Managing business in India | Communicaid Blog | Cross Cultural Training and International Communication Skills

Apr 28

Living and Working in India – Second Most Challenging Destination for International Assignments

Cross Cultural Training, Cultural training for Relocation, Culture, Culture training for Business & Management, Culture training for Human Resources, Culture training for the Public sector No Comments »

The recently published 2010 Global Trends Survey reports a 46% decrease in corporate international assignments, a fall directly linked to the global financial crisis. On a positive note, 44% of multinationals surveyed expect the number of employees sent on international assignments to rise in the future. Surveying 120 multinationals, the report also provides an overview of what countries are the most popular destinations for employees on international assignments, offering considerable insight into the cross cultural challenges faced when doing business on an international scale.

According to the report, India is now the second most challenging destination for expatriates, and tops the list of countries for failure rate of international assignments, falling to fourth place in the list of emerging assignment locations. Despite its roaring economy and membership of the emerging BRIC bloc, establishing and doing business in India still poses a considerable challenge to multinational organisations.

Taj Majal x drew i Living and Working in India – Second Most Challenging Destination for International Assignments

Why is India such a problematic destination for international employees? After all, as a former British colony it is not new to Western culture and business practices. English is the official language – used throughout India’s civil service and legal system – which should theoretically facilitate cross cultural business interactions, particularly for US and UK companies. Furthermore, unlike China, India does not have a system of government many international companies could perceive as a cultural risk and a hindrance to trade.

When you look at the core values of Indian business culture, the greatest differences with the world average are in power distance and uncertainty avoidance. Indian indexes for the first are well above the world average, suggesting a widespread acceptance of uneven distributions of power within the workplace as well as a certain adversity to embracing Western management styles that encourage empowering staff and delegating decisions. As a result, despite the strong work ethic Indians are renowned for, managers on international assignment in India may find Indian employees reluctant to take on responsibilities, preferring to be told exactly what to do, when to do it and how. Furthermore, nepotism is strongly present within Indian companies, which contrasts with Western values of ascendancy by merit.

Indians have a fairly high tolerance for uncertainty, in other words, Indian business people generally accept unstructured situations and are able to successfully adapt to different business scenarios. Although this may seem in line with other Western business values, Indians seem to take it a step further. This is where potential cross cultural misunderstandings and risk begin. Such a high acceptance of uncertain situations can push adaptability to new boundaries, where honesty becomes relative and experimentation dominant. Coupled with the influence of the concept of karma and fatality, decision-making processes can appear highly volatile in the eyes of foreign business people who are unaware of Indian business culture.

There are, however, risks to approaching cross cultural business interactions from such a broad stance as offered by some of Hofstede’s research highlighted above. Often, a much more bespoke solution is both necessary and more effective in order to take into account a business’s unique corporate culture and the cross cultural skills that its managers and employees may well already possess.

This is even more the case when doing business in India, a country both as vast and diverse in territory as in population, resources and business opportunities. If you or your organisation are managing an Indian team or negotiating a merger with an Indian business, the dynamics of the business interactions will most likely be determined by the specific context in which all parties are operating, as well as the wider context of Indian business culture. A lack of tailored cross cultural awareness training solutions could well be one of the reasons for such a high rate of failure in international assignments there.

Recognising the need and the benefits of combining a general overview of culture with an organisation’s specific business needs and context, Communicaid has developed a tailored approach to intercultural training for international business. Communicaid’s Intercultural Training India programmes include Doing Business in India and Living and Working in India, providing business people and their families with concrete intercultural skills to ensure international assignments in India do not pose such a cross cultural challenge.

© Communicaid Group Ltd. 2010

Tagged with: Courses - Cultural Training • Cross Cultural Awareness India • Cross Cultural Training India • doing business in India • Global Trends Survey • Indian business culture • Intercultural Training India • international assignments • Living and Working in India • Managing business in India • most challenging country • relocation

Mar 22

Challenges of Doing Business in India

Cross Cultural Training, Cultural training for Relocation, Culture, Culture training for Business & Management, Culture training for Human Resources, Culture training for the Public sector 3 Comments »

India’s economy is one of the fastest growing in the world. It has seen an explosion in the increase of foreign business investment, outsourcing and Indian companies venturing overseas. Doing business in India offers immense benefits for international organisations, however there are a number of key cultural challenges that can create misunderstanding and conflict as well as huge direct and indirect costs to the organisation if overlooked.

Indian woman 4 i2 Challenges of Doing Business in India

Navigating the challenges of doing business in India can be difficult without a comprehensive understanding of Indian social and business culture. Going through cultural awareness training like Communicaid’s Doing Business in India programme will ensure you and your organisation have the right level of knowledge and skills to successfully deal with some of the following key challenges of doing business in India.

Attitudes towards Authority – Traditionally a caste society with roots in Hinduism, Indian culture places a high importance on authority and status. Communication between levels is relatively closed so valuable insight or suggestions from employees in lower positions will rarely be shared with their superiors. Without understanding the complexity of Indian attitudes to authority and how they impact business, organisations doing business in India will struggle to implement change as quickly as necessary, and fail to harness the experience and value of its employees.

Concepts of Time – India is a polychronic culture, in other words, people tend to change priorities depending on their importance and attitudes towards punctuality are relaxed. Most large global organisations require adherence to strict deadlines and fast decision-making, so they struggle to cope with the idea that when doing business in India, time cannot be controlled and is not absolute. Cultural awareness training can help you better understand Indian concepts of time and develop strategies for dealing with them.

