10 11 negotiation Economics_Study_Cards Flashcards
What is Guanxi and why is it significant in negotiations?
Guanxi refers to personal relationships and networks rooted in Confucian values, emphasizing trust, reciprocity, and mutual obligations. It plays a critical role in assessing partners and building long-term relationships in Chinese negotiations.
What are the key differences between Australian and Chinese negotiation styles?
Australians value low power distance, individualism, and contracts. Chinese negotiators prioritize high power distance, collectivism, relationships (guanxi), and group goals.
What are the five stages of cross-cultural negotiation in Chinese contexts?
- Preparation 2. Non-task stage (relationship building) 3. Exchange of task-related information 4. Persuasion 5. Concession and agreement.
What are two major mistakes often made in negotiations with the Chinese?
- Failing to understand the complex political and social contexts. 2. Lacking proper relationship-building efforts, leading to choosing the wrong partner.
What is BATNA and why is it important?
BATNA stands for Best Alternative to a Negotiated Agreement. It is essential as it defines your fallback option, giving leverage and clarity during negotiations.
How does Confucianism influence Chinese negotiation behavior?
Confucianism emphasizes patience, hierarchy, face (mianzi), and harmony, shaping negotiation strategies toward building trust and fostering long-term relationships.
What is ‘Zhengti Guannian’ and how does it affect negotiations?
‘Zhengti Guannian’ is the holistic approach in Chinese negotiations, where all issues are interconnected and discussed simultaneously rather than sequentially.
What challenges did Tesla face in its negotiations with China?
Tesla faced challenges like data privacy concerns, adapting to local consumer preferences, and maintaining quality standards in a competitive market.
What are the key motivations for forming International Joint Ventures (IJVs) in China?
Motivations include sharing costs and risks, accessing local knowledge and resources, gaining market entry, and facilitating technology transfer.
How can the yin-yang principle apply to Chinese negotiation strategies?
The yin-yang principle emphasizes balancing competition and harmony, fostering flexible strategies that address conflicts while seeking mutual benefits.
What are the characteristics of a negotiation situation?
- Two or more parties with conflicting needs and desires. 2. Expectation of a ‘give and take’ process. 3. Interdependence shapes processes and outcomes. 4. May involve zero-sum (win-lose) or non-zero-sum (win-win) situations.
What is the importance of ‘Face’ (Mianzi) in Chinese negotiations?
Mianzi represents personal and collective reputation. Protecting face is critical for maintaining respect and harmony, and losing face can undermine relationships and agreements.
What are the four mindsets in Chinese negotiations?
- Cultural context (e.g., Confucianism). 2. Guoqing (Chinese characteristics). 3. (De)globalization contexts. 4. Historical context and strategies (e.g., 36 stratagems).
How is mutual adjustment a key aspect of negotiations?
Mutual adjustment involves both parties influencing each other throughout the negotiation. Understanding and predicting adjustments is critical for effective strategies.
What is the role of technology transfer in Chinese negotiations?
Technology transfer is a priority for Chinese negotiators. They often insist on acquiring Western technologies as part of agreements, e.g., in joint ventures like Tesla and AT&T.
What are the stages of planning and managing International Joint Ventures (IJVs)?
- Establish JV objectives. 2. Conduct cost/benefit analysis. 3. Select partner(s). 4. Develop a business plan.
What are the strategic uses of IJVs?
Strategic uses include accessing technology, diversifying markets, establishing long-term relationships, and aligning with local and global business strategies.
How does the holistic approach differ from the sequential approach in negotiations?
The holistic approach (e.g., Zhengti Guannian) considers interconnected issues simultaneously, while the sequential approach addresses issues step-by-step.
What are the major cultural dimensions influencing negotiation behavior?
Key dimensions include power distance, individualism vs collectivism, uncertainty avoidance, and masculinity vs femininity, based on Hofstede’s framework.
What are the common pitfalls in forming international partnerships in China?
- Poor planning. 2. Choosing inappropriate partners. 3. Structuring deals poorly without aligning mutual goals and expectations.
How did AT&T prepare for negotiations in China?
AT&T prioritized building guanxi by engaging with high-level officials, using patience, and adopting a long-term strategy to establish trust and collaboration.
What was a key outcome of AT&T’s negotiations in China?
AT&T secured a joint venture with Shanghai Telecommunications in 2000 and extended the partnership to align with China’s Belt-Road initiatives in 2017.
What challenges did Tesla face during its negotiations in China?
Tesla faced issues like government concerns about data privacy, adapting to Chinese consumer preferences, and local market competition while setting up its Gigafactory in Shanghai.
Q4: What strategies helped Tesla establish its presence in China?
Tesla built strong government ties, leveraged incentives, and aligned its goals with China’s push for electric vehicles and carbon neutrality by 2060.
How did cultural understanding benefit AT&T’s negotiations?
AT&T’s understanding of guanxi and the importance of reciprocity enabled effective relationship-building and successful joint venture agreements.
What role did reciprocity play in AT&T’s success in China?
Reciprocity allowed AT&T to foster trust and collaboration by offering benefits and aligning its strategy with the interests of Chinese stakeholders.
What were the main pitfalls Tesla encountered after its initial success in China?
Tesla faced reputational challenges, including quality complaints and privacy concerns, which impacted its market share despite early success.
What lesson can be drawn from the Google-China case study?
Google’s conflict with censorship laws highlights the importance of understanding and adapting to the local regulatory environment in China.
How did Tesla align its strategies with China’s goals?
Tesla supported China’s focus on electric vehicles and carbon neutrality, establishing its Gigafactory and adapting to Chinese market dynamics.
What is a common theme in successful negotiations, as seen in the AT&T and Tesla cases?
Both cases underline the importance of aligning with local government priorities, building strong relationships, and maintaining cultural sensitivity.
