India

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
 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

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

 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

 Negotiation
 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.

Passport to India: Your Pocket Guide to Indian Business

 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

 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

 Cultur al
Dimensions
of
India
 Hofstede’s
Dimensions
 Power distance
 Uncertainty avoidance
 Collectivism
 Masculinity

International Management p.116-131

 Power Distance
 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.

Passport India: Your Pocket Guide to Indian Business

 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

 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
 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

 Trompenaar’s
Dimensions
 Particularism
 Communitarism
 Neutral v. Emotional
 Diffuse
 Ascription

International Management p.116-131

 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

 Communitaris
m
 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

 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

 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

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

Passport India
Regions of INDIA
 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
Regional Population
 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>

 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
 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
 India’s
Communication
Style
 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

 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

 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

 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
 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

 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

 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

 Common Benefits
 Financial housing assistance in urban
areas

 Funding for continuing education

HRMagazine: 42(7), p. 104-110

 Labor Relations
 Legislation very protective of labor

 Factories Act of 1948

-maternity leave, child care

Industrial & Labor Relations Review: 49(4), p.

635-657
 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

 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

 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

 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.