International business activities required people to negotiate across cultural and national boundaries. There are many cultural challenges, to be considered while conduct business negotiation in cross cultural situation. Cultural dimension theory and negotiation process help to understand these challenges and find the remedies. For instance, Hofstede four dimensions and high and low culture context dimensions are two important theories to explain the behavior of negotiator in international business from cultural perspective. From these theories researches were able to have better understanding of conflicts and challenges arise from across business negation and finding the remedies. However, no theory is perfect. Other studies indicated that Hofstede method did not fully applied in specific cultural situations. This was attributed to the influences of other factors like economy, human behavior. This has made the issue more complicated and adds more hidden challenges in the international business. Hence, there are no unique solutions to tackle these diverse challenges. However, understanding the cultural behavior differences will lead to increase the likelihood of successful business negotiation in cross culture situation.
As business become more international, greater numbers of people are conducting business negations across culture boundaries. Culture-clash will continue to affect all aspects of international business as consequences of this phenomenon. Different cultures have different challenges and there is no unique or magic solution to tackle all of them. However, understanding and building theories will help to increase the likelihood of success in a cross cultural negation situation.
Lieh (2003) defined culture as distinctive characteristic of social group that share values and attitude by their individual making them unique from other social groups. The culture covers all aspect of life like religion, economics, language…. . on the other hand, Yunxia ,Bernard Zhu (2007) mentioned cross cultural negotiation as a dialogue of share and conflicting interest between people from different cultures who work together to reach to an agreement benefit both sides. The understanding of culture behavior is essential for conducting international successful business negotiation.
Cultural Theory and challenges consideration
One of the most important theories to understand the cultural differences is Hofstede four dimensions theory. Donald, Rebecca, Hendon, Paul (1999) mentioned the four hofstede dimensions which are masculinity/femininity, uncertainty avoidance, power distance and individualism. Moreover, Lieh(2003) mentioned about one more dimension called Confucian dynamic to differentiate Chinese culture form Western cultural values.
Roger, Maria, Leme (2002) indicated Power distance to the degree of accepting the difference in wealth, power and social class between people in the society. This issue is very important in hierarchical system to indicate the higher degree of right and respect. Therefore, in a hierarchical system the authority in higher rank or class tend to hold the power and to keep a power distance higher. Mohammad, Susan, Ercan (2002) mentioned that Japanese and Chinese (high power distance culture) people from lower class more bound to respect the formal hierarchical authority, while the low hierarchical system such as Americans and Canadians has low power distance between the society classes. In American company, the senior managers usually are more willing to delegate their authorities to their employee in decision making, and to leave some space for disagreement. Lieh(2003) consider China is a good example for high power distance country, as Chinese fear from people who are in higher rank in the society. It is often that Chinese negotiators will not negotiate with the opponent who is in lower rank. Therefore, foreign negotiator from low power distance...