Doing Business in India Explained and How to do Business in India
In This Article
- 1 Doing Business in India Explained and How to do Business in India
- 2 Question: Doing Business in India? here are some quick tips
- 3 In this country-specific article I will cover several topics:
- 4 What Will You Learn?
- 5 Which one of these statements do you recognize?
- 6 What This Article is NOT About
- 7 Then Why This Article on Doing Business in India?
- 8 Business Culture in India
- 9 Scores of India on the First Four Primary Dimensions of Culture
- 10 India Uncertainty Avoidance
- 11 Working With Indians; Is It That Difficult?
- 12 Summing it Up
- 13 Remember, Culture eats strategy for breakfast…
- 14 Get a Taste of How Chris Presents, Watch his TEDx Talk
- 15 Book Chris Smit as a Speaker
Question: Doing Business in India? here are some quick tips
- Respect the hierarchy and don’t jump “rank” (skipping a layer of hierarchy)
- Loss of face is real. Be careful to single out an individual when working in a group or teams
- Understand the Indian-head-nod
- A “yes” is not always a “yes” but don’t push it. Ask circumventing questions to get the real answer
- Family is important. Just like relationships. Take your time to develop them. It’ll be worth your while
- Not every Indian speaks English, nor do they all work in IT
- Read this article…
In this country-specific article I will cover several topics:
- How to do business in India, or Doing business in India explained
- Business Culture in India
- Understanding Indian Culture
- Working with Indians
What Will You Learn?
- How to interpret the Indian head-nod.
- How to do business in India and how to deal with Indians in business.
- Why doing business in India involves relationship building.
- How India scores on the first primary dimensions of culture.
- The essence of doing business with India.
- India Uncertainty Avoidance.
- and a lot more…
Which one of these statements do you recognize?
- You don’t understand “Indian English“.
- You don’t understand the Yes & No nodding (watch the 1-minute video below) in the Indian business culture
- You get what you ask for, but not what you want (you see the difference?)
- You wonder why Indians don’t ask for help if they don’t understand something, but simply muddle through.
- You don’t understand the Indian “family thing“.
- Why do Indians never give you a “straight” answer or why do they say “Yes” to everything?
If you recognize any of the above examples, read on…
Watch this short, 1-minute video to understand the famous Indian head-nod…
What This Article is NOT About
Although I will use some statistics here and there and sum up some numbers, this article is not about the facts and figures. It’s about understanding Indian culture in business. More statistics about doing business in India can be found here.
And although there is a map of the country below, this article is not a tourist guide. It’s about business culture in India, working with Indians, and understanding Indian culture in business. Another good source for a better understanding of Indian culture is Wikipedia. Click here to find out more.
Then Why This Article on Doing Business in India?
In my 20+ years of experience working with different cultures, doing business with India, working with Indians in and outside India has taken up a significant part of those years.
In addition, I’ve worked with many companies that either employed Indians in their organization, or who were working with Indians or doing business in India but then more in terms of outsourcing.
Either way, for most non-Indians, it was not easy working with Indians. People would not understand their English (this tends to be typically true for people from the Mumbai area), or they wouldn’t understand the (famous?) Indian head-shake (does it mean yes or no?).
Quite often both Indians and Western simply don’t understand each other. In other words, doing business in India, how to do business in India culture and working with Indians is not that simple for most Westerns.
And the more you understand Indian culture, the better, more efficient and effective you will be.
Books on Indian etiquette and business practice will tell you some do’s and don’ts, but they won’t tell you how to do business in India. You have to dig a (or even several) layers deeper. Business in India isn’t as straightforward as it is in the West.
So, this article is about you. You, who does or will do business with Indians.
Business Culture in India
Below you see a table with an overview of how India scores on the first four primary dimensions of culture.
Scores of India on the First Four Primary Dimensions of Culture
Above are the scores for India compared to some other Western European countries. If you want to know more specifics about each of these dimensions, click here.
As you can see, India, compared to the other Western countries, scores quite different (any score with more than 10 points difference is significant). But not on all dimensions. This means that when you’re working with Indians it is important to realize that different cultures will have a different way of doing business in India.
A note in the margin with the third dimension, Goal Orientation, is that the more South you go in India the lower the score will be on this dimension. Even as low as 25. So it makes sense to ask where your Indian counterpart is from to better understand Indian culture.
India Uncertainty Avoidance
A special word on Uncertainty Avoidance in India. I have re-named this dimension Predictability because I think it’s simply more practical to use as a term in business. We’re looking here at the fourth column. You can see that India scores relatively low on Uncertainty Avoidance. Most people are surprised to see this because they think or have experienced the thick bureaucracy in India.
An Example of Uncertainty Avoidance in India
An example of the low Uncertainty Avoidance in India are the mountains of paper stacked in many local postal offices. The papers are being collected and kept. But… no one does anything with those papers. Why are those papers being kept then?
The explanation for this is that the rules (in doing business with India) are there to keep the power holder (i.e. the boss) in his position. In other words, in order to get something done, you need the (written and stamped) permission of the boss (who has a boss, who has a boss, etc). So, it’s not that “the Indian” needs a lot of structure and rules to work.
As I say, you can give an Indian a street corner and he’s in business.
This is the explanation of the relatively low score on Uncertainty Avoidance in India.
Working With Indians; Is It That Difficult?
As said before, working with Indians will be different for different cultures. However, from my own experience of doing business in India, there are a couple of things that will help you with understanding Indian culture and will help you to work with them more effectively.
Mind you that these topics cover situations that pertain to how to do business in India, not per se to Indian family lives outside of the work environment.
- Indians will generally not say no if you ask them to do something. If you are (being perceived as) the boss, an Indian will nod yes politely. Even if he doesn’t understand what you said or what he must do. It is, therefore, important to check back if your Indian colleague indeed correctly has understood what you said.
- In the US and UK, it is possible to delegate upward. Meaning that if your boss asks you to do something you can make it conditional to the extent that you can request your boss to do this or that in order for you to do what your boss asks you to do. This is not common in India. You can even say that upward delegation in India is simply not done.
- Being more collectivistic or Loyalty-to-Group oriented, Indians put a lot more emphasis on relationships than on tasks. For an Indian, it is important to know who you are as a person. In India, it is relationships over tasks. In the West, it is task over relationships.
- Indians communicate indirectly. Direct questions from Westerns are seen as rude and impolite. In response to a Western asking his Indian colleague if he can get “this” done in 2 weeks time, the Indian could reply with something like “you’re asking quite a lot of me“.
- Status is important in India. Not only in what you can or have acquired, but also in terms of the function or position you have in a company. Being a Manager gives status.
- Although at first you might not see this, but rules and regulations are not as important in India as they are in the West. Even though you might experience India as very bureaucratic, the rules, regulations, paperwork etcetera, are mainly a function of power of the powerholder. Not so much a display of the necessity of rules.
Summing it Up
How to do business in India, understanding Indian culture and working with Indians is not as straightforward as you might think. And that says absolutely nothing about the Indians. It says everything about the cultural differences between India and Western cultures.
You might think that every Indian speaks English, while in actual fact only about 10% do (source). You might think that every Indian has an MBA but that is not true either. And finally, you might think that every Indian works in IT. Guess what, that is also not true.
There are plenty that do though and even if they speak English, have an MBA and work in IT, if you don’t understand the culture, chances are high that the business you do in India will frustrate you more than necessary. That it will cost you more time and money than necessary or that you might fail completely.
Remember, Culture eats strategy for breakfast…
Doing business with China? Read this article
Are you working with Indians? Get in Touch to Learn More
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