PROTOCOL
In India, where ceremony is an integral part of daily life, there is accepted protocol followed even in the negotiation process. Indian society is formal and hierarchical, and most of the discussion in a negotiation should be directed at the most senior person present or the person with the most decision-making power. Commonly, the spokesperson of the negotiation team will dominate the discussion, although he/she may call upon various team members.
When dealing with foreign negotiation teams, Indian negotiators may often appear to approach topics in an indirect way or to deviate from the agenda at hand. They are often persistently focused on getting the best bargain, though they will do so in a very gentle and roundabout way. They are open to what can be quite lengthy discussion and will often keep the other team’s interests in mind when proposing a solution.
NEGOTIATOR Indians prefer negotiators who are intelligent, patient and good listeners, and who are able to put the point across with as little conflict as possible. Precedence is important, and an effective negotiation should be able to put the point across. International negotiating teams who employ aggressive, short-term and impatient tactics are not appreciated. Indians would prefer to reach a win-win situation where possible and are typically very accomplished negotiators, as it is part of their daily life.
When dealing with teams from other companies, Indians expect them to be open, forthcoming, have good communication skills and adhere to accepted standards of behavior. They also should be senior enough to make decisions on the spot, and may challenge a negotiator’s authority as a tactic to force a premature decision that would be advantageous for their side.
BASIC APPROACH
When entering the negotiation process with an Indian counterpart, it is important to use the first few meetings to establish trust and a good working relationship, as the team’s background credentials are important. Third-party introductions help establish the negotiating team’s credentials, through in-person introductions or an endorsement over the phone or by email prior to the meeting. It is also common to have a third party present to ensure a smooth and hassle-free process.
When receiving negotiating teams, Indians will behave with hospitality and respect and may take time offering refreshments and social banter to ensure the comfort of their guests. Upon arrival, teams will likely receive a very professional, warm and responsive welcome.
Indian negotiators are most likely to showcase past work done and refer to a network of common references to support their cases. They are also keen to ask questions, listen to what is required and ensure that the negotiation is done in a social, relaxed, professional and collaborative manner. Indians tend to appreciate a good bargain, so when negotiating with Indians, they are likely to expect a discount or a concession.
In general, the monetary aspects of a deal are the last to be discussed and typically not even in the first meeting. The monetary aspects are often eased into gradually and may seem as an afterthought at the end of the negotiation process but are always very important, and the timing is part of the overall negotiation strategy. In no way are they the focus of the discussion.
Negotiation in India takes time. It may take anywhere from three to nine months for a contract to go through, as it will need to progress along several steps of the company hierarchy, and there is back-and-forth discussion. Modifications are expected and commonplace. There is even the potential for modifications to be requested after the contract or agreement is signed.
RISK TAKING
Wegenerally have a moderate to low tendency to take risks in the business environment, although that is changing rapidly with the rise in entrepreneurial successes. They like to be sure of all the variables and outcomes before making a commitment. This contributes to longer negotiation periods and in-depth discussions at every stage of the contract.
This tendency to avoid taking risks also impacts the pace of the negotiation, and it may appear to be stuck for a while. Typically, the decision maker is the last person met, and until that stage, the tendency will be to discuss the proposal in depth before referring a negotiator to the person who is next on the hierarchal ladder.
CONFLICT
While Indians may vent their frustrations in social or personal situations, they are most likely to avoid conflict in the workplace. They would rather not do business with someone than enter into a situation that may result in negative issues being aired or discussed in public. When conflicts do arise between colleagues of similar rank in the same company, they are often discussed openly and enthusiastically in a face-to-face meeting. In rare cases when the conflict crosses hierarchical lines or cannot be resolved by other means, a manager will most likely be asked to arbitrate.
During the negotiation process, Indians are hesitant to handle conflict openly. This may result in halting the negotiations or delaying issues for resolution later. In some cases, the most senior member of the team may call upon the opposite team’s leader to resolve the conflict in private.
DECISION MAKER
In many Indian firms, decision-making takes place mostly at the senior- and middle-management levels. While employees may have certain responsibilities and tasks, they often do not have the ability to make decisions regarding these responsibilities and tasks and will have to wait for senior management to make a decision.
When making decisions, it is expected that these decisions be fair and analytical and be based on business logic. It is also commonly seen in many Indian firms that, if the decision results in a success, the leader takes credit for the success, and the leader’s enhanced credibility then benefits each team member in the long term. If it results in failure, then the entire team is responsible for the failure.
When making decisions in teams, which is less common, the group is most likely to engage in a lively debate as they push for consensus within the group before arriving at a decision. If the group is unable to reach a consensus, the decision is made by keeping in mind the majority viewpoint.
PROCESS
The negotiation process in India begins with a sometimes-long period in which the parties establish trust with each other. Bringing in a third party who can attest to the team’s trustworthiness can expedite the process.
Because the decision-making process is almost always a top-down approach, it is accompanied by many hours of discussion with various team members, observation, and then more discussions, after which a consensus may be reached. The alternative to the top-down approach is consensus, and then, only after all the members of the senior-management team are in agreement, can a final decision be made. While decisions are often considered final, there needs to be much room for flexibility and modifications throughout the process, and exceptions may even be requested for consideration after signatures are on the agreements.
In most Indian companies, decision-making is a lengthy process, as the stakeholders would rather be certain of a positive outcome than risk failure and subsequent blame. Indians tend to be conservative decision-makers, and this requires deliberation when making high-impact decisions. They often debate points in depth, resulting in multiple discussions.
Indian companies prefer detailed written documents in addition to oral agreements. An oral agreement must be followed by a written document explaining options and alternatives. Documents are written in English, but in the case of government contracts, they may also be written in the local or regional language (Hindi).
TIME The decision-making process in Indian organizations can take anywhere from four to sixteen weeks in corporate organizations and multinational companies, and can last for months with governmental organizations. Recruiting local advocates and representatives who can attest to the negotiation team’s credibility may reduce this length of time.
The complexity of the deal and the risks involved can influence the process. Indians tend to be conservative and spend time on the multiple aspects of a complex deal. Other factors include the scope of the deal, the monetary aspects involved, the number of people involved and the timelines. The decision-making process greatly depends on the levels of trust and the relationships between all of the parties, especially in the presence or absence of established trust between decision makers.
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