Why do westerners sweat so much over plans and deals? It’s all about “culture”

Why do westerners fret so much over contracts and project plans? Why do they become angry and agitated if things have to change? And why do their relationships end when the other side has a different view of planning? Why do westerners and Asians struggle to understand each other?

The answer can be found in one word – culture.

In writing about cultural differences, I do not mean to give offence, criticise, imply one is better or create division – my aim is understanding.

For Asia and the west, culture can be “make or break” in business, yet most of us are not even aware that the way we think is largely determined by our culture. This lack of awareness is poor preparation for global business and trade, where knowing culture is king.

With Asia, culture becomes complicated for westerners and many give up on it.

With India, cultural understanding becomes even more complicated, because it is a land of many cultures, different ways of seeing the world and is rich in diversity. For me, this is one of the great attractions of India. It is also why I go to Asia a lot. But for others it can become a deal breaker.

So, how can we bring an understanding of cultural differences to our business and trade negotiations between westerners and Asia? How can we find acceptance and understanding even when there is difference?

That answer can be found in two words – understanding culture.

Why contracts and project plans end in disputes

Most westerners place a high importance on rules, laws, regulations and contracts. They are almost “set in stone” and apply without exception. Most importantly, rules come before relationships – even if it is a family member. Variations to agreement cause confusion and even anger.

In Asia and especially in India, there are all the rules and contracts and so on, but the common view is that each circumstance and each relationship is different, so the rule may or may not apply. It becomes a moment by moment thing. Variations to agreements are taken for granted and fully expected to happen.

How does this work in business? For many westerners, any change to a contract becomes a time to consult the lawyers and can be a relationship ending event. For Asians, change is expected and accepted.

Why western individualism hits the collective wall

Even children are encouraged to make their own decisions in the west – including on courses, careers and most definitely on choice of partner. Under individualism, you make your choices and must take care of yourself – and in some countries this is harshly applied, in others there is a more compassionate welfare safety net.

Most Asian families make decisions for their children, including courses, careers and partners. The view is that the group – the family and so on – is more important than the individual. In return, the group looks after any member at time of need.

How does this work in business? An American is ready to sign the deal now – but the Asian partner wants time to talk to colleagues and ensure a group decision. Pressure versus group consultation.

Why westerners misunderstand indirect communication

In the west people can work together without having a good relationship and direct communication is highly valued. In fact, any indirect communication – going around the bush – creates mistrust in the other or is simply missed by the westerner. They just want the facts – a simple “yes” or “no” will do.

In Asia there is an overlap between work and personal life and they choose indirect communication because their major concern is to keep the relationship. Being direct such as saying “no” is difficult.

How does this work in business? People in the west keep work and personal lives separate so are less likely to socialise with Asian colleagues – or any colleagues – after work.

Why some hide face, while others save it

Most westerners make a big effort to hide emotions – this varies of course. They see “reason” as more important than “feelings”, so they often keep thoughts to themselves.

In Asia, spontaneous emotional responses can break out and this often surprises westerners. Saving face can become the most important thing.

How does this work in business? An Asian colleague will give or expect some emotional outbursts but is also looking for the following harmony.

Why becoming someone clashes with born something

Westerners value people by what they do or what they have achieved. Performance is king, no matter who you are.

Asian culture generally values people for who they are, so power, title and respect matter greatly, but of course the person should behave according to this status.

How does this work in business? Westerners will often “high five” with everyone including junior colleagues and everyone gets in to share the celebration, while in Asia the leader might receive most of the credit.

Why order dominates the western mind

“Order’ is highly prized in the west. That means doing things on schedule, being punctual, sticking to your plans and a “time is money” view of most things. They react badly to any disturbance to the smooth schedule.

“Time” is viewed differently across Asia, with the past, present and future seen as interwoven and so plans and commitments are more flexible.

How does this work in business? This different view of schedules and time causes relationship breakdowns and can see the end of the deal.

Why westerners feel in control of everything, including climate change

“Control” is big in the west – to the extent they see people as controlling nature or the environment, down to how they work with teams and with the organisation. Conflict is fine so long as the job gets done.

Asian cultures see nature and the environment more as controlling them – events, circumstances are in control more than the team. Conflict is avoided even at the expense of timely delivery.

How does this work in business? Westerners will need to give more reassurance and feedback to their Asian teams and setting clear objectives becomes paramount for both sides.

Adapting

These cultural differences can have big impacts, but with learning and adaptability, both sides can find they quickly work well, understand more and feel better about how things are going. Cultural understanding provides quick and positive results. Cultural ignorance can be the deal breaker.

India’s Reliance second to Apple in “FutureBrand Index”

Who said India could not produce strong brands?

Billionaire Mukesh Ambani’s oil-to-telecom conglomerate Reliance Industries has been ranked second biggest brand after Apple on the FutureBrand Index 2020.

