CROSS-CULTURAL NEGOTIATION AND DISPUTE RESOLUTION

By Andrs Correa Cruzat

Lawyer
Master in Dispute
Resolution
Based on my own experience, following the criterion used y !eert "ofstede to
understand the dimension of national culture, and other three outside resources, # am
going to analyze how cultural differences etween the $nited %tates of America &$nited
%tate' and Chile would affect a negotiation or dispute resolution process etween
indi(iduals from these two countries)
*he $nited %tates and Chile are two countries from opposite ends of "ofstede+s
spectrum of cultural dimension) ,n one hand, the $nited %tates has a wea- Uncertainty
Avoidance, small Power Distance; it is an Individualism culture and a Doing culture) ,n
the other hand, Chile has a strong Uncertainty Avoidance, large Power Distance; it is a
Collectivist culture and a Being culture) .(en thought we can classify the different
cultures, it is important to mention that there are memers of each culture that they do
not share the ordinary characteristics of his/her culture &characteristics on which is
ased the classification)'
Based in the descried cultural differences, # can distinguish the following issues that
can affect a negotiation or dispute resolution process etween indi(iduals from $nited
%tate and Chile0
1. Risk Aversion
According to !eert "ofstede, the Chilean culture has a strong Uncertainty Avoidance,
which means amiguous and uncertain situations are threatened) #n the same line, the
Chilean culture is a(erse to ta-ing ris-s, especially loss aversion0 a(oiding sure losses
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e(en if the potential loss from the gamle will e significantly greater than the sure loss)
,n the other hand, the $nited %tates culture has a wea- Uncertainty Avoidance, which
means they do not feel threatened y uncertain and amiguous situation) *he $nited
%tates people are more susceptile to ta-ing ris-s than the Chilean people in order to
otain a future gain) Conse1uently, this is an important factor which these parties need
to e aware of in a negotiation)
#t is also important, and can e (ery eneficial for a third neutral such a mediator, to e
aware of this factor in order to influence the parties2 perception of an offer &in pri(ate
caucuses' y framing alternati(es in terms of gains or losses) 3or example, the mediator
must e aware of transmitting particular offers from the $nited %tates party to a Chilean
party when trying to frame the prolem in terms of securing gains from a reference point
rather than framing the prolem in terms of a(oiding losses from a reference point
&Cochran, Di4ippa 5 4eters, 6777')
2. Individualis vs. Colle!"ivis Cul"ures
Memers of indi(idualist cultures tend to (iew themsel(es as independent of each other,
their personal goals and interests ta-e precedence o(er group goals and interests)
Memers of collecti(ist cultures tend to (iew themsel(es as interdependent, group goals
and interests ta-e precedence o(er personal goals and interests &Mar-us 5 8itayama,
6776')
3rom my perspecti(e, this difference is the one that can most affect negotiation or
dispute resolution etween indi(iduals from Chile and $nited %tates, ecause Chile is a
collecti(ist culture and $nited %tates is an indi(idualist culture)
i' Collecti(ist pays more attention to how something is said than to what is said, and
silence is highly (alued) #ndi(idualists (alue specificity and clarity of communication,
they rely hea(ily on what is said, and silence is not (alued) *hese differences can create
loc-s in communication etween collecti(ist and indi(idualist people9
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ii' 3or indi(idualists, conflict is a natural y:product of social life) Collecti(ists (iew
conflict as dangerous ecause of their concern for group harmony9
iii' #ndi(idualists tend to pay less attention to the other side2s interest and thus fail to
realize that they ha(e shared interest with the other party &*hompson 5 "astie, 677;')
$nderstand other party2s interest9 it is essential in order to resol(e a conflict;
i(' #ndi(idualists are more li-ely to exhiit an egocentric fairness ias, that is, to (iew
their own eha(ior as fairer than the other party2s eha(ior &Morris 5 !elfand'9
(' Collecti(ists tend to adopt much harsher contentious tactics against out:group
memers9
(i' Collecti(ists gi(e priority to the goals of their in:group rather than to their personal
goals) *herefore, in a negotiation, the #ndi(idualist party, who gi(es priority to personal
goals, can not understand this way of thin-ing and may ecome confused9
(ii' *he free expression of emotions, which people from indi(idualistic cultures are use
to practice, can disrupt relations with collecti(ist peoples who tend to control such
emotions &*riandis, <;;;')
(iii' Another aspect of cultural impact concerns the ultimate resolution of matter9 a
culture pro(ides specific parameters for resol(ing the dispute0 for example, in collecti(ist
culture rather than in indi(idualistic culture an apology is more necessary to get to an
agreement)
#. Passive vs. A!"ive Cul"ures
According to "arry C) *riandis, the $nited %tates is an =acti(e culture> and Chile is a
=passi(e culture>) *he cultural idiosyncrasies are (ery important when the third neutral is
deciding which style and techni1ue to use in an alternati(e dispute resolution process
such us mediation) # would say that Chilean people who are in the mediation process
