How To Bridge The Cultural Hierarchy Gaps In Your Negotiation

One of the things I love most about negotiations is that you’ll never have the same one twice. The journey is always different, and the outcomes are all unique. A large part of what makes negotiating such an adventure is the impact of culture. Beyond corporate culture driving the specific routines of asks and offers that take place during your discussions, the overarching culture of the individuals involved will make you work hard to understand, and then adapt to the new negotiation terrain.

Over the past year or so, I’ve seen cultural differences when it comes to hierarchy play an ever-larger role in shaping what’s happening at the conference tables. Some cultures have a high hierarchical divide (for example, Japan) and others a very low one (the US or Canada).

With a high hierarchical gap, the more senior the individual is within an organization or society, the greater their importance in the negotiation. Decisions are made (seemingly) unilaterally, and those in more junior positions wouldn’t dream of questioning the decision or even offering unsolicited advice. In the final stages of the negotiations, only the bosses speak – or are even in the room. No deal is done unless the ‘right’ (read: most senior) leaders from both parties are in attendance.

As the gap shrinks, the number of voices involved in the negotiation grows. Companies in low hierarchy gap cultures will be used to open-door policies between employees and management, lively discussions and sharing of opinions amongst all levels of the organization is commonplace, and the voice at the table with the best message tends to be heard, even if that employee isn’t at the top of the food chain. Closing a deal may require sign-off from an executive back at the office, but even a relatively wet behind the ears negotiator can act as the main point of contact in finalizing the contracts.

So how do counterparts – be they vendors, customers, or partners – from cultures at different points of the spectrum negotiate together effectively?

If you’re used to low-hierarchy gaps

1)    If you’re farther down the totem pole and are being kept out of the negotiations with a high-gap counterpart, work hard to prepare your superiors for the negotiation. Maintain ownership and pride in your work as though you were at the table.

2)    Identify the relative positions of your counterpart’s negotiation team as soon as possible, and know to direct informational requests to the juniors or subject-matter experts, and decision-making requests to the senior members. Have patience if all decisions need to get run up the ladder back at head office.

3)    Understand the importance of a senior executive from your negotiation team opening and closing each session of discussions, even if they can’t be in the room the entire time. This sets the right tone, and lets the counterpart know there’s high-level buy-in.

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If you’re used to high-hierarchy gaps

1)    Ahead of the negotiation, work with the more junior members of the team in order to generate strategy, and establish the ‘rules of engagement’ for when in front of your counterpart. Increased participation from all members of the team, regardless of seniority, will help with relationship building and information gathering during discussions.

2)    Figuring out the relative positions of your counterparts’ negotiation team members won’t be straightforward. Look for who seems to have the strongest voice, or who the team defers to – it may not be the most senior person at the table. The key will be that influence > power within their organization.

3)    Consider splitting your negotiation points between those that need senior buy-in, and those that can be closed immediately during negotiations. This will help reduce progress/pace related frustration.

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Are you used to working in a high-gap or low-gap culture when it comes to hierarchy? Have you ever negotiated with a team from the other culture? How have you been able to blend the two to achieve your best results?