Insight on the Role of Culture in International Negotiations

Not many research reports can claim the expansiveness of recently published work from John Graham and his colleagues. Why? Well, this body of research includes nearly 40 years of studies involving 20 cultural groups from countries such as China, Brazil, Russia, Japan, Iran, Spain, Canada, and more.

Applying the lens of marketing science, behavioral economics, anthropology, and sociolinguistics, among others, the research examines the way culture impacts behaviors, processes, and outcomes within international business negotiations.

“We hope to help international negotiators understand the cross-cultural differences that can impact business relationships,” Graham explained. “We knew from other research that the success of international commerce largely revolves around the cultural diversity of its participants, but we wanted to better understand under what conditions this was true.”

To gather data from outside the U.S., Graham partnered with local researchers in target countries who were interested in replicating the studies within their cultures. In addition to the work of his co-authors, Mehdi Mahdavi and Navid Fatehi-Rad of the Islamic Azad

University in Kerman, Iran, Graham’s research required the ongoing commitment of research partners in every other country studied. This resulted in a database of results gathered from 1,198 experienced business people with an average age of 35 years and at least two years of work experience. Participants engaged in a three-product, two-party, mixed-motive, intracultural, buyer-seller negotiation simulation. Identical methods were used in each of the collection locations around the world and were compiled for over 36 years. Detailed reports on the body of work are available in the Summer 2020 and Fall 2020 publications of the Negotiation Journal

To distill and contextualize this data for an audience outside of academia, Graham has co-authored four books on international negotiations.

“I want business people, business students, curious people of all kinds to have access to what we’ve learned through this compilation of research,” Graham said. “Of particular interest for me were the lessons for Americans. Our research suggests that we still have a lot to learn when it comes to global negotiations, and I think this body of work synthesizes those lessons into some revolutionary ideas for Americans that can help them in any other country where they do business.”

Graham’s interest in international negotiations began in the 1970s when he worked for Caterpillar selling oilfield equipment around the world. In observing his peers, he quickly learned what contributed the most to a successful sale—the salesperson’s negotiation style.

“It didn’t take long to see where Americans fell short in negotiating,” Graham said. “For example, Americans are generally uncomfortable with periods of silence in a conversation. But those silences are fairly common in other cultures. In coaching Ford executives in the 1980s, I had to advise them to pause a bit longer between statements when negotiating with their Japanese counterparts. Otherwise, the Americans from Ford would end up doing all the talking to the detriment of the whole business relationship.”

Since then, international commerce has only gotten more complicated. It involves complex supply chains connected by dozens of collaborations that are regularly in a state of flux driven by technological change, accelerating globalization, consumer demand, and many other factors. According to Graham’s research, what holds everything together amid this chaos are not efficient processes, slick bargaining tactics, or even creative problem-solving.

“What ends up mattering are long-term interpersonal and commercial relationships that promote cooperation and reciprocity,” Graham explained. “We’ve named it ‘inventive negotiation’ because the main goal is discovering common opportunities. Inventive negotiation is an innovation process, not a competitive game.”

In inventive negotiation, a person’s culture is a fundamental component that impacts the behaviors within and the outcomes of the negotiation and, perhaps more importantly, the relationships between those behaviors and outcomes. Graham explained that the first step in harnessing the power of inventive negotiation is simply paying attention to the variety of cultural differences across the U.S. and around the world. Being observant of, curious about, and respectful of the culture of the person across the table is a powerful behavioral tool.

“For instance, in Brazil, it’s common for people to interrupt or talk over each other, but in some cultures like our own, interruptions are considered impolite,”

Graham said. “Without a mutual understanding, what is simply a cultural difference can end up causing tension and frustration or even permanently damage the partnership.”

Graham’s contributions to international business, both the negotiations and marketing fields, show no signs of slowing anytime soon. In particular, he is interested in communicating his learnings in other ways, namely, through several upcoming books. His novel, Charlotte’s War, is due out in June 2023, and later that year, two children’s books focused on multigenerational families. The 19th edition of his international marketing textbook is the most popular book in the world on the topic, having been translated into seven languages, and will also be published in 2023.

According to Graham, the main goal of all his publications is to promote peace within families, businesses, nations, and the world. In his experience, international commerce is one of the best ways to do so.

“I am convinced that the key to world peace is international trade. Trade relationships are the most common global relationships, and they have been for centuries. When you’re on an international flight, chances are over half the people flying with you are businessmen and women,” Graham explained.

“I believe that if the U.S. intends to rebuild and strengthen relationships with China, Russia, Iran, and Cuba, trade has to lead that process. We need to talk about mutual opportunities so we can mutually benefit each other. Otherwise, we’ll find nations becoming more and more inwardly focused and unable to interact with and care about one another.”

John Graham, is an author and professor emeritus of international business at the UCI Paul Merage School of Business. For four decades, he has provided expert advice and training on international negotiations to executive groups at Fortune 500 companies and government organizations including the U.S. Institute of Peace. Graham has published more than 60 articles in journals such as the Harvard Business Review, the Harvard Law School’s Negotiation Journal, the Journal of Marketing, and Management Science. His seven books with partners have all been best sellers on their respective topics. Graham is a founding director and has been an advisory board member of the UCI Center for Citizen Peacebuilding during the last two decades.