Doing Business in India

Author: Communicaid

India 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 create misunderstanding and conflict as well as huge direct and indirect costs to theorganisation if overlooked.

Cross-cultural training programmes such as Doing Business in India help organisations ensure those involved in setting up business in India understand the cultural challenges and develop a set of strategies for overcoming these differences.  The following are six of the key cultural differences international organisations face when setting up or doing business in India.

  1. 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.
  2. Adherence to Rules – India’s high tolerance to uncertainty has created a society which runs on the basis of a set of assumptions and accepted social etiquette and norms instead of rules and regulations.  Rules do exist, but 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.
  3. 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.  Indian concepts of time are so flexible that Paul Davies, author of the book What’s this India Business said that in lieu of the official Indian time zone Indian Standard Time (IST), many westerners refer to it as Indian Stretchable Time. 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.
  4. Impact of Relationships – Rather than work hard towards specific business objectives, Indians will place more emphasis on relationship and trust building which they believe will in turn produce results.  The strategies developed in a Doing Business in India course will help international organisations 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.
  5. Communication Style –Understanding Indians’ communication style is one of the biggest challenges of doing business in India.  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’.  As a result, international organisations doing business in India struggle to achieve their business objectives.  Communicating with Indians becomes ever more challenging when done remotely, resulting in failed communication, frustration, missed targets and lost time and money.
  6. 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.  A Doing Business in India course will provide tips for navigating the ‘Indianisms’ and accents of Indian English.

Recognising 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 Communicaid cultural awareness training course such as Doing Business in India programme will help the organisation 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.

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About the Author

Communicaid is Europe’s leading Culture & Communication Skills Consultancy. Headquartered in London with centres in major capitals across the globe.

Declan Mulkeen, Marketing Director, Communicaid.