Know Your Partner
Doing business in the BRICS nations? Then you must understand the importance of cultural norms.
The BRICS countries offer vast opportunities for doing business, but dealing with the BRICS nations requires knowledge and understanding of specific business and cultural practices. It is critical to recognize how cultural norms, values, and beliefs impact how business is done; failing to appreciate these differences may lead to costly errors and mistakes.
It is important to recognize that cultures are dynamic and may change gradually or rapidly. If one looks at an initial greeting between a Western and Chinese businessperson 50 years ago, there may have been some confusion about whether to bow or shake hands. Today, it is quite common to observe a simultaneous handshake and a slight bow.
There are numerous aspects of culture that influence the success or failure of business relationships. This article focuses on four important topics: 1) Task versus relationship orientation; 2) Direct versus indirect communication styles; 3) Perceptions of time and space; and 4) Matters of etiquette.
Understanding and appreciating different cultural norms before actually engaging with that culture will have tremendous value. One can navigate with greater comfort and confidence, and members of the other culture will appreciate your efforts.
Task versus Relationship Orientation
There is a clear distinction across cultures regarding how one approaches doing business. The two main styles involve an emphasis on completing the task, or on developing a relationship and then focusing on accomplishing the goal. A majority of businesses in Western countries favor task orientation – negotiating the contract and signing the agreement – while businesses in many other regions prefer to first build a relationship. When the latter technique is preferred, pushing a decision without developing a relationship will typically result in a failed agreement.
The BRICS nations favor relationship-building to varying degrees. Russians are typically interested in getting to know their business counterparts, but also want to make efficient progress toward completing a business arrangement. Brazilians and South Africans devote more time to developing relationships with potential business partners before entering into actual negotiations or discussions. Brazilians will often foster relationships over meals. India and China highly value relationship development, predicated upon tremendous respect for elders and hierarchy. It is important to identify who is the actual decision-maker in Indian and Chinese businesses. The Chinese term ‘guanxi’ refers to relationships and suggests the necessity of building a sense of trust.
Direct versus Indirect
Communication styles vary significantly around the world. Western cultures generally communicate in a direct and explicit manner. Context is not as important because the meaning is easy to identify and understand. In many other cultures, the meaning appears in the context and delivery.
There is a direct correlation between direct and indirect communication styles with the task versus relationship orientation. Looking at the BRICS nations, Russia would be the most direct and China the most indirect, with Brazil, South Africa, and India falling respectively in between. An important observation in cross-cultural communication is that representatives from the BRICS countries can understand the direct style of Western communicators, but Westerners will often face challenges fully grasping the indirect communications of other cultures.
Perceptions of Time and Space
Time is viewed differently around the world and affects how and when business gets done. Western cultures see time as a commodity. Things are scheduled to be done at particular times and business activities are highly organized. Change often happens quickly.
India and China, in contrast, see time as a process. Time is not so easily scheduled, but what is important is that the activity gets done. People are more open and flexible with time. Change is often slow, in part because things are rooted in the past. No matter the culture, one must recognize and appreciate how time factors into the daily routine of business and decision-making.
Personal space is distinct across cultures and can occasionally lead to embarrassing missteps. In many Western cultures, people prefer a space of three to four feet between them when they are engaged in a conversation. Brazilians and South Africans often display their friendliness by standing much closer to one another and may pat the other person on the back or shoulder during the discussion.
One can generally ascertain the normal degree of personal space in a specific culture by observing how members of that culture greet one another. Westerners will often extend their arms and shake hands and, after concluding the handshake, will remain at the distance created by the handshake. People in other cultures may embrace, kiss, or otherwise engage in a greeting that draws them into closer proximity and they will remain closer together during the conversation.
Business Etiquette Matters
What may seem like simple matters of etiquette can deeply influence whether or not a business relationship blossoms. In China, business cards are presented with two hands, and one should offer their business card the same way in return. Take time to look at the card and do not write on it. When visiting China, it is preferable to have business cards printed in one’s native language on one side and in Mandarin on the other. It is also a normal practice in China to recognize hierarchies and show respect at all times. During meetings and negotiations, allow your Chinese counterparts to save face, and take care not to criticize them in the presence of others. There is a similar business etiquette in India. The exchange of business cards is typically done with both hands, and showing respect to elders is the norm.
Building relationships is crucial in China, India, and Brazil. Expect that initial meetings with Brazilian businesspeople will frequently center around a meal and that the discussion will focus on personal information. Actual business will be discussed after the meal.
If one is invited to a person’s home for dinner in South Africa, it is typical to take a gift for the host or hostess. This can be South African wine or chocolates. Gift giving also occurs in China, but it is useful to check on the appropriateness of the gift as well as the color of wrapping paper and other items. A Western financial services company that was negotiating to work with a Chinese company thought that clocks would be a tasteful gift for their Chinese counterparts; fortunately, a local representative was able to let them know that the pronunciation of ‘clock’ in Chinese sounds almost identical to the pronunciation of ‘the end’ or ‘death’ and that clocks are generally considered inappropriate as gifts. The Western company successfully made a substitution.
In Russia, it is also important to appreciate hierarchy and to make certain one is doing business with the appropriate person in the organization. If one does receive an invitation to another person’s home, it is proper to bring a small gift.
Cultural Norms Bring Opportunities and Challenges
Globalization brings exciting opportunities to experience different cultural norms and practices and, at the same time, provides challenges for the businessperson experiencing a new culture for the first time. Communication styles, emphasis on accomplishing the task or developing a relationship, perceptions of time and personal space, matters of etiquette, and various nonverbal cues and behaviors are all important to consider before visiting another culture, and careful and reflective observation will provide insights into cultural norms when one is actually in another country.