Social capital and the dynamics
of business negotiations
between the northern
Europeans and the Chinese
Rajesh Kumar
The Aarhus School of Business, Aarhus, Denmark
Verner Worm
Copenhagen Business School, Frederiksberg, Denmark
Keywords Negotiating, China, Interaction, National cultures, International business
Abstract The paper assesses the impact of social capital on the dynamics of Sino-northern
European business negotiations. It is argued that, while conflicting negotiation styles create
interactional difficulties between the Chinese and the northern Europeans, the impact of the
interactional difficulties on the processes and outcomes of negotiations is critically dependent on
the pre-existing level of social capital among the negotiators. Social capital has three major
components, namely cognitive, relational, and structural. The cognitive dimension highlights the
level of shared understanding among the actors; the relational dimension focuses on the affective
bonding among the actors; while the structural dimension highlights the nature of
interconnectedness among the actors. This is an exploratory study conducted through in-depth
interviews with 24 northern Europeans and 15 Chinese managers, who have been negotiating
with each other for several years. We highlight the linkages between the different dimensions of
social capital and negotiation processes and outcomes, and conclude with implications for research
and practice.
Introduction
Negotiation scholars have begun to highlight the importance of national culture
in shaping negotiation processes and outcomes (Brett, 2001; Brodt and Tinsley,
1998; Gelfand and Dyer, 2000). A major theme in this literature is that
negotiation styles vary across cultures (Adair et al., 2001; Cohen, 1997; Graham
and Sano, 1984; Worm, 1997). It has been proposed that differences in
negotiation styles manifest themselves as differences in negotiation scripts
across cultures (Kumar, 1999a, b; Tinsley, 1999). A negotiation script defines
the nature of expectations associated with the negotiation process and these
expectations, it is argued, are culturally variable. It has been further
maintained that there are three kinds of negotiation scripts, namely:
(1) a behavioral script;
(2) an interpretational script; and
(3) a conflict management script (Kumar, 1999a, b).
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IMR
20,3
262
Received March 2002
Revised September 2002
Accepted December 2002
International Marketing Review
Vol. 20 No. 3, 2003
pp. 262-285
q MCB UP Limited
0265-1335
DOI 10.1108/02651330310477594