Negotiating Globally: How to Negotiate Deals, Resolve Disputes, and Make Decisions Across Cultural Boundaries (Jossey-Bass Business & Management)

381 Pages·2007·1.07 MB·English

by  Jeanne M. Brett

Negotiating
Globally

How to Negotiate Deals,
Resolve Disputes, and Make Decisions
Across Cultural Boundaries

Second Edition

Jeanne M. Brett

John Wiley & Sons, Inc.

Brett.ffirs 7/2/07 8:28 AM Page iii

Brett.ffirs 7/2/07 8:28 AM Page ii

Negotiating Globally

Brett.ffirs 7/2/07 8:28 AM Page i

Brett.ffirs 7/2/07 8:28 AM Page ii

Negotiating
Globally

How to Negotiate Deals,
Resolve Disputes, and Make Decisions
Across Cultural Boundaries

Second Edition

Jeanne M. Brett

John Wiley & Sons, Inc.

Brett.ffirs 7/2/07 8:28 AM Page iii

Copyright © 2007 by John Wiley & Sons, Inc. All rights reserved.

Published by Jossey-Bass
A Wiley Imprint
989 Market Street, San Francisco, CA 94103-1741-www.josseybass.com

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any
form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise,
except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without
either the prior written permission of the publisher, or authorization through payment of the appro-
priate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA
01923, 978-750-8400, fax [phone], or on the Web at www.copyright.com. Requests to the
publisher for permission should be addressed to the Permissions Department, John Wiley & Sons,
Inc., 111 River Street, Hoboken, NJ 07030, 201-748-6011, fax [phone], or online at
www.wiley.com/go/permissions.

Readers should be aware that Internet Web sites offered as citations and/or sources for further infor-
mation may have changed or disappeared between the time this was written and when it is read.

Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best
efforts in preparing this book, they make no representations or warranties with respect to the accu-
racy or completeness of the contents of this book and specifically disclaim any implied warranties of
merchantability or fitness for a particular purpose. No warranty may be created or extended by sales
representatives or written sales materials. The advice and strategies contained herein may not be
suitable for your situation. You should consult with a professional where appropriate. Neither the
publisher nor author shall be liable for any loss of profit or any other commercial damages, including
but not limited to special, incidental, consequential, or other damages.

Jossey-Bass books and products are available through most bookstores. To contact Jossey-Bass
directly call our Customer Care Department within the U.S. at 800-956-7739, outside the U.S. at
317-572-3986, or fax [phone].

The materials on the accompanying CD-ROM are designed for use in a group setting and may be
customized and reproduced for educational/training purposes. The reproducible pages are designated
by the appearance of the following copyright notice at the foot of each page:

Negotiating Globally, Second Edition, by Jeanne M. Brett. Copyright © 2007 by John Wiley & Sons,
Inc. Reproduced by permission of Jossey-Bass Publishers, an Imprint of Wiley. www.josseybass.com

This notice may not be changed or deleted and it must appear on all reproductions as printed.

This free permission is restricted to limited customization of the CD-ROM materials for your organi-
zation and the paper reproduction of the materials for educational/training events. It does not allow
for systematic or large-scale reproduction, distribution (more than 100 copies per page, per year),
transmission, electronic reproduction or inclusion in any publications offered for sale or used for
commercial purposes-none of which may be done without prior written permission of the Publisher.

Jossey-Bass also publishes its books in a variety of electronic formats. Some content that appears in
print may not be available in electronic books.

Library of Congress Cataloging-in-Publication Data
Brett, Jeanne M.
Negotiating globally: how to negotiate deals, resolve disputes, and make decisions
across cultural boundaries/ Jeanne M. Brett.—2nd ed.
p. cm.—(The Jossey-Bass business & management series) “A Wiley Imprint.”
Includes bibliographical references and index.
ISBN 978-0-7879-8836-4 (cloth/cd)
1. Negotiation in business—Cross-cultural studies. 2. Negotiation—Cross-cultural
studies. 3. Decision making — Cross-cultural studies. 4. Conflict management—
Cross-cultural studies. I. Title.
HD58.6.B74 2007
658.4'052—dc22
2007019065

Printed in the United States of America
second edition
HB Printing
10 9 8 7 6 5 4 3 2 1

