Do Cultural Values Affect Negotiation Styles in Pakistan: The Mediatory Role of Cultural Intelligence

Abstract

Culture assumes a significant job in deciding the way to deal with business matters, method of managing and gatherings with subordinates and associates, and different business correspondences and choices. Successful cross-cultural negotiation requires a good understanding of the differences in cultural values and Behaviors. The purpose of this study is to identify the association between the values that influence culture, different Negotiation styles, and the Cultural Intelligence in Pakistani Environment. For this, we apply Caputo et. al. (2019) framework on Pakistani employees. We hypothesize that cultural values such as Power Distance (PO), Uncertainty Avoidance (UN), Collectivism (CO), Long-Term Orientation (LTO), and Masculinity (MA), significantly affect the mode of negotiations i.e. Competitive (CN) or Cooperative (CON). Competitive negotiation styles involve the use of distributive or combative tactics, such as threats, false promises, misrepresentation of positions, bluffing, selective disclosure, and sometimes deception to force concessions from the other parties or the cooperative negotiation style that involves the use of tactics to increase cooperation and information exchange with the other party. Moreover, this relationship is mediated through Cultural Intelligence (CQ). CQ construct consisted of four elements: (i) metacognitive CQ (MCCI), (ii) cognitive CQ (CCI), (iii) motivational CQ (MCI) , and (iv) behavioral CQ (BCI). First, metacognitive CQ describes an individual's conscious awareness of the cultural interactions and, within such situations, the ability to identify their own and other people's thoughts and to strategize. Second, cognitive CQ reflects an individual's knowledge of a cultural group's values, beliefs, and norms. Motivational CQ, reflects an individual's interest, drive, directed energy, and willingness to learn about cultural differences. Finally, behavioral CQ is an individual's ability to choose the appropriate verbal and physical actions and thereby, to effectively accomplish her goals when interacting with people from different cultures. Empirical validity was established by conducting a survey using a close-ended questionnaire. Data were collected from 200 employees working in the educational, banking, and telecommunication sector, and analyzed using confirmatory factor analysis and structured equation modeling. The results indicate that Long-Term Orientation (LTO) has a significant and positive effect on most of the CQ dimensions i.e. BCI, MCCI, MCI, whereas Masculinity seems to have a negative and significant effect on all CQ dimensions. Power distance also seems to affect BCI and MCI negatively while Uncertainty Avoidance affected CCI positively. Surprisingly, Collectivism didn’t seem to be affecting any CQ. Moreover, All dimensions of CQ seems to affect Cooperative NS (CON) significantly, whereas Competitive (CN) was positively and significantly influenced by CCI and MCCI. Hence, investigating and evaluating the cultural values of an organization in consolidation with cultural intelligence and negotiation styles may lead to the practice of dealings.