Negotiation and Culture: Case Study

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Culture and Negotiations
Why do Japanese negotiators behave in the manner they do? How does culture affect negotiating behavior and outcomes?

MASTER THESIS Author’s name: Patrycja J. Krause Student’s number: 258891 Academic advisor: Søren O. Hilligsøe Faculty of English Aarhus School of Business May 2006

I would like to thank my Mom, Barbara, for her understanding, encouragement and eternal support, as well as my advisor, Søren O. Hilligsøe, for his academic help, advice and faith in me keeping my deadline!

Patrycja J. Krause Aarhus, May 2006

In loving memory of my Dad, Władysław, for showing me the world – this one is for you.

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1. 2. 3. 4. 5. 5.1 5.2 5.3 5.4 5.5 6. 7. 8.

INTRODUCTION METHOD WHY JAPAN? DEFINITION OF CULTURE AND VALUES HOFSTEDE’S VALUE DIMENSIONS POWER DISTANCE UNCERTAINTY AVOIDANCE COLLECTIVISM VERSUS INDIVIDUALISM FEMININITY VERSUS MASCULINITY LONG-TERM VERSUS SHORT-TERM ORIENTATION CRITICAL PERSPECTIVES ON HOFSTEDE EDWARD HALL CULTURAL DIMENSIONS

4 6 7 9 11 12 13 13 14 15 15 16 19 20 21 23 25 26 28 30 40 43 47 59 61 64 65

8.1 CONFUCIANISM 8.2 IE 8.3 THE WA-CONCEPT 8.4 ISOLATION 8.5 UNIQUENESS 8.6 WESTERN INFLUENCE 9. 9.1 10. 11. 12. 13. JAPANESE NEGOTIATOR THE NANIWABUSHI STRATEGY BRETT & USUNIER CASE STUDIES CONCLUSION SUMMARY

REFERENCES APPENDIX

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1. Introduction
This paper wants to provide a culture-based explanation, examination and analysis as to why Japanese negotiators behave in the manner they do in negotiation, as well as how culture affects negotiations and their outcome. The paper is, due to the focus on cultural differences, solely dealing with international negotiations. This paper is focusing on the cultural aspect of the negotiation, which is only one piece of a larger puzzle, but it is a crucial and decisive piece. It is now widely accepted that culture indeed has an affect on negotiation and its outcome, which reflects a given culture and the underlying values and beliefs that are central and fundamental in a culture. The culture can be defined as being both behavior, a meaning system and a communication style, and there is a link between the dominant world view present in a given culture (Japan), and the negotiating style that appears to be characteristic of that culture. This paper is not to depict a stereotypical image of a Japanese negotiator, but merely to show that culture indeed does influence the behavior, negotiations and their outcome. It should also be kept in mind that (a) the negotiation is a universal process, and (b) there are a number of contextual factors that too have an impact on the cultures’ impact on the negotiation – e.g. the nature of the other party (member of an in-group or an out-group), and the individual difference, although a member of a collectivistic culture tends to suppress his personality and individuality in order to maintain group harmony. This paper is to focus on a Japanese negotiator, who is dominated by his cultural values, and his interaction (in a negotiation) with a member of an out-group (foreigners and people that do not have a long term relationship with the Japanese negotiator), and a member of the in-group (fellow Japanese with established long-term relationships). Several studies and surveys (e.g. Brett and Usunier) have shown that culture does affect the negotiation process and the final agreement or outcome of the negotiations. Nevertheless, while there have been a number of studies that have explored the behavior of negotiators from different cultures, only very few have dealt with the underlying reasons - why people from a given culture behave the way they do. Additionally, most theorists and scholars have relied on the value dimensions index, depicting the differences between cultures, developed by Hofstede between 1968 and 1973. Hofstede’s research has undoubtedly helped people understand other cultures, but there is also a need to understand the underlying reasons why people from a given...
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