Negotiating is a specific type of communication with its own particular characteristics and challenges, and for that reason we consider it separately.

In the previous chapter, we described American business communication styles, and recommended certain approaches for being persuasive with Americans. In those situations, your goals are to influence your American partners and colleagues, to enable them to see your point of view, and to be clear and credible.

Since negotiation is a process in which two or more parties try to reach agreement on some kind of exchange, it is different from “selling” or persuasion. In the latter case, one party is simply trying to convince another to agree, to accept, to authorize, or to buy according to stated conditions. There is no exchange or tradeoff involved. In negotiation, on the other hand, participants are trying to maximize the benefit for themselves and their organizations, of that exchange by relying on either power or trust. This presents a crucial strategic choice to every negotiator.

YOUR CHOICE – POWER OR TRUST?

Every negotiation involves power and trust to a degree, but the relative weight attached to one or the other depends in part on the desired relationship. If one side intends to establish a long-term, mutually beneficial partnership with the other, then advantage can be best obtained by negotiating so as to ensure trust, clarity, and mutual understanding. On the other side of the coin may be a desire to maximize short-term gains and mutual independence. In that case, parties in the negotiation may choose instead to emphasize their power. One way of doing that is to communicate so as to be deliberately ambiguous, to conceal one’s feelings and real objectives, or to cause anxiety in the others involved.

Therefore when negotiating with Americans, you may not want to communicate in a way with which they are comfortable. For very sound business reasons, you may instead want to cause them to feel uncomfortable and more anxious so that their position is weakened. To achieve this, you may want to exhibit certain elements of communication style in a very different manner to that suggested in Chapter 7. It may be to your advantage to appear impassive and unenthusiastic; to take a long time in getting down to business in the negotiation; or to argue over principles or seemingly irrelevant matters such as where people sit. Aspects of your communication style that may hinder your ability to be clear and persuasive in other dealings with Americans may be effective tactics when it comes to negotiating.

It is not our purpose here to teach you negotiation skills and tactics. Skilled negotiators understand that both approaches – the power-based “pure bargaining” and the trust-based “joint problem-solving”(1) – need to be brought into every negotiation, and they know how to manage the tension between the two. Your choice between the two is sometimes limited by situational factors. As a buyer or seller, you have more independence and thus more latitude in that choice than if, for example, you are “negotiating” your performance targets and objectives with your American boss.

We simply want to remind you of the choice that is there. If you understand how Americans view and approach negotiation situations, you will have a sounder basis for making that strategic choice.

Before going further, however, we ought to point out that negotiation is one area of business in which Americans are very aware of international differences. Dealing with Arab organizations in the 1970s and early 80s, and Japanese organizations in recent years have taught them that “foreigners” negotiate not only differently, but also effectively. Many hard lessons were learned from those contacts.

So what, then, is the American way of negotiation?

SELF-INTEREST AND CO-OPERATION

We Americans first, and above all, make the pragmatic assumption that in a negotiation, both parties are trying to maximize benefits to their organizations as far as possible. Furthermore, we expect that each side will look out for its own interests: you look after yours, I look after mine. This is not to say that we do not co-operate; both parties are to some degree interdependent and need each other. Otherwise they would not be negotiating. But any agreement we reach will be based on self-interest, a further reflection of our attitudes toward organization and teamwork that we described in Chapter 6.

A contrast with Japan illustrates this point. Management writers have observed on a very different assumption that has characterized negotiations between Japanese companies. A subcontractor who is absolutely dependent on a large customer for survival is in a weak position. The customer recognizes this, and will feel obligated to a degree to look after its supplier. (I will leave it to our Japanese readers to decide if that assessment is still applicable.)

In the American view, a seller may perceive a buyer as being in the stronger position, but the seller does not expect to be taken care of or looked after by the buyer. The buyer, in turn, does not expect to have to look after the interests of the seller in any way. Weak or strong, each side retains its independence, and looks after itself. The “obligations” of each are specified in the written contract. It is in the contract, the law, not in the obligations of their relationship, that each side finds its protection. This, to an American, represents a “fair” and “co-operative” agreement. Fairness does not mean equality of outcome, nor does it oblige the more powerful side to help the weaker.

At the same time, we also believe (or like to think that we believe) that it is possible to achieve this competitive outcome under the idealistic slogan of “win-win”. The objective of the negotiation process is not to find the perfect logical solution, the objectively “right” one. It is instead to reach an agreement of maximum benefit to your side, which both sides can “feel good about”.

WHAT’S NEGOTIABLE?

The expectations of American business people in this regard correspond to those of businesspeople from many other countries, northern Europe especially, when it comes to contracts of purchase, sale, service, performance and so on. What is not negotiable is the terms of a contract once agreed, with the sole exception of a major crisis or impending disaster. Renegotiation does occur, but it is not expected, unless it is permitted under the terms of the agreement.

In the short case described above, many Americans would be surprised, frustrated, and upset by the client’s “demand”. Alternative (c) best decribes their reaction. More savvy American businesspeople might respond with a firm rejection, or a polite “Not at present, but we can consider that when looking at future business” or even a willingness to renegotiate certain terms of the contract. They won’t like it, though. They might view this as suggested in alternative (e), but only as an indication of major dissatisfaction with some aspect of the service being provided. This is not the case in this scenario.

