Managing and controlling a subsidiary in India – a maximum challenge.
In the last fifteen years, hundreds of medium-sized companies have moved to India - be it with the help of Indian sales representatives, joint ventures or even with their own subsidiary.
But the initial euphoria has apparently worn off (see study Business climate in India), because an increasing number of companies are reporting significant start-up difficulties, some of which last for many years. In particular, there are complaints about a lack of profits and there are a variety of problems with the Indian partners, managers and employees. Many German entrepreneurs believe that the cause of their problems is simply in the Indian behavior and sometimes also speak of Indian “slyness” or even “fraud”, of a “lack of reliability” (see Quality management in India) or simply from “lack of loyalty”.
A current study by the Indian management consultancy Dr. However, Wamser + Batra GmbH comes to a completely different conclusion: In the majority of cases, there is no “immoral” or even “malicious” behavior on the part of the Indian employees and managers - the “blame” for the misery experienced lies somewhere else - namely the person so-called culture clash – the collision of two fundamentally different cultures. And in this case it's about two very different understandings of leadership.
Unfortunately, Western companies still underestimate the very high intercultural demands that an engagement in India places on the German headquarters and its managers.
Managing India from a distance (from “distant” Germany) is a daily challenge - but apparently only a few German company headquarters want (?) or can (?) deal with it to a sufficient extent.
Indians – as a rule – don’t behave like Europeans
What is the most common misconception in business practice? Many local managers believe that Indians behave like Europeans. This fatal error leads directly to the leadership problems mentioned above.
Just because Indians often speak excellent English, dress in a Western way and share many of our Western ways of thinking with us, that doesn't mean that the same leadership tools and strategies can be used in India as in Germany, Austria or Switzerland.
The Indian management consultant and mythologist Dr. Devdutt Pattanaik released in 2013 with the “Business Sutra” a basic Indian management handbook. He clearly concludes that Western (and especially American) management models cannot work in Indian culture.
Our practical experience also shows that it is far too rarely questioned which “Indian peculiarities” need to be taken into account during planning – both in India and in the German headquarters. Intercultural leadership behavior quickly takes a back seat in day-to-day business. Questions about setting up a company, setting up a structure or sales usually have higher priority.
However – as the experience of foreign companies in India shows – it is just that this Complex of topics that ultimately play a key role in determining success and failure in the later course of business: your own leadership behavior, the cleverly used mechanisms and an organizational structure that is adapted to the actual Indian conditions.
See article: The active management of the Indian business is YOUR job!
We guide you so that you (can) lead!
You can (and must) adapt to the Indian peculiarities in the behavior of employees and the special intercultural requirements. However, this requires the willingness to deal more than just superficially with the diverse Indian factors that influence strategic and operational activities. You also have to be prepared to incorporate the knowledge gained into the planning of guidelines and internal early warning systems, as well as to distribute responsibilities and decision-making powers according to the special Indian understanding of hierarchy. And above all, it is important to consistently renew and live this willingness every day.
Because of the importance of this topic, Dr. Wamser + Batra GmbH decided to create an independent department back in 2013 WB human resources® to set up a team that also specializes in questions regarding the organization, management and control of Indian subsidiaries. A focus of WB human resources®'s consulting work is customer-oriented problem analysis and the creation of practical solutions for how the German parent company deals with the Indian branch.
Werner Heesen, who heads the WB human resources® department, worked in India for Lufthansa AG for 13 years (most recently as Director South Asia). Contact him to discuss your leadership issue in India!
