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Around the World

Doing Business in India

Author(s):

RaeAnn Slaybaugh


September/October 2008, eSide Supply Management Vol. 1, No. 5

India is a hugely popular sourcing destination for good reason: It represents the world's 12th-largest economy, has the fourth-largest purchasing power and boasted a growth rate of 9.4 percent last year — among the fastest-growing in the world. It is also home to the world's second largest labor force at 516.3 million.

Delhi

Delhi

Given all this, many supply management professionals will find themselves in India on business at some point. While the country is noted for its rich diversity and complexity, most business is transacted in Delhi, Mumbai, Bangalore and Hyderabad, where common etiquette practices and protocol should be observed.

Meeting Planning

Arrange meetings well in advance. Confirm the appointment a few days in advance. If you will be in the country for a limited time, specify this. Leave your contact information with your Indian counterpart's assistant in the event of location and time changes.

Do not schedule meetings on or around national holidays. These include Independence Day, Diwali and the two Eids. Additionally, most Indians take vacations during the summer months between April and June, as well as mid-December through mid-January.

Refer to dates as Indians do: date/month/year. For example, in the United States, it is written as December 25, 2009. In India, it is written as 25/12/09.

When requesting a meeting, go straight to the top. Even though it is unlikely the boss will facilitate your request, hierarchy is extremely important in India. He or she will probably redirect you to someone with mid-level authority.

Punctuality is not a priority. Indian businesspeople regard schedules with a fair amount of flexibility. Family responsibilities take precedence over business, so last-minute cancellations and delays are not unheard of.

Expect distractions. Indians deal with more than one task at a time. For this reason, a meeting might be interrupted or delayed by an assistant bearing papers or the conversation veering off-topic.

Business Attire

For men: A business suit and tie is standard except in warm weather; in this case, a neutral-colored long-sleeved shirt and tie is acceptable.

For women: Women traveling to India for business should wear pantsuits or skirts below the knees. Necklines should be conservative. Indian women might wear traditional salwar suits to meetings.

In casual situations: Jeans, T-shirts and short-sleeved shirts are acceptable for both men and women at social gatherings. However, wearing an Indian costume — a kurta (pajama) for men or a sari or salwar suit for women — is a gesture of friendship.

Introductions and Farewells

Approach and greet the most senior figure first. Again, hierarchy is extremely important in Indian business culture. When their boss enters the meeting room, your Indian counterparts will likely stand. Your best option is to rise and greet the boss personally.

Mumbai

Mumbai

A handshake is required, but using the Namaste goes above-and-beyond. Business meetings in India start with a short and light (not firm) handshake. However, Indians themselves use the Namaste, bringing their palms together at the chest, smiling, bowing the head slightly and saying "Namaste." Derived from the Sanskrit language, the connotation of the word is, "I bow to you out of respect."

Doing likewise shows you understand Indian etiquette, which is appreciated.

Business card etiquette. Business cards are exchanged at the first meeting. Receive and give cards with your right hand.

Use formal titles. If you know your Indian counterparts personally, "Professor," "Doctor," "Mr.," "Mrs." and so on are appropriate. When titles are unknown, use "Sir" or "Madam."

Shake a businesswoman's hand only at her initiative. In its absence, the Namaste is an appropriate greeting.

Do not stand with your hands on your hips at any point. This is considered an aggressive posture.

Do not expect to get right down to business. In Indian business culture, light conversation typically comes first. Acceptable topics include the latest business news, the Bombay Stock Exchange and cricket.

Language Preferences

English is common. Executives at the managerial and technical levels typically have a good command of spoken and written English. As such, it is not necessary to have business cards and literature printed in Hindi, but it is considered a sign of respect.

Dining Etiquette

Business dinners are rare. Dinners are usually hosted as large gatherings and attempts at socializing. In recent years, "power breakfasts" and lunches have gained popularity.

Many Indians do not drink alcohol or eat beef. Keep this in mind when ordering.

Celebration dinners are customary at the end of negotiations. They signify moving forward in the relationship-building process.

A Done Deal

Negotiations can be slow. Focus instead on building rapport. Bargaining for price or additional concessions is common in India. Sometimes a straightforward offer can be perceived as a rigid stand, so be sure to factor some flexibility into the initial offer to allow for bargaining later.

In India, businesspeople deal favorably with those they know and trust, even at the expense of lucrative deals. Indians tend to take larger risks with people whose intentions they trust, so your credibility and trustworthiness are critical.

Decisions are made by the owner or another high-level executive. Do not insist on commitment in the first meeting as a decision might have to be ratified by people who might not be present at the negotiating table. If such a person is not in attendance at your meeting, you are probably in the early stage of negotiations.

Numbers will not win them over. Intuition, feeling and faith also guide business decisions in India. Hide your irritation and impatience, and exhibit good character.

"No" sounds (and looks) different in India. Indians do not like to express "no," verbally or non-verbally. To avoid doing so, Indians often offer the response that they think you want to hear. This is not an attempt at being dishonest; an Indian would be considered rude if he or she did not attempt to give you what you want.

Indians might give an affirmative answer but be deliberately vague about details. Take note of any reluctance to commit to a time for a meeting, and watch out for unenthusiastic responses. Listen for responses such as, "We'll see," "I'll try" and "Possibly." Some business travelers even report their Indian counterparts shaking their heads "no" while saying "yes." As such, paying attention to non-verbal cues is essential.

Gift-Giving Guidelines

Do not wrap in black or white. These colors represent bad luck in India. Instead, use red, green or yellow, which are considered good-luck colors.

Do not wait for your host to open the gift. In India, it is customary to open a gift in private. Likewise, do not open a gift from your Indian counterparts in their presence.



Sources



RaeAnn Slaybaugh is a senior writer for the Institute for Supply Management™. She can be reached by e-mail.

For more articles and resources on doing business internationally, visit the ISM articles database.

Take me to the eSide home page.


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