Business Etiquette: Understanding International Business Cultures
In order for any business to expand into the international markets it is vital they have a strong understanding of the different international business cultures they’ll be working with.
To both successfully reach new customers and strike up great working relationships with foreign companies, taking time to research and learn more about their cultural practices and business etiquette is necessary.
Whether you’re after a new supplier for importing and exporting products or are seeking to make a different kind of business deal with foreign companies, there are many elements of the process to consider. Read below TNT’s guide to understanding cultures in business and improving international business communication.
Making a Deal
Negotiating a deal with any new supplier or client can often be a nervous affair for those involved and when cultural differences are involved it can make it even tougher. There are some major differences to understand to help ensure a smooth process.
Negotiators from certain cultural backgrounds will have a far more formal style than others, including their dress, language use and interactions. Addressing others by official titles and wearing a full suit to meetings are common practice and the safest bet when unsure of other parties’ expectations. Using first names may be viewed as friendly in one culture but in others, such as Japanese, it is a sign of disrespect.
Many cultures, like German, English and Asian ones, avoid showing too much emotion during business dealings. This keeps things more formal whereas certain other cultures are more likely to let their emotions show, leading to an informal atmosphere.
Direct communication is common within the likes of American culture as they aim to get deals done as quickly and efficiently as possible. However, other cultures can view this as confrontational and aggressive, instead preferring a more indirect style. When the two clash without much understanding it can lead to confusion, such as an indirect rejection from one party being interpreted as negotiations needing further work but still ongoing by the other.
Different businesses organise their teams and negotiation style in various ways, usually based on their background. Many American ones focus on the individual, leaving the final decision to them within a small team. Chinese and Japanese companies are more likely to go with team negotiations, usually including more people in a meeting and coming to a joint decision. Knowing how the opposing business operates can prove useful in achieving your desired outcome.
Another helpful thing to know about your counterpart is how big a risk taker they are. This can help you know whether it’s worth pushing negotiations that bit further or holding back. In general Japanese like to go through deals thoroughly and avoid risks as much as possible, while Americans are more willing to take the plunge, if only to reach an agreement quickly.
Creating a Relationship in Business
Starting up a new relationship with another business involves a good knowledge of what they do and their customs. Each side may have different aims in mind when entering negotiations which can lead to some difficulties, so understanding their ways proves useful.
Businesses may go into the same meeting with different goals in mind. Due to their country’s culture many North American companies will often see the first meeting as a good opportunity to get a contract drawn up and signed. They see this as the first step in a good working relationship. Others may view their goal from an initial meeting as more informal, just setting the foundations of a strong relationship with no official outcome required.
There are many stereotypes about different nationalities and their punctuality. Some do ring fairly true with lateness associated with disrespect and poor organisation, while others are less bothered. The safest option is to turn up on time to all arranged meetings.
Cultural Differences in Business
There are further, more general, cultural differences which can have an impact upon professional proceedings too.
Language barriers can prove tricky to overcome in important meetings. This should be an obvious difference but don’t assume everyone involved automatically speaks English or to a good level. Be appreciative that a translator may be required or negotiations could go slower.
Especially when undertaking negotiations with companies based in highly religious countries, it is important to understand how this affects their business. There may be prayer breaks or they could be less willing to hold meetings during religious holidays for example. Be understanding to such requests for developing a good relationship.
One thing that can seem shocking to Western businesspeople is the way women are treated in negotiations in particular nations. They may be present but not actually speak, or be asked to wear certain clothing to the meeting. Where possible it is best to meet these requests and avoid confrontation, realising that a lot of their culture is still dictated by religion.
Taking time to study regional cultural differences and understanding culture in business is far more likely to lead to a successful business result than when lacking cultural awareness. Learn more about cultural nuances with our useful guide.