The_Essential_Manager_s_Handbook

NEGOTIATING INTERNATIONALLY / 439

POLITICAL RISK

While some countries have long traditions of an abundance of

resources and political stability, others have scarce resources

and are marked by volatile political changes.

IDEOLOGY

In individualistic cultures like the US, the purpose of the business is

to serve the interests of its shareholders, but in collective cultures,

the business has a larger purpose: to contribute to the common

good of society.

CULTURE

Different cultures have starkly different cultural beliefs about the role

of individuals in society, the nature of relationships, and the ways in

which people should communicate. These have a fundamental effect

on how you need to approach a negotiation.

INTERNATIONAL FINANCE

Currencies fluctuate and affect the balance of expenses and profits.

The stability of the currency your investment is made in affects the risk

to you. Many governments also control the flow of currency, limiting the

amount of money that can cross their borders.

BUREAUCRACY

Business practices and government regulations vary from country to

country. In some countries, the government bureaucracy is deeply

embedded in business affairs, and businesses are constantly required

to secure government approval before they act.

POLITICAL AND LEGAL SYSTEMS

Different countries have different tax codes, labor laws, legal

philosophies and enforcement policies, laws that govern joint

ventures, and financial incentives for attracting business

investments.

Factors to consider in international negotiations

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