would li-e to ha(e a mediator acting li-e a =teacher> or a =traffic cop> for four specific
purposes0
i' *o teach the parties aout the mediation process9
ii' *o assist the parties in understanding the perspecti(e of the other party and the
reason ehind it) iii' *o share expertise in the su?ect matter9
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i(' *o control the process y using the telling techni1ue in aggressi(e moments during
the mediation) 3or example, an aggressi(e moment would classify as0 one party
expresses their feelings y extremely raising their (oice)
*herefore, the perfect mediator for a Chilean party in(ol(ed in mediation is a facilitator
mediator that uses some telling techni1ue &e(aluati(e style' in a situation such as the
one descried pre(iously) ,n the other hand, a $nited %tate party in(ol(ed in a
mediation process would prefer a facilitator mediatior using the 1uestion techni1ue and
no telling techni1ue) *he $nited %tate party is a horizontal culture which will not accept a
mediator acting li-e a =teacher> or a =traffic cop>)
$. %er"i!al vs. &ori'on"al Cul"ures
According to "arry C) *riandis Chile is a @ertical culture and $nited %tates is a
horizontal culture) @ertical cultures accept hierarchy as a gi(en9 people are different
from each other) "orizontal cultures accept e1uality as a gi(en9 people are e1ual)
#n a hypothetical negotiation etween usiness men from a Chilean company and those
from a $nited %tate company, a suordinate from the Chilean company will ne(er
contradict his superior in negotiation) ,n the other hand, the $nited %tate team
memers are going to through ideas and participating as e1uals) *his mentioned
difference can affect a negotiation ecause the Chilean team will e confused ecause
they are going to ha(e many (alid interlocutors from the other team) *he $nited %tate
team will ha(e only one (alid interlocutor in the Chilean team who is the person with the
highest position in the hierarchy)
(. Tie Orien"a"ion
Cultural factors must e considered y the parties and y the third neutral when
conducting a dispute resolution process, where these factors are in(ol(ed) *he o?ecti(e
is that the third neutral must e aware of this factor in order to not interfere with the
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communication etween the parties and etween the third neutral) Aithout the
-nowledge that the mediator can ha(e with regard to cultural differences, third neutral
may not e as effecti(e in their facilitation as they could e)
3or example, indi(idualistic cultures li-e Borth America ha(e a monochronic time
orientation, which means that they ha(e a strong sense of doing one thing at a time)
Collecti(ist cultures, li-e Chilean culture, ha(e a polychronoic time orientation, which
means that they thin- aout, and attempt to do a numer of things simultaneously)
Conse1uently, in the frame of a mediation process, while the Borth American party may
li-e to discuss topics in order, not eginning one matter until the pre(ious topic is
finished9 the Chilean party may li-e to ?ump from one topic to another) %o, the Borth
American party would assume that if they ?ump from one topic to other, they will ne(er
agree and close one su?ect9 leading to s-ipping the discussion of some su?ects) *he
Chilean party would thin- that discussing topic y topic is too slow and not allowing them
to finish the discussion of the whole dispute, also this party may thin- that all of the
issues are related)
#n the descried situation, a mediator with -nowledge in cultural differences will e more
effecti(e in facilitating communication and coming to a creati(e solution) ,ne approach
of the mediator could e explain to the Borth American party that there is an organized
agenda so they will not s-ip the discussion of any su?ect of the dispute) Another
approach of the mediator could e explaining to the Chilean party that he/she has an
organized agenda with time designated to e(ery su?ect of the dispute)
). Lan*ua*e
As # ha(e stated, the $nited %tates and Chile are two (ery different cultures) =Cultural
distance> is roader when people spea- different languages) *herefore, an important
difference etween these two cultures is that people from the $nited %tates spea-
.nglish and people from Chile spea- %panish) *his o(ious difference can
tremendously affect a negotiation etween the people of these two countries, e(en
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though they may use an interpreter, it is not the same, and the misunderstanding of a
translator will always e a concern) #t is not the same to hear a proposition directly from
the other party than hearing it from a third person)
A less o(ious language difference that can arise is that Chilean people write in terms of
third person) 3or example, e(en though there is a single author he will use plural form,
as in =we thin->, rather than =# thin->) Conse1uently, this can affect things such the
understanding of an agreement etween Borth American and Chilean people) Cultural
differences, such as language expressed in numers, can also affect the agreement)
3or example, accordance etween a Chilean and a Borth American which estalishes
the day 66/ ;6/ <;;C to accomplish some oligation can pro(o-e cultural prolems) *he
Chilean party would say that the day is Danuary ele(enth of two thousand six and the
Borth American would say that the day is Bo(emer first of two thousand six)
+. S,a!e Pro-ii".
