In the article, ‘The hidden challenge of cross-border negotiations,’ the author Sebenius talks about the impact cultural differences can make on cross-border negotiations and businesses. These cultural differences can lead to significant misinterpretations,…
For instance, Sebenius notes that business dealings in China are influenced by local political groups even in private companies, which might surprise American business professionals (p.7). In case of Germany, major board-level decisions involve labor force participation. Cultural differences also cause serious confusion in identifying the actual decision makers. Different cultures follow different norms and have different meanings to trust, faith, relationship, and ethics. These differences could startle the ignorant business personnel. In some countries, decision rights are even vested with the shareholders, which could become terrible cause for concern when foreign companies invest in these shares; moreover, shareholder regulations are different in different countries. Sebenius also points out that informal influences can cause significant say in a deal; these informal groups can assume different forms in different countries (p.7). Hence, it is important to realize and understand who these informal groups are before signing any deals. Through illustrations explaining such influences of cultural difference, Sebenius attempts to clarify that cross-border negotiations would require acquisition of clear understanding of other cultures, their influential people, roles, and various other groups that might influence the negotiation and the business.
Sebenius (p.10) also enlightens us with some suggestions to deal with people from different cultures to arrive at successful negotiations. For instance, in top-down authoritative cultures, negotiations must be made directly with the authoritarians rather than any subordinates; however, it is also important to obtain an awareness of other informal groups in such cultures. Negotiation process also differs in different cultures. In some cultures, the negotiators aim at win-win whereas in some they only think about their advantage. This article also introduces various types of ...
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