As part of our series on internationally relevant topics by our author Sergey Frank, we are devoting a 3-part article to the extremely important question of how to conduct a successful negotiation in detail on the international stage.
Negotiations play a significant role in any business, including at the international level, of course, and rarely proceed in a uniform manner. Internationally, complex situations often arise, for example due to different language levels of the negotiating parties or diverging cultural and value views. Discussions are usually conducted in English or third languages, often with the help of interpreters, as described above. In addition, there are diverging priorities and time constraints.
These aspects are complex and carry considerable risks that can end in misunderstandings, loss of time and frustration. To prevent this and at the same time improve communication and understanding between the negotiating partners, certain rules of the game must be observed.
These rules include a clear negotiation process in four steps: opening and setting the essential milestones (part 1), communication and exploring the interests of the other side (part 2), the actual negotiation (part 3), and agreement and ideally conclusion of the contract (part 4). The result of a negotiation can initially only be a partial agreement before the further issues are negotiated in a further round. And the process of understanding, listening and negotiating can also be repeated several times. Especially in people-oriented cultures, such as in the Middle East, Asia or even Russia, negotiation talks can drag on for a long time.
In many countries, the personal level is perhaps even more important than the factual level. To avoid serious conflicts, it is therefore important to separate the two levels. Often the partner is not seen as a representative of a company, but as a human being. Displeasure about an unpleasant situation can lead to taking it out on the other person. To avoid this, it is better to precisely separate relationship elements such as understanding, respect, affection, fear and anger on the one hand and factual elements such as prices, specifications, competitive advantages, payment and delivery terms on the other. You can always negotiate your interests consistently, but at the same time be polite with your partner.
Personal esteem and integrity are essential components of any business relationship, whether national or international. In this context, it is impossible to provide a patent recipe for successful negotiation at the international level. Furthermore, it is not the intention to provide rhetorical tricks that may "trick" or "bamboozle" the other party. The following is about conscious negotiation, i.e. how to act factually, rationally and structurally. It is in the negotiator's overriding interest to
- negotiate effectively and professionally
- Avoid ineffective conflicts
- Achieve appropriate results as quickly as possible
- to achieve bindingness also in an intercultural context.
After thorough preparation, including a clear definition of what is wanted, the actual negotiations can begin. In principle, negotiations follow the pattern shown in the figure below, whereby the process of understanding, listening and negotiating can be repeated several times. Often, the final agreement is reached in the form of partial agreements.
The figure above clearly shows the overall constellation and also the dynamics of the contract negotiations. In principle, these are based on good negotiation preparation, reaching partial agreements and then continuing the negotiations. Finally, one arrives (or not) at the overall conclusion of the contract.
It is a good idea to think about the individual steps as follows:
Before the actual negotiations take place, you should try to get to know your partner. The more you know about him, both in business and personally, the better. Therefore, it is very important to create a positive atmosphere at the beginning of a negotiation.
Courtesy and hospitality go without saying in this context. Added to this are interest in the person of the partner, open communication, friendly eye contact and, last but not least, humour. In addition, national customs play a very important role in international negotiations.
It is always advisable to allow enough time for negotiations. A lot of negative results are achieved under time pressure. The lack of time often becomes a means of pressure, especially in international negotiations.
If you define your negotiation topic precisely in advance, you can be sure that the negotiation will proceed according to plan and not get out of hand. A good way to do this is to divide the issue into main topic, sub-topics, main arguments and sub-arguments. An issue that initially appears complex will thus become structured and comprehensible, both in itself and for the partner. The following points should be noted:
- Agenda - structure the negotiation topic
- Definition of key terms, because it is often important, ideally together with the other side, to define terms precisely
- Developing a negotiation strategy and preparing for one's own goals, but also reflecting on priorities of the other side
- Flexibility - looking for options and considering possible concessions
- A Step-by-Step Approach - From Smaller to Larger in the Course of Negotiation
Apart from personal aspects, the procedural approach is also relevant and a clear structure of the conversation is indispensable. With regard to argumentation, care should be taken not to start the negotiation too coldly and too soberly. This form of negotiation with high initial positions and negative stipulations such as "up to here and no further" is seen in many countries as clearly too demanding. You also risk losing face if you give in on your expectations in the course of the talks.
It is therefore important not to be too demanding from the outset, but rather to build up appropriate positions. Factors such as saving face and being interested in the other person's culture and personality are generally very important. Therefore, negotiate less about positions and more about upstream interests. If you can successfully summarise the position of the other party and then explain your own position, you will significantly improve your own chances of success.
A clear and thus consistent argumentation should be well prepared. The preparation for this usually takes some time. It is advisable to check the coherence of one's own position and possible changes to it. At the same time, as many options as possible for the negotiation goal and strategy should be developed in advance.
It is no less important to take into account objections from the other party, insofar as they are foreseeable, in order to be able to react to them quickly and appropriately.
In reality, there is often a lack of such preparation, especially due to time constraints. The parties usually enter the negotiation ill-prepared and with what they believe to be the correct and therefore infallible solution; conflicts are then pre-programmed.
Please bear in mind: In few other areas can so much be won so quickly, but also lost, as in international negotiations. In the next part we will look at the right structure and show how helpful a change of perspective can be.
To the article Rules of the Game for International Negotiation (Part 2)