Mind and Heart of the Negotiator 6th

Edition Leigh Thompson Solutions

Manual
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 Chapter 10: Cross-Cultural Negotiation 1

CHAPTER 10
Cross-Cultural Negotiation

OVERVIEW
In a traditional course, there is little opportunity to experience cross-cultural negotiations; therefore, this
chapter must often be discussed in the abstract, without a direct context for experience. I begin the class
lecture by defining prototypes versus stereotypes. This is important to do, so as not to pigeonhole people.
If the class is diverse enough in background, it may be worthwhile to have students engage in a face-to-
face negotiation and make a personal note of every cultural issue of which they are aware. The lists that
students make can become the basis of discussion. I like to begin the discussion by introducing two
models: (1) the iceberg model; and (2) the three-dimensional model. Students will generally spend quite a
bit of time working through the three dimensions. I tend to resist spending a lot of time attempting to
characterize each country in each box (there will be a strong temptation to do this). Rather, I use this
model as a lens to analyze culture and, most importantly, expand our own repertoires for negotiations.

LECTURE OUTLINE

I. LEARNING ABOUT CULTURES

A. Negotiations across cultures are not only commonplace but a requirement for effective
management in multinational and international companies.

B. Distinguish stereotypes from prototypes to develop cultural framework.

1. Framework is sensitive to heterogeneity within cultural groups
2. Allows us to learn how cultures change and grow

C. Culture as an iceberg (Exhibit 10-1)

II. CULTURAL VALUES AND NEGOTIATION NORMS

A. Three dimensions of culture: (Exhibit 10-2)
1. Individualism vs. collectivism
2. Egalitarianism vs. hierarchy
3. Direct vs. indirect communication

B. Individualism versus collectivism

1. Individualism
2. Collectivism
a) Accountability pressure
3. Implications for negotiation:

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a) Social networks (Exhibit 10-3)

b) Cooperation
c) In-group favoritism (Exhibit 10-4)
d) Social loafing versus social striving
e) Emotion and inner experience
f) Dispositionalism versus situationalism (Exhibit 10-5)
g) Preferences for dispute resolution:
(1) Bargaining
(2) Mediation
(3) Adversarial adjudication
(4) Inquisitorial adjudication
C. Egalitarianism versus hierarchy
1. Egalitarian power relationships
2. Hierarchical power relationships
a) Hofstede’s (2010) analysis of collectivist/hierarchical countries (Exhibit 10-6)
3. Implications for negotiation:
a) Choose your representative
b) Understand the network of relationships
c) “Face” concerns
d) The conduct of negotiation
D. Direct versus indirect communication
1. Direct communication
2. Indirect communication (Exhibit 10-7)
3. Implications for negotiation:
a) Information necessary to reach integrative agreements
b) Dispute resolution preferences

III. KEY CHALLENGES OF INTERCULTURAL NEGOTIATION

A. Expanding the pie

B. Dividing the pie

C. Sacred values and taboo trade-offs

D. Biased punctuation of conflict

E. Ethnocentrism (Exhibit 10-8)

F. Affiliation bias

G. Faulty perceptions of conciliation and coercion

H. Naïve realism
1. Western Canon debate
2. Fundamental attribution error

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IV. PREDICTORS OF SUCCESS IN INTERCULTURAL NEGOTIATIONS

A. Conceptual complexity: people who are conceptually complex show less social distance
to different others.

B. People who use broad categories adjust to new environments adjust better than do
narrow categorizers.

C. Empathy

D. Sociability

E. Critical acceptance of stereotypes

F. Openness to different points of view

G. Interest in host culture

H. Task orientation

I. Cultural flexibility

J. Social orientation

K. Willingness to communicate

L. Patience

M. Intercultural sensitivity

N. Tolerance for differences among people

O. Sense of humor

P. Skills in collaborative conflict resolution

V. ADVICE FOR CROSS-CULTURAL NEGOTIATIONS (Exhibit 10-9)

A. Anticipate differences in strategy and tactics that may cause misunderstandings.

B. Cultural perspective taking

C. Recognize that the other party may not share your view of what constitutes power.

D. Avoid attribution errors.

E. Find out how to show respect in the other culture. (Exhibit 10-10)

F. Find out how time is perceived in the other culture.

1. Cultural differences across 4 global negotiation stages

G. Know your options for change. (Exhibit 10-11)

1. Integration

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2. Assimilation
3. Separation
4. Marginalization

VI. CONCLUSION
A. Negotiating across cultures is a necessity for success in the business world.

B. Unfortunately, cross-cultural negotiations frequently result in less-effective pie expansion

than intracultural negotiations; part of the problem is a lack of understanding of cultural
differences.

