Meredith Wood at Fundera has suggested that there are 5 main negotiating styles, and 6 cultural dimensions that differ between countries. Let’s take a look.
Our personalities play a major role in dictating how we behave and interact with others. They also contribute to the way we resolve conflict and negotiate. As a small business owner, you’ll likely have to negotiate for your company and as you grow, you may find yourself wading into international waters where negotiation styles may differ.
Whether you hope to find a great new product for your company or want to get the best manufacturing deal possible, communicating with people in different cultures is probably in your future as a small business owner.
To help you navigate negotiations with a foreign company, we’ve created an infographic with 10 major countries around the globe. We detail important traits of each country, the negotiation style that best fits their culture, and how you can adapt your own negotiation style to find the best solution for both sides.
Understanding the Five Negotiation Styles
Before trying to negotiate in another country, it’s important to understand the basics of negotiation and how they are affected by psychology and personality.
There are five main negotiation styles (also called conflict resolution styles). These styles vary based on the personality and background of the negotiator, their needs, and the urgency needed to find a solution.
Understanding how to interact with and adapt to different negotiation styles is imperative in coming to a satisfactory solution and maintaining good relationships with business partners.
When conducting business in foreign countries, take the time to research your opponents and understand their perspective and needs before beginning negotiations.
1. Competing: Confident and assertive, these negotiators tend to pursue their own needs and focus on results. They may be perceived as aggressive and controlling.
How to adapt to a competing negotiator: Maintaining your ground is important when interacting with a competing negotiator. State your position firmly and do not back down from important self-interests.
2. Avoiding: These negotiators approach conflict with caution, preferring not to cause tension. They may not outwardly express their own interests and often sacrifice those interests if their opponent has a stronger voice.
How to adapt to an avoiding negotiator: Expressing deadlines and communicating details early is critical when negotiating with an avoider. If no solution is reached, consider escalating the issue with a higher authority.
3. Accommodating: Relationships are important to these negotiators; they prefer to smooth out conflict if it arises, focus on maintaining positive communication with negotiating partners and satisfy the needs of others before their own.
How to adapt to an accommodating negotiator: Do not accept unnecessary concessions from this negotiator. Allowing others to give up too much may be detrimental to both sides in a long-term relationship.
4. Compromising: These negotiators prefer to find a middle-ground solution quickly rather than debate back and forth for long periods. Coming to an agreement that pacifies both sides is the ultimate goal of this negotiator.
How to adapt to a compromising negotiator: Maintaining the importance of your interests is crucial in a negotiation with a compromising style. Communicate your needs clearly and take the time to explore multiple alternatives before agreeing on a solution.
5. Collaborating: The optimal solution is the goal for this negotiator. They tend to focus on finding results that satisfy all parties and express honest communication during debate. These negotiators would prefer to weigh many options before finding the best result.
How to adapt to a collaborating negotiator: While a collaborative negotiation partner is often interested in taking the time to find good solutions for both parties, it may not be in your best interest to invest significant time in the negotiation. Clearly define your needs and do not accept alternatives to hard requirements.
No matter what the negotiation involves, it is important to always:
- Clearly state your party’s interests and requirements.
- Approach every negotiation with a willingness to communicate.
- Understand your opponent’s negotiation style and perspective.
- Blend your negotiation style to best adapt to opponents.
Understanding the Six Cultural Dimensions
Renowned psychologist and professor Geert Hofstede published a theory in the 1970s that describes dimensions of international cultures. These dimensions describe important social elements of culture, including how they impact communication and connection between populations.
The six cultural dimensions have become a vital part of international business communication and are important to successful negotiations in foreign countries.
1. Power Distance Index (PDI): This dimension focuses on how a culture perceives and interacts with authority. A low-scoring power distance culture emphasizes the importance of equality, while a high-scoring power distance culture exhibits a strong hierarchical structure.
Score of 0–49: equality
Score of 50–100: hierarchy
2. Individualism versus Collectivism (IDV): Cultures with high scores (individualistic) encourage their members to adopt a self-serving mentality and strive for personal achievement. Cultures with low scores (collectivistic) prefers tight-knit groups and emphasizes loyalty to a group or family before oneself.
Score of 0–49: group
Score of 50–100: personal
3. Masculinity versus Femininity (MAS): This dimension centers on achievement, assertiveness, and competition. High-scoring (masculine) cultures value success, heroism, and material reward. Low-scoring (feminine) societies focus on collaboration, consensus, and modesty.
Score of 0–49: modesty
Score of 50–100: heroism
4. Uncertainty Avoidance Index (UAI): This expresses the degree to which a society tolerates differences and ambiguity. Cultures with high uncertainty avoidance scores generally have rigid belief systems and low tolerance for unorthodox behavior or outsiders. Cultures with low uncertainty avoidance scores tend to be more relaxed when it comes to behavior, beliefs, and visitors.
Score of 0–49: tolerance
Score of 50–100: rigid beliefs
5. Long-Term Orientation versus Short-term Normative Orientation (LTO): Centering on the dichotomy of the past and the future, this dimension establishes how cultures interact with time. Low-scoring societies are long-term oriented, value tradition above all else, view social change with a skeptical eye, and set standards based on past events. Cultures with a high score (short-term normative orientation) encourage new ways of thinking, innovation, and education and set their sights on the future.
Score of 0–49: tradition
Score of 50–100: innovation
6. Indulgence versus Restraint (IND): This dimension focuses on quality of life, leisure time, and drive. A high-scoring (indulgent) society values leisure, gratification, and travel. A low-scoring culture (restraint) tends to limit this gratification in favor of stricter social norms like dress code or restricted travel.
Score of 0–49: strict norms
Score of 50–100: gratification
Negotiating in Different Cultures Across the Globe
To help you determine the best way to negotiate when conducting business in a foreign culture, Fundera created an infographic with 10 of the most culturally-diverse countries across the globe. We analyzed each country’s Hofstede scores and compared them to the negotiation styles that you will most likely encounter in that culture.
Remember: it’s important to research your negotiation partner before meeting with them. While our suggestions may fit your partner’s overall culture, negotiation style varies person to person! Be prepared to adapt to any negotiation style once you arrive at the meeting.
Click here to view the infographic.
Adapting to both conflict styles and cultural dimensions is crucial to successful negotiations in foreign countries. Remember, negotiators from other countries are unlikely to demonstrate the same negotiation style you use. For this reason, it is important to understand how you negotiate and how different cultures approach negotiations.
For the best results, thoroughly research appropriate business etiquette in the country you’ll be visiting and communicate your interests clearly when negotiating.
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Sources: [1], [2]. Image sources: Eliott Reyna [1], [2], Joseph Grazone [3].