Some reflections of Vietnamese and American

Cultural values on Vietnamese-American

Business Negotiation

Lê Thị Vân Nga

University of Languages and International Studies

M.A Thesis: English Linguistics; Code: 60 22 15
Supervisor: M.A. Phan Thị Vân Quyên
Year of graduation: 2011

Abstract. In the trend of globalization of the business world, the area of cross
cultural business negotiation has become more and more popular. That is because
cultural differences usually influence the negotiation process significantly and
unexpectedly. Understanding and recognizing cultural variables of the counterparts
from another culture will be most important in getting successful outcomes of a
negotiation. This study aims to examine the ways of thinking and behaviors of
Vietnamese and American business people in business negotiation to seek out the
influence of their cultural values and potential problems in Vietnamese – American
business negotiation. Furthermore, some solutions will be suggested to improve the
negotiating process between business people from the two countries.

Keywords. Tiếng Anh; Văn hóa; Đàm phán; Việt Nam; Hoa Kỳ

Content

CHAPTER 1: INTRODUCTION
1. Rationale of the study
The increasing globalization of the economy has resulted in the tremendous growth in
international market. As international business opportunities open, negotiations also increase.
There have been so many studies about negotiation skills across cultures, but they only
focused mainly on developed countries. Just few studies have been conducted in the
Vietnamese market.
Among various foreign investors are those from the U.S. The U.S.-Vietnam Trade
Agreement has created opportunities for US investors in Vietnam and given Vietnamese
businesses access to the U.S. market. With the development in US-Vietnam trade relation, the
negotiations between Vietnam and U.S. partners grow to be a norm. This study attempts to
explore one side of cultural differences - Vietnamese and American cultural values to find out
how they are reflected on Vietnamese-American business negotiation.
2. Aims of the study
- to find out typical Vietnamese and American cultural values.
- to understand the nature of a cross cultural business negotiation.
- to examine the potential problems in Vietnamese – American business negotiation.
- to analyze how cultural values influence the negotiation process and outcomes.
These aims are formulated into 3 following research questions: 1) What are the
similarities and differences between Vietnamese and American business negotiation? 2) How
are Vietnamese and American cultural values reflected in Vietnamese – American business
negotiation? 3) What are potential problems in Vietnamese – American business negotiation?
3. Scope of the study
The focus of this study is to investigate only some typical cultural values of the two
target countries: Vietnam and the United States; and to find out how they affect Vietnamese-
American business negotiation.
4. Methods of the study
The study used mixed methods to find answers to the two research questions. The
instrument for data collection in this study was the questionnaire. The data collected from
questionnaires were analyzed quantitatively and qualitatively for descriptive statistics.
5. Significance of the study
The results will be of some contribution to the literature of international business
negotiation. The findings and comments of the study may be useful for raising the cultural
awareness of Vietnamese and American businessmen when they meet up in a negotiation so
that they can achieve success when they do business in the United States or Vietnam.
6. Organization of the study:
This minor thesis consists of 5 chapters: introduction, theoretical background,
methodology, findings and discussion, and conclusion.
CHAPTER 2: THEORETICAL BACKGROUND
1. Culture
1.1. What is culture?
1.2. Components of culture
1.3. Cultural values
1.3.1. Vietnamese cultural values
1.3.1.2. Harmony
1.3.1.3. Respect
1.3.1.4. Duty and honor
1.3.2. American cultural values
1.3.2.1. Individualism
1.3.2.2. Self-reliance
1.3.2.3. Equality
1.3.2.4. Competition
1.3.2.5. Materialism and hard work
2. Communication
2.1. What is communication?
 2.2. Cross – cultural communication
2.3. Potential problems in cross – cultural communication
3. Negotiation
3.1. What is negotiation?
3.2. Negotiation as a form of communication
3.3. Elements of negotiation
3.4. Business negotiation
3.5. Characteristics of business negotiation
3.6. Cross - cultural business negotiation
3.7. Potential problems in cross cultural business negotiation.
CHAPTER 3: METHODOLOGY
1. Research method
The methods used to process the collected data are both qualitative and quantitative.
All the considerations, comments and assumptions are based on the analysis of statistic data
and reference to relevant publication.
2. Data collection instrument
Questionnaire is the instrument to collect data. The questionnaire consists of two
parts. Part one is about personal information such as age, gender, nationality and especially
experience in Vietnamese – American negotiation. Including 15 questions, part two aimed to