C. The tripartite model of culture identifies individualism-collectivism, egalitarianism-hierarchy,

and direct-indirect communication as key dimensions of cultural differences.

D. Key challenges of intercultural negotiation: expanding the pie; dividing the pie; dealing with
sacred values and taboo trade-offs; biased punctuation of conflict; ethnocentrism; the
affiliation bias; faulty perceptions of conciliation and coercion; and naïve realism.

E. Negotiators should learn to analyze cultural differences to identify value differences that
could expand the pie, recognize different conceptions of power, avoid attribution errors, find
out how to show respect, how time is perceived in other cultures, and assess options for
change.

KEY TERMS

accountability pressure The extent to which a negotiator is answerable for conducting themselves
in a certain manner

adversarial adjudication A judge makes a binding settlement decision but disputants retain control
of the process

affiliation bias A bias that occurs when people evaluate a person’s actions on the basis
of their group connections rather than on the merits of the behavior itself.

assimilation A situation that occurs when a group or person does not maintain its
own culture, but adapts to the host culture

attribution error The tendency to ascribe someone’s behavior or the occurrence of an

event to the wrong cause

bargaining Disputants retain full control over discussion process and settlement
outcome

biased punctuation of conflict The tendency for people to interpret interactions with their adversaries in
self-serving and other derogating terms

causal chunking The process of organizing interactions with others into a series of
discrete causal chunks, rather than an uninterrupted sequence of
interchanges

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conceptual complexity People who think in terms of shades of grey, rather than black and white,
show less social distance to different others

context-free A message has the same meaning regardless of the context

direct-indirect communication Refers to the manner in which people exchange information and
messages

dispositionalism The tendency to ascribe the cause of a person’s behavior to their

character or underlying personality traits

egalitarianism-hierarchy The means by which people influence others, either laterally or

hierarchically

ethnocentrism Unwarranted positive beliefs of one’s own group and the simultaneous
negative evaluation of out-groups

fundamental attribution error An error that occurs when people attribute the behavior of others
to underlying dispositions or character and discount the role of
situational factors

guanxi networks Chinese networks of deep interpersonal trust built over years and decades

individualism-collectivism Refers to the basic human motive concerning preservation of the self vs.
the collective

inquisitorial adjudication Disputants yield decision outcome and process control to a third party

integration In terms of cultural relations, a type of acculturation whereby each group

maintains its own culture while also maintaining contact with another
culture

marginalization A situation that occurs when neither maintenance of a group’s own

culture nor contact with another culture is attempted

mediation Disputants retain control over final agreement decision but a third party
guides the process

prototype A belief that substantial variation is likely within a culture

pseudosacred values Issues that a decision maker claims are sacred or heartfelt when, in fact,
they are not

quality of communication Measures the nature and quality of intra- and intercultural
experience test communications

sacred values Issues that are deemed by the decision maker as ones that cannot be
compromised, traded off, or even questioned

secular values Issues and resources that can be traded and exchanged

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separation A situation that occurs when a group or individual maintains its own
culture but does not maintain contact with another culture

situationalism The tendency to ascribe the cause of a person’s behavior to external

factors and forces that are beyond a person’s control

schematic overcompensation When a negotiator tries to adjust to their counterpart’s cultural

assumptions about negotiations

social loafing A form of motivation loss in which people in a group fail to contribute as
much or work as hard as they would if they worked independently

social striving A form of motivation in which people are concerned for the welfare of
the group

stereotype A faulty belief that everyone from a given culture is exactly alike

SUGGESTED EXERCISES AND OTHER MATERIALS

1. EXERCISE: Abhas-Bussan
by Amol Patel and Jeanne M. Brett
Abhas-Bussan is a negotiation between a Japanese manufacturer and an Indian distributor. It is
designed to be used with Raiffa’s (1982) chapter about quantifying preferences and priorities.
Preparation: 120 min. Negotiation: 60 min. Available from the Dispute Resolution Research
Center (DRRC) at the Kellogg School of Management, Northwestern University, 2001 Sheridan
Road, Evanston, IL 60208; www.negotiationexercises.com.