You may come from a business culture in which it is more acceptable to propose a renegotiation of price or other terms, based on your relationship with your business partner or simply on the basis of a change in circumstances, as in alternatives (a) or (b). To your way of thinking, the renegotiation may strengthen your relationship. Your American partner, however, may see it as evidence that you cannot be trusted, and as a weakening of your relationship.

This attitude will set the pattern for the whole negotiation. An American will expect in a negotiation that the other party will make their objections, complaints, and arguments before the contract is signed, not afterward. A negotiation is not just an indication of an intention to do business, nor a description of a “relationship”. It sets out the “rules of the game”, the contract, which will bind both parties.

“LET’S GET DOWN TO BUSINESS!” – HOW DO AMERICANS CONDUCT NEGOTIATIONS?

The following example illustrates a number of aspects of the American way of negotiation.

A relationship is good, a deal is better

The most basic American assumption here is that you are negotiating on behalf of your business or organization (even if you are an independent sole provider), and so the immediate personal relationship between the negotiators – although it may be useful for facilitating contact – has only limited importance. The personal relationship between the two of you, cemented on the golf course, over dinner, or with frequent contact over time, may serve to make negotiation easier but it will have no bearing on immediate business needs. If you responded (a) in Example 8.2, we would say that while the Chinese (or anyone) may react with mistrust, the Americans are acting on the basis that trust arises from the way you do business together, not from your relationship.

Each party has the authority to reach an agreement

Americans will further assume that you have full authority to conclude an agreement, and will be responsible for its implementation. American negotiators will have their specifically delegated authority, and will expect that you have yours. That gives each negotiator equal status in the negotiation. If you have to continually consult higher levels of management for approval, sooner or later your American counterpart will conclude that he is wasting his time negotiating with you.

The American also assumes, unless it is clearly understood otherwise, that you are will be negotiating the details there and then. He will not usually appreciate an approach whereby you are only there to set the stage for “real” negotiations sometime later.

On the other hand, while you may need to consult your directors, Americans will not hesitate to consult their lawyers! This may annoy you, but it is not normally a sign of distrust or possible conflict. It is usually a positive sign: the American wants to know if he can legally agree to a particular item, so that it can be put into the contract.

Apart from the need to consult these other authorities, Americans will expect the negotiations to be carried on directly between the two parties. Certain issues or details can be left to designated subordinates or intermediaries, provided that the parties agree to this. If, however, other people are used as indirect lines of communication, Americans may sec this not as good diplomacy, but as an attempt to avoid confronting an issue or to go behind one’s back.

Team negotiations – everyone’s a chief

When it comes to team negotiations, Americans very often expect each member of their team to speak for his particular function, requirements, and objectives. Each member will accordingly determine whether a proposal satisfactorily addresses his individual needs. Furthermore, they may expose their differences with each other publicly, in front of you.

To you this may seem like lack of coherence and discipline. To Americans, on the other hand, this signals openness, honesty, and “sharing”. They will normally expect the same of your team, with people of both sides more or less freely expressing themselves to any other member of the other team. This is similar to common American behavior in most business meetings that have a specific objective. If you have something to say, you speak up. Silence means you have nothing to say. Consequently, Americans may not be used to hearing from or addressing a single “chief” or designated spokesperson.

What do we talk about? When?

The fundamental American approach to the actual negotiation itself will focus on resolving and deciding, not debating. Americans are likely to prefer:

• 1.To start discussing specific issues quickly, without spending time discussing principles, preliminaries, the order of issues to be negotiated, the setting of the negotiation, or the “shape of the table”. In Example 8.2, they have signalled this clearly to their Chinese suppliers.
• 2.To adopt a correspondingly narrow focus on specific outcomes, what is to be done or delivered by whom, when, where, how, and for how much. Depending on what you are accustomed to in your country, you may be surprised that American negotiators at fairly high levels will want to negotiate details, rather than expect more junior people to handle them.

Americans may also not be satisfied with “agreements in principle”. To a British management consulting firm, for example, this may be a valid way to establish a commercial relationship wherein the exact requirements and services will be determined as the need arises. Americans may show a much greater insistence on specific and detailed provisions from the start. To the British negotiator, the American is inflexible. To the American, the “Brit” is being vague and non-committal.

• 3.To follow a more or less linear progression of discussion, according to an agenda agreed beforehand or at the time. Once a particular point has been dealt with, there should be no need to return to it, except as summary and confirmation (or in case of clearly signalled need).

Experienced American negotiators are flexible in the strategies and approaches that they adopt, and recognize these when others employ them. Those who are less experienced, however, may become frustrated and impatient with those on the other side of the table who do not meet their expectations:

• A supplier from Chile who makes a long introductory statement concerning his organization, its history, and product range;
• A French Directeur who explains to his American Finance Vice President the particular needs of the French market and suggests that his Accounting Manager be the one to handle the request;
• An Egyptian Information Technology Manager who appears to want to go back over issues already discussed and then to skip over other issues on the agenda;

When those others are non-Americans (who perhaps speak less than perfect American English), the frustration and tension may be more intense. . .