collect information on their attitude and perceptions of what happen in a negotiation. The
questions were arranged in the order of the main elements of a negotiation.
3. Data collection procedure
The questionnaires were delivered to American and Vietnamese business people in
face-to-face meetings and conversations, and via email.
4. Informants
22 American and 22 Vietnamese business people were finally selected as eligible
informants. Among these, only 8 Vietnamese and 3 American are female. The ages of all the
informants range from 26 to 60. They are employers or employees in different types of
company or business group. Their fields vary from sales, import/export to agency, etc.
CHAPTER 4: FINDINGS AND DISCUSSION
1. Presentation and analysis of the data
1.1. The negotiators – the actors of a negotiation.
While the Americans appreciate negotiating skills (64%), expertise (64%) and
especially experience in negotiating with the counterpart (82%) and position (27%), the
Vietnamese place most emphasis on negotiating skills (91%), then position (46%) and both
expertise and experience in negotiating with the counterpart (both 36%), seniority (32%).
91% Americans do not care much about the balance in status, position and age of negotiators
of the two parties. However, there is an opposite view of the Vietnamese in this situation: a
half requires a balance between two parties and the rest suppose that it doesn’t matter.
1.2. The size of negotiation team.
The majority of both Vietnamese and American people agree that the team size has
certain influence on the negotiation outcome, but 55% of Vietnamese think that the influence
is very considerable while most of the American (72%) said that it is small. The same
percentage of both American and Vietnamese (18%) believe that the team size has no
influence. Almost all Vietnamese and American agree upon the advantage of a large
negotiation team. They highly appreciate the “making use of the smart of many brains” (55%
Vietnamese and 64% American) and also care for the confidence of negotiators. The
difference here is that no American thinks about “expressing the power over the counterpart”
while 13% of Vietnamese like this. The same small number of Vietnamese and American
people (5%) stated that there is no advantage.
1.3. Negotiation approach
Up to 100% of Vietnamese people and almost all American ones (91%) choose the
Integrative negotiation (win – win) as their negotiation approach. Only a few American
negotiators (9%) prefer the approach of Distributive negotiation (win – lose).
1.4. Negotiating style
The majority of Vietnamese people try to seek the initial agreements on very general
principles. Then during the negotiation process, they will discuss each specific issue. This is
inductive style. In contrast, American people prefer deductive style when 77% of them decide
to get agreements on each specific detail first and gradually come to the end with general
agreements.
1.5. Risk-taking
41% of Vietnamese informants are willing to take risks and the rest 59% try to reduce
risk as much as possible. Meanwhile 59% of Americans willingly take risks and 41% will
avoid.
1.6. Goal of negotiating
Both Vietnamese and American business people expect to build a long-term business
relationship with the counterparts and the negotiation seems to become the first step in the
process.
1.7. The role of attorneys in the negotiation.
A high rate of Vietnamese people (88%) underestimates the appearance of attorneys
during the negotiation as they think more of the trust between two parties. In contrast, the
majority of American people (64%) more highly appreciate the role of attorneys in the
negotiation to ensure the legality of the contract.
1.8. Conflict management.
Almost all American people and the majority of Vietnamese ones choose the solution-
oriented approach to manage conflicts. Only a small proportion prefer avoidance-oriented
one, in which the percentage of Vietnamese people is much higher than that of Americans.
1.9. Decision-making
Up to 86% of Vietnamese negotiators try to seek agreement from other team members
before making decision whereas only 14% think that they can make decision independently.
This is completely opposite to the American negotiators when the majority of them
confidently believe that they can decide themselves and the minority has to consult the team
before making their mind.
1.10. Activities accompanying the negotiation
82% of Vietnamese people and 68% of Americans think that the relationship-building
activity is essential. The people who often give gifts to the counterpart make up 73% of the
total of Vietnamese and only 45% of the total of American. The majority of Americans (55%)
think that it’s not necessary.
 2. Similarities and differences between Vietnamese and American in business
negotiation and the cultural explanation.
2.1. Similarities
In the selection of negotiators, both Vietnamese and American value some criteria
like negotiating skills, expertise and experience in negotiating with the counterpart; almost all
Vietnamese and American enjoy win-win approach or integrative negotiation; both
