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This question was placed on De Baak International’s LinkedIn Group page in reference to the Dutch doing business with Indians. Armijn Peltekian of NexusNovus gave a detailed, very complete and, in my opinion, spot-on answer that deserves a wider audience. I’ve reprinted it below:

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[It] is of great importance to understand the socio-cultural differences that exist between the two countries. However, India is immensely multicultural with a large number religions, castes, sub-castes and regional differences. To generalize all Indians as equal in terms of politeness, humility and sensitivity would be an error. In my opinion the most important lesson to be learnt is that since you have to deal with a vast array of cultural differences, your approach needs to be tweaked on a case-to-case basis.
Experience is crucial when conducting business in India. SME’s in general neither have the required in-house experience, nor can they afford to hire an experienced expat to conduct business functions for them on location. The task of facilitating an effective entry into India would prove to be extremely challenging to them.
MNC’s too, face a number of problems, particularly in management styles. Deputing an inexperienced expat to carry out necessary business functions in India very often fails to generate expected results. This boils down to the cultural differences as mentioned by [a previous respondent]. A very direct style of management might be counter-productive. The cost perspective of Dutch managers is quite off from the point of view of the existing reality as costs are generally much lower in these regions. However, many managers fail to understand the extent to which the costs are lower. In India, it would be a grave error to come across as one who gives in to unnecessary splurges. To pay “too much” for something is a sign of weakness. Hindustan Lever (now Unilever), McDonalds and Maruti-Suzuki, have attained their position of success due to the fact that they have completely Indianized their functions and processes.
[The original question] however questions whether the Dutch will have the skill sets to compete in a new (flat?) world. In my opinion, the greater majority of people in Europe lack the skill sets required to conduct business efficiently in Asia. But with the rise of the new economies there will be a large premium on people who have acquired these skill-sets and this will result in adjustments/ training for people currently lacking those skill-sets. If one takes some historical aspects into consideration, throughout past centuries the Dutch have been able to trade with many different Asian and African countries as well as all different cultures contained within Europe. If that teaches us anything, it shows us that these skills-sets can be acquired.
To conclude, India is extremely multi-cultural, multi-ethnic and multi-religious. Your approach needs to be custom designed on a case-to-case basis, and to do this, one requires a great deal of experience. Entry into India can be tough for SME’s due to cost restraints and lack of experience. MNCs do face hardships as well due to the large cultural difference that exist, as mentioned by [the previous respondent]. I also feel that Europe currently has a lesser focus on India than America does. Outsourcing and the flat world are well known concepts in those regions. Europe has not yet been exposed to India to the extent that America has, but that is rapidly changing. I fail to recognise any factors that would inhibit The Netherlands in any attempt to reap the benefits of lower sourcing costs and tremendous market potential of India.

RT @HarvardBiz: Leadership lessons from Indian companies: good preview of an very good article http://bit.ly/bpzusc

The question is: can the rest of us learn from their practices? As Peter Cappelli astutely observes, the lessons are not new, and even though many are based on circumstances found unique to the Indian business environment, there are nevertheless inherent lessons.

Especially: measuring and tracking training and development and creating a real sense of social mission, whereby employees can feel that their work has impact can have clear influence on the culture and success of any company.

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