Negotiation Styles: A Comparative Study of Pakistani and Chinese Officials Working in Neelum–Jhelum Hydroelectric Project (NJHEP)

Abstract

The real negotiation world, particularly cross-cultural negotiation, is highly complex and competitive as each party in today’s connected world is fully equipped with cultural intelligence. Therefore, negotiators have to go out of the box to satisfy all parties, that is, create value by expanding the negotiation pie. The purpose of this research study is to identify the preference of Pakistani and Chinese officials, who are working together on Neelum–Jhelum Hydroelectric Project (NJHEP), with respect to endorsement of different negotiation styles, that is, knowing their preferences for ‘value creation’ or ‘value claiming’. It also explores differences (if any) between managers of two nationalities with respect to opting certain negotiating strategies in their pursuit of value creation for their customers and stakeholders. Hence, it answers the core question: Do negotiation styles vary from one nation to other in a multicultural work setting? A sample of 303 managers (Pakistani managers = 153 and Chinese managers = 150) was extracted by using convenient sampling technique. Respondents were surveyed via close-ended questionnaire through emails and in person. Mean analysis was used to identify the dominant negotiation style of each nationality and t-test was applied to test the prevalence of hypothetical differences between Pakistani and Chinese officials concerning their choice of negotiation strategies. Chinese managers dominantly use competing negotiation style while negotiating with their Pakistani counterparts. In their negotiation style preference ranking, competing, collaborating, accommodating, compromising and avoiding style stood at 1st, 2nd, 3rd, 4th and 5th ranks, respectively. It means that, first they attempt to claim maximum value, if they fail to do so, they opt ‘value creation’ as their residual strategy, which requires proactive, conscious and imaginative actions. On the other hand, Pakistani managers excessively use accommodating style while negotiating with their Chinese counterparts. In their preference ranking, accommodating, compromising, collaborating, avoiding and competing style stood 1st, 2nd, 3rd, 4th and 5th, respectively. Here, it appears that Pakistani managers are ‘depleting the value’ by simply forgoing their interests instead of looking for a win–win situation. In fact, they are also creating value in a novel manner for their stakeholders (government and people of Pakistan) by accommodating foreign investors (Chinese), who are making hefty investments in their country. There is a significant difference between the approach of Pakistani and Chinese managers to create value during negotiations. This is the first study which unveils the negotiation style of Pakistani managers, particularly when they are negotiating with foreigners. Similarly, it reveals the negotiating style of the Chinese managers while negotiating with their Pakistani counterparts and on a foreign land. Understanding of negotiation styles of people will add value to all cross-cultural negotiation situations, particularly of those which are developed during implementation of projects under the umbrella of Pak-China Economic Corridor. It highlights the importance of cultural intelligence and sensitivity in multicultural negotiations and demands for managerial training on the subject.