Impact of Culture on Business Negotiations (Keeping in mind US and Sweden businessmen)

A Minor Project on Masters of Business Administration (International Business)

By Jatin Arora MBA-IB (2010-2012) Enrollment No. : A1802012157 To Dr. Veenus Jain AIBS Amity University AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA AMITY UNIVERSITY UTTAR PRADESH

ACKNOWLEDGEMENT
For

learning to take place with any kind of efficiency students must be motivated. To be motivated, they must become interested. And they become interested when they are actively working on projects which they can relate to their values and goals in life The research work requires co-operation of many people and this work is no exception. It is difficult to thank individually all the persons who patronized this work. The researcher had asked for favors, borrowed ideas, expressions and facts from so many that it would require one volume to give credit to all. So, the researcher wants to thank all the patrons of this report First and foremost, I would like to express my sincere gratitude to all the faculty of Amity International Business School. I wish to express my profound gratitude to Dr. Veenus Jain under whose supervision I completed minor project. Her attitude towards excellence, her helping nature and her enthusiasm has been source of constant inspiration I am also very thankful to all the faculty members, the whole college staff for providing me with necessary facilities and support, essential for bringing out this work in a short time. Last but not the least, I am thankful to all the previous research scholars. The work they did helped me a lot to understand my topic and work accordingly.

Table of content
S No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Topic Executive Summary Review of Literature Introduction Theoretical Overview Model Business Culture in Sweden Business Culture in US. Aim Analysis Findings Case Study Conclusions References Page No. 4 6 7 12 13 15 18 19 26 29 30 33

Executive Summary:
The number of companies operating internationally is growing constantly. The world is opening up for foreign firms and new destinations in the company business are increasing. Because of high competition the companies operating abroad are faced with a much larger task then before. When going international the challenges the company must handle are new and unfamiliar. Obstacles the firm never faced before are becoming crucial in the everyday work. Culture is one of these obstacles and can affect the entire cooperation. Culture can influence the business in different ways. Language problems, pricing difficulties and culture collisions are not uncommon, especially in the beginning. The company must be able to handle these difficulties in a way that is satisfying also for the other part. Mistakes can be difficult to correct and disrespect for the foreign culture can destroy the entire operation. There are some general advices the company always must have in mind before and during a co-operation on the international market. It is important, even before entering the foreign country, to inform the personal about the manners and customs in that new culture. If the first impression becomes negative, this can be hard to shake. Foreign cultures have different ways of doing business, for example when it comes to planning ahead and keeping delivery times. Culture can be both a positive and negative influence and many companies are struggling in the new and foreign environment. The important thing to always have in mind is that the foreign culture is not as we are used to at home and to be prepared before starting the new foreign operation. Respecting and understanding the new culture without forcing our own beliefs on people, are things that can be extremely helpful to consider. By learning the host countrys language, can respect and trust more easily be won, and competitive advantages can arise.

In today's global business environment, cross-cultural negotiation has become a popular area of study. There are often differences between the negotiating parties ways of conducting business, language, dress, preferences, and legal and ethical considerations. Understanding and taking these cultural variables into account in the country where business transactions are taking place is one of the most important aspects of being successful in any international business attempt. I in this project have investigated how cultural differences affect business negotiations between Swedish and American businessmen. Furthermore, I have tried to find out how the influence of culture on business negotiations between businessmen from Sweden and the US can be described, as well as how the cultural problems facing Swedish businessmen when negotiating with businessmen from the US can be expressed. Finally, international business negotiations can be discussed from many different dimensions but in this thesis, I have only focused on the dimension of business negotiations between people from Sweden and people from the US, from the perspective of Swedish businessmen

Literature Review:
I started off the work by searching for literature that would be relevant for the area of study. In order to find appropriate literature in the form of books and reports, I went through some books and journals related to international business and cross cultural management. In addition to this, as well as search engine Google was used in order to find relevant articles, reports and other published material. Negotiating, cross-cultural business negotiations and international negotiations are the search words that were used. Cross cultural management mainly focuses on the behavior of people from different culture working together as a group or an organization (Adler, 1983). Most of cross-cultural management study aims at dealing with the issue of organizational behavior, such as leadership style, motivational approaches, strategy, organizational structure (Morden, 1995; Elenkov, 1998). Three aspects are discussed in this study as follows, communication system, management style, and staff behavior. As to the cultural concept, culture is a complex issue in some fields such as sociology, anthropology and now become a hot topic in management. Several contributions are devoted in this area by some authors, such as Hofstede (1997), Hall (1976, refered by Richardson and Smith, 2007), Golbe (2004). It is no exaggeration to say that Hofstedes dimensions of national culture theory is a dominant theory. Although a lot of people oppugn Hofstedes theory and his data are out of time (Holden, 2002, p20), however, the data of dimensions of national culture is not an absolute value but relative values. At least, Hofstedes dimensions of national culture theory still is a famous and popular theory, which is engaged by a large number of researches. Project GLOBE is a recent study, in which culture is linked to behavior in organization (Shore and Cross, 2005). Globe proposals nine cultural dimensions, some of these are similar to Hofstedes Dimensions of National Culture (Shore and Cross, 2005). However, Globes theory is still a new theory without sufficient test; therefore it will not be considered in this study. Halls high context-communication and low context communication can perfectly serve for the cross-cultural communication study and conflict-resolution studies (Kim, Pan and Park, 1998). In this study, both Hofstedes Dimensions of National Culture theory and Halls high contextcommunication and low context communication theory are involved.
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Introduction:
Today, stakeholders of an organization in any country in the world could be from another culture. Stakeholders include customers, competitors, shareholders and employees. If a company understands its stakeholders, it is easier to serve them and to make the organization more successful. ) In the past, companies could either operate only in the domestic markets or expand their business to other countries as well. This is no longer the case because companies are in addition to the competition on the home market, also forced to face competition from other countries. Cross-cultural encounters have become ever more frequent in a world where trade, migration, the media and travel are pushing people and governments to confront and accommodate cultural and ethnic diversity. In other words, countries can no longer maintain independence from an ever growing global economy. Due to this, people and organizations are more easily accessible and the implication for business is that it is imperative that managers understand culture. Thus, companies of today operate in an era of globalisation of business activities. This means that managers from one country will often be conducting business and/or sitting at negotiating tables with managers from other nations and countries. Culture is one of the most challenging elements of the international marketplace. The influence of cultural diversity on international business negotiation will continue to increase in importance as a result of the liberalisation of markets worldwide and cross-border mergers and acquisitions. In today's global business environment, cross-cultural negotiation has become a popular area of study. The US is Swedens largest export country, in terms of value of the exports. Therefore it would be interesting to investigate if and how the differences between the cultural environments of Sweden and the US affect business negotiations between companies from Sweden and the US. The area we have chosen to investigate is interesting to study also because the findings of this thesis may prove useful for other organisations who wish to negotiate with people from the US, and for those who already have their organisation in the US but who seek greater understanding of the cultural context within which they carry out their international business relations.

