THIS WEEK'S TOPIC

Cultural differences mean that a different approach is essential for businesses seeking to clinch overseas deals. What interesting experiences have you had while trying to negotiate deals abroad, and what tips would you provide to fellow SMEs to smoothen the process?

Richard Stuart
Managing Director
IPS Securex Pte Ltd

TWENTY years ago I started travelling to Japan. I quickly discovered that my premature grey hair (and baldness) was an advantage as people thought I was much older than I really was. The Japanese have respect for older people and so I was given much greater access and respect than I probably merited at the time. Personally, I benefited from many hotel upgrades (much to the chagrin of my older, but younger looking boss) and also won many business deals because I came across as a more convincing personality. This whole experience opened my eyes to the reality that whatever sales techniques that are successful in one country will have to be adjusted for another country to take into account the different cultures. It is definitely worth taking the time to explore the culture of a new country to understand how to be most effective when dealing with the people.

Henry Tan
Managing Director
Nexia TS

CULTURAL differences are very important and need to be considered. When we first did business with China businesses in 1998, we were not well prepared for the differences. It took us quite a few years to really understand that while we are all Chinese, we are not from the same country. Many things we do may appear harmless at first, but could put us in an embarrassing situation subsequently. Let me share an example. A Nanjing enterprise visited us and was keen to appoint us as the advisors for their IPO listing in Singapore. In their first evening here, we took them to an expensive Japanese restaurant thinking that it would impress them. During the course of the dinner, the guests started talking about the Nanjing massacre by the Japanese. It was then that I realised I made a big blunder to bring them to a Japanese restaurant on our first meeting.

Another situation arose during a joint project with our German counterparts. We were supposed to assist their clients in Asia in their tax and payroll requirements. After about six months of discussion, we realised that all that they needed was a simple calculation of the tax payable for their client, rather than the whole suite of payroll services. This stemmed from the difference in understanding what constitutes a normal scope of work, and assuming that what we do in our country is what is done in another country.

Cheryl Tong
Managing Director
Pursuit Pte Ltd

ALMOST everybody knows that doing business overseas requires an understanding of the cultural nuances and business practices of the local markets. However, attending courses and having theoretical knowledge are not sufficient. One must actually have experience doing business in the overseas market in order to acquire that understanding and knowledge.

I have learnt more about doing business in one Asian country during my recent experience negotiating a deal with a company in that country than all the seminars and workshops that I have attended.

First, they are never direct and straightforward. It is hard to tell when they mean what they say and when they imply the opposite of what they say. Learning to see beyond their spoken words and interpret their body language is not something one can learn in the classroom. We have to learn by experience and try to minimise our mistakes and missteps.

I learned to my chagrin when negotiating a deal, relationship is more important than the price or quality of the product. They will do a deal with you if they trust you. However, establishing a good relationship with the partner takes a lot of patience, time, energy and a strong stomach. Closing a deal may take 10 minutes, but getting to the closing stage may take hours and days of wining, dining and song and dance.

These businessmen are very patriotic. Although they may whine about conditions in their country, we should never fall into the trap of supporting the criticism. We are guests in their country and should never interfere with their internal affairs.

Mikell Koh
Managing Director
Milne International Pte Ltd