Intercultural Business Negotiations: Japan and America

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Table of Contents

Summary
Introduction
HOFSTEDE’s dimension theories of culture
The negotiation process and expected challenges
Recommendations
Conclusion
References

Summary

A number of American corporations acknowledge the significance of diversification. Because of this, corporations are currently expanding into foreign markets. For instance, MNCs have expanded its business globally. As such, the corporations have joint ventures in a number of countries. In their bid to expand, American firms have faced numerous challenges. Cultural dissimilarities have been blamed as the main cause of the challenges. Researchers have indicated that American entrepreneurs have little knowledge about cultural differences and their effects on their ventures.

According to some studies, American businesspersons have had ineffective, volatile, and inadequate businesses internationally because they ground their studies on western verses eastern cultural perspective (Adair & Weingart 2007). Through this, they negotiate their business deals abroad using the same standard principle. Owing to this, the negotiations have resulted in failure. As an international business manager for a MNC based in the USA, the board of directors have requested me to come up with a report focusing on Japanese company culture in comparison with the American company culture. By doing so, I am required to highlight the problems that may arise in negotiation and the appropriate negotiation skills that will be utilized in such situations.

Introduction

There are a number of dissimilarities between the Japanese and the American company cultures (Adair & Weingart 2007). The differences are not only based on their management approaches but also on how they conduct their business. Japanese employees in a manufacturing firm are required to come up with products with the highest quality as much as possible. Similarly, the Japanese employees are expected not to question how decision processes are being undertaken in their firms.

Therefore, they are not required to contribute any suggestions with respect to the management of their firms. On the other hand, American employees are expected to participate in the human resource operations by giving suggestions for how companies should be managed or advanced (Latta 2009). Based on the above illustrations, it is apparent that for American entrepreneurs to undertake effective negation processes in Japan, they must be acquainted with the cultural differences of both countries.

HOFSTEDE’s dimension theories of culture

Culture and environment affect institutions and their management in a number of ways (Aktaş & Çiçek 2011). To comprehend the negotiation challenges that MNCs and other American firms face in Japan, we have to evaluate the cultural differences and working environments between the two countries with the help of HOFSTEDE’s model theories of culture (Aktaş & Çiçek 2011).

The models are power distance, individualism, masculinity, uncertainty avoidance, and long-term orientation. With regard to power distance, the US has a dimension of 40, while Japan has a dimension of 54. Based on this analysis, it is apparent that the Japanese society is more hierarchical than US society. Therefore, the Japanese subordinates are more willing to expect to be told what to do than the US subordinates. Therefore, American managers in Japan should expect to face huge challenges in running the hierarchical organization where the subordinates expect guidance to undertake their operations.

With respect to individualism, the US has a dimension of 91, while Japan has a dimension of 46. With these scores, it is apparent that Japan is a collectivist society. On the other hand, the scores indicate that the US is an individualistic society. In Japan, American managers should expect to tackle several management challenges. Japanese employer and employee associations are perceived in moral terms, unlike in the US (Aktaş & Çiçek 2011). Similarly, American managers must learn to manage their subordinates in groups as the Japanese society upholds the collective culture, unlike US society.

With respect to masculinity, the US has a dimension of 62, while Japan has a dimension of 95 (Cellich & Jain 2004). Unlike in the US, where the society is less masculine, Japanese organizations are centred on rivalry, accomplishment, and success. Japanese society is more feminine. In this regard, American managers in Japan must be willing to allow employees to rival as a team against their competitors. On uncertainty and avoidance, the US has a dimension of 46, while Japan has a dimension of 92. Based on these dimensions, it implies that American managers in Japan will meet huge resistances while implementing new ideas in their organizations. Unlike the American employees who accept uncertainty with ease, the Japanese employees will resist new ideas and changes at a higher rate.

The negotiation process and expected challenges

When expanding into foreign markets, negotiations are part of the daily activities. In international markets, effective negotiations are the pillars of all successful businesses (Cellich & Jain 2004). Companies who adopt effective negotiation strategies can be able to generate assessable business values for themselves and for their clients. Unlike in the past, negotiations have become very important to every business organization. The above has been brought about by the need to expand into international markets.

