Reflective journal of Cross Cultural Management

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INDIVIDUAL NEGOTIATION REFLECTIVE JOURNAL 10

INDIVIDUAL NEGOTIATION REFLECTIVE JOURNAL

Individual Negotiation Reflective journal

According to Hofstede (1991), cultures that have low power distance are typified by role equality and these cultures decentralisation is popular. Contrary, countries having high power distance do have attributes with existential inequality between lower-downs and higher-ups while centralisation is widely held. In the first simulated negotiate situation, Australian car dealer was our group role while the Japanese international student had a counter group role. In this situation, my role was a Mechanic. We sought to sell a 2014 Holden commodore AT sedan (SV6) (MY14) Red car that had no accident, free for scratches and had a perfect looking. The Japanese student was offered one-year factory warranty, one-year dealership warranty, and 5 seat cushions. The base price that we offered was $20,000, there were three offerings (1st price was $30,000, the 2nd price was $24,000 and the final deal was $21,000). During the negotiation process, I realised that a meeting turns out to be a cross-cultural encounter when the involved parties are from different cultural backgrounds. In the first simulated situation, both parties (Australian car dealer and the Japanese Student) had a conflicting way of understanding the processes of negotiation given that their values systems, norms, and attitudes can differ. I noted that negotiation with a person from one’s own culture, making realistic expectations concerning the other party anchored on one’s individual experience normally makes communication successful. Certainly, this is limited if one consider, for instance, different regional variations, gender, socio-economic status, and age. Still, such a situation becomes more multifaceted when the negotiation is between individuals between two cultures. Normally, miscommunication and misunderstanding happen during cross-cultural negotiation, although communication language is a lingua franca, like English. In Marriott (1995) study as cited by Ismail, Azariadis, and Jusoff (2009) focussed on communicative difficulties in cross-cultural negotiation. Marriott (1995) utilised deviations taxonomy as the examination source for negotiations problems between an Australian seller and Japanese buyer. Findings in Marriott (1995) study point out that discord deviance normally results in dissatisfaction between Australian and Japanese business people during business encounters.

From such findings, I believe that deviance has a crucial implication for understanding how cross-cultural negotiation can fail or succeed. I noted that the differences in cultural value between the Japanese and Australian cultures results in high cross-cultural negotiations performance outcomes. To negotiate effectively, we had to understand the Japanese cultural variables that generate noise during the process of negotiation, given that this knowledge allowed us from Australian culture to look for ways of minimising the cultural noise as well as to improve communication. In the second simulated negotiate situation, the role of the group was Bestbooks Ltd while Jamie Oliver had the Counter group role. The bonus of signing the contract was $1M while royalties for hard copy and E-book was 10 per cent and 35 per cent, respectively. The books were to be sold in Australia, New Zealand, and the UK while the number of book clubs was 10,000 across the globe. This negotiation can be described by face negotiation theory, which states that people in every culture strive to negotiate face in every communication situation, but the face concept turns out to be problematic in situations that are uncertain like conflict situations (Oetzel & Ting-Toomey, 2003). During the negotiation process, I noted that people from UK, New Zealand, and Australia are individualistic since they tend to show competitive attitudes together with the appreciation and need for competition. In these simulated negotiate situation, I realised that preparation is an important element in a negotiation process since it acts as a strong foundation for preparing comprehensively as well as strategizing. I have also noted that I am too accommodating and cooperative as well as too quick to agree; therefore, I think this is my weakness.

In the construction negotiation simulation, we (JGC Philippines) negotiated a utility with Australian NIDO Gas. Even though the negotiation involved only two parties, it had multiple issues. The duration of the contract was 38 weeks with no early bonus or late penalty, but we were expected to report weekly in the first 20 weeks and bi-weekly for the remaining weeks. The contract type was Flat Fee amounting to $ 4,950,000. During the negotiation, I realized that major projects involve a lot of issues as well as the multitude of explicit and implicit interests that normally lead to multifaceted negotiations between the contractor and the client. The project details were agreed after an extensive interaction between the contractor and client. According to Murtoaro and Kujala (2007) change orders and variation, accidents, claims as well as other forms of disturbances normally result in renegotiations after the contract has been signed irrespective of how the initial project was detailed. A construction contract can trigger recurring negotiations with a number of parties, with different concerns at different times. In Yousefi, Hipel, and Hegazy (2010) study, they outline some of the negotiation models that can be used in the construction and argue that the negotiators attitudes play an unavoidable role in negotiation outcome. Therefore, negotiators that have aggressive attitudes are normally suitable for hard negotiation where there are no concessions while those with cooperative attitudes are suitable for soft negotiation. Having a cooperative attitude during a negotiation process can enable the negotiators to share their interests as well as concerns positively and strive to achieve a common win-win solution.

The Philippines have high Power Distance Index and low Individualism
like Malaysia and Thailand; therefore, their cultural attributes is different from that of Australia. Therefore, the negotiation had a number of challenges attributed by the cultural differences. Given that it was a multi-sided negotiation, the team leader controlled the content as well as the flow of negotiations. He utilised verbal and non-verbal communication skills so as to control the content of the negotiation. I noted that tactics are a crucial part of every negotiation and even through the negotiator can fail to use tactics, it is imperative to know the reasoning as well as dynamics behind them. The strategy that we used was the principled negotiation approach, which focuses on deciding the price in terms of merits. The principled negotiation strategy is believed to be successful irrespective of the tactics utilised by the opponent since it seeks mutual gain. In this strategy, people were separated from the problem, the focus was on the interests rather than positions and we invented ways for mutual gain. A resourceful negotiator normally uses different tactics and ploys so as to the other party are thrown off balance. Still, tactics that are unethical can obstruct constructive negotiations since they tend to alienate and irritate. Even though there are no all-inclusive tactics’ lists, they are normally grouped into constructive and aggressive tactics. In this case, we used the constructive tactic; fair and reasonable. Part Three

