Negotiations Training

Business Negotiations in India:
Negotiating with Indian Counterparts

Regardless of where one stands on the issue of outsourcing, a great deal of telephone-based and computer technical support, product coding and development is making its was from the United States to India. This is particularly the case in the technology industry where lower costs are influencing an aggressive shift towards placing R&D departments in places like Mumbai, Bangalore and other Indian cities. Dell, for example, has outsourced a great deal of its telephone support to India. Some charities have even begun utilizing Indian call centers to provide fundraising capabilities.

We don't plan on going into detail on the pros and cons of this trend. That is not our purpose. What we do want to do is provide you with some important tips that will help you when negotiating with Indian counterparts. Since Indian culture is vastly different than American or, rather, Western culture, some added insight is very helpful. We suggest you do your homework before negotiating in India as it will save you time, money and an unnecessary amount of stress.

* Dealing with Language and Bureaucracy - English has become the standard business language used in India. Due to the vast amount of local languages and India's colonial rule under Great Britain, chances are your discussions will be in English. While this provides an obvious advantage, it is always a good idea to have a local intermediary or representative to minimize miscommunication and to act as a local agent. This is particularly true when one must navigate through the bureaucratic process generally faced when opting to do business in India. A local agent will be able to walk you through appropriate government procedures, requirements and paperwork. This person will also provide a "calming effect" of sorts when individuals used to working at an "American pace" must deal with the typical delays encountered when dealing with the government.

* Be Prepared to Deal with Families - Many businesses in India are family owned and operated. In many instances, you will be dealing directly with a family member, particular when important decisions are involved. As a general rule, decisions are usually made by the patriarch of a family. Given India's adherence to castes and social levels, it is wise to send someone with considerable authority to negotiate business relationships and arrangements. This will ensure that your Indian counterpart will also have sufficient authority. Ultimately, decisions must be in line with family, social and group interests.

* Responsibility Lies at the Top - When it comes to decisions and ultimate responsibility, the buck truly stops with management. Many Indian employees are unwilling to accept responsibility so it is key that all agreements, terms and understanding be written down. This applies to just about every level of a negotiation. There needs to be a clear understanding between both parties. Documentation will ensure that others in the organization, particularly those in lower positions, will have an understanding of what is required of them.

* Negotiations are Part of the Indian Culture - Bargaining is ingrained into the Indian way of doing business. Your counterpart will surely be an experienced negotiator and will be a "worthy adversary", so to speak. You will need to be skilled as a negotiator and know that the other party, like you, will be looking for the best deal. As you negotiate with your counterpart, you should keep other options in mind. That is, don't look at just one possible partnership or business relationship. Just like any other product or service purchase, you should check with multiple vendors to ensure the best outcome for your organization.

* Reading Through Their Words - Similar to South America and other cultures, many Indians will not flat out say, "no" during a negotiation or business transaction. Often, answers will be vague and less clear. This should be read as a negative response. A direct "no" is seen as too abrasive. When you are caught in the same situation when a request must be denied, it is better to utilize more non-committal language.

* Be Flexible - As with other cultures, be prepared to be flexible at the negotiating table. Creativity and the willingness to bend are important. Look for ways to come to agreement that fit within your company's goals and boundaries. Strict adherence to rules may be frowned upon.