasmalltowninthecountryside 11 1 6Expressivevsreservedcultures Veryexpressivecultures TheMediterraneanRegion LatinEurope LatinAmerica Variablyexpressive USAandCanada AustraliaandNewZealand EasternEurope SouthAsia Africa Reservedcultures EastandSoutheastAsia NordicandGermanicEurope Expressivepeoplecommunicateinradicallydifferentwaysfromtheirmorereservedcounterparts Expressivepeopletendtobeuncomfortablewithmorethanasecondortwoofsilenceduringaconversation Incontrast peoplefromreservedculturesfeelateasewithmuchlongersilences Japanesenegotiators forexample oftensitwithoutspeakingforwhatseemslikeaneternitytovolubleMexicans GreeksorAmericans Afterthreeorfoursecondsthelatterfeelcompelledtosaysomething anythingtofilltheawfulsilence UnfortunatelytheloquacityofexpressivepeopletendstoirritatethereticentJapanese whoseemtovaluethespacebetweenthespokenwordsjustasmuchasthewordsthemselves Negotiatorsfromreservedculturesdonotfeeltheneedtoengageinconstantblabbingthewaymanyoftheirexpressivecounterpartsdo 11 1 7Whichstylewins Differentstylesproducedifferentsortsbenefit AgoodAmericannegotiatorwillget51percentofthecake ButagoodNorwegiannegotiatorwillensurethatitisabiggercakethanitmighthavebeen WhentwoNorwegiansnegotiatetogether thentheyseektobuildthebiggestpossiblecake WhentwoAmericansnegotiatetogether thenitisthemoreskilledofthenegotiatorswhowill win Whenaskilledcollaborativenegotiatormeetsanunskilledcompetitivenegotiatorthencollaborativeprocesseswilldominatethenegotiations Whenaskilledcompetitivenegotiatormeetswithanunskilledcollaborativenegotiatorthenitwillbethecompetitivewhodominates Butfinallywecometotheissue whenskilledcollaboratormeetsskilledcompetitor whowins Ifeachpartyhadtheskilltorecognizethestrengthsoftheother andtoworkwiththeothertothepointatwhichthatformofskillwasmostimportant thenwecouldexpectasuperlativeoutcome Butthisisaskingtoomuch Nosinglestyleofnegotiating wins Itisinparticularthepartywhichisskilledfortheparticularsituationthatwillprevail 11 1 8Thefourkeyelementsofnonverbalnegotiatingbehavior 1 Spatialbehavior interpersonaldistanceEveryhumanbeingissurroundedbyaninvisibleenvelopeofaircalleda spacebubble whichvariesinsizeaccordingtowhereintheworldtheygrewupandtheparticularsituation Thefollowingshowstheapproximaterangeofsame genderspace bubblesizesacrossculturesinabusinesssituation Close 20to35cms theArabWorld theMediterraneanRegion LatinEurope LatinAmerica Distant 40to60cms mostAsians Northern CentralandEasternEuropeans NorthAmericans 2 TouchbehaviorExpressivepeopleengageinmorephysicalcontactinpublicthanmenandwomenfrommorereservedcultures Thefollowingclassifiesculturesbythedegreetowhichtouchbehaviorisaccepted Highcontactcultures theArabWorldandMediterraneanRegion LatinEuropeandLatinAmerica Variablecontact EasternEurope NorthAmerica Australia Lowcontactcultures MostofAsia UKandNorthernEurope Differencesintouchbehaviorareseriousenoughforproblemstoariseevenbetweencultureslocatedfairlyclosetogether Forexample the moderate Americansdofartoomuchshoulderpatting elbow grabbingandb

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