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at discovering whether or not the Western negotiator understands Chinese. In some cases, agreements are purposely paraphrased slightly incorrectly (→ foggy recall). This is either an attempt to subtly change part of the agreement, or the objective may be to delay the negotiations. If the Western negotiator tries to imitate his Chinese negotiation partner by trying to avoid a clear no, the Chinese side sometimes tries to interpret this behaviour as approval, in accordance with the Western approach. Above that, it was also observed that Chinese negotiators deliberately negotiated the price in such a hard manner, that the European side wanted a break off of the negotiations. The Chinese side subsequently swaps the chief negotiator and, with the knowledge of the European side’s → deal-breaker, goes on to negotiate a result very close to the acceptable minimal demand made by the European company. This tactic enjoys a certain popularity because it gives the Chinese side the impression that making the demanded concessions has actually been utilised as a last resort. Antidotes are premature sham break offs of the negotiations in order to force the Chinese side to give in prematurely and not to reveal the own side’s real limit.
4.2.11 Implementation of Negotiation Results and Further
Negotiation
As already stated, Chinese negotiators perceive the agreement on a contract as an important interim result but not as the absolute conclusion of negotiations.According to this attitude, the implementation phase leaves scope for further concretising or renegotiating and slightly specific points. In particular, points which are presumed to be non-essential for the Western company are often the subject of intensive renegotiations, despite an agreed upon contract. In this regard, the different language versions (e.g. English and Chinese) can also prove problematic. From a Western point of view, the implementation phase is very expensive and lengthy, since it requires equally elaborate measures and processes. Yet, there are also Chinese companies that feel more obliged to conform to the clauses initially agreed upon, particularly if this can create a competitive advantage over other Chinese companies. The Chinese consider oral agreements to be even less binding and are not viewed as being sufficient, regardless of their legal validity.
4.3 How US-Americans Negotiate
4.3.1 Preliminary Note
As already stated regarding German negotiators, there is no such thing as the “US-American negotiator”. It can rather be said that there are various influencing factors that shape the negotiation style. From the outset, the USA has always been
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country of immigration. In the course of history, this immigration has been from various regions across the globe. In principle, the sheer size of the country coupled with its background of immigration would seem to point to a high level of regional heterogeneity between negotiators. Yet, due to the high assimilation power of the country, the negotiation style among American negotiators is comparably homogenous.
If negotiators from California are said to be more open for innovative ideas than their colleagues from the East coast,12 this may be due to the specific companies settled in California, which are—as part of the Digital Economy—more dependent on developing innovative solutions. The reason would thus lie less in regional specificities but rather in the respective company and its culture. Hence, even though some differences might be observed e.g. between negotiators from New York and the Midwest, the negotiation style can primarily be explained by generally factors of influence, such as personal mentality, experience abroad, gender, age, hierarchy, branch, professional expertise, negotiation skills, the company’s negotiation strategy, role (buyer, seller), the negotiation’s character as a one-time deal or being part of a permanent business relationship.
In addition, some factors are particularly important in the USA. For instance, in comparison to other countries, a bigger difference can be seen between negotiators who, like the current US President Donald Trump, prefer hard-ball negotiations, and those that strive for a cooperative negotiation following the → Harvard negotiation concept (see further below). Furthermore, in the USA the difference between a “business-like negotiator” and a “legalistic negotiator” is more emphasised (for this see further below).
4.3.2 Negotiation Training
The USA is the land that first discovered the significance of negotiations. From the early 1960s, game theory and social psychology discovered negotiations as a scientific field in the USA. In the middle of the 1970s, very successful negotiation books were already being published and corresponding coaching was offered as a guide for business-related negotiations.
In 1979, the lawyer Roger Fisher established the Harvard Negotiation Project at the Harvard Law School, which in 1983 became the institutionalised “Program on Negotiation” (PON). This program combines negotiation science and training. This became the basis for teaching contract negotiations not only to thousands of students of Harvard Law School and Harvard Business School, but to tens of thousands of practitioners in the course of PON. Many of the books published on contract negotiations, even those published by famous scientific authors, are geared towards a broad audience. The most lasting effect is ascribed to the book “Getting to Yes – Negotiating an Agreement Without Giving In”, 1st ed. 1981 by Fisher/Ury. In the
12 Cf. Hernandez Requejo and Graham (2008), p. 238 et seq.
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meantime, this book has been published in many languages and various editions. Worldwide it is associated with the name → Harvard negotiation concept. A great number of the underlying basic ideas of this concept—such as the interest-oriented negotiation or measuring the own and opposing side’s negotiation power by means of the → BATNA—have become a global benchmark for professional negotiators.
