Negotiating a deal can be tricky at the best of times. Navigating through offers, counter-offers and terms of agreement can be difficult but doing so while also anticipating cultural differences makes it all the more challenging.
Negotiators need to be aware of a whole set of rules when attempting to close a deal that is not in their country, according to the Harvard Law School.
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Successful negotiations
“Negotiating across the cultural divide adds an entire dimension to any negotiation, introducing language barriers, differences in body language and dress, and alternative ways of expressing pleasure or displeasure with the elements of a deal,” says Harvard Law School's Alex Green.
“A handful of fundamental negotiating skills can be put into practice easily in order to overcome these fears, redefine negotiation in an international context, and better understand how to negotiate in cross-cultural situations.” he adds.
When moving to wind up that real estate deal or company acquisition abroad, those involved in settling the deal must show a willingness to embrace their counterpart’s way of doing business, especially when talks are held in the other party's home country, experts say.
One way to help avoid confusion and lost-in-translation scenarios is to separate all the key issues one by one and negotiate them separately in order to avoid blurry agreements that could be costly.
“Negotiations are just like any other form of communications, they need to be simple in order to get the best possible result,” said GreekGuru.net co-founder Stelios Bouras.
“Whether you address international partners in person, via a corporate blog or a press release, the rules are the same: break down what you want to say and get the message out simply and clearly,“ said Mr. Bouras.
The cultural differences that can make - or break - a deal are enormous and far reaching.
When buying a house in Greece, for example, buyers haggle over the price - a trait that doesn’t exist in northern European countries.
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Historic ties and close proximity to the Middle East have left Greeks with a love for bargaining tactics. Giorgos Palaios, who trains industry leaders on negotiations at The Purpose, says the tactics adopted at eastern bazaars commonly appear in negotiations across Greece “even on the largest corporate deals.”
“It is necessary to be aware of the fact that the initial price is not what the seller expects to earn,” says Mr Palaios.
Other differences may be less obvious to spot but equally important.
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In countries like the US, negotiations involve a more individualistic approach that involves taking more risks for bigger gains. This compares with more collectivistic societies, such as Japan and the Arab world, which have tight-knit social frameworks and members often expect relatives, friends or neighbours to help out if needed, experts say.
"Collectivist cultures tend to spend more time in the negotiation process building relationships and focusing on harmony management instead of discussing contracts. They also tend to exchange information indirectly, whereas individualistic cultures tend to make their messages very explicit," said Nadia L. Gonzalez, Grand Valley State University on a project titled “The Impact of Culture on Business Negotiations”.
Negotiations for global business
British linguist Richard D. Lewis has charted communication patterns as well as leadership styles and cultural identities in his book, "When Cultures Collide."
Below are some of his insights on how to negotiate with people from all over the world:
Americans lay their cards on the table and resolve disagreements quickly with one or both sides making concessions.
Canadians are inclined to seek harmony but are similar to Americans in their directness.
People in the UK tend to avoid confrontation in an understated, mannered, and humorous style that can be either powerful or inefficient.
Germans rely on logic but "tend to amass more evidence and labor their points more than either the British or the French."
When meeting with the French, be prepared for a vigorous, logical debate.
Italians "regard their languages as instruments of eloquence" and take a verbose, flexible approach to negotiations.
Like Italians, Spaniards will "pull out every stop if need be to achieve greater expressiveness."
Among the Nordic countries, Swedes often have the most wide-ranging discussions.
Finns tend to value concision.
Most Norwegians fall somewhere in between Swedes and Finns.
The Swiss tend to be straightforward, nonaggressive negotiators. They obtain concessions by expressing confidence in the quality and value of their goods and services.
Hungarians value eloquence over logic and are unafraid to talk over each other.
Bulgarians may take a circuitous approach to negotiations before seeking a mutually beneficial resolution, which will often get screwed up by bureaucracy.
Poles often have a communication style that is "enigmatic, ranging from a matter-of-fact pragmatic style to a wordy, sentimental, romantic approach to any given subject."
The Dutch are focused on facts and figures but "are also great talkers and rarely make final decisions without a long 'Dutch' debate, sometimes approaching the danger zone of over-analysis."
The Chinese tend to be more direct than the Japanese and some other East Asians. However, meetings are principally for information gathering, with the real decisions made elsewhere.
People in Hong Kong negotiate much more briskly to achieve quick results.
The Indian English "excel in ambiguity, and such things as truth and appearances are often subject to negotiation."
Australians tend to have a loose and frank conversational style.