Cross Culture Difference in Negotiation

There are different countries in the world, each having its own unique identity and characteristics. Every country realises that it is not self sufficient, thus it needs to depend on other countries for varied purposes. Globalisation has led to inevitable increase in trade and commerce beyond the territorial boundaries of a country. Foreign investment and multinational companies have become a household term. Such blurring of territorial boundaries has made it necessary for people to connect to people from other countries having different culture for business purposes. Whenever an individual or industry works with another individual or industry from another country it makes an agreement. Sometimes when there is a dispute between them, they cut a deal to avoid the prolonged litigation. This dialogue between two or more parties to come to a mutually agreed situation having benefits for both the parties is known as negotiation. This process of negotiation becomes very difficult when the two parties belong to different cultures or communities. A culture is the idea, custom and social behaviour of an individual developed according the society he/she has been brought up in. Differences in culture manifests in

  1. Language: Problem in comprehending the language of the other party, misuse of language or commands. An interpreter may provide for translation of sentences to a favourable language but the meaning and sentiments are lost in such translation.


  1. Non Verbal behaviour: Facial expressions, speaking tones, loudness, speaking style, gestures contributes a lot in the process of communication. Such communication necessary for negotiation is hindered when such non verbal behaviour in not understood or comprehended by the other party.


  1. Values: The culture of a person is one of the basic influences on his/her values of life and decisions made by an individual are a reflection of his/her values. Values of a person do not change in a short period of time and this difference in value is a major obstacle in the process of negotiation.


  1. Thinking and decision process: The decision making process largely depends on a culture of the firm or the business organisation. A proactive institution will allow its representatives to make split second decision and take advantage of the situation while an institution believing in consultation and analysis would avoid such opportunities.

The language, the expression, the emotions we use during a negotiation deal is very important, more so in a cross culture negotiation. Words have meaning in the context of their uses which changes with difference in culture. In such a situation it is very important to understand the dynamics of the process. These confusions and barriers can be brought down if the negotiators can understand the culture of their counterparts. It is important for the negotiator to understand how the other person is approaching the deal. The person can consider the deal just as a contractual obligation or see it as an opportunity to build a relationship. The negotiators should be well aware of the background of the other party as well as their culture in order to decide whether to talk in a formal or informal manner. In America, calling through first name would be being friendly while in Japan it would be showing disrespect. The negotiator also needs to take care of the sensitivity and emotional quotient of its counterpart. Certain topics or areas may be very sensitive to one of the party and knowing your counterpart’s psychology helps the negotiator to clearly understand the motive and their requirements from the deal. This helps the negotiator to understand whether the other party is looking for a win-win situation or win-loss situation. The following tips can help a party in a cross culture negotiation.

  • Learn about the culture you are dealing with.
  • Understand the expectation of the other party from the negotiation process.
  • Have a clear idea about your stance and strategy to be used in the negotiating process.
  • Avoid jumping to assumption and conclusion during the process.
  • In case of confusion, clarify and re-check.
  • Keep the language simple and avoid using fancy words.
  • Listen to the other party.
  • Keep it professional.

Thus, by knowing the other party’s culture, not stereotyping and by actually making efforts in bridging the gap between the two parties, negotiators can overcome these cultural barriers.






Nikunj Poddar, Gujarat National Law University


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