The differences within the two cultures can be analyzed using the five dimensions of

culture found by Geert Hofstede. These are power distance, uncertainty avoidance,
individualism versus collectivism, and masculinity, long vs. short term orientation and
Indulgence vs. restraint. The majority of authors who wrote about business negotiation tried to
analyze and to test theses dimensions to understand the relationship between them and
business negotiation.
       Power Distance: Japan has a higher power distance when compared with the united
state according to Hofetede’s cultural dimension. Equality, a horizontal relationship, is strongly
valued in the United States but it is less important in Japan (Graham and Sano 1985). Therefore
it seems that when conducting a business negotiation with a Japanese, the first thing to do is to
find out their position. In order to indentify who has the higher social status and where could
they fit within the people involved in the negotiation. In high power distance societies like
Japan, people occupying senior positions are more likely to use their position power in
negotiating.
      Individualism versus collectivism: individualism represents the extant to which a
country emphasizes the role of individuals rather than the collective contribution of the group.
In individualistic societies people feel little need for dependency on each other such as the
united state as it shows high rating in individualism unlike Japan which has very low rating of
individualism and they are considered more dependent on group contribution rather than that
of the individual (Cellich and Jain 2004). However Americans can be more self-centred and
individual goals are mostly emphasized.
        People from individualistic cultures tend to make just a little different between in-group
and out-group communication. They prefer clarity in their conversations to communicate more
effectively and come in general directly to the point .In business they try to improve their
connections and to gain more value out of them, not for establishing a good relationship but
just to be involved in a calculative way .
       Whereas in collectivism culture like most Asian country people focus on the harmony
and loyalty within a company. Also In such cultures direct confrontation is always avoided as
such expressions or phrases are used to describe a disagreement or negative statement, saying
no would destroys the harmony of the group (Hofstede 1994). From this dimension the
negotiation can be different between Japan and united state where the negotiator should
determine whether the culture of the party emphasize the individual or the group.
Some authors found that Hofetede’s cultural dimensions are based on predictions as they
influence on the negotiation process. Tinsley and Brett (1997) argued that hofested’s cultural
dimensions lack predictive power and cannot be used to predict negotiation behaviour in
isolation of negotiation variables related to process.
            Hall (1959) identified the concepts of high-context and low-context to categorize
differences in communication styles. High context culture refers to the amount of information
that is given in communication. In low context culture that include Anglo American countries,
people tend to use direct language unlike high context culture that include Asian countries like
Japan people use indirect language. That difference between high context culture and low
context culture also can influence in business negotiation. For example, the word "no" is a
response that the Japanese tend to avoid altogether. As strange as it may seem, if they are not
optimistic about a given proposal, rather than tell you in so many words, they may choose to
make a counter inquiry, they may avoid eye contact with you, or they may simply choose to
walk away. Their answer is for all practical purposes spelled out in their behavior. Obviously,
this can be very frustrating to American negotiators who are used to a straight forward "yes" or
"no." Understanding and accepting cultural differences is critical if one expects to be successful
in an overseas assignment."

We should first realize that there is no such thing as a universal form of communication.
Take the simple gesture of a smile. It is not unusual for Americans to exchange smiles with
complete strangers. We smile at people on the street, at the airport, in restaurants, shopping
malls and so on. We consider it a friendly gesture. However, in other cultures a smile can take
on a completely different meaning. A smile can be considered insulting or it can signal
embarrassment. Many Americans fail to realize that common gestures such as shrugging one's
shoulders or scratching one's forehead can be completely misinterpreted by someone from
another country. 

When President George Bush went to Japan with Lee Iacocca and other American
business magnates, and directly made explicit and direct demands on Japanese leaders, they
violated Japanese etiquette. To the Japanese (who use high context language) it is considered
rude and a sign of ignorance or desperation to lower oneself to make direct demands. Some
analysts believe it severely damaged the negotiations and confirmed to the Japanese that
Americans are barbarians.

Hofstede has found six dimensions of culture in his study of national work related values.
Replication studies have yielded similar results, pointing to stability of the dimensions across
time. The dimensions are:

 Small vs. large power distance

How much the less powerful members of institutions and organizations expect and
accept that power is distributed unequally. In cultures with small power distance
 (e.g.Australia, Austria, Denmark, Ireland, Israel, New Zealand), people expect and accept
power relations that are more consultative or democratic. People relate to one another
more as equals regardless of formal positions. Subordinates are more comfortable with
and demand the right to contribute to and critique the decisions of those in power. In
cultures with large power distance (e.g. Malaysia), the less powerful accept power
relations that are autocratic or paternalistic. Subordinates acknowledge the power of
others based on their formal, hierarchical positions. Thus, Small vs. Large Power
Distance does not measure or attempt to measure a culture's objective, "real" power
distribution, but rather the way people perceive power differences.
 Individualism vs. collectivism

How much members of the culture define themselves apart from their group
memberships. In individualist cultures, people are expected to develop and display their
individual personalities and to choose their own affiliations. In collectivist cultures,
people are defined and act mostly as a member of a long-term group, such as the family,
a religious group, an age cohort, a town, or a profession, among others. This dimension
was found to move towards the individualist end of the spectrum with increasing
national wealth.
 Masculinity vs. femininity

The value placed on traditionally male or female values (as understood in most Western
cultures). In so-called "masculine" cultures, people (whether male or female) value
competitiveness, assertiveness, ambition, and the accumulation of wealth and material
possessions. In so-called "feminine" cultures, people (again whether male or female)
value relationships and quality of life. This dimension is often renamed by users of
Hofstede's work, e.g. to Quantity of Life vs. Quality of Life. Another reading of the same
dimension holds that in "masculine" cultures, the differences between gender roles are
more dramatic and less fluid than in "feminine" cultures. However, these role
characteristics are strongly dependent on other dimensions as well.
 Weak vs. strong uncertainty avoidance

The extent to which members of a society are anxious about the unknown, and as a
consequence, attempt to cope with anxiety by minimizing uncertainty. In cultures with
strong uncertainty avoidance, people prefer explicit rules (e.g. about religion and food)
and formally structured activities, and employees tend to remain longer with their
present employer. In cultures with weak uncertainty avoidance, people prefer implicit
 or flexible rules or guidelines and informal activities. Employees tend to change
employers more frequently.
Michael Harris Bond and his collaborators subsequently found a fifth dimension which was
initially called Confucian dynamism. Hofstede later incorporated this into his framework as:

 Long vs. short term orientation

A society's "time horizon," or the importance attached to the future versus the past and
present. In long-term oriented societies, people value actions and attitudes that affect
the future: persistence/perseverance, thrift, and shame. In short-term oriented
societies, people value actions and attitudes that are affected by the past or the present:
normative statements, immediate stability, protecting one's own face, respect for
tradition, and reciprocation of greetings, favors, and gifts.
 Indulgence vs. restraint

The extent to which a society allows relatively free gratification of basic and natural
human desires related to enjoying life and having fun. Restraint stands for a society that
suppresses gratification of those needs and regulates it using social norms.