Considered the nature of negotiation processes, it is imperative to comprehend how best to undertake them. Some of the most significant features of the processes are planning, the opening gambit and the capability to walk away. Regardless of who makes the initial proposal, a dominant question, the negotiators should ask themselves is the motives behind the negotiation. In this regard, the negotiators should analyze the offer being made. With respect to American negotiators, they should take time to understand the offers presented by Japanese businessperson. With appropriate timing, American negotiators would lessen the chances of polarizing their Japanese counterparts into situations that may hinder the negotiation processes.

American negotiators should expect to face numerous challenges when dealing with Japanese negotiators. The challenges result from their cultural differences. Unlike the American negotiators, the Japanese negotiators centre on the wellbeing of their companies (Adair & Weingart 2007). Even though they are very attentive to the chain of command, they appreciate the interconnection everyone has with other individuals. During negotiations, the Japanese give first priority to corporate interests other than individual interests.

Another challenge faced by American negotiators in Japan is caused by their social differences. Unlike the Americans, the Japanese managers rarely criticize their employees publicly. All the time, they are courteous. Disagreement is kept away at all costs. Unlike the Americans, the Japanese expect their business partners to know them socially before the negotiation of a business deal.

Equally, when dealing with Japanese negotiators, Americans should know that the Japanese appreciate silence. As such, they perceive silence as a time for consideration (Sokolova & Szpakowicz 2007). Therefore, Americans negotiators should be informed that the Japanese talk less compared to other eastern cultures. More often, when negotiations are being undertaken between Japanese and American businesspersons, the Americans do most part of the talk. Usually, the Japanese negotiate by asking questions. Through this, a number of American negotiators have found it very hard to understand their interests and motives.

Another problem that should be noted by American negotiators is that Japanese uphold a bureaucratic culture. For that reason, they should expect to face many dealings, policies, and rules during the negotiation process. Unlike in the USA, decisions are reached after a lengthy process (Adair & Weingart 2007). The consensus is valued requiring the parties to request support from the management. Because of this, negotiation with the Japanese will take a longer time compared to other cultures.

During the negotiation processes, Americans negotiators should opt for integrative negotiation other than the distributive negation model (Sokolova & Szpakowicz 2007). Integrative negotiation is normally referred to as win more- win more model of negotiation. Through this approach, participating parties aim at walking away with at least perceptions of having gained more than they could through different approaches. As compared to other models of negotiations, this model is the most preferred. During the negotiation processes, disagreements are avoided because they are more costly than compromises. Given that the Japanese negotiators avoid disagreements, the model will be appropriate when working with them.

When negotiating across cultures, distributive negotiation model should be avoided (Yurtsever 2004). The approach is normally referred to as a win-lose model of negotiation. Unlike the previous model, each party involved in the negotiation process is after winning the deal. Thus, the winning parties are not concerned with the outcomes of the losing parties. More often, losing parties will seek control over the other parties’ finances, resources, or associations.

Distributive negotiation models are applied mostly in negotiations with fixed resources to be shared (Sokolova & Szpakowicz, 2007). As such, court cases, some property negotiations, and divorce issues are the best examples of distributive negotiations. As compared with the integrative negotiation model, distributive negotiation model employs offensive tactics rather than defensive tactics. For instance, in the distributive model, parties employ deception tactics by trying to make the competing parties give in more than they can concede.

Based on the above illustrations, American negotiators should always use the integrative negotiation model when dealing with the Japanese to be successful. Through the model, MNCs and other American firms planning to expand to eastern Asia can cooperate and focus with Japanese organizations with the aim of increasing the gains for both parties. Equally, the integrative model will enable them to avoid uncertain competitive bargains.

Recommendations

Apart from adopting an appropriate negotiation model when dealing with Japanese businesspersons, American entrepreneurs should understand the Japanese organizational culture negotiation styles, behaviors, and attain a definite level of intercultural communication competence (Kennedy 2004). Cultural values have an impact on a range of features in an organization. Notably, organizational and managerial behaviors are greatly affected by the organizational culture portrayed in every organization.