Ethics is about doing what is fair, right as well as honest. Unethical practices in the negotiation process may include being dishonest or unfair. From the simulated negotiation situations, I have learned that for negotiators to be ethical in the negotiations process they must be honest, keep the promises and ensure they treat people the way they desire to be treated. People from countries with high power distance such as Japan, Philippines, and Pakistan never trust what they are told by the negotiators until they form a strong relationship. In such case, conflicts normally arise and negotiators should understand how to manage them in an ethical manner (Adair, Okumura, & Brett, 2001). During negotiation ethical issues normally arise from demographic factors such as gender, age, cultural background, nationality as well as past experience. When the negotiators are from different age groups they may have differing opinions of what may be unethical or ethical. For instance, a behaviour that is considered ethical in Philippines or Japan may be ethical in Australia or UK. Ethical issued may also arise because of personality differences, and some of the personality traits that make people behave either ethically or unethically include; being a self-oriented or team oriented person, being competitive or cooperative, and having Machiavellian traits. Individuals who are more cooperative, team-oriented and not Machiavellian are inclined to behave ethically during a negotiation process. For instance, the Japanese people are cooperative and team-oriented individuals while Australian people are more competitive and self-oriented individuals.

Some of the ethical issues that I think are prevalent in negotiation process include deceiving, lying or bluffing. According to Alavoine (2014), deception is a bargaining component that normally protects or benefits the deceiver. Besides that, bluffing in negotiation can be morally acceptable since this practice is endorsed by both participants and due to the fact that process of bargaining has no specific procedure. But when bluffing is akin to lying as well as deception it is considered unethical. It is unethical for a negotiator to manipulate information or use emotional deception as a negotiation tactic. Another ethical issue that arose during the simulated negotiation situations was threatening, whereby the client threatens in case we fail to deliver. In Alavoine (2014) study, threats are viewed in three different approaches: commitment, communication, and decision making. Most people use threats in the negotiation process so as to ensure the negotiator is committed to delivering favourable outcomes. Threats are considered by the majority of actors in negotiation, as a possibility associated with particular interaction as well as a tactic. Still, use of threats is unethical and should not be tolerated. Therefore, I can recommend that during cross-cultural negotiation the negotiators must be careful not to overestimate the level to which they understand the other side’s priorities as well as preferences. Besides that, the negotiators should be vigilant for naïve realism and try to be empathic with the feelings of the other parties (Galinsky, Maddux, Gilin, & White, 2008). Imperatively, the negotiators should ensure that all the involved parties see the process of negotiation as fair as possible.

Part Four

With the view to the negotiation simulation between Nido Petroleum and JGC Philippines, in this section, I present my negotiation planning process and outline my negotiation roles, responsibility, strategy, and tactic. The negotiation planning process will involve four stages: knowing the venue, what our team wants, what they want, and what our team has to offer. Before starting a negation, I think it is imperative to know the venue of negotiation and make sure the location is neutral so as to avoid negotiating with one party seated comfortably at their desk. After identifying the venue, our team would make sure they understand what we want since in all negotiations; every person has something they want. In this case, we would generate an ideal situation for my team as we prepare for the negotiation. In the third stage, it is important to know what the client wants so as to be able to prepare the process of negotiation.

During thenegotiation preparation, I will try to generate a comprehensive argument for our discussion side by developing charts and graphs that could help use create a visual contrast for the client to consider. Being a big project, every team member will have different roles, but my role will be relater, the team’s friendly face. As a relater I will build relationships with the client so as to be able to gain valuable pieces of information. I will also serve as arbitrate in case of conflict between personalities. My responsibilities would include taking part in the negotiation meetings, discussing proposals, suggestions as well as problems concerning the contract. Another responsibility will be meeting with the client so as to prepare and develop proposals for the negotiating sessions. The strategy that will be used during the negotiation include; breaking the negotiation into parts so as to make quick progress; adopt fair approach that will facilitate the team to neutralize conflict; prioritising and taking control so as to focus on the goals rather than revenue and risks; and making sure facts, instead of feelings. The tactic that I will use is “ourfacts are better than yours,” whereby I will use facts like the industry surveys, benchmarking studies, case- studies or standards so as to support my point of argument.

References

Adair, W. L., Okumura, T., & Brett, J. M. (2001). Negotiation Behavior When Cultures Collide: The United States and Japan. 2001, 86(3), 371-385.

Alavoine, C. (2014). Ethics in Negotiations: The. Paris: IPAG Business School.

Galinsky, A., Maddux, W., Gilin, D., & White, J. (2008). Why it pays to get inside the head of your opponent: the differential effects of perspective taking and empathy in negotiations. Psychological Science, 19(4), 378-384.

Hofstede, G. (1991). Cultures and Organizations: Software of the Mind. London, UK: McGraw-Hill.

Ismail, J., Azariadis, M., & Jusoff, K. (2009). An Overview of the Cross-Cultural Business Negotiation between Malaysia and Australia. Canadian Social Science, 5(4), 129-142.

Murtoaro, J., & Kujala, J. (2007). Project negotiation analysis. International Journal of Project Management, 1(1), 1-12.

Oetzel, J. G., & Ting-Toomey, S. (2003). Face Concerns in Interpersonal Conflict A Cross-Cultural Empirical Test of the Face Negotiation Theory. Communication Research, 30(5), 599-624.

Yousefi, S., Hipel, K. W., & Hegazy, T. (2010). Attitude-Based Negotiation Methodology for the Management of Construction Disputes. Journal of Management in Engineering , 26, 114-122.