Negotiating in Europe

When entering a negotiation in Europe, it is important to defer to the local process. Robert Semethy, chief procurement officer at Erste Bank in Vienna, joined me on a recent episode of Negotiations Ninja. He has been working in Europe for years and has gained a lot of insight into the differences between business in the U.S. and Europe, particularly in negotiation.

There is an international style of negotiation that seems to be developing across the world. This style enables us to quickly and easily get up to speed and negotiate with relative ease with counterparties in our western cultures. While the developing international negotiating style is more conventional than a North American style, it is not fail-safe. Robert cautions us against homogenizing all Europeans. Each nation has a long history and cultural traditions that are important at the negotiation table. Romanians tend to be less rigid than other Europeans, adopting more of a Latin attitude to business. Parts of Germany can be opposite, adhering to strict codes of conduct. German coworkers may be a last-name basis for decades and not have any personal relationship. Using first names in negotiating would be jarring to those immersed in that culture.

When in Europe, start negotiations formally, not using first names. Formalities show an appreciation for the existing cultural framework. Using intuition, listening, and observing is important. The other side will guide protocol. If they begin using first names, it is alright to follow suit. It is not wise to make the first move towards informality, as North American businesspeople are stereotyped as being crude at times. There is an allowance for North Americans to misstep, but recognition and practice of preferred negotiation style will be helpful to negotiations.

Not knowing a second language might seem like the biggest setback, but cultural recognition and assimilation are more important. Broadening outlook increases flexibility. To accept the opportunity, flexibility is required. Robert’s advice is to work on viewing the world outside the U.S. through a different lens and learn to acknowledge that the world doesn’t revolve around America. It is completely different and learning to appreciate other lifestyles and outwardly showing that appreciation is part of learning to be flexible.

Vacation is an applicable example. In North America, our lifestyle is “go go go.” Taking vacation is potentially seen as a weakness and a reason to hold back promotions. The self-care that vacation provides is embraced in Europe, and procurement professionals of all levels are encouraged to utilize their days.

Large corporations have offices scattered around the globe, but it is the head office that dictates company culture. The location of the head office is something to be considered when planning business. For Europeans, summer months are a difficult time for important deadlines and meetings because they value vacation. In Europe, 25 vacation days per year is entry-level. A high-level employee could have 30 to 40 days, at least. Being cognizant of that lifestyle and adapting to it establishes better relationships with stakeholders. Understanding the head office culture helps to understand the process.

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