“This year’s highest entrant at number two, Reliance Industries excels on every attribute,” FutureBrand said, releasing its 2020 Index.

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“One of the most profitable companies in India, Reliance is, very well respected and is seen as behaving ethically as well as being associated with growth, innovative products and great customer service. People have a strong emotional connection with the organisation,” it added.

FutureBrand, a global brand transformation company, said part of Reliance’s success could be attributed to Mukesh Ambani’s recasting of the firm as a one-stop-shop for Indians.

“The chairman built on the existing petrochemicals business, transforming it into a digital behemoth designed to meet every customer need. Today, this company is engaged in several sectors including energy, petrochemicals, textiles, natural resources, retail, and telecommunications. Now that Google and Facebook are taking equity stakes in the firm, we may see Reliance jostling for the top spot in the next Index,” it said.

Britain’s invasion of India, the power of the Muslim rulers and Ayodhya

Indian PM Modi’s emotion in Ayodhya, “British” rule and the power of the Mughals – how can we understand what is happening today?

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To understand modern India and even PM Modi, I feel we need to turn to Swami Vivekananda – who said:

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We talk about the British conquering India and this defines today, but as William Dalrymple writes in The Anarchy, the seizing of power in India was done by a private company – probably the first outsourced act of violence in history.

That company was the East India Company and as Dalrymple writes: “The Company’s conquest of India almost certainly remains the supreme act of corporate violence in world history.” Worth reading that line again!

It is hard to know and even relate to how my Indian friends feel about the two major invasions of their country in recent centuries – first, the Mughal empire and then this East India Company.

Which brings me to Ayodhya.

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Indian Prime Minister Narendra Modi sprinkled sacred water and flowers into a small hole on Wednesday, part of a ritual marking the start of construction of a grand Hindu temple in the city of Ayodhya.

With emotion Modi said: “Today centuries of waiting are over.” For many of my Indian friends, this was a shared emotion.

Western media persists with the line that all this is “Hindu nationalism”. I am not so sure.

It will be up to Indians – and not to people like me or the media – to define what is happening under PM Modi and what the national motivation is. Most change is painful at first but in lifting people out of poverty and restoring confidence, he has brought great optimism to India.

Now India faces another struggle – Covid 19 – which makes arguments about history seem like something of an indulgence.

From our hearts to yours, we wish India success in this life and death battle against the virus.

With Covid19 we are seeing the vast and deep truth of that classic Indian saying Vasudhaiva Kutumbakam – meaning “the world is one family”.

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India attracting investment during the pandemic and USA is the largest trading partner for a second year

Since March, India has received over $20 billion of new investment from Western companies despite the pandemic.

Thanks to John Bell, Client Relations, Amritt, Inc, Malibu California for this information.

Here are  four examples of significant improvement in bilateral trade between the two countries (India and USA) during the pandemic:

Dozens of large and small organizations depend on Amritt as their trusted advisor to succeed in India, whether selling, sourcing or leveraging talent.

You can Email John Bell at johnb@amritt.com

 

Start your India journey with Chennai – and start your India outsourcing with Sundaram

Tamil Nadu has the second-largest economy in India and by area is the fourth largest state of India. The capital is Chennai and over 60% of the state is urbanised.

Chennai is one of my personal favourites – doing business there is good and there is plenty of tourism and activity to keep life interesting.

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One of the leading firms is the Sundaram Finance group, led by Managing Director TT Srinivasaraghavan. The firm has a code of ethics and behaviour which it calls “The Sundaram Way” – an inspiring document worth looking up.

Within the Sundaram group is an outsourcing and business consulting arm, Sundaram Business Services (SBS).

SBS is strong in Australia and provides services to many leading brands, including a major superannuation outsourcing practice.

SBS is led here by Harish Rao who pioneered Australia’s superannuation outsourcing to India (pictured below, Harish Rao has won several awards in Australia).

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As a southern India state, it is highly courteous, very friendly, conservative in approach to business and a good starting place to find a trusted business partner.

Tamil Nadu has a diversified manufacturing sector and features among the leaders in several industries like automobiles and auto components, engineering, pharmaceuticals, garments, textile products, leather products, chemicals, plastics, etc.

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It has a well-developed infrastructure with an excellent road and rail network, three major ports, 15 minor ports, and seven airports across the state providing excellent connectivity.

As of February 2020, the state had 54 formally approved Special Economic Zone (SEZs), 50 notified SEZs and four with in- principle approval SEZs and has total 40 exporting SEZs.

For most of you, Chennai and the state of Tamil Nadu make a good starting point on your India journey.

