• Cross-cultural negotiations
• Cultural dimensions
• Intercultural communication
• Negotiation strategy.

The globalisation affects almost all industries around the world. Consequently, the international negotiations play a crucial role for many companies. The construction industry in Romania follows this general trend and faces new challenges regarding the complexity of the negotiations involved.

Negotiation

In general, a negotiation from a business perspective can be seen as a process where the collective aim is to reach a formal agreement that addresses the needs of the parties involved. A signed contract agreement constitutes a legal agreement. In the construction industry, the complexity of projects requires a company to negotiate with multiple specialised parties that operate internationally. These international negotiations often represent an interaction of different views, approaches, styles, and strategies; the main difficulty beyond the technical field expertise is finding common ground that allows the discussions to be productive.

Negotiation styles

Every negotiator has a preferred style and technique for approaching a negotiation. The attention of a negotiator towards the importance of the relationship between parties or the importance of an immediate outcome determines the negotiation style adopted. Considering this categorisation, there are five types of negotiation styles (Lewicky et al. 2010, 16):

• Accommodating style (high focus on the relationship, low focus on the outcome)
• Avoiding style (low focus on the relationship, low focus on the outcome)
• Competitive style (low focus on the relationship, high focus on the outcome)
• Collaborative style (high focus on the relationship, high focus on the outcome)
• Compromise (average focus on the relationships and the outcome)

Essential for a successful outcome is the ability to identify the proper style for a particular negotiation and the appropriate response for a specific type adopted by the counterparty at the negotiation table.

Culture and cultural differences

The above-mentioned negotiation styles also apply to international negotiations. In this case, they also reflect the different cultural backgrounds of the participants and, more importantly, the way they perceive their interaction. Cultural differences add another layer of difficulty to the entire process. An experienced negotiator involved in cross-cultural negotiations focuses first on recognising the differences. Various models and theoretical frameworks are available for understanding cultural differences better. For example, Hofstede’s theory (Hofstede, G., 1991), Hall’s theory, Globe project, and Brett’s prototype of culture provide valuable insights into the cultural dimensions and the individual habitual attitudes that affect the dynamics of international negotiations.

Interaction between different cultural backgrounds

In all cross-cultural negotiations, successful interactions between people with different cultural backgrounds require that an individual or group have the following abilities:

• To operate in various environments with diverse cultures, an ability presented as Cultural Intelligence in the specialised literature and examined in detail as a four-factor model (Ang and Van Dyne 2008, 3).
• To decipher the message considering the contextual arrangement based on cultural distinctions (Browaeys and Price 2015, 329).
• To identify the communication barriers beyond the language barriers.

International negotiations in the Romanian construction Industry

In the Romanian construction industry, the negotiation strategy preferred by the research participants considers the aspects mentioned above. It relies heavily on the interdependency of five themes present in international negotiations. Those five themes are:

• Individual negotiation style
• The view on multicultural diversity
• The influence of the organisation involved in the discussions
• The overall trust sentiment between the parties involved
• The existing market conditions

Within international negotiations, strategies that centre around the overall interaction between these themes deliver better results than applying prescribed styles or frameworks. Although this recommendation might seem counterintuitive, it reinforces the professional view that each negotiation is unique and requires special consideration. This study draws particular attention to these themes as essential to a fruitful cross-cultural negotiation in the Romanian construction industry.

The article is based on the Master’s Thesis prepared by Daniel Curelaru. The Thesis will be found from the Theseus portal in October 2023.

Photo Source: Image by pressfoto on Freepik.

Sources:

Ang, S., &; Van Dyne, L. (2008). Handbook of cultural intelligence: Theory, measurement, and applications. M.E. Sharpe. NewYork, p.3.

Browaeys, M.J., & Price, R. (2015). Understanding Cross-Cultural Management (Third edition). Pearson, Harlow, p.329.

Hosfstede, G. (1991). Cultures and organizations : software of the mind. London: McGraw-Hill. ISBN 9780077074746.

Lewicki, R. J., Hiam, A., Olander, K.W.,(2010). Selecting a strategy. In R.J. Lewicki, D.M. Saunders, & B. Barry (Eds). Negotiation: readings, exercises, and cases. McGraw-Hill Irwin, New York, p.16.