
Applying Negotiation Skills During The Five Step Program To Ensuring Lucrative Deals In China
1. Negotiation goal
For many the aim of negotiation is a substantive outcome and material gain. In China the transaction is about the relationship and there is no better method to succeed in doing business than through a close partnership, so think about investing a lot of time in this pre-negotiation phase.
The aim of negotiation is not the signed contract and unforeseen circumstances are resolved through the partnership; the contract is more a sign of the intent to do business together than a legally binding document. Trust is the basis of the contract and the fact that you have signed a contract does not actually mean that the transaction is closed; it means that an alliance has been established.
2. Negotiation attitude and communication approach
The Chinese negotiation approach is one of collaboration and problem solving whilst still focused on profit.
The communication style is expressed by using titles, following procedure and being highly respectful and aware in conversation. Always start with an official approach, using first names and an informal style is risky and can be considered offensive and viewed as an act of disrespect.
When you negotiate, listen carefully to ascertain the true meaning. It is unusual to be told a direct no and you will more likely hear "it is difficult" which in fact does mean that you have no chance of success. Do not expect to receive direct clear responses, because you will try to fix a situation that "is difficult" when in fact it can't be resolved.
3. Time perception
A lot of time is spent in building up a relationship which is a sign of respect and which is supposed to be reciprocated. For Westerners time is sacred and the Chinese usually take advantage of this fact. Preparation is therefore important, create alternatives and let your counterpart know that they are is not the only one who can walk away from the table. Bear in mind that "tomorrow" or "next week" often doesn't literally imply the following day or week; but this could mean "in the future".
4. Negotiation style
What for most Westerners may appear to be innocent socialising is in fact their way of collecting information.
Chinese negotiators are competent in the art of positioning & framing, the complexities of pricing and the use of delays as a negotiation tactic. They have excellent negotiation skills and will often use negotiation tactics to embarrass or shame their counterpart in order to create stress and gain the upper hand. Take the blame if a problem develops whether you are responsible or not and do not counter with disrespect.
Your whole team is advised to attend the meetings and it's vital to arrange for someone with a rank of authority within your organisation to make the introductions and to escort you during meetings. Without obvious official support, you will be delivering the wrong message about how seriously you view the negotiations.
5. Team based negotiations
The Chinese almost always negotiate in a team. It is not always clear who the leader is and who has complete authority to decide issues. Although decisions are made by consensus, there is normally one leading authority who may not be very active during negotiations. Gain the attention of their senior negotiator and direct your most persuasive and logical discussions towards him. The rest of the team normally plays the role of an advisory body.
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