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Key Cultural Factors to Consider before Negotiating a Deal

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The work environment can get intense when a deal is being negotiated across cultures. For business travelers, it is helpful to know that there are aspects of a culture called "dimensions" that indicate how the local mindset impacts business. These dimensions provide a framework for how businesspeople in a particular culture are most likely to approach professional interactions like negotiations. 

Dimension #1: Attitude towards Negotiating 

The attitude towards negotiating refers to the goal of the agreement: will it be a "win-win" situation, or a "win-lose"? In a win-win culture, the conversations will seek a compromise, where each side leaves feeling like they got a good deal. In a win-lose culture, competitive negotiators will attempt to win advantages. 

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Businesspeople in Denmark consider a contract to be an agreement to solve a problem. This outlook makes the Danes a strong "win-win" culture. Foreigners can expect a reasonable proposal from Danes, which is extremely close to what the final deal should resemble. Aggressive bargaining or seemingly selfish ploys will not be entertained.  

Dimension #2: Personal Interaction Style

Interactions leading up to a negotiation may be either formal or informal. A formal approach means that people refer to one another with descriptive titles, adhere closely to schedules during a meeting, and maintain intense focus on the goal. Cultures with an informal approach are more likely to interrupt during a meeting, bargain for small wins, and defer to coworkers at a different level of hierarchy to get certain tasks done.

China upholds a formal interaction style. In negotiation meetings, foreigners will notice a deference to the team mate with the most experience. This gesture of respect reflects a cultural value of honoring the elderly. Meetings will continue as outlined on the agenda and conversations will be largely unemotional. Assuming a calm, thoughtful voice during dialogue will help earn respect.    

Image of a global team standing together

Dimension #3: Risk Level 

Some cultures are risk tolerant and others are risk adverse. In a risk tolerant culture, employees are willing to accept ambitious contracts without concrete details. Employees from risk averse cultures are reluctant towards change and appreciate having margins of error outlined prior to beginning a project. This way, they can create plans in advance if something goes wrong

Employees from Brazil have a risk averse mindset. If you come from a risk tolerant culture, it is helpful to know that you can help them see your contract as credible by providing supplemental warranties, guaranteed outcomes, and taking the time to map out potential paths for the project. 

Dimension #4: Agreement Form

In regards to negotiations, the agreement form may range from general to specific. For a general culture, expect a verbal promise or handshake to be a sufficient contract. Bargaining is common and accepted, even after the agreement has been reached. Specific contracts, however, will be a detail-oriented, written contract that outlines the project from start to finish. Deviation from the contract is not anticipated. 

Image of international coworkers reaching an agreement

For those doing business in Qatar, it is wise to expect a series of general agreements to be made over the course of a project. First, a spoken promise and handshake will be exchanged. Later, smaller opportunities for details will arise, which may not have been previously discussed. Foreigners should anticipate this and communicate with their team to know the goals because while these additional deals may be chances to make more money, they may add significant delays the project. 

Seeking more ways to improve communication between cultures? Read more of our blogs on Intercultural Training:



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