Vietnamese and American desire to establish a long-term business relationship with the
counterpart; they both think highly of building the personal relationship with the counterpart
before starting negotiation; they use solution-oriented approach to manage conflicts during
negotiation.
Vietnamese are more concerned about saving face of the other party. They desire a
result that is good for both sides so no one will be hurt, no party has to “lose”. They want to
express “harmony” by spending time building personal relationship. Moreover, Vietnamese
collectivist culture gives them a big desire for building relationship. A long-term relationship,
especially with counterparts from a big developed country like the U.S. will bring
Vietnamese business people with more chances of technology transfer that will be used to
create the products later (Cellich & Jain, 2004). The values of duty and honor make
Vietnamese individual carry themselves with the utmost dignity in all circumstances so as to
not bring shame to oneself and his group. This is expressed in their goodwill to find solution
to manage conflicts during negotiation.
For American, though their sense of “competition” is very high and they usually try to
compete and win at any price to get their interest, it does not mean that they want the other to
“die”. That’s why they still prefer a win-win negotiation in which they can win but their
counterpart does not have to lose. However, for American business people, it is likely that
they find it necessary to build a long-term relationship as it will bring back more
opportunities to enlarge their business or gain profits from the counterparts.
2.2. Differences
- Vietnamese emphasize negotiating skills, position and seniority while Americans focus
on experience, expertise. Due to the hierarchy expressed in the “respect” for people who are
senior in age, status, or position, Vietnamese choose members with seniority and at least a
high-rank representative to be part of the negotiating team. This high-rank official will have
more authority in making concessions and agreements. Therefore, more Vietnamese people
require a balance in status, position and age. American culture values “equality” and
“individualism”. It is the equality of chances and responsibilities. For them, any
representatives with negotiating skills, expertise, and experience will do best at the
negotiation. They have high sense of self-reliance and responsibility. So what they care most
is the success of the deal, not the age or status of the counterpart’s team members.
- Vietnamese prefer to come to the negotiation with a large group, which help them feel
more confident. As being collectivist people, they present ideas, make decisions and take
responsibilities for those decisions as a group, not as an individual. On the contrary,
American people tend to focus on individual qualities and thus they can independently act at
the negotiation and take individual responsibility for their own decisions.
- Vietnamese negotiators prefer the deductive style. After the agreements on principles
are reached, they will continue to discuss each specific detail. This style provides the
framework for dealing with the issues as they occur and helps them avoid uncertainties in the
negotiating process because all the principles have already been established up-front.
Americans usually negotiate inductively. They often look for agreements on very specific
details and then collect them to come to the overall agreement. That is the way they are
willing to face and deal with difficulties right away. These are expressions of the two
different cultures: collectivist cultures value “harmony” which means people try to be less
confrontational. However, the values of individualism, self-reliance and competition of
American culture give people the willingness to cope with any problems.
- Fourthly, American people tend to practice gift-giving and attend entertainment
activities before or after the negotiation less than Vietnamese people. They may think that it’s
time-consuming while in their mind “time is money” and “business is business.” Being
known for “hard work and materialism”, they always try to make use of time and get works
done as effectively as possible. Vietnamese are often more concerned with building
relationship with their foreign business counterparts. Giving gifts or inviting counterparts to
restaurants or karaoke, etc. are their ways to gain good impressions from the counterparts and
a good relationship as well as the trust between the two sides will be built.
- Fifthly, collectivist Vietnamese business people are more affected by the reputation
and the status of the counterparts or the introduction of a third party and their basis for trust is
often on mutual respect among the parties involved.
- Sixthly, Vietnamese underestimates the role of attorneys more than Americans. For
Americans, the appearance of attorneys in the negotiation is important and compulsory to
ensure the legality of the contract. Because the individualist culture of Americans makes
them more rational whereas collectivist Vietnamese tend to be more sentimental.
