Business Culture India

Business Culture India

Author: ​​Amrita Gandikota, Manager Indo-German Chamber of Commerce

Today, as businesses are getting highly international, one can hardly avoid cross-cultural business collaborations, pushing us to be more global and functioning with intercultural competence. In a recent survey from the Economist Intelligence Unit, 90% of executives from 68 countries cite ‘cross-cultural management’ as their top challenge in working across borders. With India and Germany being at the brink of sharing competencies and forming synergies, it becomes exceedingly important to have a concise cross-cultural business understanding.

The key objective of this article is to give a deep insight intended to improve the performance and effectiveness when counterparts of two highly diverse Indo – German cultures come together to do business. The article Emphasizes to “Compare, Understand and Empathize” with inter-cultural behaviour by creating awareness of diverse patterns in business value systems

It helps, understand how to predict and prevent conflicts and how to overcome these conflicts by building intercultural competencies.

Indo-German Cultural Exchange

Some of the key factors that would be discussed which majorly affect Indo-German business relations

Hierarchy at Work

As many Asian countries, India is a country where one can see hierarchy being displayed both in its day to day cultural attributes and in organizational cultures as well. Hierarchy is displayed in something as simple as the form of addressing to decision making in teams. Being called, “Sir” or “Madam” is very common depending upon how senior you are in the organization, your levels of qualification or also if you are just merely older. When engaging with Indian teams one might often see a sense of hesitance in providing direct feedback to superiors or even among fellow team members. This could be slightly hindering when working with German teams where direct communication and transparency in feedback is expected to an effective communication. It could on occasion be misunderstood that individual opinions of Indians are not shared due to a lack of ownership of work or lack of knowledge, so it is suggested to be as precise as possible in both verbal and written communications. From the Germans’ perspective, it is encouraged to be able to perceive certain non-verbal and indirect communication cues to understand the given context.

 

The sense of Time – Punctuality

The German sense of time and punctuality is a well-known fact. Keeping deadlines, arriving to meetings on time is considered as the most important pre-requisite for doing business. This is not to be misunderstood that Germany are never late but the attribute of “Time is money” is strongly believed. In India the sense of following time is more relaxed. This is one of the most conflict causing situations. For the Indians going to Germany, it is important to set your meeting very well in advance of upto 3-6 months. In India it is relatively easier to secure last minute appointments or register for events quite late. An extra reminder before the deadline often works to spend up the processes. Also due to many infrastructural short comings in India, there may be certain unexpected delays. It is very much advised to intimate this delay or the problem spontaneously.

 

The Idea of Perfection

The ability to strive for perfection from a German perspective is imbibed as a continuous process of improvement and optimizing processes and systems. In India, perfection is often seen as a unattainable phenomenon. For an average German, to deliver the promise, is seen more of a moral responsibility and anything less is considered a breach of trust. A strict adherence to order and structure is seen. Among Indians, rules are interpreted to suit the situation at hand. There is much more focus laid on the effort put into the work rather than the outcome itself. The effort is always appreciated even if the outcome is not upto the set expectations. It is also suggested to be satisfied with the outcome generated and to make the best of it. For the German counterparts it is therefore suggested that it is highly important to understand how the objectives have been perceived and have a consistent follow-up. For the Indians it is recommended to discuss the objectives and deliverables as precisely as possible without any points left for interpretations.

 

Communication

The Germans in general are very direct and have a very low context in their communication styles. Indians on the other hand are influenced by factors such as hierarchy, relationships, public settings in terms of delivering how they exactly feel or think often giving rise to an indirect form of communication with a high context hidden in the statements.

 

Art of Feedback

Feedback is something that is perceived to improve effectiveness when communicated right. But the approached these two cultures have are once again on the far ends of the pole. From the German perspective, it is recommended to soften the directness of the statement and articulate in a polite form highlighting the fact that the feedback is of no personal bearing and only a positive criticism on the work at hand. When working with your Indian counterparts it is nice to acknowledge and appreciate the process of the work. Indian counterparts need to realise that it is best to communicate as precisely as possible and it is perfectly alright to say, “No” when a task cannot be done. It becomes a bigger conflict when a task is accepted as an obligation and is not fulfilled.

 

Art of Apology

When interacting with a collective society such as India, an apology is more effective if it is formulated to acknowledge direct and indirect inconvenience caused not only to your customer but also indirectly to his wider group.

“We apologise for the inconvenience to you and your associates”. A verbal show of empathy.

