Cross-Cultural Business Negotiations

Abstract

This is a cross-cultural negotiating exercise dealing with an international business situation in which a moderate size producer of hand tools (International Tool, Inc.) is considering a foreign direct investment in a small developing country (Mora). The exercise attempts to limit the negotiation to three issues -- staffing with local or home country managers, technology transfer to the host country, and profit repatriation to the home country. In a classroom setting it is ideal if you have a small group of or 3 students from developing countries play the country representatives and a similar set of students from developed countries act as company negotiators. The realistic issues in the case permit one to observe the culturally based negotiating styles of each group and to compare and contrast them in class discussion following the simulation. Persons participating in the exercise need sufficient time (at least a week in advance) to prepare their strategy and positions.