2. EXERCISE: Alpha Beta

by Thomas Gladwin
The DRRC’s version of Alpha Beta is a cross-cultural, team-on-team negotiation of a potential
alliance. The exercise requires the two parties to enact a cultural style during the negotiation.
Preparation: 30 min. Negotiation: 60 min. Available from the DRRC at the Kellogg School of
Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

3. EXERCISE: At Your Service

by Jeanne Brett & Michele Gelfand
This is an exercise that can be used to teach integrative negotiation skills in the context of deal
making or dispute resolution. The exercise was intended for undergraduates; however, it may be
used with more advanced students, especially to illustrate: 1) the differences between negotiating
deals versus disputes; and 2) negotiating as a solo versus negotiating as a team in the deal
making/dispute resolution context. It can also be used to illustrate how culture interacts with
negotiation context. Preparation: 15-20 min. Negotiation: 30 min. Available from the DRRC at
the Kellogg School of Management, Northwestern University, 2001 Sheridan Road, Evanston, IL
60208; www.negotiationexercises.com.

4. EXERCISE: Cartoon
by Jeanne M. Brett and Tetsushi Okumura

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 Chapter 10: Cross-Cultural Negotiation 7

Cartoon is a U.S.-Japanese version of the Moms.com exercise (see suggested cases and exercises
for Chapter 8). Preparation: 60-90 min. Negotiation: 90 min. Available from the DRRC at the
Kellogg School of Management, Northwestern University, 2001 Sheridan Road, Evanston, IL
60208. Phone: (847) 491-8068; www.negotiationexercises.com.

5. EXERCISE: Cobalt Systems

by Catherine Tinsley
This is a joint venture negotiation between a U.S. and Korean company. It is set up to teach
Raiffa’s formal analysis technique for prioritizing issues. It is also useful for teaching the concept
that culture impacts parties’ positions on the issues. Preparation: 60 min. Negotiation: 60 min.
Available from the DRRC at the Kellogg School of Management, Northwestern University, 2001
Sheridan Road, Evanston, IL 60208; www.negotiationexercises.com.

6. EXERCISE: Culture and Community Mediation

by James Wall
This exercise consists of 18 case studies that can be used to illustrate how norms for mediator
behavior vary by culture, how different cultural institutions affect the nature of mediation, and
how mediators have and use power differently in various cultures. Although community
mediation is practiced around the world, it is practiced quite differently in different
cultures. Cultural and Community Mediation can be used with undergraduate or graduate
students, but they should have some introduction to mediation prior to participating in the
exercise. Preparation: assign as homework. Available from the DRRC at the Kellogg School of
Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

7. EXERCISE: GlobeSmart
by Leigh Thompson
GlobeSmart is a cross-functional team exercise that involves “distance” teamwork. Teams face
the multitude of challenges (e.g., geographical, cultural, communication, etc.) posed by distance
teamwork. The task parallels the Mars Climate Orbiter disaster in 1999, in which one team used
metric units and the other used English units for a key operational measurement that ultimately
failed. Key learning points focus on the challenges of distance teamwork in terms of
communication biases and how to overcome them. Preparation: 20 min. Negotiation: 35 min.
Available from the DRRC at the Kellogg School of Management, Northwestern University, 2001
Sheridan Road, Evanston, IL 60208; www.negotiationexercises.com.

8. EXERCISE: Granite Corporation in Costa Rica

by Adrianne Kardon and Jeanne M. Brett
This negotiation illustrates the situation when a U.S. company has a foreign government on the
other side of the table and an activist environmental group demonstrating outside. Preparation:
60 min. Negotiation: 60 min. Available from the DRRC at the Kellogg School of Management,
Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

9. EXERCISE: International Lodging Merger

by Tony Simons and Judi McLean Parks
International Lodging Merger is a quantified, integrative negotiation about the merger of a U.S.
hotel chain with a Brazilian chain. The point structure motivates culturally different behaviors

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 Chapter 10: Cross-Cultural Negotiation 8

from the negotiators. Key cultural differences that have been incorporated into the exercise
include time, power distance, individualism/collectivism, and universalism/particularism.
Preparation: 60 min. Negotiation: 60-90 min. Available from the DRRC at the Kellogg School
of Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

10. EXERCISE: Les Florets

by Stephen B. Goldberg
A simplified version of Texoil set in France. Preparation: 30 min. Negotiation: 45-60 min.
Available from the DRRC at the Kellogg School of Management, Northwestern University, 2001
Sheridan Road, Evanston, IL 60208; www.negotiationexercises.com.

