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India

India. India’s Make-up. India is the 2 nd most populous country in the world. They hold 3% of the land and 16% of the population. Major religions are Hindu, Muslim, and some Christians. There are 15 recognized languages with Hindi as the official language. Social Interaction.

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India

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  1. India

  2. India’s Make-up • India is the 2nd most populous country in the world. • They hold 3% of the land and 16% of the population. • Major religions are Hindu, Muslim, and some Christians. • There are 15 recognized languages with Hindi as the official language. Craigheads Intl. 9th Edition

  3. Social Interaction • Indian’s are very open and will ask personal questions • The proper greeting is namaste or hello. • 3 feet of personal space, and gestures have different meanings. • Strong male hierarchy and common discrimination against women. Kiss, Bow, Shake Hands

  4. Entertainment Protocol • Most meetings are between 11am and 4pm. • Women can entertain during the day. • Always use the professional title. • An invitation to an Indian’s home should be taken seriously: Follow the proper rules. Kiss, Bow, Shake Hands

  5. Business Conduct • Business cards are in English, and exchanged at the first meeting. • Gifts are also a popular custom, but adhere to religious observance. • The use of a respected 3rd person intermediary for introduction is recommended. • Plan meetings in advance, and do not make a tight time schedule. Craighead's Intl. 9th Edition

  6. Preparation is a key to success in India. Present issues in a hierarchical order There is low sensitivity to time. A relationship must be formed. Negotiations should be at the highest level of the Indian organization. Negotiation Passport to India: Your Pocket Guide to Indian Business

  7. Do’s • Rely on written agreements, not YES. • Modern India relies on contracts • Consider other firms. • Bring a group of negotiators. • Save concessions for strategic implementation. Passport to India: Your Pocket Guide to Indian Business

  8. Don'ts • Don’t be swayed by kindness • Don’t bring up business on the first meeting. • Don’t trust every manager is equal. Passport to India:Your Pocket Guide to Indian Business

  9. Cultural DimensionsofIndia

  10. Hofstede’s Dimensions • Power distance • Uncertainty avoidance • Collectivism • Masculinity International Management p.116-131

  11. Definition: The extent to which less powerful members of institutions and organizations accept that power is equally distributed. India ranks moderate-to-high. Many subordinates give deference to age and position within the hierarchal system. Power Distance Passport India: Your Pocket Guide to Indian Business

  12. Uncertainty Avoidance • Definition: The extent to which people feel threatened by ambiguous situations and have created beliefs and institutions that try to avoid these. • India is very low. • Strong belief in fatalism. How To Do Business in Sixty Countries p.166-173

  13. Collectivism • Definition: The tendency of people to belong to groups or collectives and to look after each other in exchange for loyalty. • India is moderate-to-high. • Caste system and Nepotism. How to Do Business in Sixty Countries p.166-173

  14. Masculinity • Definition: A culture in which the dominate values in society are success, money, and things • India is moderate. When Cultures Collide p.296-298

  15. Trompenaar’s Dimensions • Particularism • Communitarism • Neutral v. Emotional • Diffuse • Ascription International Management p.116-131

  16. Particularism • Definition: The belief that circumstances dictate how ideas and practices should be applied. • Indians believe that the environment controls them so they accept fate and conform to it. Doing Business Around the World p.169-180

  17. Communitarism • Definition: People regarding themselves as a part of a group. • Strong family values and caste system. When Cultures Collide: Managing Across Culture p.296-298

  18. Neutral v Emotional • Indians tend to be neutral in displaying affection but are allowed to show assertiveness. • They are taught to be non-violent. Doing Business Around the World p.169-180

  19. Diffuse • Definition: Both public and private space are similar in size and individuals guard their public space carefully because entry into public space affords entry into private space as well. • Friendships and cordiality is expected. Doing Business Internationally p.230-235