Adherence to Rules – India has a high tolerance to uncertainty and has created a society which runs on the basis of a set of assumptions. It generally accepts social etiquette and norms instead of rules and regulations. Even though rules do exist, the low level of adherence to them creates huge challenges for organisations setting up business in India who are required to follow a set of home-country regulations.

Building Relationships – The Indian business culture focuses a lot on relationship and trust building rather than working hard and quick towards specific business objectives. A Doing Business in India cultural awareness course helps you to develop strategies to avoid the immense frustration, delayed projects, failure to reach tangible results and general clash as a result of different preferences for relationships and tasks and processes.

Levels of English – Most university graduates and Indians residing in major urban centres have a very high level of English. Understanding Indian English can be challenging, however, as a result of the different vocabulary and expressions as well as heavy accents. Many people are unaware of these differences and expect communication with Indians to be simple. Instead, many international organisations incorrectly interpret the Indian English they use to be a result of poor education and language skills. Being aware of Indian English can help you reduce misunderstandings and loss of time.

Communication Style – Indians have a preference for indirect, high context communication. In other words, Indians prefer to see the whole picture, place a high importance on the impact relationships, body language and emotion have on communication and will often avoid saying ‘no’. The differences in communication style can cause a large challenge to overcome for someone who is used to communicating in a more direct and low context way.

Understanding the cultural differences which exist when doing business in India is only the first step. International organisations must also understand the what, why and how behind them to develop strategies to effectively cope with these cultural challenges. A Doing Business in Indiacultural awareness training programme will help organisations maximise the immense opportunities and benefits of doing business in India while it will also help develop an interculturally competent workforce, giving the organisation a huge advantage in this fiercely competitive global world.

© Communicaid Group Ltd. 2010

Tagged with: Courses - Cultural Training • Cross Cultural Training • Cultural Awareness training • doing business in India • India • Indian business culture • intercultural competence • intercultural training • Managing business in India • Negotiating with Indians

Mar 05

Benefits of Doing Business in India

Cross Cultural Training, Culture, Culture training for Business & Management, Culture training for Human Resources 1 Comment »

India is well endowed with mineral and agricultural resources and it has seen a significant increase in offshore outsourcing and manufacturing over the last couple of decades, which have helped India’s economy grow at a tremendous rate.

India’s Ministry of External Affairs reports that its higher disposable incomes, rising middle class, investment friendly policies and forward-thinking reforms all make India an extremely attractive place for foreign investors. There are several key benefits for doing business in India:

Engaged and career focused – On a social level, India is predominantly a collective society which places a huge emphasis on the group. However, in business culture individualism is becoming more common as employees are increasingly recognised, paid and promoted on an individual basis. Many Indians, especially those working in westernised offices or companies, are now turning their focus to their own career advancement and performance. Through training initiatives or certificate programmes Indians are constantly taking steps towards obtaining more knowledge and qualifications, which in turn helps international organisations doing business in India by providing a constant flow of highly engaged and career focused individuals.

Globe India i 200x300 Benefits of Doing Business in India

High levels of English – The historical relationship between the UK and India means that Indians have a high level of English. Although the accent and vocabulary of Indian English is slightly different from that of British or American English, international organisations will benefit immensely from graduates’ ability to speak English fluently, as well as their command of the many local Indian languages. It is in fact estimated that there are 14 major and over 1000 minor languages and dialects spoken in India. The relatively few language barriers make doing business in India quite attractive for international organisations.

Large amount of experienced specialists – India has an extensive pool of experienced people from which they can recruit employees. There is a high value placed on education in Indian culture. Combined with India’s drive to become a successfully modernised and competitive country, this is helping to produce a population of candidates with good qualifications and specialised experience and knowledge.

Openness to new ideas and opportunities – Indians have a relatively high tolerance for ambiguity and uncertainty and can therefore be quite open to new ideas and opportunities. This entrepreneurial and creative spirit is evident in the recent influx of new businesses in India. International organisations doing business with Indians in urban centres such as Mumbai, Bangalore and Hyderabad will particularly benefit as many younger Indians are taking on more western habits and working preferences. As they increasingly adapt to keep pace with the demands and expectations of new dynamic industries, international organisations doing business in India will face fewer cultural challenges when pushing new business ideas and endeavours.

Dedicated employees – Indians have a strong work ethic and take pride in their jobs. They tend to work long hours in the hopes of showing their dedication and increasing their status in the company. Most Indians will work eight hour shifts six days a week. When working for organisations which require communication on a regular basis with people in countries such as the US or the UK, employees will willingly work shifts around the clock to compensate for the time difference. This group of highly dedicated employees, willing to work long shifts over unusual hours, is a huge benefit for international organisations doing business in India.

Business meeting track5 i 300x199 Benefits of Doing Business in India

All the above benefits are good reasons for global organisations to do business in India. Harnessing these benefits comes with the need to navigate the geographic, linguistic, religious and cultural diversity of Indian society. This requires a comprehensive understanding of Indian business and social culture on all levels.

International organisations employing people in India or working with Indians on a regular basis should therefore have a series of cross-cultural training programmes on Doing Business in India to ensure they develop the skills to successfully deal with the many cultural differences.