The Influence of Power and Individualism-Collectivism on Negotiation Initiation

Abstract

Negotiation is an essential business process, with the initiation of a negotiation likely to affect how the process unfolds. Despite the fact that opportunities are often lost when one or more parties fail to initiate, initiation has until recently been overlooked in negotiation process models and research. This paper reports findings from a study that examines the effects situational/contextual factors and culture have on the initiation process (engaging a prospective counterpart, making a request, and optimizing that request), focusing specifically on relative bargaining power (a situational factor) and individualism-collectivism. Higher bargaining power was found to increase the likelihood of initiation intentionality in general as well as the requesting and optimizing phases more specifically. In addition, individualism/collectivism was also found to affect initiation, with individualists more likely than collectivists to initiate a negotiation. Further, this effect was enhanced when individualists had high relative bargaining power. The theoretical and practical implications of these findings are discussed, with suggestions for future research.