7 ways to succeed in wonderful India

This short list can be your guide to success in wonderful India:

  1. Bring a culturally aware and adaptable mind to India – you will need both. By “culturally aware” I mean more than how to greet and exchange cards. Cultural awareness is understanding how the other thinks and requires some study and effort.
  2. Develop some flexible plans for India – they will need to change!
  3. Commit to India for the long term. One or two years is not enough. I have been going to India since around 2005 and still learning new things and making new connections – to find a way through the maze that is India.
  4. Make social media a part of your program to build your brand and product awareness in India – the shift to social media/digital marketing there is huge.IndiaDigitalEco
  5. Adapt planning and approaches for the need of your business and sector. You might need a quick market study – or you might need studies over several years. Each is different.
  6. Learn as much as you can about your potential market – connect with your potential customers and see how they operate and what is happening in their sector.
  7. Let the market build a relationship with you and learn about your business. Again, like all the other points, this takes time.

CONCLUSION

It is going to take time to succeed in India. But for one of the biggest most dynamic markets with the youngest population on the planet, investing your time will pay off.

Why get closer to India? About 600 million people, more than half India’s population, are under 25 years old; no country has more young people. Remember the economic impact of the western “baby boom”? It is time the west moved closer to India in trade, culture and tourism. What do you think? As the great Indian philosopher Rabindranath Tagore said: “You can’t cross the sea merely by standing and staring at the water.”

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Culture eats deals and even foreign policy for breakfast!

I write a lot about the vital role “culture” plays in doing business – especially in the context of the west and India. When things go wrong, generally the source is culture. Culture outlasts the deal and it is bigger than the contract.

The point about culture was researched at the University of Melbourne in 2013 by Dr Kadira Pethiyagoda in a doctoral thesis “The influence of dominant cultural values on India’s foreign policy.”

If you were wondering how India could simultaneously be friendly with the USA and Iran, culture has the answer.

The thesis identified four Indian cultural values that have survived the course of history – non-violence, hierarchy, pluralism and tolerance.

These cultural values have a significant influence on India’s foreign policy overall.

The most powerful value is non-violence.

The research found several non-violence driven preferences: global peace; caution in the use of force; and the preference for maintaining a non-violent image.

Hierarchy is found to be more influential in India’s nuclear posture than in its approach to humanitarian intervention. This value drives a preference for India rising up the global hierarchy of states.

Pluralism and tolerance strongly impact India’s approach to humanitarian intervention. These values support a pluralistic and tolerant worldview, the preference for sovereignty, and the preference for caution in condemning the internal actions of other states.

The author has a book out titled “Indian Foreign Policy and Cultural Values” which makes a major contribution to our understanding.

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7 ways Australia could build relations with India to balance China

While it is true that India is not just another China, there is a good risk management case for improving Australia’s trade and diplomatic relations with India.

To give energy to this relationship, Australia should take eight urgent steps:

(Keep in mind most of this relates to “post-Covid” but some could action now)

First, we should be flat out campaigning to get more Indian tourists down under. They now have the money, and a campaign for tourism would also communicate our culture to the broader Indian public. Let’s get Australia on the billboards, on the cable TV and in the cinemas in India.

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Second, encourage Bollywood to make more films down under and help them show the diversity of the Australian population and culture.

Third, reinforce our intellectual property and leadership in the twin areas of high demand over there – health and education.

Fourth, take more initiatives to exchange knowledge and services in the waste management and waste disposal fields – we are pretty good in this, with some of the cleanest cities in the world, and India is worried that rubbish is taking over their country.

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Fifth, create ways we can work closer on sustainable energy.

Sixth, make sure Indians are aware of our global leadership in fields such as wealth management, a growing need over there. The best way to do this would be to increase our investment into India.

Seventh, provide cultural training to Australians in all fields who are to visit India, so that our blundering around (which we often see as down to earth and friendly) does not continue to cause offence or confusion among our hosts.

Can you trade with India without leaving home?

As Covid19 has made us all (Australia, UK, USA, Canada etc) more cautious, we are reluctant to travel.

Add to that a leap in Indian online e-commerce for all kinds of products and services.

Is the future of trade with India digital? Do relationships matter any more?

We have always said that the key to long term success with India is in the careful and gradual development of close working relationships. This has to be done face to face, but these days can be supported via phone and video calls.

Deakin University is the prime example of success through perseverance and relationship building – they have had a presence in India for over 25 years.

Ravneet Pawha has led Deakin in India for most of that time and she is now the Deputy Vice President – Global and CEO – South Asia. She knows everybody in decision making on education in India. Ravneet is a regular promoter of Australia and our education at conferences and in Indian media.

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The Australian citrus industry is taking a closer look at India but their CEO has told members it could take five years to build a market.

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So relationship still matters in dealing with India.

For our diplomacy, we need closer relationships at Indian central and state government levels.

For education, we need to follow the lead of Deakin University and be on the ground over there, building collaborative relationships.

And for products and services, while online is becoming the way of the future, products and services will only become trusted and valued as people have a relationship with your brand.

