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Dealing with the Emerging BRIC Economies

 CROSSED CULTURES

Did you give your Russian colleagues the thumbs up after that impressive presentation? Yeah, well, you might as well have told them to "%@$#-$@#!"

Let's face it, it's really easy to mess things up when you're doing business in another country. No matter how impressive your credentials or high your social status, wear a yellow and green tie to your business meeting in Brazil, use red ink to write a thank you note in China, or give the thumbs up to the captain of Russian industry (the equivalent of the middle finger in the United States), and you might as well pack your bags and book your ticket home. Everything from what you wear to the gifts you give carry a cultural nuance.

Think of Former President George H. W. Bush when he handed Chinese Premier Li Peng a pair of cowboy boots, embellished with the American and Chinese flags. A great gesture of Asian/American goodwill, wouldn't you say? Actually, no. Since the sole of the foot is considered the dirtiest, basest part of the body, Bush couldn't have given a more flagrant"”albeit unintentional"”slap in the face.

Even in the current economic climate, cultural knowledge is extremely relevant. "Cultural IQ has never been more important, since the volume of international business is increasing and companies can't afford to make mistakes. Mistakes can ruin careers," says Sheida Hodge, president of management consulting firm HIA.

GMAC Global Relocation Services' recently released 2008 Global Relocation Trends Survey reveals that, of the 154 companies interviewed across various industries, an overwhelming 95 percent plan to increase the number of employees they send on international assignment, or, at the very least, to keep numbers at 2007 levels. This is due in part to the opportunities presented by fast-developing economies, particularly Brazil, Russia, India and China"”collectively known as BRIC.

And while you know that Brazil is hot, Russia is cold, India brews great tea and China makes great dim sum, do you really know anything about the management styles and negotiation intricacies involved in doing business with these cultures?

"Too often we find that companies are coming to us when things start to break down, rather than taking steps to minimize the chances of a mishap in the first place," says Diana Rowland, a cross-cultural trainer, consultant and author, and president of Rowland & Associates, Inc., a cross-cultural consulting firm. "The American market is fairly forgiving, but in much of the rest of the world, damaged relationships and market faux pas are not easily repaired. When crossing cultures, an ounce of prevention can be worth 1,000 pounds of cure."

B is for Brazil

Brazilians are a passionate, expressive, tactile people. Body language is exuberant, handshakes are heartfelt and eye contact is strong. Brazilians are also extremely sociable. Meetings and business dinners tend to be informal, starting and ending with a lot of small talk (soccer, the family, etc.), intended to build the basis of a long and trusting relationship. If you"ve prepared an agenda, don't bother bringing it.

That bond-building aspect of business carries over to team-building as well. The cohesiveness of the group depends on the strength of the relationships forged"”and strong relationships take time. Each team member will want to know his or her precise role, otherwise there's the danger of encroaching on someone else's turf.

At the same time, the chain of command in Brazilian business is extremely hierarchical, with key decisions being made at the most senior levels of the company. Personal relationships"”and therefore internal politics"”are extremely important and may impact the unofficial chain of command. Remember, too, that what you say carries much more weight than what you write. When you send a written proposal, contract or other document, you should follow it up with a phone call or personal visit. Don't rely on email, IM, text or any other technology to do the job for you.

R is for Russia

The same is true of Russia, where people tend to trust what they hear over what they read"”not that surprising when you put contemporary Russia in the context of old Russia, where mistrust of state authority and its bureaucracies ran rampant. Relationshipbuilding, business entertaining and face-to-face meetings are therefore a must. But there's a significant challenge to this in a culture often stereotyped as at once dour, volatile and corrupt.

Generally speaking, the country follows a centralized system of business management, where a strong central leader carries the responsibility for strategic decision-making, with little consultation with others, save, perhaps, a small group of trusted advisors. Given this, negotiate with individuals as close to the top of the chain of command as possible. If you do go straight to the top, you"ll find decisions are made swiftly. Deal with middle management, though, and you're on the road to nowhere.

"Always start at the highest authority level and remember that people in BRIC countries would like to work with people at the same levels," says Hodge. "Sometimes you might reach out to someone at the higher level in your company to pave the way before you take action."

Micro-management is the rule in Russia. Teams are not asked to take initiative, but rather to efficiently carry out explicit directions. It follows that meetings are extremely formal, and generally for information-sharing purposes only. By the time you get to a team meeting, the likelihood is that the big decisions have already been made. Think carefully about this"”without access to "behind-thescenes" discussions, you're unlikely to have any impact on the decision-making process.

What's more, don't be surprised if you don't see a lot of document-sharing, conversational give-and-take or expressive body language during your meetings. Responses are not given impulsively. Patience is considered a great virtue in Russian culture. And yours might well be tested. Final offers most likely are not final offers at all"”just as long as you have the patience to hold out for the lucrative deal you"ve been after. And while your lack of punctuality would be considered extremely rude, your patience in dealing with your Russian colleagues' lateness will be proof of your worth.

Unlike the other countries covered in the BRIC group, Russia focuses more on short-term gains than on long-term ones. This is a culture that grabs opportunity by the horns, and your Russian colleagues will want to know the short-term benefits of their collaboration with you.

I is for India

A fascinating aspect of Indian culture is the caste system, where class is determined by heredity and strictly adhered to. Where the American Dream tells you that you can change your social position if you just work hard enough, the caste system tells you that your lot in life is predestined and unshakable.

Not surprisingly, this system permeates business structures as well, and tells a familiar BRIC story: Companies are extremely hierarchical, and the boss"”of which there is clearly one"”is unequivocally the boss. Explicit orders are issued, never questioned, and carried out to the letter via the cut-and-dry chain of command. The team leader takes responsibility"”in its entirely"”for the team's successes and failures. If anything does go wrong, he is expected to handle the situation personally.

