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Doing Business in Europe: Not the Challenges You Think

If you plan to do sell your product or service in Europe the problems you encounter may not be the ones you expect. It's easy to focus on perceived difficulties, such as the...
Views: 1.831 Created 10/09/2006
If you plan to do sell your product or service in Europe the 
problems you encounter may not be the ones you expect. It's easy
to focus on perceived difficulties, such as the so-called
"language barrier", while not noticing the real pitfalls - until
it's too late. I learned three lessons the hard way: appreciate
the different cultures, understand the value of quality vs.
speed, and know which foreign language is key to your business.

If you hope to compete with local firms in Europe you must
understand European business cultures. Notice the use of the word
of the word "cultures" - plural. When I first started doing
business in Europe, three years ago, one of the first things I
learned was that the European business environment is much more
diverse than in the States. Despite the introduction of the
single currency, Europe is not a single business entity.
Different countries retain different ways of doing things. Like
many Americans doing business in Europe for the first time, I
learned this the hard way. After a number of awkward meetings and
deals that mysteriously didn't go through I began to understand
that it was a bad idea to deal with Europeans like I dealt with
people back home.

The American business model prevails in northern Europe - with
the UK and possibly Germany representing the nearest thing Europe
has to a US-style approach. Businesses in former Easter Bloc
countries that have recently joined the EU are also very US-
friendly. During the Soviet years America represented freedom;
American business can now reap the rewards of that iconic status.

The rest of "old Europe" is a little different and you should be
aware of each country's customs. Italy, for example, retains a
way of doing business that might seem bureaucratic and
patriarchal to Americans. Even Silvio Berlusconi - a good friend
of US business - is known as "Papa" Berlusconi in some Italian
circles. In France, a history of civil libertarianism twinned
with state control that stretches back to the revolution of 1789
has nurtured a business culture that favors consensus rather than
individual leadership. It's important to do your research - not
only on a country's business structures but also on its general
culture and history. It's even more important to get to know the
people. If you travel to Madrid to cut a deal having never before
set foot in Spain you are at a disadvantage.

Business people in old Europe have slightly different perceptions
of what constitutes good practice from their US counterparts.
Although it would be patronizing to say that a ma??ana culture
persists in southern European business, it is true that
timeliness is not considered a virtue in the way it is in the
States. For European business people, providing a quality product
or service is much more important than adhering slavishly to
deadlines or driving the hardest possible bargain. Because of
this difference in values, Europeans often perceive Americans as
being "pushy" - when the Americans in question think they're
simply being businesslike.

When I first came to Europe I thought that the most important
thing was to learn languages - I was wrong. Most European
business people accept English as the lingua franca of
international business. However, you don't want to risk seeming
ignorant. A reasonable level of conversational French or German,
for example, will come in useful. I have found that many
Europeans have a prejudice about perceived American ignorance of
the outside world. Showing a little linguistic skill - and, more
important, willingness - will be to your advantage.

My experience is that knowing the local language is particularly
useful in France. The French have traditionally been very
protective of their mother tongue. Today, many native speakers
consider French to be in a state of crisis, attacked on all sides
by international English - so your French hosts will warm to you
quickly if you seem keen to speak it to them. Again, showing you
are willing to try is more important than being fluent.

Even so, skills learned in language classes back home are useless
unless basic cultural differences are understood. Once again, do
your research: time talking to locals or reading about European
culture and history will be well spent. Knowing a little history
is especially important if you're working in Greece or any of the
nearby EU satellite states in the Balkans. Educated people there
will often talk about events of a millennium past as if they
happened yesterday. There is a perception all over Europe that
Americans follow Henry Ford's maxim "history is bunk" - I made
friends quickly when I disproved this prejudice.

The good news is that Europeans are more like us than they are
different: the general cultures of both continents respects
business and promotes honest dealing - but it's important not to
let the small differences cost you money.
Steve McLaughlin founded Global Market Insights, with offices 
in Europe and the U.S. (http://www.gmi.lu), with his vision of
giving clients two synergistic competencies: knowledge of the
global marketplace and industry expertise in manufacturing,
finance and information technology. Steve has over twelve years
of international experience in three continents, having started
in executive search as a Beckett-Rogers Associate. Steve is a
graduate of Rice University, where he was student body president,
and completed post-graduate studies in International Economics

at the Universidad Mayor, Santiago, Chile.
 

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