Customers from Individualistic cultures – (such as the US and Germany) need upfront reassurance that refunds and other kinds of financial compensation can be quickly and easily implemented when they have a complaint. Due to high uncertainty avoidance, the mechanism should be clearly and visibly communicated from the start of business relations. Descriptions of process are helpful but it is important not to over-engineer them and give long excuses. While apologizing to your German colleague, interaction should be sympathetic along with explicit apologies. Western consumers are also more likely to accept causal explanations for the service failure. Non-Western consumers prioritize speedy resolution of the problem and secondly a genuine apology from a manager (rather than a front line customer service rep).

 

Uncertainity Avoidance

The German fear of the unknown is widely known. The stringency laid on structures and processes stem from this attribute. One can commonly see Germans plan unforeseen situations trying to control and predict the future to a maximum extent. Any sudden changes without prior due diligence are unwelcome. On a sharp contrary India is a country where accepting uncertainties and dealing with the same are a second nature to many. The practice of “Jugaad” (an innovative short-term fix) is quite popular and are often life saving hacks. This stark difference does have an affect on ones social and business lives. Eventhough Jugaad is seen quite commonly in India, it is not highly respected in a German environment where quality and sustainability take the fore-front. It is important for Indian businesses to invest in proper R&D and come up with long-term quality solutions. At the same time, from the German side when doing business in India, it becomes very challenging and unfruitful to formulate a structure for everything. An openness and understand towards rustic frugal solutions must also be present to truly collaborate or improve.

Long-term Orientation

One may now be able to deduce that Germany is a country which has long term goals. It is seen that deep diving and planning is the key and orientation is always towards quality but not speed. In India the tables turn where the society and organizations steer towards achieving best possible results in a shorter engagement. It is very common for Indian employees to shift jobs every two years. With this short-term orientation in India, people are very adept in accepting new changes to survive. Whereas in Germany there is a long term outlook, in terms of hiring employees in companies, achieving competencies in their existing business line before diversification to new areas, their R&D processes and product cycles etc. It is important to be patient with the German bureaucratic processes since they are quite time consuming.  Take time for planning and developing a structure for execution is crucial. It is recommended for the Germans to be open to quicker decision making and be flexible while being prepared for ad-hoc and last-minute changes.

Negotiation Styles and Decision Making

The oft seen German way of negotiation is to begin with a clear agenda and adhering to it. Small talk is usually kept to a minimum limited to politely enquiring how your counterparts are or a comment about the weather. To seek the best possible outcome with your German stakeholders, a quantitative research-based approach is appreciated thereby more prominence is given to facts than feeling based arguments. First the research is done and only then the negotiations begin. It is of high weightage to discuss all the points in a direct manner without any hesitance clearing all the doubts with transparency at the meeting itself. Promises should not be made if unsure. Negotiations are also carried out in a very stoic manner without use of any flowery language or large emotional display. Post negotiations or meetings it is expected to send minutes of the meeting or a summary. Even-though it is a top-down decision making, Germans seek consensus before approving a decision. The process is relatively longer but once the decision is made, it is hard to change.

While negotiating with your Indian counter-parts do invest in relation-ship building. There is a sense of “people invest in people” so take time to indulge in some small talk before getting into business. Arguments are qualitative where feelings, emotions and experiential knowledge are given more prominence. Mutually beneficial proposals or win-win arguments are easy to promote.  One might easily notice that the style of negotiating is in-direct and actual opinions are communicated in a very high context manner. The decision making is highly top-down with the bosses making decisions for their teams. Since the decision making capacity is high up, there is a tendency of by-passing links to get work done faster. There is flexibility even after the final decision is made and the action steps are formulated on an ad-hoc manner.

 

Summary

German Working Methods to Avoid Conflict
– Direct and meta-communication
– Honest & transparent analysis of problems
– Build trust slowly but consistently
– Value criticism and feedback
– Pro-contra discussions; pro-activeness
– Respect order and structure
– Commit only if delivery is possible
– Duty to deliver and task orientation
– Have long term goals with strong research
– Strive for a mutually beneficial outcome

 

Indian Working Methods to Avoid Conflict
– Understanding the high context communicative style
– Re-affirming the summaries
– Value traditions and religious beliefs
– Consistent follow-ups
– Accept flexibility in terms of order and structure
– Empathetic communication of negative feedback
– Open mind toward frugal innovations
– Focus more on the end result than the process itself
– Invest time in building relationships
– Create a comfortable and reciprocating environment