Based on my own experience, Borth American people do not li-e to e close when
tal-ing, which ma-es them feel uncomfortale) ,n the other side of the coin, Chilean
people li-e to e closer when they are tal-ing, touching the other2s shoulder or ac-
when tal-ing, in order to express ideas) *herefore, during a negotiation etween $nited
%tates and Chilean people, space proximity could e an important factor to consider) #t
could e also important for an aritrator or mediator to e aware of space proximity
during a dispute resolution process etween $nited %tates and Chilean people in order
to otain the parties2 trust, and to ma-e them feel comfortale)
/. 0ul"i-C1annel Couni!a"ion T1eor.
,ne of the most helpful psychological/communication theories that we can apply to
cross:cultural dispute is MultiEChannel Communication) *his theory explains loc-s in
communication, as well as how to o(ercome a communication loc-) 8arl Alrecht, in
his oo- Understanding people: Models and Concepts, suggests that information
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etween two persons ta-es place through four separate communication channels which
transmit facts, feelings, (alues and opinions) %ince these four channels are often
inad(ertently mixed, it is (ery easy to confuse these four channels of communication9
therefore, communication can e ostructed) ,structed communication is one of the
principle sources of conflict etween parties from different cultures)
Alfred %mith emphasizes the relationship etween communication and culture9 he
writes0 =,ur perception is a eha(ior that is learned and share, and it is mediated y
symols) Culture is a code we learn and share, and learning and sharing re1uire
communication) And communication re1uires coding and symols, which must e
learned and share) Communication and culture are inseparale>) *hree of the four
channels of communication suggested y 8arl Alrecht0 feelings, (alues and opinions,
are influenced y our culture) Conse1uently, communication etween Borth American
and Chilean people &great =cultural distance>' is susceptile to eing loc-ed)
#n order to ha(e good communication etween parties, and also etween parties and a
third neutral in a dispute resolution process, the MultiEChannel Communication theory is
(ery helpful in alerting the parties not to confuse facts, feelings, (alues, and opinions in
order to maintain fluent communication and to a(oid a communication loc-, y
differentiating them and calling attention to the confusion etween them) Being aware of
each of these channels and separating them, people can ha(e empathy, understanding,
and consideration etween them)
An aspect that this theory implies is that people are not capale of listening o?ecti(ely
since we see and hear through our (alues, feelings, attitudes, and reaction patterns) %o
during a dispute resolution process such as a mediation process etween Chilean and
Borth American people, through the awareness of this theory mediators can help the
parties in conflict to distinguish fact, feelings, (alues and opinions with the purpose of
impro(ing the communication during the process) 3or example, using the formula =Fou
feel GGGGG ecause GGGGG>, mediators can help the parties differentiate the facts from
the feelings or emotions)
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*hrough my experience as a lawyer, # can say that # asolutely agree with 8arl Alrecht
in that the most fre1uently mixed channel of communication are facts with opinions) Ae
can oser(e this situation all the time when clients are telling their stories) %ince people
are always ta-ing positions aout what is happening, what is eing said and others+
proposals, eha(iors and attitudes, it is easy to confuse facts with opinions) *his
confusion can e e(en more pronounced in a negotiation etween people from different
cultures, since opinions are determined from our cultures &Boshear 5 Alrecht, 677H')
A""i"ude and A!"ion o2 "1e Par"i!i,an" in a Con2li!"
