Chapter One Basic Theories for International Business Negotiation
In business as in life, you don’t get what you deserve, you get what you negotiate.
—Chester L. Karras
In September of 2013, computer software titan Microsoft made the shocking announcement that it was purchasing Finnish mobile handset maker Nokia for $7.2 billion in an effort to build its mobile and smart phone offerings.
The complexity of the business negotiations undertaken by negotiators at Microsoft and Nokia underscores the challenges companies and negotiators face in integrating two different identities. Rather than engaging in the reconciliation of differences in identity, integrative bargaining negotiators may instead see the value (and value creating potential) in letting each firm maintain its own identity. In this way, it is advantageous to negotiators to view their negotiating counterparts as individuals, highlighting the strengths of each organization and how those strengths can be combined into a successfully implemented negotiated agreement.
Question: How do you understand the practice of integrative bargaining negotiators? How will it benefit the negotiation?
Section A Understanding International Business Negotiation
The negotiation process is a very complicated social process, involving an intricate structure of attitudes and opinions, social relationships — both inside and outside the firm — and the ways such attitudes, opinions, and social relations are changing. It contains various elements of individual and organizational behavior, influenced by the past and perception of the future as well as the present. It is composed of a large number of decisions made by different people at different points in time. The understanding of the final outcome of such a process depends on an understanding of all its stages and parts.
Many executives and policy makers tend to regard negotiation like most people view having children — it is something one does almost instinctively, with varying amounts of skill, confidence, and pleasure, but not a likely subject for analysis or scholarly research. These people believe that good negotiators are born, not made; and if made, made in the trenches, not in the classroom.
Most of the time poor communication plays a role in the failure of business negotiation or becomes a serious barrier. And when people of one nation negotiate with people of another, they often unwittingly trample all over the other customs of those people and the negotiations are consequently doomed to failure before they even start.