  20. Achievement v Ascription • Most Indians value ascription because of their reliance on the caste system. • Professional titles, age, degrees and caste level are indicators of status. • Friendships and kinships are more important than expertise. How to Do Business in Sixty Countries p.166-173

  21. Time Be prompt for meetings unless with government official. The immediate situation and people are of major concern. Environment Outer directed Fatalism Other Cultural Dimensions Passport India

  22. Regions of INDIA

  23. Climate • India has 3 different seasons • Summer- April thru June- it gets extremly hot in summer with temp. up to 43C. • Winter- November thru March- is normally mild, except in the North around the Himalayas where it snows. • Monsoons- in the beginning of June thru September- it rains every day. Passport India p.27-28

  24. Three Largest Cities- In the West is Mambai with 14.5 Million In the East is Calcutta with 12.0 Million In the North is Delhi the capital of India with 10.1 Million Maps of India homepage <www.mapsindia.com/overview> Regional Population

  25. Business • North- City of Punjab is renowned for agriculture, small scale industrial sector • South- (heavy industry) City of Hyderabad produces electronics, machine tools and aerospace industries. Passport India. p.27-28

  26. Business • West- The western city of Gujarat focuses mainly on the production of major textile,cement,chemical, automotive and engineering industries. • East- Calcutta is a heavy engineering and steel industry and is adding petrochemicals, electronics and software to its repertoire. Passport India: p. 27-28

  27. India’sCommunicationStyle

  28. Barriers of Communication • Culture- • With India having so many different languages communication can be difficult • The national, political, and commercial language is English. Organization Studies: 8(3) p:246-247

  29. Communication Style • Indian’s use a downward flow of communication • Indians are obedient to their seniors • They do not disagree with people of power • Accustomed to being commanded Organization Studies: 8(3), p:246-247

  30. Strategic Planning • Some companies in India use a polycentric strategy. • Polycentric- Tailored to suit the cultures of the country where the MNC operates. International Management (Text) p.253

  31. Polycentric Strategy • Example: Coca-Cola purchased a local bottling company that bottled the drink Thums Up. • Coca-Cola tried to discount Thums Up so that Coke would be the top sell how ever the market did not accept it and they were forced to bring back Thums Up. The Wall Street Journal: pg 1-4

  32. Acquiring qualified workers • For every 5 openings, only 1 qualified candidate • Employees seen as internal “customers” • HR managers judged as salespeople- rather than administrators HRMagazine: 42(7), p. 104-110

  33. Recruitment/Retention Strategies • Differentiating company from competitors - compensation and benefits tailored to particular job • Play on sense of togetherness - de-emphasize pay-for-performance • More important whether person liked and respected - performance ability not valued as strongly HRMagazine: 42(7), p. 104-110

  34. Satyam Computer Svc.’s Strategy • Fund employee ideas; takes share in start-up • Weekend retreat center for families Far Eastern Economic Review: 164(6), p. 70

  35. Common Benefits • Financial housing assistance in urban areas • Funding for continuing education HRMagazine: 42(7), p. 104-110

  36. Labor Relations • Legislation very protective of labor • Factories Act of 1948 -maternity leave, child care Industrial & Labor Relations Review: 49(4), p. 635-657

  37. Unionization • Sponsored by political parties • Only 7 employees needed to form union • “External leaders”- political party reps. instead of company employees Industrial & Labor Relations Review: 49(4), p. 635- 657

  38. Bargaining • Done at company level • Industrial Disputes Act of 1947 -restricts firing, lay-offs, closings - required to pay 50% of wages for 90 days of lay-off • Dispute resolution system ineffective Industrial & Labor Relations Review: 49(4), p. 635-657

  39. Employers’ Reactions to Unions • Lockouts increasing • Promotions to administrative, supervisory ranks more common • Declaring private businesses “essentially public” Industrial & Labor Relations Review: 49(4): 635-657

  40. Summary • Just as in any country, doing business in India requires the American businessperson to keep an open mind to the cultural differences and business practices.

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