A great advantage of doing business in India is that English is one of the nation's 15 official languages, and it's rare to find a business person who doesn't speak English excellently. This is fortunate given that, "For business people to learn a BRIC language is a waste of time. To become fluent to the point of making a difference will take years. These days, people don't have the time, and a little knowledge could be dangerous," says Hodge.

"On the other hand," Rowland adds, "learning to speak "˜international English" is imperative. This means leaving idioms and colloquialisms at home. I know someone who spent 6 months on a difficult negotiation in Asia. At one point he responded to his counterpart's comment with, "˜That's a no-brainer" meaning to convey that the suggestion was acceptable without needing thought. This, however, was the final straw in their dealings when the man sitting across the table from him thought it was an assessment of his intelligence."

Note also that saying "no" in India (as well as in China) is considered an insult. Unless you get an unequivocal "yes" (not "yes, possibly" or "yes, if all goes well"), the answer most likely is "no."

"Americans have been conditioned from childhood to ask questions when they don't understand and to tell it like it is," Rowland explains. "But in the Chinese and Indian cultures, respecting hierarchy and saving face are guiding values, so people are reluctant to tell superiors or clients that they don't understand or that something won't work. The problem only becomes apparent when deadlines are missed, the product has flaws, or other predicaments come up that spell business trouble."

C is for China

Guanxi"”the concept of forging influential, personalized networks"”is the crux of Chinese society, a place where diplomacy and accord are favored over bluntness and debate, and where respect"”for elders, influencers and leaders"”is synonymous with honor.

Naturally, then, the code of conduct for business meetings is extremely formal. For example, business cards are always exchanged on first meetings and treated reverentially"”hold the card in both hands and study it closely. Whatever you do, don't glance at it, jot down a few notes on the back of it and then shove it in your pocket. Handshakes are light and lingering (a bow or nod may be used instead), eyes are lowered as a mark of respect, and body language is restrained"”and definitely non-tactile.

"Americans like to slip into a casual informality," Rowland explains. "But in these hierarchical countries, formality and respect for status are essential. And it's hard to overstate the irreparable damage that can be done by causing someone to lose face by criticizing them in front of others or exposing their weakness."

"People in China and India don't express emotions as readily as they do in Brazil and Russia," says Hodge. "Being group-oriented in these countries relates most to the level of importance of a person, and then to task."

Even when it comes to business entertaining, formality reigns"”seating arrangements are linked to perceptions of hierarchy and social position, and gift giving takes on ritual status.

There's a fine line to tread here. Gifts should be thoughtful but not extravagant, and given in the spirit of friendship rather than business, since they otherwise may be misconstrued as a bribe. It's wise to give the gift to the company, rather than singling out a specific person. Always wrap the gift and expect it to be refused three times (in order to not appear greedy) before being graciously accepted. Even then, the gift will be unwrapped in private. If you are receiving a gift, follow the same protocol.

Unlike Russia, with its short-term take on business opportunities, China, as a culture, believes strongly in the merits of longevity. Incorporate long-term objectives into your proposal and you"ll be upping your chances of a successful deal. Don't expect any quick decisions though. Business meetings tend to take place in series, during which relationships are forged and trust is built.

While Brazil, Russia, India and China are very much in the limelight these days, cultural knowledge is a must for anyone whose work carries them into international waters"”wherever those waters may be.

CULTURAL FAUX PAS

BRAZIL: Avoid wearing yellow and green"”the country's national colors"”or purple and black"”the colors used in Holy Week processions. And don't assume that it's fine to speak Spanish"”Brazil's national language is Portuguese. Never start into business discussions before your host does. And the A-OK hand gesture is absolutely not A-OK"”in fact, it's an obscenity.

RUSSIA: Never be late for an appointment"”and don't express aggravation if your host is late. Patience is a virtue"”no really, it is. Don't stand with your hands in your pockets, or take your jacket off during negotiations. But do take your gloves off before shaking hands. Never show the soles of your shoes"”the basest part of the body"”and don't speak or laugh loudly in public"” you"ll be considered rude. Oh, and that A-OK thing about Brazil? It applies to Russia as well.

INDIA: Don't stand with your hands on your hips (an aggressive gesture) or beckon someone with the "dog call" (palm raised, wagging finger), which is considered an insult. Whistling is a definite no-no, as well. Also, don't wear all-white or all-black, which are considered unlucky, perhaps because they're often worn by widows. As an example of the intricacies of culture in business negotiations, note that saying "thank you" to your host at the end of a meal is considered a form of payment and therefore an insult.

CHINA: Don't ever point with your index finger; use an open palm instead. Always address your colleagues by title, not by first name. Do not eat or drink before your host does"”and always taste all the dishes you are offered. Do not discuss business during a meal, and whatever you do, don't stick your chopsticks straight up in your bowl"”it's considered bad luck.

 
OBJECTS OF IRE

When gift-giving in China, it's best to wrap your gift in plain red paper, the color of luck. Avoid blue, black or white, which are funerary colors. If giving a group of one object, avoid the number four or any multiple of four, which is symbolic of death. Six, eight and nine are considered lucky numbers. What's more, don't give any of the following objects:


GREEN HATS: Symbols of cuckoldry.

CLOCKS: Symbols of mortality"”tantamount to a death wish.

HANDKERCHIEFS Associated with funerals.

SHARP OBJECTS: Symbolic of severed ties.

RED INK: Symbolic of severed ties.

FOOTWEAR An insult (extends to anything associated with the sole of the foot).


by Judy Giannetto, Insight Magazine

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