Expanding Business to Other Cultures

When a company expands its operations to new geographical areas, it will not only acquire new customers, but new partners as well. These partners include agents, distributors, and other facilitating agents such as law firms and advertising agencies. The government in the foreign country is another important partner to consider. It is essential that a company acquire these partners as their work facilitates market development and penetration. Along with an expansion into other countries, will also come new employees programs are carried out. It is thus critical to have an understanding of what these groups value and find motivational as well as to know what they dislike and/or find offensive.

Cross Cultural Negotiations:

The diverse makeup of many societies and global nature of business today make cross-cultural negotiation a regular part of life. Unfortunately, many major disputes in need of resolution also cross ethnic and cultural lines. Communication and negotiation etiquette varies widely across cultures. In France, it is rude to talk money over dinner while in Brazil the American A-OK gesture (thumb and forefinger forming a circle) can be a major insult. Understanding when, where, how and with whom it is appropriate to negotiate any given issue is extremely important to working across cultures. Negotiators and mediators should do their best to understand the cultural norms of other parties, and should be charitable in understanding that others have different norms from their own. When a company expands its operations to new geographical areas, it will not only acquire new customers, but new partners as well. These partners include agents, distributors, and other facilitating agents such as law firms and advertising agencies. The government in the foreign country is another important partner to consider. It is essential that a company acquire these partners as their work facilitates market development and penetration. Along with an expansion into other countries, will also come new employees or strategic alliance partners who have a large impact on how well marketing programs are carried out. It is thus critical to have an understanding of what these groups value and find motivational as well as to know what they dislike and/or find offensive. It is only through interaction with people of a culture, coupled with in-depth study of the history, traditions, and institutions of this culture that one can begin to understand the behaviors, values, and overall approach to life that people of this culture have. When companies in different countries trade and interact, there are many issues that differ from domestic trade. The external environment may be very different in terms of infrastructure and political climate. A major consideration for companies is the cultural differences that might cause problems in the communication between business partners.

Negotiations occur in all societies, and on all levels between various parties in various situations. These situations can be of a social, economic or political art. Individuals, companies, ethnic groups and nations have always used negotiations as a way to try to satisfy their basic needs. Five important considerations in cross-cultural negotiations. These are; the players and the situation, styles of decision making, national character, non-verbal cross-cultural noise and verbal cross-cultural noise. Below these factors with examples are presented. 1. The players and the situation - Expectations - The people present - Views of the negotiator 2. Styles of decision-making -Consensual/ Authoritative style

3. National character
- Patriotic / Ethnocentric / Aggressive/ - Listening habits - Conceptualizations on what is important

4. Non-verbal cross-cultural noise

- Gestures - Burping

5. Verbal cross-cultural noise

-Language - Meaning of words

In the below presented model the cultural influence in each country is presented. Culture in each country is meditated through three factors: cultural forces, cultural messages and consumer decision process. Family, education and national identity manifest cultural forces. Ethics and morality, behaviour and roles and design influence cultural messages. Culture is also influenced from universal needs and wants in the society and consumer trends.

These cultural differences are different in country A and country B. The foreign company must analyze and cope with these cultural differences and harness the tension to bring about reconciliation between these countries. With combining and synthesizing cultural differences the foreign company can integrate different cultural perspectives and seek a dynamic solution to problems that may arise

Cultural Forces -family -education -national identity

Cultural messages -ethics and morality -behavior and roles

Cultures decision process -needs and wants -consumer trends

Culture in Country A

Reconciliation -reduce conflict -cope with differences -harness tension

Culture in Country B

Synthesis of cultures -integrate different cultural perspectives

- seek a dynamic solution

The extent to which national culture becomes relevant to a firm can be shown in the following table. The company own home country culture is of high relevance, though the managers and other employees may not be aware of its influence. The relevance of other peoples culture becomes greater for a firm as it spreads its activities and products past its national boundaries to reach foreigners with different value systems and tastes

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Tayeb, M. 1998. The Management of a Multicultural Workforce, England: John Wiley & Sons.

Relevance of natural culture:

Character of the firm

Home culture

Foreign culture

Domestic, single-nation firm with no foreign interests Single-nation firm with import/export activities Multi-nation firm with franchising and licensing activities Multi-nation firm with manufacturing and/or service units abroad Global firm with various business activities in most parts of the world

High

Nil

High

Low to moderate

High

Moderate to high

High

High

High

High

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Theoretical overview model This model is about the overall areas that we are using in the essay and describes how these areas are affecting each other. The model shows how these three elements are tied together and how they all seem to be influencing one and other.

