By Antonio Cuciniello

What are the factors to consider in evaluating the effectiveness of negotiation processes in international and intercultural contexts?

It seems like a million-dollar question. However, more than a single answer, there are indications that can help those who work in international negotiating contexts to achieve their objectives, strengthen skills in the sector, and above all reduce the emergence of clashes resulting from the link between the concepts of cultural and logical distance as well as the structure and conduct of negotiations.

In the international context, sensitivity to cultural differences is increasingly a decisive aspect, to the point of becoming a real source of competitive advantage for a company. Moreover, it is a fact that negotiations in the context of transactions between companies from different countries (cross-cultural clusters) present greater difficulties than those “at home” (intra-cultural clusters), both in terms of process and result, given the variables to be kept under control.

Negotiations are mainly characterized by different values and cultural differences, in terms of established managerial practices (e.g. communication, cooperation, conflict management, acceptance of authority, etc.). For example, a different conception/perception of time affects the degree of satisfaction in the negotiations.

In fact, when the parties involved are from different cultures, they may have different expectations regarding how much time is “necessary” for the negotiation process, even attributing an economic value to it that can be summed up in the adage: “Time is money!”

It’s no coincidence that, based on the concept of Time Orientation, there are cultures inclined to consider and plan in the long term and others with a “day-by-day” orientation. Therefore, each negotiator, consciously or not, uses a style and a rhythm that is noticeable in every stage of the conversation, as well as in what is expressed in writing.

Often all these variables can create misunderstandings among the negotiators in the dynamics of communication, as well as in the interpretation of the actions that accompany every stage of negotiation activity, influencing the style and the rhythm along with the formal and material aspects of the agreement to be reached.

For these reasons, taking into account the counterparties’ cultural distance can be a decisive element favoring the fluidity of relations and meeting the expectations of the parties involved, reducing the negotiation time and above all misunderstandings that could put the business relationship at risk.

We’re specifically talking about cross-cultural management with reference to the knowledge and management of different cultures and especially to the consideration of other points of view, creating synergies useful for increasing the company’s business, with the aim of guiding relations towards a satisfactory situation for the negotiating parties.

To acquire adequate skills in relation to the counterparties’ different cultures, an in-depth analysis of the context in which the negotiation will take place (e.g. information about demographics, the sociological and economic situation, etc.) is required to be fully aware of the negotiating situation and, consequently, to configure the most appropriate negotiating structure. However, one should remember that the personal characteristics of the negotiators (gender, level of education, experience) affect the overall negotiation process and the results achieved.

When it comes to cultural differences, studies analyzing their characteristics first divide cultures into the categories of collectivist (e.g. East Asian and Latin American areas) and individualistic (e.g. Canada, the US, Australia, Great Brittan) to explain the social behavior typical of different countries, specifying whether they stress the meaning of “I” or “we”.

In particular, the following key attributes have been identified which make it possible to detect the peculiarities of collectivist or individualistic cultures: self-conception, the objective of the relationship, the importance of personal attitudes and behavioral norms, as well as orientation within the group.

Equally significant is the distinction between high or low communication contexts in which business-related information is conveyed. In those considered “high”, communication is implicit in the behaviors of the people involved, who reach conclusions through informal interactions, but also through non-verbal aspects, for example, respect for a person’s status.
The most important objective is to establish a relationship of trust with the other party, therefore personal relationships and friendship/empathy are valued. The negotiation process is essentially based on rituals.

On the contrary, in those contexts considered “low”, information is communicated explicitly and, in general, the negotiating report is conducted formally, providing for rigidly established activities. The most important objective is the reference to the business in question and the fundamental element in the relationship with the counterparty is the value of previous experience and performance. Ultimately, the negotiation process is based solely on its efficiency.

The analysis of empirical evidence shows a correlation between collectivist cultures and a high communication context and individualistic cultures and a low communication context.

Regarding the negotiating structure, there are some cultures oriented towards a cooperative approach, which considers several alternative solutions that allow negotiators to make the agreement as satisfactory as possible, and others oriented towards an essentially competitive approach.
In this case it has emerged from specific studies that between collectivist and individualistic cultures or between high and low communication there is no distinction in the use of the cooperativeapproach.

In fact, the only difference is in the degree to which cooperation is used. Ultimately, negotiators from countries with a high context place greater emphasis on interpersonal relationships, are less provocative and, for these reasons, reach a higher level with the cooperative approach. The opposite is evident for those who come from low context cultures.

Although there is still an open debate on the topic of “measuring” culture, cultural differences can also be bridged by grouping countries into cultural clusters, to detect possible cultural distance and establish certain orientations during a negotiation process. This is a useful reference as it indicates the degree of similarity or difference between cultures.

According to the GLOBE (Global Leadership and Organizational Behavior Effectiveness) model, starting from the identification of a rapport between social and organizational cultures and leadership practices, ten mutually exclusive cultural clusters have been classified.