An emerging conflict etween two parties of different cultures can affect the negotiation
or an alternati(e dispute resolution process etween the indi(iduals of these two
cultures) Borth American people as memers of an indi(idualistic, low:context culture
are more li-ely to utilize a confrontational, direct address, one:to:one style) Chilean
people, as memers of a collecti(ist high:context culture are more li-ely to possess an
indirect, not confrontational style) *herefore, the $nited %tates party is going to prefer to
resol(e the conflict y the two parties in(ol(ed, and preferaly without a third party such
as a mediator)
3urthermore, the incorporation of a third party in an early stage of the conflict could e
seen from the $nited %tates party as a(oidance y the other party) *hey would prefer to
confront other party immediately, express demands asserti(ely, and see- resolution
directly in their negotiation) ,n the other side, the Chilean party, as a memer of a
collecti(ist culture, should see the $nited %tates party2s eha(ior as dysfunctional and
pragmatically dangerous to the possiility of resol(ing the dispute producti(ely) *he
Chilean party would see- for emotional distance, protection of honor and alance of
power) &Augsurger, 677<')
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A T1ird Neu"ral in a Cross-Cul"ural Dis,u"e Resolu"ion
*he -nowledge that the parties or a third neutral party, such as a mediator or an
aritrator can ha(e with regard to cultural differences, can impact a negotiation or a
dispute resolution process in a numer of ways ranging from how conflict is defined and
expressed to methods of communication) *hese differences can affect the dispute itself)
%ome understanding of these factors is important so that the third neutral party can
assist the parties in wor-ing through and exchanging information) *he third neutral party
should e aware of cultural factors that contriute to any difficulties in the
communication etween the parties or with the third neutral) Ahile the third neutral
cannot change communication patterns for the indi(iduals, hisIher awareness of these
differences can assist with facilitating each party2s understanding of the other) *he third
neutral must also e ale to tolerate differences and maintain neutrality)
#t is important that a third neutral consider culture differences, especially to assure
process fairness to all parties) 8nowledge of culture can e 1uite helpful in pro(iding
awareness and insight into why people do and say what they do)
Carley ") Dodd in his oo- Values and Intercultural Communication &677H' gi(e some
ideas to practice when a third neutral is conducting a dispute resolution process where
cultural factors are in(ol(ed0 i' Do as oters do) *ry to oser(e the methods of respect
toward symols within the parties2 culture) ii' Develop sel! " awareness) *he aility to
-now yourself is truly helpful) $nderstanding world (iew can pro(ide tremendous insight
into our own cultural ac-ground) iii' Do not assume tat you #now a world view)
Cultural elief systems are (ery complex) #nstead, -eep as-ing 1uestion, oser(ing, and
listening) i(' Discover wen to use !ormal and in!ormal modes$ 3or example Chilean
people, as memers of a collecti(ist culture, would prefer informal modes)
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3inal T1ou*1"
Recognition of cultural differences can create in us a desire to understand those
differences and to communicate effecti(ely when we contact memers from contrasting
cultures)
#t is important that in a dispute resolution process the third neutral considers =cultural
distance,> especially to assure process fairness to all parties) #t is also important that the
third neutral guards against reliance on his/ her own stereotypes)
Ae will always e influenced y our culture and our education in the decision that we
ma-e) *hen, it is important to consider this at the moment of choosing a third neutral in a
cross:cultural dispute resolution process9 he/she must e aware of his/her preconcei(ed
ideas and also to the preconcei(ed ideas that the parties may ha(e ased on their
cultures)
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4i5lio*ra,1.
6) Alrecht 5 Boshear &67HH') $nderstanding 4eople0 Models and Concepts)
<) Ac-erman, !)R) &<;;J') Cross:Cultural Begotiations and Dispute Resolutions,
pages J:6;, <K:J;)
J) Augsurg, D)A) &677<') Conflict Mediation Across Cultures0 pathways and
patterns)
L) Carley, D) &67MH') Dynamics of #ntercultural Communication, pages MC:M7)
K) Cochran, R) 3), Di4ippa, D) 5 4eters) M)M) &6777') *he Counselor:At:Law0 A
Collaorati(e Approach to Client #nter(iewing and Counseling, pages 6<C:6<7)
C) "ofstede, !) &67M;') ,rganization Dynamics)
H) Mar-us,") 5 8itayama, %) &6776') Culture and %elf0 #mplications for cognition,
emotion and moti(ation, pages <<L:<KJ)
M) Morris, M)A), 5 !elfand, M)D) Cultural differences and cogniti(e dynamics0
.xpanding the cogniti(e on negotiation)
7) *hompson, L)L, 5 "astie, R) &677;') %ocial perception in negotiation)
,rganizational Beha(ior and "uman Decision 4rocess, pages 7M:6<J)
6;) *riandis, ") &<;;;') Culture and Conflict) #nternational Dournal of 4sychology,
pages 6LK:6K6)
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