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Applying Negotiation Skills During The 5 Stage Process To Attaining Successful Deals In China
1. Negotiation goal
For many the purpose of negotiation is a substantive outcome and material gain. In China the deal is all about the relationship and there is no better method to succeed in doing business than through a close alliance, so think about investing a lot of time in this pre-negotiation phase.
The goal of negotiation is not the signed contract and unexpected events are resolved through the partnership; the contract is more a sign of the intent to do business together than a legally binding record. Trust is the basis of the contract and the fact that you have signed an agreement does not actually mean that the deal is sealed; it means that an alliance has been established.
2. Negotiation approach and communication approach
The Chinese negotiation approach is one of teamwork and problem solving whilst still focused on the bottom line.
The communication approach is expressed by using titles, following procedure and being highly respectful and aware in discussions. Always start with an official approach, using first names and an informal style is dangerous and can be considered offensive and interpreted as an insult.
When you negotiate, listen carefully to ascertain the true meaning. It is unusual to hear 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 anticipate to receive direct clear responses, because you will try to resolve something 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 symbol of respect and which is supposed to be reciprocated. For Westerners time is sacred and the Chinese usually exploit this fact. Preparation is therefore important, create options and let the otherside know that they are is not the only one who can walk away from the transaction. Bear in mind that "tomorrow" or "next week" often doesn't literally mean the following day or week; but this could mean "in the future".
4. Negotiation style
What for most Westerners may seem to be innocent socialising is in fact their way of gathering information.
Chinese negotiators are well versed 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 humiliate or shame their counterpart in order to create stress and gain the advantage. Take the blame if a problem develops whether you are accountable or not and do not react with disrespect.
Your whole team is advised to attend the meetings and it's vital to arrange for someone with a position of authority within your organisation to make the introductions and to escort you during meetings. Without visible official support, you will be delivering the wrong message about how genuinely you view the negotiations.
5. Team based negotiations
The Chinese almost never negotiate unaccompanied. 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 usually 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 arguments towards him. The rest of the team normally plays the role of an advisory body.
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