Section 1 A framework for international business negotiations
Ghauri (2003a, p.9) offers a framework for the process of international business negotiations, which helps us to have a deep understanding of the complication and structure of international business negotiations. The framework introduces the effects of cultural and other contextual factors on the international negotiation process, and it also makes links between various factors. It involves background factors, atmosphere, strategic factors, cultural factors and negotiation process.
According to the vast literature on negotiation, negotiation process can be divided into three major stages: pre-negotiation, negotiation and post-negotiation stages. A stage of the process of negotiations means a specific part of the process and involves all actions and communications by either party pertaining to negotiations made during that part.
The three stages of the negotiation process can be further subdivided into five phases, namely, preparation, opening, formal information exchange, contract conclusion, and contract execution phases. The three stages and the five phases are shown as follows:
Table 2.1 Subdivisions of the process of international business negotiations
Three major stages | Five subdivided phases |
Pre-negotiation | Preparation |
Negotiation | Opening |
Formal information exchange | |
Post-negotiation | Concession and agreement |
Agreement execution |