Business Culture across Countries

Managers, marketers, salespersons, and virtually all businesspersons can be more effective in doing business with persons and companies in other countries if they have an understanding and appreciation of business culture variation across countries. Thus, let’s focus here on a few coun­tries to compare and contrast their business cultures with the U.S. business culture.

1. Mexico’s Business Culture

Mexico is an authoritarian society in terms of schools, churches, businesses, and families. Employers seek workers who are agreeable, respectful, and obedient, rather than innovative, cre­ative, and independent. Mexican workers tend to be activity-oriented rather than problem solvers. When visitors walk into a Mexican business, they are impressed by the cordial, friendly atmo­sphere. This is almost always true because Mexicans desire harmony rather than conflict; desire for harmony is part of the social fabric in worker-manager relations. There is a much lower tolerance for adversarial relations or friction at work in Mexico as compared to that in the United States.

Mexican employers are paternalistic, providing workers with more than a paycheck, but in return they expect allegiance. Weekly food baskets, free meals, free bus service, and free day care are often part of compensation. The ideal working condition for a Mexican worker is the family model, with people all working together, doing their share, according to their designated roles. Mexican workers do not expect or desire a work environment in which self-expression and initiative are encouraged. American business embodies individualism, achievement, compe­tition, curiosity, pragmatism, informality, spontaneity, and doing more than expected on the job, whereas Mexican businesses stress collectivism, continuity, cooperation, belongingness, formal­ity, and doing exactly what is told.

In Mexico, business associates rarely entertain each other at their homes, which are places reserved exclusively for close friends and family. Business meetings and entertaining are nearly always done at a restaurant. Preserving one’s honor, saving face, and looking important are also exceptionally important in Mexico. This is why Mexicans do not accept criticism and change easily; many find it humiliating to acknowledge having made a mistake. A meeting among employees and managers in a business located in Mexico is a forum for giving orders and direc­tions rather than for discussing problems or participating in decision making. Mexican workers want to be closely supervised, cared for, and corrected in a civil manner. Opinions expressed by employees are often regarded as back talk in Mexico. Mexican supervisors are viewed as weak if they explain the rationale for their orders to workers.

In general, Mexicans do not feel compelled to follow rules that are not associated with a particular person in authority they work for or know well. Thus, signs to wear earplugs or safety glasses, or attendance or seniority policies, and even one-way street signs are often ignored. Whereas Americans follow the rules, Mexicans often do not. Life is simply slower in Mexico than in the United States. The first priority is often assigned to the last request, rather than to the first. Telephone systems break down. Banks may suddenly not have pesos. Phone repair can take a month. Electricity for an entire plant or town can be down for hours or even days. Business and government offices may open and close at odd hours. Buses and taxis may be hours off schedule. Meeting times for appointments are not rigid. Tardiness is common everywhere. Effectively doing business in Mexico requires knowledge of the Mexican way of life, culture, beliefs, and customs.

When greeting others, Mexican women normally pat each other on the right forearm or shoulder rather than shake hands. Men normally shake hands or, if close friends, use the tradi­tional hug and back slapping upon greeting. If visiting a person’s home in Mexico, bring a gift such as flowers or sweets, but avoid both marigolds and red flowers because they symbolize negativity. White flowers are an excellent choice. Arrive up to 30 minutes late, but definitely not early. If you receive a gift, open it immediately and react enthusiastically. At dinner, do not sit until you are invited to, and wait to be told where to sit. This is true in most foreign countries as well as in the United States. Do not begin eating until the hostess starts. Only men give toasts in Mexico. It is also polite to leave some food on your plate after a meal. For business appoint­ments, as opposed to home visits, it is best to arrive on time, although your Mexican counterparts may be up to 30 minutes late. Do not get irritated at their lack of punctuality.

Mexicans often judge or stereotype a person by who introduces them, and changing that first impression is difficult in business. Expect to answer questions about personal background, fam­ily, and life interests—because Mexicans consider trustworthiness and character to be of upmost importance. Mexicans are status conscious, so business titles and rank are important. Face- to-face meetings are preferred over telephone calls, letters, or e-mail. Negotiations in Mexico include a fair amount of haggling, so do not give a best offer first.

