Dan Poston from University of Washington Foster School of Business on Strategies and Experiences in International Business Negotiation

My name is Dan Poston. I work for the University of Washington and Foster School of Business at this point, but before I came back and worked with a business school, I spent 15 years as an international business lawyer, conducting numerous negotiations between companies in different countries. I also participated in three different companies operating in Japan and China, so I have experience in this area. In terms of the most successful steps in a negotiation, the most important thing to begin with is to make sure that you know the other people involved in the discussion and the negotiation. You want to understand where they're coming from, know something about their company, the business environment they're working in, and their objectives for this negotiation. Spending time to get to know them is crucial.

You also need to know your own objectives. What are you trying to achieve in the long term? What are acceptable solutions? Enter the negotiation with these ideas, not just one concept, but perhaps several alternative concepts that could all work. I was the lawyer for a Japanese corporation negotiating with a Chinese government corporation to create a joint venture. Their objective was to provide the equipment used for manufacturing down comforters and down-fabric products, while the Chinese corporation would supply the raw materials. It took us five years to build a sufficient relationship with the Chinese government corporation, a crucial step as it was their first international joint venture in a completely different area. Once trust was established, after extensive discussions, it took only about six months to finalize the deal and begin production.

I believe the personal qualities that make a good negotiator include empathy—understanding where the other party is coming from. Also, imagine yourself on the opposite side of the table to anticipate how your proposals will be received. Understanding both sides is essential.

Several factors can cause negotiations to fail. A major problem is if someone is not authentic or misrepresents anything. For instance, a business transaction internationally might propose to deliver a product, but if the delivered product fails to meet the initially impressive samples, it can completely derail the deal. In our case, the initial quality samples were excellent, but later inspections revealed poor quality, which led the other party to abandon the deal.

Differences in culture can create significant challenges. Some cultures find it easy to say no, while others struggle to do so. I have attended several negotiations in China where my American clients were eager to conclude a deal. They did most of the talking, and the Chinese counterparts responded positively but never actually agreed. The Americans assumed the negotiation was successful, but in reality, no deal was made.

I often advise listening first. Many American clients focus on presenting themselves, but it is wiser to start by learning about the other party. Let them explain their strengths and objectives. The longer you listen, the more insights you gain, which are often crucial for successful negotiation.