Nowadays, negotiation courses are offered all over the USA at law schools and business schools, as well as at engineering schools and for business psychologists. The → win-win approach (expanding the pie; → negotiation pie) which is promoted within the Harvard Program is, however, less relevant within the US-American practice, than could be expected with view to the Harvard negotiation concept.
The openness for interdisciplinary cooperation as well as practice orientation is a special strength of the US-American university system and is particularly beneficial for negotiation practice. In this regard, lawyers, psychologists and business economists as well as classical economists cooperate intensively. The practical consulting actions of many negotiation scientists, the cooperation between scientists and practitioners and the feedback of course participants with practical experience ensure an intensive exchange between theory and practical experience.
Even outside the university sphere, the USA depicts a rich variety of offers for coaching and consultancy. The amount of literature on contract negotiations written in laymen’s terms, which invites the reader to private study, is hardly quantifiable and in total attains a print run of millions. Generally, each book focuses on a specific issue or deals with a negotiation approach, which the author propagandises as resounding. The average education level in contract negotiations is estimated to be higher than in all other comparable trading nations. Yet, many US-American negotiators primarily take the gained knowledge to be a recipe that just needs to be applied. Despite the volume of negotiation training on offer, more in-depth understanding of negotiations as a strategy game requiring complex, individually adapted thoughts is less common.
4.3.3 Mentalities
Just like there is no typical contract negotiator as such for each nation (see above), there are also significant differences of mentality among US-American negotiators. Having said that, the law of averages allows similarities in values to be identified, which, from a relative point of view, are a common basis in comparison to negotiators from other countries. Thus, certain basic cultural values are common to US-citizens, regardless of their original country of origin, religion or social status. These basic values coin their mentality. The following notes illustrate these aspects in detail.
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4.3.4 Orientation Towards Legal Requirements
The US-American version of common law is, as the common law in general is, strongly based on formalities. Thus, the exact wording of the contract (plain meaning rule) is more significant than the economically desired outcome or a fair balance of demands. This also complies with the fact that US Americans emphasise the importance of self-responsibility for the contractual parties. Moreover, US law is case-based and does thus not favour general rules. Likewise, legal rules vary significantly from state to state. Contract-based solutions are therefore the only means to prevent legal divergence.
This approach promotes the inclusion of lawyers in the contract negotiation and also explains the tendency towards very lengthy and detailed contracts that cover every possible case. In general, these contracts are also formulated in such a manner that circumstances outside the written contract are not regarded.
With regard to legal certainty, the parties regularly do not want common law to apply, which is the case where contractual gaps occur. The US-American proceeding law ensures that it is not economically sensible to initiate court proceedings for small sums. Opposed to that, the system of serious penalties with legal means such as class actions, punitive damages and very high and hardly juridically reviewable sanctions by government agencies (e.g. the Securities and Exchange Commission (SEC) or the DOJ (Department of Justice)) ensure that companies are aware of the fact that more voluminous transactions cannot be made without legal consultation. US lawyers do not enjoy great popularity, firstly due to the high sanctions which entail accordingly high costs for US lawyers, but also because of the utilised jury system. This system allows laymen, who are emotionally influenceable, to make decisions, thus allowing a good lawyer the opportunity to achieve results against the objective law. The US have an extremely high number of lawyers, not only in absolute numbers, but also with regard to their ratio per number of inhabitants (the highest per capita rate globally, at least as far as the bigger states are concerned).
US-Americans lawyers tend to think more economically-oriented than for instance German lawyers. This is due to their stronger interdisciplinary-based education, e.g. in the field of law and economics, but also linked to their high degree of willingness to become acquainted with other fields, and to use this knowledge for their further actions. Likewise, their generally positive attitude towards taking risks with respective chances (for this see further below) makes it easier for US-lawyers to take a stance that is more strongly economically-based. Thus, viewing law as an integral part of risk management is not uncommon.
Nonetheless, in the US, a lawyer will employ a different approach to negotiations than an economist. This has led to businesslike negotiators being differentiated from legalistic negotiators in the US-American sphere. Businesslike negotiators are generally very optimistic about the successful completion of negotiations. Hence, they prefer broad strokes and do not insist on a perfectly detailed solution. On the other hand, legalistic negotiators, similar to German negotiators, place great emphasis on dates and facts, often informing themselves of potentially important details before-