Negotiating Across Culture Paper- India and the United States
Negotiating is a difficult task in supply chain management. Many variables must be considered when negotiating especially on a global scale. Understanding important factors assist in developing and following negotiation strategies across cultures and ethnic differences. Effective use of various techniques and concepts increases the probability of an organization reach a successful conclusion to global negotiations. Failure to adhere to these certain procedures can result in failed negotiations. This paper will review how an organization headquartered in the United States will negotiate with a potential supplier in India on a major purchase of key components used in manufacturing the United Sates organization’s product. In evaluating this negotiation process several concepts will be addressed: the cultural and ethnic makeup of each country will be introduced, cultural and ethnic differences between the two countries, determination of the correct negotiation tactic, and how the negotiation will be conducted to reach the desired objective.
United States Cultural and Ethnic Composition
To measure cultural differences and similarities, a cultural dimension study was created. Based on five cultural dimensions created by Geert Hofstede, culture dimensions measures a culture’s Power Distance Index (PDI), Individualism (IND), Masculinity (MAS), Uncertainty Avoidance Index (UAI), and Long-Term Orientation (LTO). The United States has a widely diversified culture and ethnic composition. The United States PDI score was 40 that is lower than the global average of 55. PDI measures a society’s level of inequality from government, organization, to within family structures. The score of 40 relates the United States attitude that there is greater equality among society levels that results in cooperative interactions across power levels creating stability within a cultural environment.
The United States IND score of 91 is highest among all nations. High IND scores suggest a society with a more individualistic attitude with loose ties with others. Often IND societies are more self-reliant looking out for them and close family members. The MAS score of 61 indicates eh United States is dominated predominantly by males in the business world. As a result, the female population has become more assertive moving away from their female role model toward amore male role model. The United States UAI score of 46 is below the global average of 64 revealing that the country has fewer laws in an attempt to control all outcomes and results. Moreover, a lower UAI indicates a greater level of tolerance of ideas, thoughts, and beliefs. The LTO score for the United States of 29 indicates how the society believes in meeting social obligations and a reflection of appreciating cultural traditions.
The ethnic composition of the United States is as follows: White 79.96%, Hispanic (includes Mexican, Cuban, Puerto Rican, Dominican Republic, Spanish, and Central or South American origin) 15.1%, Black 12.85%, Asian 4.43%, American and Alaska native 0.97%, native Hawaiian and other Pacific Islander 0.18%, and two or more races 1.61%. (N. A., 2010).
India Cultural and Ethnic Composition
Reviewing India’s cultural dimension scores revealed the following. The PDI score was 77 revealing a high-level of inequality of power and wealth within society that is accepted as a cultural norm within India. Individuals must be aware that all societies are unequal, but some are more unequal than others. India’s IND score of 48 reveals that India’s society is more collective than individualistic. Beginning at birth collectivism is how individuals are inte-grated into groups that remain string throughout one’s lifetime. A MAS score of 56 places India above the global average and indicates a gap between men and women especially in the business world.
India’s UAI score of 40 deals with man’s search for truth and tolerance of uncertainty and ambiguity. Low scores reveal that countries or societies believe they do not need laws, rules, or regulations for every conceivable circumstance of unknown or unexpected origin. An LTO score of 61 places India above the world average of 48 indicating a perseverant and close society.
India’s ethnic composition is as follows: Indo-Aryan 72%, Dravidian 25%, and Mongoloid and other 3%.