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Business Culture in Sweden:

Often, Swedish businessmen don't expect businessmen from other countries to differ much from themselves in management, behavior, clothing etc. Most of them would be surprised if they were told that their business culture differs greatly from the international norm.

Management Style
Swedish management is based on the idea that the individual is both willing and able to do a good job. A Swedish manager tends to think of himself as a coach rather than a commander, and he often delegates tasks and authority to his staff. Swedish organizations, employees on all levels have the freedom to make decisions and solve unexpected problems without asking superiors for permission.

A good manager, according to Swedish standards, is a person who takes advantage of the natural creativity and motivation of his staff. He should lead the emploees not through his power or formal position, but through the principles of cooperation and agreement. Being a good listener is considered to be another important quality. In discussions with his staff, a professional manager should use reason and base his views on facts. Getting emotional when discussing a problem is considered rather inappropriate.

Power Distance
The power distance in Swedish companies is among the smallest in the world, according to a study of 40 countries in 1984. 'Power distance' can be defined as "the extent to which people in a hierarchical situation feel they can and should control the behavior of others, and the extent to which those others are conditioned by reflexes of obedience". In Swedish companies, the concept of power distance is largely replaced by personal responsibility.

Personal status is of relatively small importance in Swedish business life. Managers only rarely give signals of their own status and employees normally don't feel inferior to them. An executive is most of all considered to be a specialist in managing companies and he is therefore not socially superior to a specialist in any other field. In this respect, Sweden seems to differ from many other countries. A further sign of the non-hierarchic (or, better, modestly hierarchic) Swedish company structure is that Swedes normally use their first names at work.

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Organizations
Swedish organizations are probably less rigid than many of their foreign counterparts. Swedes try to solve problems in an informal and pragmatic way, even if it means bypassing one or more layers of executives. In most cases, managers do not feel threatened by this practise, the general idea being that decisions are made in order to achieve a result and not to demonstrate your own position. The same attitude explains the vivid exchange of information in Swedish companies. If people know what is going on, the argument goes, they will feel more involved, and therefore more motivated for work.

Swedish companies usually have a flat and team-oriented structure with few management levels. The result is a simple and direct decision-making process. Matrix organizations are common, since Swedish employees often report to more than one manager.

The Approach to Risks

Swedish executives are generally more willing to take risks than their colleagues in other countries. An international study showed that Sweden had the lowest "uncertainty avoidance index" by far among the countries compared, while Japan had the highest. To generalize this result, one could perhaps say that Swedish managers are not so anxious to do the 'right' thing as long as they do their best.

In countries where managers show a high uncertainty avoidance, employees are often promoted according to seniority. In Sweden, on the other hand, actual work performance tends to be of greater importance. As a result, young men and women are frequently seen in leading positions.

Making Decisions
Although Swedish executives are willing to take risks, decisions are often made with great consideration. This is so, because there is one thing that must not be risked: the feeling of consensus and agreement in a company. Heated debates are very unusual at business meetings, and criticism has to be presented in a non-personal and diplomatic way. Unlike the situation in most other countries, Swedish business culture strongly favors compromising.

Punctuality
Being punctual is not only regarded as a sign of respect but also of efficiency and Swedish businessmen will have little understanding for cultural variation in this case. The stressing of the

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time factor can also be seen in everyday business contacts; it is generally not considered rude to set a deadline for a thing to be done or a decision made.

Punctuality is important not only in working life but also when it comes to purely social gatherings. This means that when a Swede is invited for dinner at eight, he show up at eight!

Business Contacts
Foreign businessmen often find that their Swedish colleagues talk too much business, and too little about themselves or their interests. They might draw the conclusion that their partners are simply limited and ignorant. The Swedish businessman, on the other hand, probably wishes his foreign business partner would cut the small talk and come to the point. In Sweden, a direct approach
is seen as a sign of efficiency and a wish not to waste the other person's time.

Business Culture in US:

To ensure successful cross cultural management when working in the U.S., it is safest to treat all people with an equal amount of respect and deference (within the informal framework of America, in general), focus on schedules and maximizing time, and expect that people will want to be dealt with as individuals. In the U.S. there is a sense that all people in the organization have an important role to play and all are valued for their input. Therefore, managers consult employees to gather background information and often have them share in the decision-making process. The American working environment has changed drastically. With one eye on costs and the other on retention, employers are increasingly offering part-time or shared jobs, or outsourcing to external contractors. Change is constant as companies are restructured, work teams become "virtual," and flexible work arrangements become more common.

The Role of a Manager

Cross cultural communication will be more effective when working in United States when you remember that the most productive managers in United States recognize and value the specialized knowledge that employees at all levels bring. Employees expect to be consulted on decisions that affect them and the greater good of the organization.

Approach to Change
Cross cultural management is more likely to succeed if you understand that businesses in the U.S. have a high tolerance for risk and a ready acceptance for change. The underlying mindset is that change, while difficult, usually brings improvements and enhancements with it.

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Approach to Time and Priorities

The U.S. is a controlled-time culture. Global and intercultural expansion has meant adherence to schedules is important and expected. Missing a deadline is a sign of poor management and inefficiency, and will shake peoples confidence. Successful intercultural management will depend on the individuals ability to meet deadlines.

Decision Making
American managers are viewed as facilitators--people who help employees do their best work-and not simply decision makers. They empower employees and expect them to take responsibility. Employees freely cross management levels and speak directly to senior managers. This freedom is particularly apparent at meetings, where everyone in attendance is encouraged to participate openly.

Boss or Team Player?

Cross cultural management is more likely to succeed if you understand the mindset behind the work force. In The United States, groups collaborate well together as teams. Members are generally chosen to participate based on tangible skills or the knowledge base they bring, and are equally welcome to contribute to any discussion that may arise. They are encouraged to generate new ideas that may further the direction of the plan or spawn a new track entirely. In successful, dynamic teams, all members are valued for their actual and potential contribution, and all are treated with equal respect.

