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International Business – An analysis of cross-cultural difference of Sri Lanka and Japan for Siddhalepa to operate in Japan


International Business – An analysis of cross-cultural difference of Sri Lanka and Japan for Siddhalepa to operate in Japan

Word Count 2837


Executive Summary


Culture and Negotiations

Japan presents a totally different culture

Power Distance



Uncertainty Avoidance

Long-term orientation


Challenges in intercultural negotiations

How to Approach inter- cultural negotiations: Key Recommendations



Additional information


Executive Summary

Culture can be defined as generally accepted behavior and norms displayed by human societies. In a more detailed sense, culture is a combination of different norms, beliefs, values, customs and ways of doing things that shape behavior, attitudes, and decision making of individuals and groups. When it comes to international business, the aforesaid cultural dimensions largely come into play especially in negotiations and striking business deals. Business leaders and negotiators who acknowledge and respect multicultural differences tend to form better business relationships in a highly competitive market setup. Technically, negotiation can be viewed as a form of conflict resolution mechanism through which two different parties try to agree on a mutually beneficial outcome or solution. Siddhalepa being a dominant Ayurveda and wellness brand in Sri Lanka considers to form a joint venture with a Japanese hotel and restaurant chain to open up several Ayurveda spas in Japan. The main purpose of this report is to brief the international marketing team of Siddhalepa regarding the cross- cultural differences that need to be considered during the planned negotiations with the Japanese delegates.
Hofstede’s cultural dimensions has been used to discuss the key cultural differences in Japan. However, the report will facilitate a generic understanding regarding the unique Japanese culture and would not cover the individual and organizational differences. The report will finally provide a set of recommendations for the international marketing team of Siddhalepa to improve their communication and negotiation tactics prior to the foreign assignment. With this briefing paper, the project team is expected to identify the motivations and stereotypes of the other party based on the cultural differences. However, some organizational and individual level factors must be evaluated individually by considering the situational factors whilst using this report as a general guide.


The quality of business negotiations largely influences the business performance and growth. It has become a key parameter of competiveness in the today’s business world. For example, a business which is on the growth trajectory may have to negotiate in a number of occasions both internally and externally to arrive at mutually beneficial solutions. Negotiation can be viewed as a form of conflict resolution mechanism which overcomes differences and creates an acceptable middle ground between different parties. This process can get complicated if the negotiation happens in a multicultural setup where there are significant differences in terms of values, beliefs, norms, personality types, communication styles, etc. Therefore, businesses with ambitious foreign expansion plans tend to explore the science behind this process as it significantly affects the business growth and sustainability (Horst and Colonel, 2012).
Simply, a culture can be defined as how a similar set of people do things (Daniels et al, 2014). There are a number of different scholarly views and definitions for culture in various disciplines such as psychology, sociology, anthropology, etc. Overall, culture refers to the overriding habits, beliefs and values of people that shape the decision making process. People who share similar characteristics such as religion, race, ethnicity and geography can be differentiated as separate cultural groups. National culture can be viewed as a broader way of approaching the concept.
When negotiating with an individual or a group of people, it’s important to study their respective cultures which reflects different norms, values, beliefs and ways of doing things. This will make the negotiation process much easier with less misunderstandings and disturbed relationships (Gelfand et al, 2007). When both parties are well-informed about cultural differences, it’s easy to agree on compromises from both sides. Further, this knowledge will help the involved parties to identify certain signals and ways of behavior from a communication point of view. For example, in majority of the Arabic countries negotiations are often headed by a man. Further, many Arabians do not appreciate if the other party is unnecessarily invading their privacy and private life. Therefore, studying the cultural differences is imperative to a successful negotiation process.
The cultural differences need to be carefully handled in international business too. When expanding to a new country, businesses will have to deal with new cultures and value systems because understanding and respecting cultural norms and values are really important in cross-cultural negotiations. Certain behaviors and practices can be well-accepted in one culture, but the same maybe offensive in another. For example, in Gulf cultures, men do not shake the hands of women. In China number 4 signifies bad luck and patience is treated as a great virtue by Chinese people. Therefore when negotiating people should talk less and listen more. Poor knowledge in above identified factors may negatively affect the negotiation process even before it commences. Hence it can be concluded that, having a good understanding about multicultural differences will provide negotiators a clear edge especially when marketing products internationally.
As part of the Siddhalepa’s global expansion strategy, the company intends to open up several Ayurveda spas in Japan. This paper intends to investigate the link between cross cultural differences and business negotiations with a special reference to the cultural attributes of Japan. Some useful recommendations will be made at the end to overcome the identified cultural barriers that the company anticipate to face in Japan during the course of the foreign assignment.