Tomalin B., Nicks M. The World’s Business Cultures and How to Unlock Them
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NINE
Meetings and negotiations
NINE
Meetings and negotiations
The meeting was tense. The British team handling due diligence in the takeover
of a French company were trying to sort their way through the agenda. The
French team were discussing everything under the sun under every agenda
point. Eventually, tempers frayed. “Look, can’t we at least keep to the agenda?”
one of the Brits said. ‘But that’s not the way we do things,” replied his French
counterpart. “Everything is linked to everything else.” “Do you mean to say
you only prepare agendas for us?” challenged the Brit. The Frenchman said
nothing, just smiled.
If you assume that meetings work in similar ways the world over, think again.
Different communities have different procedures, covering matters such as
the location of meetings, the type of meetings there should be and who attends
them, the function and role of agendas and orders of business, ways of working
and the role of minutes and action points. If you understand these, you can
get the best results and avoid a lot of frustration.
Where are meetings held?
There are generally three types of location: the meeting room, the private
office and the hotel restaurant or bar. Where you prefer to meet is obviously
a personal decision, but it remains true that in relationship-oriented cultures
the key discussions often happen during hospitality sessions. The decisions
are then ratified in an official meeting. In systems-oriented cultures the crucial
debates usually take place in a meeting room. There may also be preliminary
talks in private offices, as in Scandinavia, and the agreements reached will
then be brought to the table in the meeting room for formal approval. It’s
important to be flexible about meeting venues and to focus on the result, not
on where you feel most comfortable.
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Who attends?
Japanese business tends to hunt in packs. Many people attend meetings, as
opposed to the minimal numbers in the UK or the US. The Japanese believe
that everyone who is in the loop should know what is going on. A number
of junior executives may be in the room, but their job is to listen rather than
contribute. Be careful you don’t spend your time talking to the junior staff
member just because he appears to be paying rapt attention. Jack Howard,
a former senior lecturer at Birmingham University, once gave us an invaluable
piece of advice. “How do you know who is the senior person in a Japanese
meeting?” he asked. “See who is served the tea first.”
In Spanish meetings you talk to the top person, possibly accompanied by his
or her deputy. Other managers are on standby, and they will be brought into
the discussion as necessary. This is your signal that all decisions go through
the boss, and he will attend or keep a close eye on any policy meeting.
The Germans, like the British, tend to have a minimum number of people
present, but they will include both policy and implementation personnel
required for the task. If you’re dealing with a manufacturing project,
representatives from the works committee will also participate to ensure that
the employees’ legal requirements are looked after.
It’s often difficult to find out in advance who is attending a meeting, but it’s
always worth asking. It’s also important to identify the key decision-maker,
as it may not always be immediately obvious.
How are meetings arranged?
Once again, relationship-oriented societies may appear far more casual about
setting up meetings than systems-oriented ones. Gatherings may be convened
at short notice by telephone or brief email. No attendance list may be considered
necessary and no agenda circulated. In contrast, in Germany, Austria, and
the Nordic countries, full details will be circulated up to six to eight weeks
beforehand. The British and Americans are somewhat more relaxed about
this, but clear notice will still be given.
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Expectations of meetings
“Why do we go to meetings?” grumbled the sales manager of an international
French firm. “To be told what to do, of course,” he continued. The distribution
of information is often the function of a gathering in a top-down management
system. Objectives are laid down, and the details of any changes in
organization and working methods explained; negotiations take place in private
offices outside the main meeting. If you hear about a change in the working
environment at a French meeting, it’s probably too late to influence it.
Many German firms, on the other hand, make a clear distinction between
information meetings, action meetings and brainstorming sessions. An
information meeting is just that: it gives instructions. An action-point
meeting is expected to achieve minuted decisions for implementation, while
a brainstorm gathering comes up with ideas for dealing with a particular
problem or project.
In Italy, all meetings are aimed at eliciting ideas and gathering the mood of
the participants. Decisions are then taken outside the meeting. In Japan, the
principle of nemawashi means that all meetings must end in the agreement
of all participants. Collective agreement and collective commitment are the
order of the day.
These examples indicate how different business communities have their own
expectations of meetings. The lesson? Don’t assume that your assumptions
about a meeting and its outcome will be the same as everyone else’s. In a
multinational or virtual distributed team, find out what others – and
particularly the group leaders – will be thinking.
An agenda or not?
British and US meetings tend to run on agendas. Even in an informal meeting
someone will ask, “What do we want to cover?” and a rough agenda or order
of business will be drawn up. If an agenda is distributed beforehand, the order
of business might be amended according to how the discussion flows, but
if an item of business isn’t covered in its original order, it will usually be dealt
with before the end of the meeting.
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Other business communities have very different attitudes to agendas. Some
see an agenda as more of a wish list of things to cover, rather than a detailed
order of business. For the French, for whom everything is connected, keeping
to the strict order of an agenda seems unnatural, while for the Germans and
Swiss the order is sacred, and you only go back over a topic if there is time
at the end of the meeting.