Communication and Negotiation Styles

The American negotiating style tends to be a "hard sell"sometimes characterized as sledgehammer subtlety combined with missionary zeal. A strong pitch may sound boastful but is meant to inspire confidence and trust. It is also consistent with the penchant for logical reasoning, directness and comfort with self-promotion.

American negotiators may have little familiarity with, or patience for, the formal business protocol, indirect communication style, or consensual decision-making practices of other countries (a fact that savvy international negotiators often use to their advantage). Their focus is on the short term and the "big picture" --securing the best deal in a timely manner.

Their approach is informal, cordial and straightforward. The U.S. team will reveal its position and expect the other party to engage in a competitive bargaining process. If an impasse is reached, American tenacity, creativity, and persuasiveness will come to the fore. Despite the "hard sell" tactics, negotiating partners should not feel pressured into making a decision. The
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Americans expect their counterparts across the table to be similarly pragmatic and single-minded in trying to secure a favorable deal.

Another significant issue about culture is the levels manifested through artefacts, values and underlying assumptions:

Artefacts

Values

Underlying assumptions

Visible organizational structures and process Includes visible products, clothing, manner of address, work practices. Strategies, goals, philosophies includes for example attributions, avoidance. Unconscious, takes for granted beliefs, perceptions, thoughts and feelings

Each society has its own elements of culture. These elements of culture are manifested through: Language Religion Values and attitudes Manners and customs Material elements Social Institutions

Education
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Aim:
The aim of this study is to gain a better understanding of how cultural differences affect business negotiations between Swedish and American businessmen. How can the influence of culture on business negotiations between businessmen from Sweden and the US be described? How can the cultural problems facing Swedish businessmen when negotiating with businessmen from the US be described?

CORPORATE CULTURE

Twelve main variables that affect negotiations: Basic conception of the negotiation process strategic versus synergistic Negotiator selection criteria Significance of types of issues substantive versus relational Concern with protocol formal versus informal Complexity of the language high context versus low context Nature of persuasive argumentation emotional versus logical Role of individuals aspirations Bases of trust cognitive versus affective Risk-taking propensity high versus low Value of time monochromic versus polychromic Decision-making system authoritative versus consensual Form of satisfactory agreement written versus oral.

The shared values, traditions, customs, philosophy, and policies of a corporation; also, the professional atmosphere that grows from this and affects behavior and performance.

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How Can the Influence of Culture on Business Negotiations between Businessmen from Sweden and the US be described? Cross-cultural negotiations are influenced mainly by twelve different variables
Basic conception of the negotiation process strategic versus synergistic
If a person has strategic conception he/she sees the negotiation as a Win-lose process, in other words, one side will end up a winner and the other a loser. It claims that if one has a synergistic conception one will strive to create a win-win outcome by working together. The marketing and sales manager for exports says that Americans are seldom willing to make compromises to the same extent as Swedes are. If one party is strategic and the other is synergistic, the latter may get the bad end of a deal. If Swedes have a more synergistic conception of the negotiation process than people from the US, as our data above indicates, then Swedish negotiators. Theory get the bad end of a deal in negotiations with Americans.

Negotiator selection criteria:

It says that the negotiator selection criteria are about how a party selects its negotiator .A persons position in the company can be a selection criterion that is used to select a negotiator. It
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extremely important to understand who is in charge of the negotiating team and who will make the ultimate decision. The decision maker in a negotiation may sometimes be a single person and sometimes an entire team. The experience of the marketing and sales manager for exports Sweden is that in the US it is almost exclusively the person responsible for purchases possibly with assistance from the person responsible for production, who are chosen to negotiate for US companies. In Swedish companies, more specialists take part in negotiations compared to US companies, according to the respondent. Position in a company is a criteria used for selecting negotiators in both Sweden and the US, even though it is not necessarily people in the same position that are selected to negotiate in the two countries. Also, in companies in the US it is in general only those responsible for purchases, possibly with assistance from the person responsible for production, who come into question as far as taking part in business negotiations with Swedish is concerned.

Significance of types of issues substantive versus relational

A person that has a substantive view will focus on issues such as how resources will be if one has a relational view, he/she will find issues such as how the relationship will develop and continue, and what the parties can do for each other, important. The marketing and sales manager for exports says that relationships with customers in the US rarely last for a longer period of time because many people change positions and move in the US, which make longer relationships almost impossible. It also says that in the US, suppliers are changed much more often and this is done in order to achieve the purpose of lowering the prices, or making a point that the supplier should not take anything for granted. This would suggest to us that businessmen from the US lean more towards a substantive view than a relational view when they negotiate.

Concern with protocol formal versus informal

An informal approach as opposed to a formal approach to protocol means that for example first names will be used when addressing the other party in a negotiation, and humor can also be used at the negotiation. Americans lean more toward the informal than formal. They want to get on a first-name basis quickly which is a positive sign of relationship building. As far as formal differences in how negotiations are conducted in the US compared to in Sweden are concerned, the marketing and sales manager for exports says that in the US, titles are not used, instead first names are used and the atmosphere is open but frank. Thus, the data and literature above agree on this issue and say that in general negotiators from the US are more informal than formal.

Complexity of the language high context versus low context

If the language of a culture is high context it is indirect and uses a lot of non-verbal language. People who use low context language are more comfortable with different modes such as telephone than people who are used to a high context language. Comparing how Swedes and Americans use non-verbal language/body language in a negotiation situation, the respondent says that negotiators from the US evidently show when they are not content, and they are willing to call off negotiations if no progress is made. After having compared the collected data about high context and low context language, it seems as if businessmen from the US may use body
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language more than Swedish businessmen do and due to that, the US have a language that is more high context than the language of the Swedes.

