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Cox and Cocktails: Presidential slogans & doing business in India

Posted by Chad O'Connor  October 8, 2012 11:00 AM

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"Cox and Cocktails" was the presidential campaign slogan used by Warren G. Harding in 1920.

In 1928, Herbert Hoover used the slogan, "A chicken in every pot and a car in every garage."

I bet you could read Hoover's slogan to a large group of people and most would understand his message – it is fairly self-explanatory. Harding's slogan might raise more than a few eyebrows, some might openly question how he won the election with that slogan.

Hoover's slogan is considered low-context because it is direct and explicit, you don't need to know more than the plain definition of each word to understand the meaning of "a car in every garage." Harding's "Cox and Cocktails" slogan is regarded as high-context, requiring you to know a lot about American society at the time to get it's meaning. "Cox and Cocktails" makes sense as a political slogan if you know that Harding was running against James Cox who was opposed to Prohibition.

The terms high-context and low-context are typically used to categorize different cultures. In a high-context culture complex messages can be communicated with many key words left unspoken. The communication is nonetheless effective because common cultural experiences allow clear inferences to be drawn, as in the communication made by Harding's "Cox and Cocktails" slogan. In a low-context culture, messages are more explicit and there is less room for inference or interpretation. The United States is categorized as having a low-context culture. India is categorized as having a high-context culture.

If you are thinking about doing business in India, it is important to capture communication that is unspoken and left to inference. Clear communication is necessary to building business relationships and strong business relationships are critical when doing business in India. Investing the time to understand and develop strategies to overcome the challenges of doing business in a high-context country can be significant to the success of your market entry strategy.

American firms often stumble on communication problems when doing business in India in my opinion. The difference in American’s low-context culture and India’s high-context culture is exacerbated by the fact that both countries use English as the language of business. Americans tend to fall into a false sense of security believing that their Indian counterparts communicate as they do.

When Americans rely on literal words and do not realize they are missing out on a lot of unspoken communications it breaks down trust and relationship building efforts. It’s not unusual to hear complaints from Americans and Indians about the other being untrustworthy.

So how do you mitigate the risks of unspoken communication to build successful business relationship? Below are general tips:

1) Be like your lawyer. Follow-up every communication, via phone or meeting with a written summary of your understanding and copy to all participants in the business transaction. Ask your Indian counterpart to clear up misstatements that may exist in your summary.

2) Focus on decision-makers. The vast majority of Indian companies are family owned-businesses (including publically listed companies). Decisions are made at the top. Junior employees are less likely to influence or be included in decision-making.

3) Hire a local Indian representative. The representative should be someone you trust and who has a stellar local reputation in your industry.

However, this is not an option in India’s defense sector. India has complex regulations about the use of middlemen to pursue defense government contracts, including steep penalties for violating the rules.

Also, beware of independent contractor relationships. Indian courts treat independent contractor agreements similar to courts in the U.S., meaning they look beyond the contract to determine the real relationship between the parties. The courts can deem an independent contractor to be a de facto employee. If a company has an employee in India they are considered to be doing business in India, in which case the company is subject to India’s labor laws as well as its corporate rules and regulations.

High-tech firms are best to stay away from Agents and Distributors unless thorough due diligence has been conducted on the Agent or Distributor. Several have underperformed. It is a good practice to establish clear performance metrics in contractual agreements with remedies if the metrics are not met.

4) Create a local network of trusted advisors. If hiring a local representative is not an option, then develop third-party sources for business intelligence. Discussing you business dealings with Indian association leaders, industry professionals and other companies may help you identify misunderstandings. Expect that it will take at least one year to develop a strong business relationship.

5) Implement real-time reports. If you are planning a complex project with your Indian counterpart, develop a written tracking process. Indians can be extremely indirect when delivering bad news particularly verbally in meetings, but are not hesitant to implement real-time reports. Note: In India, good etiquette dictates being indirect when delivering bad news. Being indirect is not intended to hide information.

Sheila H. Khatri is President of Moti International, a firm specializing in incubating sales and marketing functions for U.S. firms in India.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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