In conclusion, we can say that a careful configuration of the negotiating structure and an adequate analysis of cultural distance between the parties, represent essential stages of an effective cross-cultural negotiation process.

Antonio Cuciniello is a Milan-based Arabist, and expert in intercultural education.

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By Suroopa Chatterjee

The past few weeks have seen the Central Government of India in an ongoing standoff with its farming community owing to agricultural reforms that it has introduced.

Quoting a news article from Scroll.in the Indian Prime Minister Narendra Modi stated, “Reforms are very much needed for a new order and to give new facilities,” at the launch of the Agra metro rail project via video-conference. “We cannot build the next century with the laws of the previous century. Some laws that used to be good in the past century have become a burden in the present century. Reforms should be a continuous process.”

The point of the argument with regards to both the pros and cons of reforms is whether the new era requires new methods or if it’s best to carry on with the tried, tested, and often questioned practices of the old ways.

Leaders in India and in other countries often take a cue from history, or guidance from the repository of written texts or reference manuals which the ancients have left behind in matters of governance, reforms, business development, foreign diplomacy and other arenas involving running a country.
While India has gifted many ancient and valuable texts and books to the world on myriad subjects ranging from history (the Rajataragini), sexuality and emotional fulfillment (the Kamasutra), Ayurveda (the Charaka Samhita) to name just a few.

However, time and again one book that has come up in discussions in scholarly circles because of its practical profundity, is the Arthashastra penned almost 2400 years ago by Chanakya (also called Kautilya, 350–275 BCE) during the reign of the great king Chandragupta Maurya.

Chanakya, a student at Taxila University, considered the oldest university, gifted us with this legendary and phenomenal book that was almost considered as folklore.
The book Arthashastra (often translated as Science of Politics and Management) is believed to have been written as a guide or rule book for the king for the functioning of his kingdom, placing more emphasis on the practical aspects of running a state as opposed to mere religious principles. It performed an integral role in the discussion around topics of politics, management, law, courts, trade and economics.

This masterpiece is of great interest to present day students and scholars of subjects like economics, trade, business, politics and administration. Kautilya wrote the book in the 4^th Century BC and it consisted of 15 chapters, 380 shlokas (poetic song-like chants in Sanskrit) and 4968 sutras (rules in the Sanskrit language) that included several intriguing concepts and ideas.

They are explicitly set forth and still have much relevance to and similarity with modern day management theories; foremost among them the very widely accepted importance of vision, mission and motivation. Many view this as the first book to ever have focused on the practice of management and the art of governance that comes across as guidelines or instructions.

Particularly interesting to observe is the immense level of detail with which the book deals with industry and commerce by mentioning concepts and nuances for establishing mines and factories, having a superintendent of gold in the workshop, the operations of the chief goldsmith in the street market, as well as the management and administration of commodities, forest produce, the armory, the standardization of weights and measures, measures of space and time, and handling of shipping and customs.

The rules laid down in the Arthashastra that have a contemporary application center around power and how to make business effective, the consolidation of acquired experience and expansion of what has been acquired, how to identify potential, enjoy the rewards, in addition to contemplating and visualizing a different business for a different time and in the future.

The book also has some very well-defined directives or attributes that diplomats were meant to have, namely they should be intelligent with a sharp wit, and a good memory, also well-spoken, with knowledge of politics, sound morals and ready to provide resources.
In fact many modern researchers, students, and corporate leaders find it easy to identify with and apply the advice from this book when considering current corporate wars and competition in the 21^st century.

War and conflict has been a recurring theme in history as we have witnessed between races, nations and continents. And it’s important that each nation have a strong military.
But most nations wage war from political compulsions and ultimately look for diplomatic channels to settle disputes through international diplomacy or astute management of international relations.

The Arthashastra also offers good counsel on matters pertaining to defense and the importance of war, peace, alliances, economic competition and trade policies, as well as the imbalance of supply and demand. Astonishingly, the book even addresses the different facets of military management like cavalry, infantry, training, pay, emoluments, rewards and honors for those fighting in it, much like modern day defense structures.

According to Chanakya, the concept of ‘wealth’ covers a wide spectrum that includes not just money but commodities, acquired wealth, property (whether private or public), precious metals and the power of appropriation. An integral part of this scope of wealth was also labor and land or forest produce and agriculture, which had pride of place. The rotation of crops, intensive and extensive cultivation, large and small scale farming, the use of fertilizers, crop diseases and their eradication, river irrigation, the evils of fragmentation of holdings, and fair prices for agricultural produce are all mentioned.

Many believe that India’s foreign policy strategy is inspired by this ancient book, which is undoubtedly a very practical compilation that deals with the complicated yet delicate machinery of governance and international affairs. Much of it is relevant today, especially its views on non-alignment. Although the basic tenets in it need to be modified to suit contemporary times and issues, it will always be valued as a reference book for statecraft even in the 21^st century.

The Arthashastra will continue to serve as a benchmark from which the current political powers may take guidance whether for internal problems or those with neighboring countries.

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