Nature of persuasive argumentation emotional versus logical

Persuasion through emotional argumentation means that one side in a negotiation tries to reach the other side and get it to agree to things by playing on what they expect and on their emotions, and the parties relationship to one another. Logical persuasive argumentation is based on facts and logical reasoning. Comparing how Swedes and Americans show and use emotions in a negotiation, the marketing and sales manager for exports negotiators from the US can give of themselves to a large extent, something that we as Swedes doubt the sincerity of. This doubt is well-founded according to the respondent. We believe that one reason for why US businessmen give of themselves in a negotiation, is because they try to use this behavior as a way to persuade the other side in some way, it suggests that negotiators may do. The behavior of giving of oneself may be seen as emotional argumentation describes it in the literature.

Role of individuals aspirations

The individuals that an organization sends to take part in a negotiation may have personal aspirations, such as doing whatever it takes to win a deal, further, it says that these aspirations may be very different to the aspirations of the company, and may also be considered unacceptable by the company. When it comes to the question of if there are any differences between what negotiators from Sweden and the US respectively, usually do in order to succeed with the negotiation, the marketing and sales manager for exports we have interviewed says that in the US suppliers are changed much more often and this is done in order to achieve the purpose of lowering the prices, or making a point that the supplier should not take anything for granted. The respondent does not say whether this behavior is driven by personal aspirations or by the companys aspirations. The discussion above shows that negotiators from the US may act differently than their Swedish counterparts in order to succeed with the negotiation.

Bases of trust cognitive versus affective

Some cultures establish trust for one another according to what seems reasonable logically, whereas others establish trust based on feelings for one another. A cultural difference that the Sweden has experienced when negotiating with Swedes and Americans respectively, is that in Sweden a hand shake is a guarantee, but in the US one should get everything documented on paper. This data suggests that Swedish businessmen may have a more affective base of trust in negotiations than businessmen from the US have.

Risk-taking propensity high versus low

People with a low risk-taking propensity are relatively conservative and think that they will reach their goals eventually, whereas those with a high risk-taking propensity are more adventurous, no opinion concerning the risk-taking propensity of Swedish and US business people in negotiations.

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Value of time monochromic versus polychromic

Time is valued differently in different parts of the world; some think of it as something that can be divided into many parts and should be monitored closely, whereas others view it as something that is more relative. After having compared how Swedes and Americans perceive the issue of time in a negotiation, the result is that both Swedes and Americans put a high value on punctuality. Based on the data and literature above, one can say that business people from both Sweden and the US are concerned with being on time and thus view time as something that can be divided into parts and should be monitored closely, and therefore they have a monochromic value of time

Decision-making system authoritative versus consensual

In a negotiation, one party might expect the other to behave the same way as it does. In some cultures decisions are made in consensus, which means that everyones opinion is taken into consideration and the decision is one that everyone supports American negotiators make decisions extremely fast - at times to their own disadvantage. Some U.S. executives live by the axiom, "Right or wrong, he who hesitates is lost negotiators from the US have, compared to Swedish negotiators, a deliberate tendency to not make decisions on a lower organizational level. Instead the American negotiators forward decisions to a higher level in their organizations in order to avoid having to make difficult/uncomfortable decisions. This often leads to that negotiations with people from the US may be prolonged before they can be concluded. The data shows a difference between the decision-making systems of Swedish and American negotiators. Furthermore, the data and literature do not agree on how fast negotiators from the US make decisions.

Form of satisfactory agreement written versus oral

In some cultures, written agreements are insisted on as they are thought of as superior to oral ones, whereas in other cultures people feel offended if a written agreement is insisted on as they feel it is a sign of a lack of trust between the parties. The experience of the marketing and sales manager for exports is that a cultural difference between negotiators from the US and Sweden, is that Swedish negotiators consider a hand shake to be a guarantee, but in the US one should get everything documented on paper and attested when doing business. The data above indicates that a cultural difference between negotiators from Sweden and the US, is that Swedish negotiators use oral agreements to a much greater extent than their American counterparts. From the respondents recommendation, that when doing business and negotiating in the US one should get everything documented in written form, one can also gather that in general, oral agreements do not seem to be considered as a satisfactory form of agreement in the US.

The National Cultures of Sweden and the US

Swedes communicate with very small gestures and they also immediately apprehend differences in minimal indications. Their well-developed consideration for each other and the fact that many Swedes are not very talkative, make it difficult and time-consuming for foreigners to understand the Swedish culture. The American culture, on the contrary, is much easier to understand and get
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in to for foreigners. However, the American culture is also easier to forget and to spare. Both the American culture and the Swedish culture are characterized as low context cultures. According to Hofstedes dimension of culture scales, there are differences between Sweden and the USA, as one can see in the table below.

Hofstedes Dimension of Culture Scales

Country Sweden USA Source: Power Distance Uncertainty Individualism 31 71 40 91 Avoidance Masculinity 29 46 5 62 Long term Orientation 33 29

http://spectrum.troyst.edu/~vorism/hofstede.html

Chart Title
Sweden PDI 100 80 60 Long term orienation 40 20 0 Uncertainty USA

Masculinity

Avoidance

Four categories of underlying cultural variables that may drive surface behavior, the

The four categories are

Relationships Communication, Time Space.

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Relationships
Is the culture deal-focused or relationship-focused? In deal-focused cultures, relationships grow out of deals; in relationship-focused cultures, deals arise from already developed relationships. Americans tend to move on to the next potential customer rapidly after the check has been signed. When the respondent is asked whether relationships with negotiators from the US develop from prior agreements, or whether agreements develop from already existing relationships, or if these things develop in some other way, he says that it depends on if it is an old or a new customer. Americans tend to change jobs more often, so the personal business relation has to be rebuilt more often with negotiators from the US. Minelcos Managing Director of sales on the US market says that if he compares how much focus negotiators from the US and Sweden respectively put on relationships and deals respectively, he thinks that negotiators from the US are more people oriented than their Swedish counterparts. This data suggests that negotiators from the US are more relationship- focused than negotiators from Sweden.