2. Japan’s Business Culture

Due to its dwindling workforce and aging population, Japan is increasingly promoting women into managerial positions. Recent statistics show that only 10 only percent of managers in Japan are currently women, compared with 31 percent in Singapore, 38 percent in Germany, and 43 per­cent in the United States.6 Therefore, Prime Minister Shinzo Abe of Japan has proclaimed a goal to fill 30 percent of leadership positions in Japan with women by 2020. Abe recently filled five open positions in his own cabinet with women. A key reason that Japanese women have histori­cally not advanced to managerial positions is the business culture of notorious long work hours. Although Japan’s powerful business lobby, Keidanren, currently has no women on its 24-mem­ber board of directions, the body has mandated its member companies to publicize their gender equity strategies and progress—and Keidanren itself plans to appoint women into board positions. Suppression, exploitation, and even persecution of women are severe problems in many countries, especially in the Middle East and to a lesser extent in the Far East. However, Japan is taking a leadership role by aggressively reversing its historical underutilization of women in business.

The Japanese people place great importance on group loyalty and consensus—a concept called Wa. Nearly all corporate activities in Japan encourage Wa among managers and employ­ees. Wa requires that all members of a group agree and cooperate; this results in constant dis­cussion and compromise. Japanese managers evaluate the potential attractiveness of alternative business decisions in terms of the long-term effect on the group’s Wa. This is why silence, used for pondering alternatives, can be a plus in a formal Japanese meeting. Discussions potentially disruptive to Wa are generally conducted in informal settings, such as at a bar, so as to mini­mize harm to the group’s Wa. Entertaining is an important business activity in Japan because it strengthens Wa. Formal meetings are often conducted in informal settings. When confronted with disturbing questions or opinions, Japanese managers tend to remain silent, whereas Americans tend to respond directly, defending themselves through explanation and argument.

Americans have more freedom to control their own fates than do the Japanese. The United States offers more upward mobility to its people, as indicated below:

America is not like Japan and can never be. America’s strength is the opposite: It opens its doors and brings the world’s disorder in. It tolerates social change that would tear most other societies apart. This openness encourages Americans to adapt as individuals rather than as a group. Americans go west to California to get a new start; they move east to Manhattan to try to make the big time; they move to Vermont or to a farm to get close to the soil. They break away from their parents’ religions or values or class; they rediscover their ethnicity. They go to night school; they change their names.7

In Japan, a person’s age and status are of paramount importance, whether in the family unit, the extended family, or a social or business situation. Schoolchildren learn early that the oldest person in the group is to be honored. Older folks are served first and their drinks are poured for them. Greetings in Japan are formal and ritualized, so wait to be introduced, because it may be viewed as impolite to introduce yourself, even in a large gathering. Foreigners may shake hands, but the traditional form of greeting in Japan is to bow. The deeper you bow, the more respect you show, but at least bow the head slightly in greetings.

Chocolates or small cakes are excellent gifts in Japan, but do not give lilies, camellias, lotus blossoms, or white flowers, because they all are associated with funerals. Do not give potted plants because they encourage sickness, although a bonsai tree is always acceptable. Give items in odd numbers, but avoid the number 9. Gifts are not opened when received. If going to a Japanese home, remove your shoes before entering and put on the slippers left at the doorway. Leave shoes pointing away from the doorway you are about to walk through. If going to the toilet in a Japanese home, put on the toilet slippers and remove them when you exit.

Learn how to use chopsticks before visiting Japan and do not pierce food with chopsticks. Never point the chopsticks. Japanese oftentimes slurp their noodles and soup, but mixing other food with rice is inappropriate. Instead of mixing, eat a bit of rice and then a bit of food. To sig­nify that you do not want more rice or drink, leave some in the bowl or glass. Conversation over dinner is generally subdued because the Japanese prefer to savor their food.

Unlike Americans, Japanese prefer to do business on the basis of personal relationships rather than impersonally speaking over the phone or by written correspondence. Therefore, build and maintain relationships by sending greeting, thank-you, birthday, and seasonal cards. You need to be a good “correspondent” to effectively do business with the Japanese. Punctuality is important, so arrive on time for meetings and be mindful that it may take several meetings to establish a good relationship. The Japanese are looking for a long-term relationship. Always give a small gift as a token of your appreciation, and present it to the most senior person at the end of any meeting.

Business cards are exchanged in Japan constantly and with excitement. Invest in quality business cards and keep them in pristine condition. Do not write on them. Have one side of your card translated in Japanese and give it to the person with the Japanese side facing the recipient. Business cards are generally given and received with two hands and a slight bow. Examine any business card you receive carefully.