11. EXERCISE: Lost in Translation

by Corinne Bendersky
Lost in Translation is a cross-functional team exercise that challenges students to solve problems
with teammates who use different modes of communication: speaking, drawing, and acting. The
exercise simulates the communication challenges that typically arise in cross-functional teams
when people find that they cannot be understood by people from other functions because their
disciplinary training emphasizes distinct ways of thinking and representing knowledge. The
exercise consists of two tasks that involve conveying words that are distributed to different team
members, and constructing phrases from those words. In the Learning Task, team members all
use the same communication mode to establish norms. In the Challenge Task, students are in
cross-functional teams with each member using his/her own functional communication mode to
convey the words. Preparation: 30 min. Negotiation: 60 min. Available from the DRRC at the
Kellogg School of Management, Northwestern University, 2001 Sheridan Road, Evanston, IL
60208; www.negotiationexercises.com.

12. EXERCISE: The Mexico Venture

by Holly Schroth and Jackie Ramirez
The Mexico Venture is a negotiation between joint venture partners, one representing the U.S.
partner and the other representing the Mexican partner. There are several cross-cultural issues,
such as currency devaluation and cultural differences in work norms. Preparation: 15-20 min.
Negotiation: 45 min. Available from the DRRC at the Kellogg School of Management,
Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

13. EXERCISE: Mouse

by Geoffrey Fink and Maria Baute Stewart
The DRRC’s version of this Harvard University Program on Negotiation (PON) case is a six-
party negotiation based loosely on EuroDisney’s rocky start in France. At the table are four
Mayors of French communities, a representative of the Mouse corporation, and an official of the
French national government. This multiparty, multi-issue, multicultural negotiation contains some
interesting teaching points regarding the BATNA concept. Preparation: 60 min. Negotiation: 90
min. Available from the DRRC at the Kellogg School of Management, Northwestern University,
2001 Sheridan Road, Evanston, IL 60208; www.negotiationexercises.com.

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 Chapter 10: Cross-Cultural Negotiation 9

14. SUPPLEMENTAL MATERIALS FOR A BOOK: Negotiating Globally

by Jeanne Brett
Interactive Instructor’s Manual for Negotiating Globally, 2nd Edition (Jossey-Bass, 2007) by
Jeanne M. Brett. This completely revised material includes suggested syllabi, new cases and
exercises, self-assessments, lecture outlines, and suggestions for DRRC exercises to accompany
each book chapter.

15. EXERCISE: The Paradise Project

by Jeanne M. Brett, Rekha Karambayya, Catherine A. Tinsley, and Anne Lytle
This is a version of Amanda (see suggested cases and exercises for Chapter 9 and Appendix 3) set
in a Mexican tile manufacturing facility. Preparation: 30 min. Negotiation: 60 min. Available
from the DRRC at the Kellogg School of Management, Northwestern University, 2001 Sheridan
Road, Evanston, IL 60208; www.negotiationexercises.com.

16. EXERCISE: The Summer Interns Program

by Roy Lewicki and Blair Sheppard
This is a dispute between the heads of engineering and personnel. It can be used to teach interests,
rights, and power in multiple cultures. It has good comparative culture data in the teaching notes.
Preparation: 60 min. Negotiation: 60 min. Available from the DRRC at the Kellogg School of
Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

17. EXERCISE: Tipal Dam

by Peter Wheelan and Jeanne M. Brett
This is a transactional negotiation between a construction company and a foreign government.
Preparation: 60 min. Negotiation: 60 min. Available from the DRRC at the Kellogg School of
Management, Northwestern University, 2001 Sheridan Road, Evanston, IL 60208;
www.negotiationexercises.com.

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