Communication
Are communications indirect and high context or direct and low context? Do contextual, non-verbal cues play a significant role in negotiations, or is there little reliance on contextual cues? Do communications require detailed or concise information? Many North Americans prize concise, to-the-point communications. Americans are extremely straightforward in their verbal communication and their message is both frank and clear. Sales on the US market, body language is individual. Americans train more often in sales/negotiating skills, and that business is more built on competition in the US. The respondent claims that in a negotiation, the communication of Americans and Swedes differ in the sense that the Americans speak louder and more than the Swedes, which can be perceived by the latter as being hostile. The data shows that both Americans and Swedes use both verbal and non-verbal language, and that the verbal language is more distinct for the respective culture than the non-verbal language. Furthermore, the data presented in this paragraph concerning how negotiators from the US communicate, is in conformity with the literature.

Time
Is the culture generally considered to be monochromic or polychromic? In Anglo-Saxon cultures, punctuality and schedules are often strictly considered. This monochromic orientation contrasts with a polychromic attitude, in which time is more fluid, deadlines are more flexible, interruptions are common, and interpersonal relationships take precedence over schedules.. says that in general, Americans are time conscious than Swedes and also expect their counterparts to be that. Comparing how Swedes and Americans perceive the issue of time in a negotiation, the respondent says that his perception is that Americans are more easy going than Swedes. The data suggests that Americans have a more polychromic attitude to time than Swedes or that Swedes have a more monochromic attitude to time than Americans.

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Space
Do people prefer a lot of personal space or not much? In many formal cultures, moving too close to a person can produce extreme discomfort. When it comes to issue of how much personal space and physical contact/touching negotiators from the US and Sweden respectively prefer, the respondent is of the opinion that Americans tend to be more open and easy going. This could suggest that Americans belong to a culture that is less formal than the Swedish culture.

How Can the Cultural Problems Facing Swedish Businessmen when Negotiating with Businessmen from the US be described? Cultural differences between business partners
Major consideration for international companies is the cultural differences that might cause problems in the communication between business partners. The differences between Americans themselves are often larger than between Swedes and the general perception of an American. Finally, the respondent has not experienced any cultural problems in negotiations with people from the US that he has not experienced in negotiations with people from Sweden and therefore, the data and literature is not in conformity when it comes to cultural differences between business partners.

Incompetence concerning the cultural elements

Problems in cross-cultural negotiations may occur if companies lack understanding of the cultural variables. If any of the cultural elements: language, religion, attitudes and values, traditions and customs, education, laws and regulations, political factors, and technological factors, have caused any problems in negotiations. Americans are non- discriminatory most of the time and that Americans are politically more conservative and Swedes should therefore avoid talks about Iraq war for example when negotiating with people from the US. The data shows that the respondent has not experienced any cultural problems due to incompetence concerning the cultural elements when he has negotiated in the US. Problems in cross-cultural negotiations derived from the professionalism of the negotiating team Cultural clashes are often underlying motivations for failure in many international activities Problems in cross-cultural negotiations derive from two sources: the professionalism of the negotiating team, and cross-cultural bias. Usually, negotiating teams of companies do not consist of professional or trained negotiators. How negotiators in companies in the US and Sweden respectively are selected depends on the size of the company and the importance/amount of money involved. The experience of the respondent is that a negotiator from Sweden is generally better prepared than a negotiator from the US. The respondent has not experienced any cultural problems derived from the professionalism of the negotiating team during his negotiations in the US.
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Problems in cross-cultural negotiations derived from cross-cultural bias

If the negotiators completely lack foreign experience, they may have large difficulties understanding the logic, intent and ethical standpoints of the other side. The Managing Director of sales on the US market. It gives an advice in order to avoid problems when negotiating with people from the US, explicitly to be open and relaxed. Following the advice from the data from the respondent may be one way to avoid problems derived from cross-cultural bias.

How Can the Influence of Culture on Business Negotiations between Businessmen from Sweden and the US be described?
As far as formal differences in how negotiations are conducted in the US compared to in Sweden are concerned, both respondents say that names are used instead of titles. In the US, first names are used. US negotiators quickly learn the other persons names and uses them often. Both the Swedish and the US cultures have a relaxed atmosphere and use humor during the negotiations. The atmosphere during negotiations in the US is open but frank. An informal approach as opposed to a formal approach, to protocol means that for example first names will be used when addressing the other party, and humor can also be used at the negotiation. When comparing the data with the literature, one can see that the data and literature above agree on this issue and say that in general negotiators from the US are more informal than formal in negotiations. Relationships with customers in the US rarely last for a longer period of time because many people change positions and move in the US, which make longer relationships almost impossible. Americans tend to change jobs more often than Swedes, so the personal business relations in the US has to be rebuilt more often than in Sweden. Americans are more people oriented than Swedes. In deal-focused cultures, relationships grow out of deals and in relationship-focused cultures, deals arise from already developed relationships. The data from both respondents is in conformity with each other when it comes to relationships. However, when comparing the data with the literature, it is not possible to say if the American and the Swedish business cultures are more deal-focused or if they are more relationship-focused. When the respondents is asked if there are any differences in what agreements generally made with negotiators from the US look like compared to agreements generally made with negotiators from Sweden, both respondents have the same opinion and say that they use written agreements when negotiating in the US. One should make sure that everything is stated in written documents some cultures written agreements are insisted on as they are thought of as superior to oral ones, whereas in other cultures people feel offended if a written agreement is insisted on as they feel it is a sign of a lack of trust between the parties. Here, the data from the respondents is in conformity with each other and when comparing the data with the literature one can see that when Swedes negotiate with Americans, written agreements are thought of as superior to oral ones.

