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Tips for Doing Business in Germany

Management tips, information about expats in Germany, and Clients and Business development tips.
ITAP International | 21.08.2011
I. Management Tips:

1. Currently, the most important business issues for managers (natives and expats) in Germany are:
- Cost effectiveness, overcoming the financial crisis
- Adapting business to obligations regarding the environment
- Internal talent management, that is to keep and develop the current employees within the company
- Implementing the strategies from headquarter during the time of the assignment

2. Effective leadership in Germany includes for following behaviors?
- Knowing when to use task or relationship orientation
- Delegation of tasks (the goal is to be as dispensable as possible)
- Defining tasks and their scope
- Formality, directness and timeliness, deductive decision-making and decision-making

3. Business is not conducted during the following times and or occasions:
Public holidays all over Germany are: New Years Day, Easter Monday, first of May, Ascension Day, Pentecost, Christmas. Some federal states have more public holidays.

II. Expats in Germany:

1. What are the most important issues for expat managers in Germany to get right?
- Working self reliance, being able to deal with relatively flat hierarchies and a democratic way of decision-making.
- Channel information in formalized structures, using directness in communication.
- Use business English so that it can be understood as a second language.
- Consensus-finding approach of aggressive conflict resolution.
- Learn about German values and norms in the light of history with a broad contextual understanding of behaviors and mannerisms.

2. How are expat managers typically perceived?
As a representative of headquarters in a non-German based corporation, thus representing not always the ideas of local staff. Therefore they need to convince the local staff about their mission not just by vision or statements, but have adapted strategies at hand and discuss these with detailed knowledge of local procedures.

3. If an expat doesn’t clearly back up ideas and strategies with facts and data , he or she can be perceived by Germany nationals as not reliable?

III. Clients and Business Development Tips:

1. How can vendors be effective at building rapport with potential clients in Germany?
- By communicating in a direct way, focusing more on facts and targets than personal relationship
- By being clearly structured
- By having a clear agenda and keeping the time schedule
- Convince by experience and competence

2. What should vendors do when visiting a prospect or a client?
- Being informed about the company
- Explain in detail what they can achieve
- Give examples of their product and implications

3. What should vendors avoid doing?
- Be too entertaining
- Not be specific about the client
- Not prepare

4. What are the most important things to keep in mind when negotiating with prospects or clients from Germany?
Germans communicate directly and expect their partners to be direct as well. Germans usually need complete information on a subject (low context communication) as well as a clear structure. Germans are used to discuss and decide subjects democratically with all people involved, regardless of their hierarchical position. They stick to contracts and decisions made and get very irritated if the other party does not.

5. What is considered a conflict and how are conflicts handled?
A conflict can be a result of diverging interests and ideas about something as well as an interpersonal matter. Conflicts are seen as normal and are usually openly discussed. Usually everybody who is involved is expected to express their personal opinion (it is also expected to have an individual opinion) directly and openly so that, through open discussion, a solution can be found.

6. After the end of the contract, the most effective thing one can do to maintain a relationship (for the purpose of getting follow-on business) is:
- Follow up the points of the agenda
- Stick to the cornerstones of the contract
- Be timely with delivery
- As much written communication as possible
- Inform the other (German) side in time if a change of plans cannot be avoided or if a deadline cannot be kept
About the author: ITAP International