For corporation with several departments, organizational culture has intense effects on the leaders’ decision approaches and results of these decisions. In the Japanese and the American organizations, the impacts of organizational culture are dependent on their cultural structures. As such, cultural norms and values have played important roles in molding both the American and the Japanese managers’ outlooks and defining their leadership roles and functions. Given that both societies differ in their perceptions of leadership and facets of effective leaders, the American negotiators should be informed about the attributes of Japanese businesspersons for successful dealings.

Negotiation styles and behaviors are specific to national cultures and are never universal. Therefore, American negotiators should expect to face a distinctive negotiation style when dealing with the Japanese. Globally, negotiators will portray types of negotiation styles and behaviors desired in their communities and organizations. The above illustration affirms that cultural values play a great role in determining the type of negotiation behavior exhibited by a businessperson.

In one of the modern studies on cross-cultural negotiation, researchers found out that cultural attributes and practices did not only differentiate cultures from each other, but also served as predictors for negotiators’ attributes and predictors (Odell 2002). Based on the above illustrations it is apparent that the American business person should understand the Japanese negotiation styles and behaviors for them to be successful in the foreign land. According to researches, it is essential that businesspersons learn to adapt their negotiation styles to accommodate the other party’s cultures (Odell 2002). Failure to this will result in poor and unsuccessful negotiation.

Universally, it is accepted that negotiators play a huge role in the success of the corporations expanding internationally. Successful international corporations are the products of such negotiators. Over time, these negotiators have learned and conducted their dealings in accordance with the organization’s expectations. Therefore, firms seeking to carry out negotiations with other firms in foreign nations should seek support from these experts. Therefore, before engaging with Japanese businesspersons prospective American businesspersons seeking to open a joint venture in Japan should consult the experts. Through this, they will be informed about the possible challenges and how to overcome them.

Equally, effective communication skills are paramount when negotiations are being undertaken between businesspersons of different cultures (Kumar 1999). Therefore, when dealing with the Japanese the Americans negotiators ought to understand that they are dealing with persons whose native language is not English. They should use words that are easy to understand, talk slowly, and avoid the use of figurative language and slangs (Adair & Weingart 2007).

Effective communication skills are indispensable for American negotiators planning to reach at a deal with the Japanese. For effective communication to be achieved, both the sender and the receiver must cooperate (Lebra 2007). However, the sender must meet the major objectives of any business communication such as receiver understanding, receiver response, and favorable relationship. Therefore, the American negotiators must implement the above techniques to ensure that the message is received and understood as indented by their Japanese counterparts.

Likewise, it is appropriate for international negotiators to attain a definite level of intercultural communication competence (Sokolova & Szpakowicz 2007). With the increasing effects of globalization, organizations now appreciate the significance of intercultural competence. Studies indicate that intercultural knowledge is a chief contributor to the future companies’ negotiation accomplishments (Kai 2006). Equally, a comprehensive knowledge of cultural diversity is important for any person with career ambitions of working as a negotiator in this innovative inter-reliance, cosmopolitan, and multicultural world. Therefore, it is apparent that the American and the Japanese negotiators must attain a definite level of intercultural communication to be of value to these organizations.

On an individual basis, enhanced intercultural communication competence would be beneficial. It would enable a negotiator to mingle and relate with other negotiators of diverse cultures with ease (Peterson & Søndergaard 2008). With these abilities, an individual can seize on endless opportunities that exist in the international market level. With respect to professionalism, enhanced intercultural communication competence can still be beneficial (Adair & Weingart 2007). For American businesspersons wishing to venture into Japanese markets, knowledge about intercultural communication will offer them numerous prospects of how their ventures will fair in a foreign land (Le 2004). As such, an understanding of the Japanese culture is very important for their business to thrive.

With regard to the above illustrations, it is very essential for negotiators to undertake their dealings based on cultural context (Watkins 2002). Understanding cultural differences in negotiation prototypes is very important for managers in foreign countries such as Japan for them to perform effectively. In the past, effective cross-cultural training for managers has been a challenging task demonstrating the need to understand automatic and schema-based components of perceptions and behaviors specific to particular institutions and organizations (Ganesan 2003).

Conclusion

In conclusion, it should be noted that culture affects leadership in various ways. There are several of dissimilarities between the Japanese and the American company cultures. The dissimilarities are not only based on their management approaches, but also on the way they conduct their business. In the above article, to comprehend the negotiation challenges that MNCs and other American firms face in Japan, the cultural differences and working environments between the two countries were evaluated with the help of HOFSTEDE’s model theories of culture.