Australian PM Morrison has been gradually building a closer relationship with India PM Modi and this is producing some progress on agreements and cooperation.

Relationship – it is the way forward with India.

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10 essential tips for doing business with India

Doing business with India? Here are some tips that might help your experience, but keep in mind you will find many variations and contradictions of these points in the very diverse and exciting India market:

The language barrier is real – even English

India has some 26 major languages, but your Indian counterpart will almost certainly speak English, which itself can be a problem – it creates the illusion of communication and understanding. Many of us speak English and think western – your Indian partner speaks English and thinks Indian, so take care to build real understanding. Also keep in mind there are “many Indias” with many different languages and ways of thinking.

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You are in a different culture

Visitors to most of Asia and China are visually reminded all day that they are in a vastly different culture. But often, especially in offices, India can appear quite westernised and individuals also give that impression. Better to open your mind and see things and people more clearly, looking beyond the surface level “westernisation” – exploring cultural differences expands your horizons and you will find many charming similarities.

Be patient and you will get there faster

Adopt a patient long term view – India is a 5 to 10 year game. It is very easy to get MOU’s (Memorandum of Understanding) signed with fanfare in India but too many do not produce any outcome. One way to improve our cultural dexterity would be to take a long-term view and apply lots of patience.

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Businesses should not start out on market entry unless they are prepared to commit at least five years to making it work. Governments need the same longer-term perspective. Rushed trade missions, political announcements and photo opportunities amount to very little – we see them as an achievement, but they are just a beginning.

Relationships take time – but they are everything

India is a collective culture which means relationships are the number one factor in success, and building relationships takes time. Many who see India as not a short-term transaction opportunity can find success, but not for long as someone with a better price comes along. A better strategy is to aim for longer success through a focus on building relationships. The first trade meeting in India can be exciting and positive, but from the India side this is just seen as an introduction and they will wait to see if the relationship grows. Trust and relationship take time.

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“Yes” can mean “maybe” or “no”

See beyond the politeness: Indians are among the most courteous and generous hosts on the planet. On top of this, their culture demands that they never provide an outright rejection or “no” statement, even when this is clearly the only answer. The dumbest question for a business to ask in India is “can you help me with market entry for my products?” The answer will always be “yes” and you will sit idle for a long time back home until you realise this is not the right question. Within Indian culture built so solidly on relationship above all else, the word “no” is a real relationship breaker and is rarely or never used. “Yes” can in fact mean “maybe” or even “no” and you need to look for the signs. Like most of Asia, Indians are indirect communicators.

Prepare for the collective

Most westerners come from a culture of the individual, but the Indians they meet are firmly placed in a collective culture.  A visitor to an Indian company will often find four or five Indians in the meeting, and often it is not clear who is in charge. Many Indian leaders will not speak up or even speak at all in these meetings – in the collective someone else does the talking while they do the evaluating.

It will be slow and fast

Modern India can be slow or fast and it is hard to know which you will encounter. Sometimes delivery seems to take forever, yet on other occasions it is faster than the west. This means to succeed there you need incredible patience, so don’t send your least patient executive to India. Being able to respond positively under both slow and fast delivery is the key.

The visitor can be shocked and unprepared for the speed of modern India. Businesses need to go prepared to deliver on a product or service right now, not just having some idea for a future opportunity. Trade missions from around the world arrive weekly, so they have plenty of choice. Fast and slow, east and west – India is a living and dynamic paradox.

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India is many countries in one

Differences are not just seen in the North, South, East and West, India is truly many countries in one and you need to be ready for cultural diversity. While Mumbai is the fast and flashy financial capital, it is also a tough place because everything is done on grand scale and at great speed. New Delhi is more formal and stuffy, also more liveable, and is more than a political capital – it is a powerful business city. Chennai is one of my favourites, embracing that slower southern pace and the values that shine in southern businesses. Regions have varying strengths, so research is the key. Recent moves to allocate Smart Cities across India can provide insights into alternative gateways for you.

Navigate through the spider web

While the west strives for simplicity and certainty, Indian business leaders know that life is like trying to find your way through a spider web – where does it begin, where does it lead, who can tell? Consistent with this view, most Indian corporations offer an incredibly diverse range of products and services – whereas western business tends to focus on just one area. In most cases Indian companies are willing to buy from you but are also looking for the deal to include some intellectual property sharing arrangements – think about these before you head over there.

Learn the art of flexibility and patience

Being patient and flexible is an asset, even if you come from a country that likes to be blunt, direct and structured. Most Indian communication is indirect, so it can take some time to work out what the real issues are. India is full of surprises and you cope best through being flexible. Dropping any “one rule for all” approach is a good start.

If you are thinking of going, India’s great thinker Rabindranath Tagore can be your inspiration: “You can’t cross the sea merely by standing and staring at the water.”

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