3. China’s Business Culture

In China, greetings are formal and the oldest person is always greeted first. Like in the United States, handshakes are the most common form of greeting. Many Chinese will look toward the ground when greeting someone. The Chinese have an excellent sense of humor, oftentimes laughing at themselves if they have a comfortable relationship with the other person. In terms of gifts, a food basket makes an excellent gift, but do not give scissors, knives, or other cutting utensils, because these objects indicate severing of the relationship. Never give clocks, handker­chiefs, flowers, or straw sandals, because they are associated with funerals. Do not wrap gifts in white, blue, or black paper. In China, the number 4 is unlucky, so do not give four of anything. Eight is the luckiest number, so giving eight of something is a great idea.

If invited to a Chinese person’s home, consider this a great honor and arrive on time. Remove your shoes before entering the house and bring a small gift to the hostess. Wait to be told where to sit, and eat heartily to demonstrate that you are enjoying the food. You should use chopsticks and try everything that is offered; never eat the last piece from the serving tray. Hold the rice bowl close to your mouth while eating. Do not be offended if a Chinese person makes slurping or belching sounds; it merely indicates that they are enjoying their food.

The Chinese rarely do business with companies or people they do not know. Your position on an organizational chart is extremely important in business relationships. Gender bias is gen­erally not an issue. Meals and social events are not the place for business discussions. There is a demarcation between business and socializing in China, so try to be careful not to intertwine the two. Like in the United States and Germany, punctuality is important in China. Arriving late to a meeting is an insult and could negatively affect your relationship. Meetings require patience because mobile phones ring frequently and conversations tend to be boisterous. Never ask the Chinese to turn off their mobile phones because this causes you both to lose face. The Chinese are nonconfrontational and virtually never overtly say no. Rather, “they will think about it.” The Chinese are shrewd negotiators, so an initial offer or price should leave room for negotiation.

4. India’s Business Culture

According to statistics from the United Nations, India’s rate of female participation in the labor force is 34.2 percent, which is quite low, especially because women make up 42 percent of col­lege graduates in India. But even Indian women with a college degree are expected to let their careers take a back seat to caring for their husband, children, and elderly parents. “The measures of daughterly guilt are much higher in Indian women than in other countries,” says Sylvia Ann Hewlett, president of the Center for Work-Life Policy, a Manhattan think tank, who headed a recent study on the challenges Indian women face in the workplace.8 Hewlett adds, “Since tak­ing care of elderly parents usually becomes a reality later in a woman’s career, it takes them out of the workplace just when they should be entering top management roles.” That is why gender disparities at Indian companies unfortunately grow more pronounced at higher levels of management.

Like in many Asian cultures, people in India do not like to say no, verbally or nonverbally. Rather than disappoint you, they often will say something is not available, will offer you the response that they think you want to hear, or will be vague with you. This behavior should not be considered dishonest. Shaking hands is common in India, especially in the large cities among the more educated who are accustomed to dealing with westerners. Men may shake hands with other men and women may shake hands with other women; however, there are seldom handshakes between men and women because of religious beliefs.

Indians believe that giving gifts eases the transition into the next life. Gifts of cash are com­mon, but do not give frangipani or white flowers, because they represent mourning. Yellow, green, and red are lucky colors, so remember that when you wrap gifts. Because Hindus consider cows to be sacred, do not give gifts made of leather. Before entering an Indian’s house, take off your shoes, just as you would in China or Japan. Politely turn down the host’s first offer of tea, coffee, or snacks. You will be asked again and again. Saying no to the first invitation is part of the protocol. Be mindful that neither Hindus nor Sikhs eat beef, and many are vegetarians. Muslims do not eat pork or drink alcohol. Lamb, chicken, and fish are the most commonly served main courses. Table manners are somewhat formal, but much Indian food is eaten with the fingers. Like most places in the world, wait to be told where and when to sit at dinner. Women in India typically serve the men and eat later. You may be asked to wash your hands before and after sit­ting down to a meal. Always use your right hand to eat, whether using utensils or your fingers. Leave a small amount of food on your plate to indicate that you are satisfied. Finishing all your food means that you are still hungry, which is true in Egypt, China, Mexico, and many countries.

Indians prefer to do business with those with whom they have established a relationship built on mutual trust and respect. Punctuality is important. Indians generally do not trust the legal system, and someone’s word is often sufficient to reach an agreement. Do not disagree publicly with anyone in India. Titles such as professor, doctor, or engineer are important in India, as is a person’s age, university degree, caste, and profession. Use the right hand to give and receive business cards. Business cards need not be translated into Hindi but always present your busi­ness card so the recipient may read the card as it is handed to him or her. This is a nice, expected gesture in most countries around the world.

Source: David Fred, David Forest (2016), Strategic Management: A Competitive Advantage Approach, Concepts and Cases, Pearson (16th Edition).

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