The question for international negotiators is shifting from "How much do you want China?" to "How much does China want you?" Organizations that don’t have a good answer may find themselves in a very weak bargaining position. The China-MNC romance is starting to look like a desperate tale of unrequited devotion. (Just in case you’re wondering, the MNCs are that desperate guy insisting how great it’s going to be.)
Google is just the latest high-profile suitor to have its hopes dashed – but at least it didn’t compromise its ethics or vision so badly that it can’t live to fight another day. Google made its share of blunders, but there is still a lot that the rest of us can learn from its pain. Here are five take-aways:
Google gets to fight another day internationally, and will probably maintain respectable numbers on its dot-com site within China. The fact that Google analyzed its BATNA – Best Alternative To No Agreement – and had other businesses to fall back on meant that it could keep its head and negotiate with China as an equal. Had Google caved in early, its gains in China would have been marginal, but its ability to operate around the world would have been severely compromised. If you bet everything on your China presence then you are undercutting your position at the bargaining table.
2) You can’t always get what you want
Westerners and international Chinese have a bad tendency to conjure up a kinder, gentler China that just isn’t really there. Many of us have been guilty of this, and now it’s starting to show up on the bottom lines. If your business plan requires China, Inc. to change policies, attitudes or market characteristics then you are probably going to fail. When Google said it would stop censorship it was actually announcing its intention to leave, since it was obvious that China would not give up any ground on that particular negotiating point.
3) Sometimes "no" has to mean "no."
Chinese negotiators can be masters of the "wear down" – alternating between promises and threats to keep you at the table so long that sheer exhaustion turns the tide against you. Good negotiators know that you have to develop an internal timetable and bottom line – and stick to them. Ignore the promises, the 1.3 billion customer fantasy math and the bleating of the herd – and be ready to walk away when your own deadlines expire. Once a Chinese counter-party gets you to shift from "no" to "probably not," you have lost everything.
4) Don’t sacrifice your own core values for empty promises.
Compromising a company policy or methodology for huge profits is one thing – jettisoning your basic vision for a vague promise of possible profits at some undetermined later date is quite another. For a lot of MNC managers, this means that you have to do your most serious negotiating within your own company. Someone sold your board of directors on China as the new El Dorado, and now the organization wants you to deliver. You can’t negotiate with your Chinese counter-parties and your own HQ at the same time. Get it right with your own organization first, and then be ready to walk away if you can’t hit your minimum requirements. I’ve seen many companies give up their key values, business models and intellectual property only to end up with nothing.
5) Walk away slowly and leave the door open to come back later.
Remember – the censorship issue was probably a face-saving cover for hacking and security issues. China is doing much the same – treating Google’s exit as a purely business decision. Don’t be too surprised if Google maintains some kind of presence in China and eventually returns with an online product. That’s still possible because the Google people haven’t burned any bridges – so far.