We once got a surprise when we circulated a British-style agenda before an
international gathering, with the usual Any Other Business line tacked on
the end. It caused an eruption: colleagues from some countries saw it as an
invitation to potential chaos. We thought it was totally innocuous, but for
those who liked to control meetings from beginning to end, the phrase ‘AOB’
seemed like a minefield, the equivalent of a supplementary questions session
at Prime Minister’s Question Time in the House of Commons. This is not to
say that you shouldn’t include ‘AOB’ on any agenda that you circulate in an
international environment, but be aware that it may not be seen as a way of
tidying up loose ends that the British use it for.
Lessons? Remember that agendas are not routine for everyone and, when
they are used, are not always rigidly followed. Don’t insist on drawing up an
agenda if one isn’t produced at a meeting that you attend, and don’t insist
on your way of doing things without checking other people’s views.
Consideration for others is everything.
Meetings etiquette
International meetings can be a minefield of frustrated expectations. Do they
start late? Yes, in Italy and the Arab world. Do they finish late? Probably, if
you’re in France. Do people feel that it’s OK to answer their mobile phones
and indulge in long conversations round the table, oblivious to everyone else?
They do in Central and Eastern Europe. Are meetings interrupted by foreign
phone calls or personal visitors while you sit there helpless? Frequently, in
Arab countries. Do meetings begin with long involved speeches by the
chairperson, extolling their education or explaining in detail the story so far?
Yes, in Spain and Latin America. Do participants get up while you’re making
your presentation, help themselves to coffee and biscuits and stand there
chatting while you sit there, your concentration totally distracted? It’s not
unknown in France or the USA.
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These are all things that we’ve regularly encountered in international get-
togethers. British people’s response is often to lapse into ironic humour and
ask barbed questions such as, “Is my meeting interrupting your conversation?”
But avoid that approach at all costs. The fact is that all of these incidents were
seen as normal meetings etiquette by the people involved.
On the other hand, we arrived in Nicosia late for a meeting after a delayed
flight. We raced to the venue, walked in, said ‘Hello’, and – still hyped up
from the journey – launched into the reason for our visit. Our host listened
quietly for a few minutes and then said, “Wouldn’t you like a cup of coffee
first?” We’d committed a major sin by forgetting a Mediterranean custom:
people first, business second. In the Arab world, and also in Japan, it’s
considered polite to wait for your host to introduce the business. To march
in and open discussions is seen as discourteous.
The lesson? Check the meetings etiquette before you start, so that there are
no surprises.
Results and outcomes
What’s the ideal outcome of a good meeting? Everyone emerges knowing
the project’s objectives, their responsibilities and the time frames, and
everything will be recorded in the minutes or action points, right? Not
necessarily. A meeting can simply be held to gather opinions: decision-making
comes later. Or it might be about a simple statement of aims or values, and
any action planning will be done somewhere else. In a German ‘action’ meeting,
plans, responsibilities and time frames for delivery are clearly defined. However,
in one German company we know, minutes are circulated not only to those
who were present, but to everyone else involved in the operation, who then
have the right to alter or add to the minutes. A British manager involved with
this firm said that it felt as though another meeting that he hadn’t attended
had been superimposed on top of the original one, and that completely different
decisions had been taken. Result? Confusion and demotivation.
The lesson: team members from other countries may see the British and
American practice of agreeing the outcome with action planning, time frames
and allocation of duties very differently. In an international environment, check
your understanding of procedures, and in your own team make clear what
you expect and why.
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Negotiating
In any negotiation you must know two things: your walk-away point and what
concessions you are prepared to make. However, as with meetings, negotiation
styles are subject to cultural variation, and it is important to identify those
differences before you start discussions. This section will identify the key areas
where differences generally occur.
Who do I negotiate with?
The Chinese and Japanese negotiate with individuals, not companies.
Therefore your initial contact in an organization from one of those countries
will probably remain in the discussions, even if he changes his responsibilities
within the firm before an agreement is reached. He will probably continue
to attend meetings, even at a high level, until the deal is completed: the Chinese
and Japanese feel that this adds confidence to the relationship. If there is a
change in your key contact, however, handle your initial communication with
him or her formally and carefully: a casual phone call or email won’t do.
We’ve already noted that in countries such as Spain or Italy, you negotiate
with the top person, with others being brought in to arrange implementation.
The negotiator’s first aim will be to establish trust and a working relationship,
and then to decide prices and logistics. Without the first, the second is unlikely.
In Nordic countries, as in Britain or the USA, negotiation will be with a manager
at the appropriate level, and debate will quickly centre on the contract and
the price. A British negotiating team will usually make an opening bid, after
which there is discussion and a response by the other side. If the bargaining
becomes aggressive, the British are well known for withdrawing and
seeming to appear quite vague before repackaging the deal in some form of
acceptable compromise. Whether you recognize your tactics in that description
or not, it’s the way foreigners usually view the British. They also think that
Britons like to ‘sleep on a deal’ to be sure they are comfortable with it, and
that Brits are capable of changing their minds and renegotiating some points
the following day.