“But you said an hour ago that you could deliver in 60 days. Now you’re telling us something different. . .!”

“But I thought we agreed that already?!?!”

Those are the signs of an American who is losing his patience.

COMMUNICATION STYLE IN NEGOTIATING

In the previous chapter on communication, we described an American’s “comfort zone” – the habits of speech, interaction, and non-verbal signals with which Americans are accustomed to conduct their spoken communication. Several of them need reemphasis here, in the context of direct business negotiations.

Informal

The Americans will want to lessen the social distance by calling you by your first name, unless there is a very senior person present on your side, or unless they have been told otherwise. They will speak to “you” as if addressing only you, as an individual. If you are more comfortable referring to yourself in the negotiation as “our company”, and to the Americans on the other side as “your company”, this may be awkward. You need not worry – the Americans are addressing you as the representative of your organization.

Friendly

We have already seen how American friendliness implies few obligations, while facilitating social and business relationships. Americans view the negotiations as a process of reaching an agreement under “adversarial” conditions. By adversaries, we do not mean enemies, we mean people whose interests will conflict, but who need to find a way to co-operate. Since friendliness helps make that possible, Americans are comfortable conducting business negotiations in that sort of atmosphere.

Do not be surprised to find that even high-level negotiations are conducted under this friendly blanket, while the substance of the talks involves aggressive demands and blunt rejections. In Example 8.2, the American demands will no doubt be expressed in this friendly way, with further small talk about the golf game and the dinner. Lack of friendliness implies “keeping your distance”, which an American may in turn interpret as an unwillingness to do business, caution, or even evasiveness.

Americans love to use very positive and encouraging terms such, as “win-win” or “partnership” (especially if they are a supplier or potential supplier) to describe the outcome they desire. But they will be looking for a rapid agreement that will meet their objectives. Whether that agreement meets your objectives is your responsibility. Americans will compromise, but they do not regard compromise as an ideal outcome, unlike many negotiators from, say Britain, or northern Europe. “Win-win” might be better translated as, “I win; you think you’ve won” or “I win but don’t feel bad about winning!”

Direct

Americans are accustomed to signalling disagreement or lack of acceptance by a clear “no” or with an appropriate phrase that expresses “no”. They will expect the same from you. Consequently, they may have trouble interpreting more indirect ways of saying “no”, such as changing the subject, saying “yes” without further commitments, or using a phrase, such as “That will be difficult for us”, that avoids direct negation.

Do not be surprised to hear your American counterparts directly express their anger, impatience, frustration, or defensiveness. They will try to keep those under control, but will not hesitate to let their feelings be known. “No way!” is an emphatic rejection. “That proposal is crazy!” is even more emotionally direct. You should not take such expressiveness as rude, insulting, or as evidence of a loss of discipline on their part. We like to believe that our emotion is directed at the idea, not at the person presenting it. “Don’t take it personally”, we say. Americans will do their best to ensure that an emotional reaction passes quickly, otherwise it will interfere with the business at hand, and will – as ever – waste time. We will generally want to restore quickly the friendly atmosphere.

Reading conversational signals

In Chapter 7, we described American preferences for a certain type of body language and the correct physical distance. What is particularly important here is the matter of “turn-taking” –establishing a comfortable synchronization of speakers.

In a negotiation, Americans may well be annoyed by an opposing party who interrupts quickly and frequently, especially if they interrupt in order to reject or disagree.

At the same time, Americans (and we are not unique in this) are equally uncomfortable with the contrary response: the other party pauses for a long time before replying, or simply responds by saying nothing at all. In that case, an American negotiator may relieve his anxiety by continuing to speak. And as experienced negotiators know, the more you speak in a negotiation, the more likely you are to say something unwise.

Do not deceive yourself, however. Highly trained American negotiators are quite capable of establishing and maintaining the informal friendly atmosphere they like so much, while responding to the other side’s “difficult” style with tough terms supported by (smiling) threats.

GETTING AGREEMENT – “WOULD YOU PUT THAT IN WRITING?”

The phrase “Would you put that in writing?” is a clear sign that an American negotiator is happy with a proposal that has been made, and is seeking a firm commitment. Americans are quicker than others to want to put things in writing. Verbal agreements have little legal force, and are not sufficiently “black and white”. If the other side refuses or appears to hesitate, an American will understand them to be implying, “We are not confident” or “We did not really mean what we said.” The willingness to “put it in writing” is evidence of trustworthiness.

When an American negotiator asks that of you, do not take it as an indication that they do not trust you. It is their way of saying, “We are ready to accept that offer as part of the contract. Are you?” If your answer is “no” then you risk annoying your American counterparts unless you explain why, and keep the discussion focussed on what specifically you need so that you will be ready to sign.

If both parties are ready to agree in writing, it’s time for the Americans to call on their lawyers to draw up the contract. When it comes to concluding a negotiation, spoken promises are not good enough.