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ABSTRACT
This exploratory study focuses on identifying the key cultural and other contextual influences that affect the process and outcome of commercial negotiations between Pakistanis and Non-Pakistanis. A survey of negotiators was conducted asking for information, based on their experience, about the business negotiation process involving Pakistanis and Non-Pakistanis. Utilizing the studies of Hofstede, and Salacuse, the responses of Pakistani and Non-Pakistani negotiators are analyzed and cultural traits displayed by Pakistani negotiators in international business negotiations are identified.
1. INTRODUCTION
The integration of the global economy over the last two decades has led to the creation of an environment full of opportunities for firms to increase business with the Third World. But in order to take advantage of these opportunities firms have to face certain challenges. Entering a new market like Pakistan means that business managers have to contend with the challenge of doing business in a different, and somewhat unknown, cultural environment. Ghauri (1983) sums up this challenge by stating that Western firms have faced difficulties in negotiating projects and deals with the Third World, owing in part to a lack of understanding of the cultural needs and behavior of these countries.
In order to avoid stereotyping and committing social and other blunders related to differences in culture, managers should take time to understand the culture of the country. According to Cateora and Graham (1999, p.586), Fletcher and Brown (1999, p.84) and Graham (1999, p.76). cultural differences cause four kinds of problems in international business negotiations: at the level of language, nonverbal behaviors (such as eye contact), values and thinking (such as punctuality, use of status and title, self-esteem and face) and decision-making.
With a population of 144 million (2002 estimate), Pakistan is the seventh most populated country in the world (Population Reference Bureau. 2002). Ninety seven percent of Pakistan's population belongs to the Islamic faith, making it the second most populated nation in the Muslim world. As such, religious beliefs heavily influence the national and business culture of Pakistan (Malik. 1999), and can reasonably be expected to influence negotiation behavior. For the majority of Pakistan's existence, the military has ruled the country. Active and retired military personnel manage many of the state owned enterprises (Hashmi, 1983). This professional military culture has...