Alcohol and negotiations (1/2): What impact should you expect?

Is the art of negotiating somehow affected by alcohol being served? In a number of cultures, having a drink during negotiations is relatively common practice. So where might we expect shots, and where is water the norm?

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In Russia, rounds of vodka shots may sometimes be served even during morning meetings. In China, each business relationship usually starts with several celebratory toasts, while in France local wines are often available during business lunches.

With regard to Asia, in Japan and Korea you will be considered rude if you decline a drink from your business partners. But on the opposite side of the spectrum there is Saudi Arabia or Malaysia, where abstinence is required.

Of course, in most drinking cultures it is primarily about taking part in the activity; the actual drinking itself is less important. Therefore, you should participate but you don’t necessarily have to down every drink you are given.

Less alcohol is better

An article published by the INSEAD business school decribes an experience of one of its employees who, many years ago, was working for the Korean Ministry of the Environment. During negotiations with farmers about the quality of water, both sides became engaged in what the Koreans call a ki fight (where ki, also spelt gi or chi, refers to physical or mental energy).

The weapon of choice in this case was soju liquor. In the end, the poor government employee ended up in hospital suffering from liver problems. So if you do opt for drinking during negotiations, obviously there may appear some serious practical problems.

Alcohol and aggression

Alcohol usually leads to slower physical and cognitive functioning, as well as reduced decision-making ability. You should never drink in an attempt to affect negatively your counterpart’s performance. Count also on the fact that alcohol fosters an inclination to use more aggressive tactics.

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Article source INSEAD Knowledge - INSEAD Business School knowledge portal
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Alcohol and negotiations (1/2): What impact should you expect?

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Alcohol and negotiations (2/2): To drink or not to drink