There are three stages in a negotiation:
• Opening bids
• Bargaining
• Close
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The British and Americans like to state quite early in the proceedings what
they want to achieve. Americans are often quite firm about this and put the
deal ‘on the table’. When alternative bids are made, they will then respond
with: ‘But that wasn’t on the table!’ The French, on the other hand, like to
listen to the other person’s offer and put forward their proposals in the light
of what the other side is saying. This can cause friction with Americans, in
particular.
Germans and Scandinavians tend to know what they believe is a fair price
in a contract, and get upset at what they feel is a British tendency to start at
too high a level and then move down to a lower figure. Italians, on the other
hand, are quite happy with that process, and will worry away at each aspect
of a deal until they bring the price down to their satisfaction.
The lessons are clear:
• Know absolutely what your final situation is and never deviate from
it.
• Never assume that the other nationality’s approach to negotiating is
the same as yours. Learn anything you can about their style so that
you have some idea of what to expect.
• Remember that cultures like the Indians, Chinese and Arabs have been
negotiating and haggling successfully for thousands of years and have
developed their own approaches.
In his fascinating book on the call-centre industry, What’s This India
Business?, Paul Davies goes into detail on the Indian style of negotiation. When
you first mention your price, he explains, you will be met with shock and
horror. Take no notice, he advises: repeat your position exactly as you did
the first time. Indians will then try and wear you down. It’s acceptable for
you to leave the room; they will wait, expecting you to come back and restart
the negotiations.
Simultaneously, you’re building a relationship with them and a kind of trust.
Finally, he says, the green light may come not in the office but somewhere
else entirely, such as over dinner.
The Chinese seek agreements that will not cause political problems and can
lead to a sincere partnership. If they see you behaving dishonestly, they will
feel free to be less than frank with you. Their concern is balance: if they take
something, they feel that it’s important to be seen to give something back.
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Be aware of the danger of flattery in China. An ‘old friend’ is expected to
offer better terms. Also, be wary of introducing lawyers too early – it may
be seen as a sign of mistrust. Never lose your temper – although the Chinese
may sometimes use anger as a pressure tactic.
Russians treat negotiation like a game of chess. They plan several moves ahead,
and it is important to think carefully about the consequences before you
respond. A well-known Russian tactic is to tough things out and to regard
compromise as a sign of weakness. Concessions are exchanged for
concessions. Therefore it is important to have a number of throwaway positions
at your disposal. Ultimately, however, what is important to Russians is that
you show your human side: understand Russian difficulties – layers of hierarchy
and the need for government approval – don’t hide your own problems, and
be direct and straightforward. Russians combine hard-nosed negotiating skills
with the personal touch: you need to be able to do the same.
In the Arab world, negotiators combine requests for favours and concessions
on price as an important part of the process. In his book Cross-Cultural Business
Behaviour, Richard Gesteland writes: “Some Arab businessmen measure their
success at the bargaining table by how far they are able to move you away
from your opening offer. They think of negotiating as a challenging contest,
a competitive sport.” Negotiations in these circumstances can be a long process,
and you should build in wide margins. Visitors to Arab markets always
comment on how bargaining is almost like a game, and how sellers are
disappointed if you don’t enter into the pleasure of haggling. Business
negotiation is not dissimilar, with each concession reluctantly offered, and
only on condition that something is given in return. Don’t rush, and write
everything down.
Finally, to Brazil. In Brazilian negotiations, socializing and bargaining go
together, often in the same space. For a polite social people, Brazilians can
be quite blunt. This is less a pressure tactic than simple directness: they like
you to know where they stand. Once again, allow time for negotiations and
build substantial margins into your offer to provide for concessions. Be
prepared for them to ask for favours in other areas, which you should try to
help with as it will tend to cement the relationship.
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Conclusion
These and other examples stress the need to do your homework in dealing
with another country or someone from another business community.
Understanding the negotiating style and what brings your bargaining partner
to the table and keeps him or her there is a vital part of business negotiation.
You will do yourself no favours by ignoring this: they will probably have
studied your culture’s style.
Key learning points
• In relationship-oriented societies, small talk and hospitality are vital
to successful meetings.
• Agendas aren’t for everyone – don’t insist on them if they’re not a
normal part of the meetings process.
• Find out if the meeting is for general discussion, information or to
take action.
• Familiarize yourself with where business is done, who attends
meetings, who chairs the session and the way business is conducted.
• Check the anticipated outcome of a meeting – it may not be minutes
and action points.
• Familiarize yourself with your counterpart’s approach to opening bids,
negotiation and close.
• Be certain of your walk-away point and don’t deviate from it.
• Be careful how you price your opening bid. Leave a margin for
concessions, but remember the German, Dutch and Nordic preference
for the concept of a fair price.
• Remember that high-pressure bargaining and haggling may not get
in the way of warm hospitality.
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