The models utilized were power distance, individualism, masculinity, uncertainty avoidance, and long-term orientation. Similarly, it should be noted that American negotiators should expect to face numerous challenges when dealing with the Japanese negotiators. As such, American negotiators should note that the Japanese uphold a bureaucratic culture. For that reason, they should expect to face many dealings, policies, and rules during the negotiation process. Unlike in the USA, decisions are reached after a lengthy process.

Consensus is valued requiring the parties to request for support from the management. Because of this, negotiation with the Japanese will take a longer time compared to other cultures. Therefore, Apart from adopting an appropriate negotiation model when dealing with Japanese businesspersons American entrepreneurs should understand the Japanese organizational culture negotiation styles, behaviors, and attain a definite level of intercultural communication competence.

Likewise, effective communication skills are required when negotiations are being undertaken between businesspersons of different cultures. Thus, when dealing with the Japanese the Americans negotiators ought to understand that they are dealing with non-westerners whose native language is not English. They should use words that are easy to understand, talk slowly, and avoid the use of figurative language and slangs. Based on the above illustrations, it should be noted that culture affects negotiations in various ways.

For corporation planning to venture into the international market, cultural differences have intense effects on the negotiation approaches and their results. As such, cultural norms and values play important roles in molding negotiators outlooks and defining their roles and functions. Globally, businesspersons will undertake their negotiations based on their cultures. The above affirms that cultural values play a great role in determining the type of negotiation strategy to be adopted in the international market.

References

Adair, W & Weingart, L 2007, ‘The timing and function of offers in U.S. and Japanese negotiations,’ Journal of Applied Psychology, vol. 92, no. 4, pp. 1056-1068.

Aktaş, E., & Çiçek, I 2011, ‘The Effect Of Organizational Culture On Organizational Efficiency: The Moderating Role Of Organizational Environment and CEO Values’ Procedia – Social and Behavioral Sciences, vol. 24, no. 1, pp. 1560-1573.

Cellich, C., & Jain, S. C 2004, Global business negotiations: a practical guide. Thomson/South-Western, Mason, Ohio.

Ganesan, S 2003, ‘Negotiation Strategies and the Nature of Channel Relationships’ Journal of Marketing Research, vol. 30, no. 2, pp. 183-184.

Kai, J 2006, ‘Cross-cultural communication,’ The Foundation Years, vol. 2, no. 3, pp. 99-101.

Kennedy, G 2004, Essential negotiation, Thomson/South-Western, Mason, Ohio.

Kumar, R 1999, ‘Communicative Conflict in Intercultural Negotiations: The Case of American and Japanese Business Negotiations,’ International Negotiation, vol.4 no. 1, pp. 63-78.

Latta, G. F 2009, ‘A Process Model Of Organizational Change In Cultural Context: The Impact Of Organizational Culture On Leading Change,’ Journal of Leadership & Organizational Studies , vol.16, no. 1, pp. 19-37.

Le, E 2004. ‘Cross-cultural communication,’ Information Design Journal, vol. 12 no. 1, pp. 76-78.

Lebra, T, S 2007, ‘The cultural significance of silence in Japanese communication’ Multilingua – Journal of Cross-Cultural and Interlanguage Communication, vol. 6, no. 4, pp. 343-358.

Odell, J 2002, ‘Creating Data on International Negotiation Strategies, Alternatives and Outcomes,’ International Negotiation, vol.7, no. 1, pp. 39-52.

Peterson, M. F., & Søndergaard, M 2008, Foundations of cross cultural management. Sage Publications, Thousand Oaks, CA.

Sokolova, M., & Szpakowicz, S 2007, ‘Strategies and language trends in learning success and failure of negotiation,’ Group Decision and Negotiation, vol.16, no. 5, pp.469-484.

Watkins, M 2002, Breakthrough business negotiation a toolbox for managers, Jossey-Bass, San Francisco.

Yurtsever, G 2004, ‘Emotional Regulation Strategies and Negotiation,’ Psychological Reports, vol. 95, no. 7, pp. 780-781.

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