Brett.ffirs 7/2/07 8:28 AM Page iv

The Jossey-Bass
Business & Management Series

Brett.ffirs 7/2/07 8:28 AM Page v

Brett.ffirs 7/2/07 8:28 AM Page vi

Contents

CD-ROM Contents
ix

Preface
xi

Acknowledgments
xix

The Author
xxv

1.
Negotiation Basics
1

2.
Culture and Negotiation
25

3.
Culture and Integrative Deals
53

4.
Executing Negotiation Strategy
79

5.
Resolving Disputes
115

6.
Third Parties and Dispute Resolution
155

7.
Negotiating Decisions and Managing
Conflict in Multicultural Teams
175

8.
Social Dilemmas
219

9.
Government At and Around the Table
245

10.
Will the World Adjust, or Must You?
279

Notes
289

Glossary
325

Index
335

How to Use the CD-ROM
349

vii

Brett.ftoc 7/2/07 8:29 AM Page vii

Brett.ftoc 7/2/07 8:29 AM Page viii

CD-ROM Contents

Chapter One

Negotiation Planning Document

Exercise 1.1. Personal Choices in Decision Making

Chapter Two

Case 2.1. System Modification for Japan

Chapter Three

Case 3.1. A Scandinavian Scare

Chapter Four

Guide to Listening to Your Negotiation Audio Recording

Chapter Five

Case 5.1. Nichia Corporation Versus Shuji Nakamura:
The Blue LED Dispute

Chapter Six

Being Effective in Mediation When You Are the Disputant

The Mediation Process

Additional CPR Model Clauses

ix

Brett.ftoc 7/2/07 8:29 AM Page ix

Chapter Seven

Exercise 7.1. Cultural Metacognition

Exercise 7.2. Identifying Effective Strategies
for Multicultural Teams

Chapter Eight

Case 8.1. OPEC Negotiations

Chapter Nine

Case 9.1. Nokia and Motorola Versus Telsim

Case 9.2. Newbridge and Chinese Negotiations Over
Shenzhen Development Bank

Case 9.3. The Checkered Negotiation History of the
Dabhol Power Project

x
CD-ROM CONTENTS

Brett.ftoc 7/2/07 8:29 AM Page x

Preface

If you must negotiate deals, resolve disputes, or make decisions in
multicultural environments, this book is for you. If you have had
formal training in negotiations but no training in culture, the book
will extend your negotiating skills and knowledge across cultural
boundaries. Be prepared to discover that old, familiar negotiation
concepts, such as power and interests, take on somewhat different
meaning in different cultures. If you have had no formal training in
negotiations, the book will introduce you to all the fundamental
concepts in negotiation and explain how the concepts apply in dif-
ferent cultural settings.
Although the book emphasizes negotiations in a multicultural
business environment, its advice is relevant not just to managers
and management students who expect to be negotiating across cul-
tural boundaries but also to lawyers and law students, and to gov-
ernment officials and students of public policy who are concerned
with economic development in a global environment. Global ne-
gotiations occur in multiple legal, political, social, and economic
environments. International agencies and national and local gov-
ernment officials are frequently at the table in negotiations that
cross cultural boundaries.
Negotiating Globally focuses on national culture, because nation-
state boundaries are both geographical and ideological. The ideol-
ogy or theory underlying a nation’s social, economic, legal, and
political institutions affects the way people interact. When nego-
tiators are from the same culture, ideology is the backdrop against
which deals and decisions are made and disputes are resolved.

xi

Brett.fpref 7/2/07 8:28 AM Page xi

xii
PREFACE

When negotiators are from different cultures, each may rely on dif-
ferent assumptions about social interaction, economic interests,
legal requirements, and political realities.
In today’s global environment, negotiators who understand cul-
tural differences and negotiation fundamentals have a decided ad-
vantage at the bargaining table. This book explains how culture
affects negotiators’ assumptions about when and how to negotiate,
their interests and priorities, and their strategies: the way they go
about negotiating. It explains how confrontation, motivation, in-
fluence, and information strategies shift due to culture. It provides
strategic advice for negotiators whose deals, disputes, and decisions
cross cultural boundaries.

Researching Multicultural Factors

Until recently, most of the knowledge about how to negotiate deals,
resolve disputes, and make decisions in teams came from U.S. re-
searchers studying U.S. negotiators negotiating with other U.S. ne-
gotiators. The evidence is overwhelming that U.S. negotiators
leave money on the table when they negotiate deals, escalate dis-
putes to the point where costs outweigh gains, make suboptimal
decisions in teams, and allow their emotions to interfere with out-
comes.1 Their outcomes also often fall short of the outcomes they
could have obtained if they had integrated their interests fully with
those of the people across the table.
Armed with knowledge about this gap and what can be done
about it, my colleagues at the Kellogg School of Management at
Northwestern University and I have worked with thousands of stu-
dents, managers, and executives who wanted to improve their ne-
gotiation skills. In the early 1990s our student population and their
interests started to shift. Managers from all over the world began to
come to our executive programs. We were invited to teach negoti-
ation in Europe, Latin America, and Asia. Kellogg’s students be-
came decidedly international. We could not avoid dealing with the

Brett.fpref 7/2/07 8:28 AM Page xii