Newsletter

Negotiating with the Japanese
Part II

At the request of many of our readers, we have included additional remarks on doing business with the Japanese in this issue of THE SUCCESSFUL NEGOTIATOR. The remarks are taken from a book by John Graham and Yoshihiro Sano* -- a book we feel is well worth reading in its entirety. According to Graham and Sano, there are seven specific aspects of the negotiation situation which should be arranged prior to beginning the negotiation.

• Location - If possible, negotiate "on your own turf" or in a neutral location, such as Hawaii. If you must travel to another location or to Japan itself suggest holding meetings at your hotel or in a location other than their office.
• Physical Arrangements - If you travel to Japan the Japanese will make all arrangements for you and you can be certain that everything will be quite formal. If the Japanese travel to your location, make certain that their standards of formality characterize all the arrangements you make for them.
• Planning - For the Japanese, the roots of a negotiation session are laid among team members before the negotiation begins (nemawashi). What happens at the negotiation table is a ritual approval of what has been decided before, by numerous meetings and discussions. Americans, on the other hand, tend to discuss and make decisions among themselves at the negotiation table. It is helpful to realize these differences during planning.
• Number of Participants - When negotiating with the Japanese, don't do it alone. It is wise to have several people with you.
• Audiences - Although they may not actually be seated at the table, don't minimize the importance of the other factions (audiences) who have a vested interest in the outcome of the negotiation. They might be other companies, governmental agencies, the public, etc. As Graham and Sano write, "You should anticipate that Japanese clients ... may manipulate audiences for their advantage ... You should also be aware of audience reactions that may help you and should know how to elicit such reactions, when appropriate."
• Channels of Communication - Personal contact is imperative if your goal is to both establish and maintain solid relationships with Japanese partners or clients. Letters, fax transmissions, and telephone conversations are devoid of the personal presence the Japanese require.
• Time Limits - The Japanese will not rush into anything--least of all, serious business decisions. Time can work against you unless you allow for their extended time parameters in your planning, scheduling, and deadlines.

*Smart Bargaining, Doing Business with the Japanese by John L. Graham and Yoshihiro Sano (New York: Harper Business, 1989).

Conclusion

Forget that American expression "time is money." It will only cause you to rush and make mistakes. Patience is imperative with the Japanese.

Concessions - A Handy Guide

• KNOW THE VALUE OF EACH CONCESSION - Know what it is worth to you and the other party.
• MAKE EACH CONCESSION IMPORTANT - the other party should believe that your concessions are difficult for you.
• BUILD UP TO MAKING A CONCESSION - A concession given quickly without ritual, has less importance.
• NEVER MAKE TWO IN A ROW - If you do then you only negotiate against yourself.
• KEEP TRACK - Note your concessions and keep track of them.
• CONSERVE - Use your concessions only when you have to. Leave some to help close the deal.