- Lastly, negotiators from individualist culture like Americans seem to be more
independent and assertive in making decision whereas the collectivist Vietnamese tend to be
much more interdependent.
3. Potential problems in Vietnamese – American business negotiation and some
suggested solutions.
3.1. Potential problems
- More emphasis on the balance of status, position and age, Vietnamese negotiators
may be unsatisfied with the younger and status-lower American negotiators.
- There may be misunderstanding between two parties in suggesting and accepting
activities around the negotiation. Vietnamese negotiators are likely to experience the feeling
of disappointment in such case as their American counterparts are not excited about
participating in activities which are aimed at personal relationship building.
- U.S. negotiators often expect to be able to complete negotiations timely and
efficiently. So they may feel impatient when Vietnamese negotiators are slow in making-
decision process as they have to consult every team member, or they even delay making
decision (if the representatives are lower-ranked officials of the organization.)
3.2. Some suggested solutions
- Before the negotiation, both Vietnamese and American negotiators should spend
time learning about the counterpart’s culture such as ways of thinking, rules of behaviors…
When already having certain knowledge about each other’s culture, each party should try to
predict the possible situations if they negotiate with the counterpart and prepare possible
solutions for those situations. When being well-informed, each party will be more well-
prepared which helps minimize misunderstandings, culture shock in negotiation.
- Vietnamese business people had better prepare carefully for the issues that will be
introduced at the negotiation table, which can be conceded and which cannot. With careful
preparation and prediction, they will be more decisive and assertive. In addition, Vietnamese
companies should not send too many representatives to the negotiation as they can choose
only who are with knowledge and negotiating skills, provide them with authority to decide
right at the negotiation conference.
- For American business people who are doing business with Vietnamese
counterparts, it is crucial for them to spend time building personal relationship with their
Vietnamese counterpart to shorten the distance and create good impression. Additionally,
they should try to be more patient at the negotiating table while their counterpart comes to the
final decision.
CHAPTER 5: CONCLUSION
1. Conclusion
American negotiators tend to emphasis on individual values such as self-reliance,
equality, competition, materialism and hard work. They highly appreciate individual
negotiators with negotiating skills, expertise and experience in negotiating with the
counterpart, who can deal with any possible risks and has the complete authority to make
decisions at the negotiation. Their main objective is the negotiating itself, so they do not care
much about the position or age of the other negotiators or the size of the negotiating team, as
well as not spending too much time on other activities around the negotiation such as giving
gifts to the counterparts, going to restaurants or karaoke, etc. During the negotiation, they
follow deductive style to seek agreements and always find solutions to manage conflicts.
In contrast, Vietnamese negotiators are affected by their collectivist values such as
harmony, respect, duty and honor. Their ways of thinking and behaviors at the negotiation
meeting are clear expressions of those cultural values. Their selection of negotiators also
includes the criteria of seniority and status and they prefer a balance of age, position from the
counterparts. Coming to the negotiation table with a large team, they make decision together
and take collective responsibility. They expect an outcome with the winning of both sides.
Vietnamese negotiators think highly of building relationship and usually organize activities
for that purposes such as dining, karaoke… or giving gifts to the counterparts. Their
negotiating style is inductive and they would rather reduce risks during negotiating. Their
approach to deal with conflicts is solution-oriented one.
2. Limitation of the study
With the limited relationship, the researcher was unable to directly approach the
informants to have some interviews which help to make their answers in the questionnaires
more explicit with more ideas or explanations. If only interviews were carried out, there
would be more interesting findings in this research.
The time constraints, the shortage of available materials and the limited knowledge
and experience in doing research of the researcher has resulted in more minor mistakes in this
paper.
3. Suggestions for further study
- The negotiating strategies used by Vietnamese and American business people.
 - Non-verbal communication in Vietnamese-American business negotiation.
- Cross cultural study on business negotiation between Vietnam and another country
except the United States (such as Japan, Germany …)

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