A CASE STUDY ON CROSS CULTURE IMPACT

ON BUSINESS NEGOTIATION WITH REFRENCE

TO AMERICANS V/S ARABS AND ITS COUNTER
PARTS
 INTRODUCTION
• An American is someone who is a native or citizen of the United States. There official language is
English.
• An Arabs a person whose language is Arabic, who lives in an Arabic-speaking country, and who is
in sympathy with the aspirations of the Arabic-speaking peoples".
• Negotiation becomes cross-cultural when the involved parties have a different cultural
background, hence do not share the same way of thinking, feeling, and behaving.
• To proceed with the analysis, the United States and Saudi Arabia are chosen as examples to
illustrate cultural issues that need to be anticipated if negotiation is to be successful.
• The reason behind the selection is based on the fact that Saudi Arabia represents an opportunity
for US organisations to do business with, being a major investor in the US and is ranked under the
top 20 of host economies for FDI inflows
 HOFSTEDE CULTURE DIMENSION
Cultural issues in Negotiation between an American & An Arab Counterpart
100 95
90
90
80
80

70 65
62
59
60
Score

50
40
40 35

30 25 25

20

10

Power Distance Individualism Uncertanity Long term Masculinty

Cultural Dimension orientation

USA ARABS
 NEGOTIATION PROCESS
• The very first step is Non-task sounding- Activities that are not related to actual business.
• The Arabs mostly overlap their work life and personal life . They follow a synchronic culture which
means that engaging in more than one activity and appointments and schedule are subordinate to
relationships.
• Here American manager must show great patience. They considered “Time is Money”. They must
keep in mind several things like Negotiation should not take place between SALAT TIMES and also
no politics , religion and family matters be discussed.
• Key point here is to build relationship rather than discomfort.
• Gifts can be offer by both the parties like quality pens and Business card cases but must remember
to offer them with the use of RIGHT HAND and NO EXPENSIVE or OPULENT GIFTS be offered as it
may be interpreted as bribery.
• If ay gift is been offered to Americans by Arabs then it should not be rejected as the Saudi
counterparts will lose face or feel disrespect.
Exchange of view and ideas
• US does not expose too much of information or their goals or the reason behind their
request and express things which are required.
• Where as , Arabs on the other hand address the whole subject with need to
understand their counterparts’ demand , concerns and needs.
• Arabs discuss on different point at the same time to get into conclusion whereas
Americans follows a linear approach to mark their progress.
• Based on research , Americans negotiator must re-orient his negotiation skills to
provide all the information first followed by the agreement on the different point at
the end.
 BARGAINING APPROACH
• Americans are direct and start bargaining at a point close to what they expect to
achieve. They are extreme in their offers and are more susceptible to
competitive judgement biases.
• Deviation of the offer in negotiation point is off by 5-10 %
• Where as Arabs believes in building relationships and wants to achieve mutual
perception of value , honesty and personal merit. They set initial offer too high
but do not expect straight acceptance too.
• Deviation in negotiation point would be 20-50%
• In this sense , American manager should become familiar with the process of
bargaining , its practice but also its meaning to avoid irritation from both the
parties.
 CONCESSIONS & AGREEMENT
• In US , a handshake usually implies that an agreement is reached
• Where as in Arabs it just meant that negotiation are just beginning.
• This might result in conflict and misunderstanding and can break off the deal.

INTER CULTURAL COMMUNICATION

• Language
• High & Low Context culture
• Long time and silence
 SUBMITTED
‫النهاية‬ THE END
BY :
ROSELINA

M.COM(58)

SUBMITTED
TO : DR.
GEETA
MISHRA