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The individual(s) that an organization sends to take part in a negotiation may have personal aspirations, such as doing whatever it takes to win a deal, the data does not say something concerning personal aspirations of the negotiators. However, when it comes to the question of if there are any differences between what negotiators from Sweden and the US respectively, usually do in order to succeed with the negotiation, the two respondents have different opinions. Experience is that a negotiator from Sweden is generally better prepared than a negotiator from the US. But some says that suppliers are changed much more often in the US and this is done in order to achieve the purpose of lowering the prices, or making a point that the supplier should not take anything for granted. Comparing how Swedes and Americans communicate in a negotiation, the respondents have somewhat different opinions further, he says that Americans are seldom willing to make compromises to the same extent as Swedes are. The Managing Director of sales on the US market at Minelco says that Americans speak louder and more than Swedes. He also says that this can be perceived as being hostile by people from Sweden. According to Vora (2001), a culture that uses a lot of non-verbal language has a language that is high context. Comparing the data in this paragraph with the literature, one may say that the US language is higher context than the language of the Swedes. Comparing how Swedes and Americans use non-verbal language/body language in a negotiation situation, the respondent at SSAB Tunnplt says that negotiators from the US evidently show when they are not content/pleased, and they are willing to call off negotiations if no progress is made. The respondent at Minelco has somewhat different opinions. He says that body language is individual. He also says that compared to Swedes, Americans train more often in sales or in negotiating skills. Vora (2001) writes about the complexity of a language and if a language is high or low context. She says that if the language of a culture is high context it is indirect and uses a lot of non-verbal language. Due to the discussion above, it is not possible to decide how complex the American and the Swedish languages are. When it comes to the matter concerning personal space, the data from the respondents is in conformity with each other. The opinion of how much personal space and physical contact/touching negotiators from the US and Sweden respectively prefer. Americans tend to be more open and easy going than Swedes and that individuality is encouraged in the American culture. According to the literature moving too close to a person can in many formal cultures produce extreme discomfort. Time are valued differently in different parts of the world. Some think of time as something that can be divided into many parts and should be monitored closely, whereas others view it something that is more relative. Comparing how Swedes and Americans perceive the issue of time in a negotiation, the two respondents have different perceptions. His perception is that both Swedes and Americans put a high value on punctuality. The perception is that Americans are more easy going than Swedes. However, this analysis may indicate that both American and Swedish negotiators have a monochromic value of time, It says that in some cultures, written agreements are insisted on as they are thought of as superior to oral ones, whereas in other cultures people feel offended if a written agreement is insisted on as they feel it is a sign of a lack of trust between the parties. The respondents we have interviewed have experienced diverse cultural differences between
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negotiators from Sweden and from the US. One cultural when negotiating with Swedes and Americans respectively is that in Sweden, a hand shake is a guarantee, but in the US one should get everything documented on paper. This shows that Americans tend to use written agreements more than Swedes do. The negotiators from Sweden and the US that he has experienced when negotiating with Swedes and Americans respectively is that Swedes are looking for consensus while an American is looking for a good deal, which means that everyones opinion is taken into consideration and the decision is one that everyone supports. When it comes to the matter concerning personal space, the data from the respondents is in conformity with each on the US market at having opinion of how much personal space and physical contact/touching negotiators from the US and Sweden respectively prefer. Americans tend to be more open and easy going than Swedes and that individuality is encouraged in the American culture. According to the literature by Sebenius (2002), moving too close to a person can in many formal cultures produce extreme discomfort. The analysis in this paragraph shows that negotiators from Sweden may be more interested in making decisions in consensus compared to American negotiators. When the respondents are asked if there is anything that characterizes negotiators from the US, negotiators are very price conscious and that price is very important in the US compared to Europe where quality and certainty of delivery are considered more important. The businessmen are in opinion that Americans generally have a stronger attitude but that they not necessarily are better prepared. He also thinks that US negotiators are more willing to negotiate and quick to come to a deal. If the negotiators completely lack foreign experience, they may have large difficulties understanding the logic, intent and ethical standpoints of the other side. The respondents gave a couple of advises for negotiators from Sweden in order to avoid problems when negotiating with people from the US. Their advises are; be open and relaxed, read about the other company before the visit in order to try to have something positive to convey, be well prepared, know what you want, avoid the subjects of politics and religion, and listen and ask many questions.

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Case Study:
You have probably heard the phrase, "it loses something in the translation". Sometimes the translation carries an entirely different meaning. Before a company goes global, they need to make sure they have a great translator that understands word and how they are interpreted cognitively in the other country. Delivering the right message to the right audience is paramount in todays fragmented marketing world, where brands compete for consumers share of wallet against both global and local competitors. One critical element of this is to ensure that all elements of the marketing mix product features, brand name, communications message, packaging, etc. are sensitive to the cultural environment in which they are competing for business. Cultural blunders can damage not only a companys sales, but also its broader image and reputation among consumers, so brand owners have to be very careful when they expand beyond the comfort zone of their own country, language or culture. Serious mistakes do occur and have significant negative impacts of their companys business, sometimes leading not just too lost sales and wasted costs, but to the need to completely withdraw the affected product, brand or communications, and in one reported case even to company bankruptcy! However, one positive side effect of such blunders is that they do make amusing reading for the rest of us, so here a few examples, starting with linguistic blunders, which have been reported over the years. Many of these examples relate to brand names, which have proved to be disastrously inappropriate (often straying into obscenities) in some of the languages of the countries where the products were launched. The cereal "Bran Buds", made by Kellogg's, was introduced to Sweden and soon underwent a name change. "Bran Buds" in translation is about the same as "burned farmer".

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Conclusions
The aim of this study was to gain a better understanding of how cultural differences affect business negotiations between Swedish and American businessmen. In this I have found relevant details that have improved our understanding of this topic. Below, I also present the conclusions connected to the two research questions. The conclusions are based on the analysis I have made on the literature and the empirical data. Some of the findings presented may be applicable on more than only one of the research questions.

How can the influence of culture on business negotiations between businessmen from Sweden and the US be described?
Below, are the conclusions and findings connected to research question one are presented: The findings show that Americans may have a more strategic conception of the negotiation process while Swedes may have a more synergistic conception of this process. Negotiators from the US tend to forward decisions to a higher organisational level compared to negotiators from Sweden. Businessmen from the US lean more towards a substantive view than a relational view when they negotiate, since suppliers are changed much more often in the US compared to Sweden. The difference in behavior between negotiators from Sweden and the US is mainly not depending on the personal aspirations of the negotiators, but rather on the respective companys aspirations which in turn may be attributed to the culture in the country. US negotiators are seldom willing to make compromises to the same extent as Swedish negotiators are. With reference to this investigation, businessmen from the US have a more informal than formal approach to protocol when they negotiate with Swedish businessmen. In negotiations between businessmen from the US and Sweden respectively, it seems as if emotional argumentation is used more by businessmen from the US than by their Swedish counterparts. Businessmen from the US may use body language more than Swedish businessmen do, and this could be an indication of that people from the US have a language that is higher context than the language of the Swedes.

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 Negotiators from the US are more straightforward than negotiators from Sweden in their verbal communication, and the communication of US and Swedish businessmen differs in the sense that businessmen from the US speak louder and more than the Swedes. The findings suggest that Swedish businessmen may have a more affective base of trust in negotiations than businessmen from the US have. Written agreements are thought of as superior to oral ones in the US. In Sweden, on the other hand, oral agreements seem to be widely accepted and deals are often sealed with a hand shake. The findings indicate that a cultural difference between negotiators from Sweden and the US is that Swedish negotiators use oral agreements to a much greater extent than their American counterparts. Our findings show that negotiators from Sweden and the US have similarities in their ways to reach agreements and communicate in negotiations, and that both the Swedish and the US culture have a monochromic orientation to time. The fact that negotiators from the US tend to forward the decisions to a higher organizational level is an indication of that the decision-making systems are more authoritative in the US compared to what they are in Sweden. Finally, to conclude the discussion regarding the influence of culture on business negotiations between businessmen from Sweden and the US, our findings show that culture has a low impact on negotiations between businessmen from Sweden and from US, and that the cultural differences between Americans themselves are often larger than the cultural differences between Swedes and the general perception of an American are. Actually, some of the differences between negotiators from Sweden and the US might have more to do with the individuals personal characteristics than with the culture they come from.

How can the cultural problems facing Swedish businessmen when negotiating with businessmen from the US be described?
The conclusions and findings connected to research question two are presented: Culture is one of the most challenging elements of the international marketplace and problems in cross-cultural negotiations can derive from two sources: The professionalism of the negotiating team, and cross-cultural bias. The cultural problems in negotiations between businessmen from different countries, described in the literature, are not thoroughly in conformity with our own findings. problems connected to cross-cultural business The findings show that negotiators from the US do not learn foreign languages well enough to be able to handle negotiations in these languages and therefore conduct all negotiations with business people from Sweden in English. This means that Swedish
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negotiators always have to be well prepared to negotiate in the English language when doing business with people from the US. Finally, to avoid possible problems when negotiating with people from the US, Swedes should not discuss politics or other certain subjects. Swedes should neither express their opinions of how the US carries out its foreign policy. The findings also show that to avoid problems in negotiations, Swedish businessmen should be well prepared, know what they want, and listen and ask many questions when they negotiate in the US.

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References:
Francesco, A.M. & Gold, B.A.(1998). International Organizational Behavior: text readings, cases, and skills Adler, N.J. (1986). International Dimensions of Organizational Behavior Antypas, M. (2003). Tips for Doing Business In Sweden. On line. Available at: http://www.stratevative.com Doing Business Abroad. On line. Available at: http://www.compuserve.com http://www.scb.se/statistik/ha0201/ha0201tab3eng.asp http://spectrum.troyst.edu/~vorism/hofstede.html Tayeb, M. 1998. The Management of a Multicultural Workforce, England: John Wiley & Sons. http://www.articlesbase.com/marketing-articles/top-20-global-marketingcommunications-mistakes-1234051.html Ellis, P. 2000. Social Ties and Foreign Market Entry, Journal of International Business Studies, 31(3): 443-469 Rodgers, I. 1998. Making cultural differences work for you, Industrial & Commercial Training, 18(3):15. http://www.andritz.com/ANONIDZ62DE7DBC6EC72624/about-us.html https://www.cia.gov/library/publications/the-world-factbook/geos/br.html https://www.cia.gov/library/publications/the-world-factbook/geos/ci.html# https://www.cia.gov/library/publications/the-world-factbook/print/uy.html http://www.geert-hofstede.com/hofstede_dimensions.php?culture1=86&culture2=96 http://www.uppsatser.se/uppsatsguiden/ord/29/ 2008. http://www.uppsatser.se/uppsatsguiden/ord/ http://en.wikipedia.org/wiki/USA/Sweden Research Thesis of Vaxjo University : Effects of cultural differences in international business and price negotiations Research Thesis of Sodertorn University : International Business Negotiations Research Thesis of Halmstad School of Business and Engineering: Barriers of Cross Cultural Negotiations in Multi National Firms. Usunier, J. and Lee, J. A. (2005). Marketing across cultures (fourth edition). Pearson Education Ltd., Edinburg Gate Harlow. Adler, N. J. and Graham, J. G. (1989). Cross-Cultural Interaction: The International Comparison Fallacy? . Journal of International Business Studies

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