Klaus Maier | Managing Director & Founder | M+V & Dr. Singh Sikand  | Director | Steigenberger Hotels
First published in April 2015

Cross-cultural leadership skills are the key to business success in India.

High staff turnover is one of the biggest problems for foreign businesses in India. However, lasting success on the subcontinent is only possible if able and motivated employees can not only be found but also retained in the long term. “Far too often, foreign managers are ignorant of the specific cultural characteristics of their Indian workforce and Indian team members, as they attempt to simply transfer their accustomed leadership style and patterns to the Indian work environment. That doesn’t work, and businesses without the necessary cultural awareness often fail to retain qualified and motivated staff, thereby wasting human resources and jeopardising their market advantage,” says Klaus Maier, Managing Director of the Maier + Vidorno GmbH (M+V).

The booming Indian economy represents a highly promising perspective for international businesses looking to tap into the huge Indian consumer market or planning to set up production plants in India. To grab hold of this opportunity, large international corporations often employ thousands of Indian workers. In order to retain this workforce – and in particular, the highly sought-after managerial staff – whilst staying within the budget, an awareness of Indian culture and mentality is essential.

Dr Singh Sikand, who, as director of numerous Steigenberger hotels in India, has experienced firsthand how German HR policy can clash with local employment culture, confirms this and can pinpoint some of the differences: tradition, hierarchical thinking and a fixation with structure and organisation that would no longer be considered appropriate in a European business context are as commonplace in the Indian work environment as is the importance of family and a loyalty towards individuals rather than organisations. “In India, it is the norm to invite the whole family to company outings or festivities. While, for example, in Germany an employee representative would be the first port of call for any problems at work, in India you will find more of a ‘mentor – mentee’ relationship between managers and their staff,” says Dr Sikand. “Being approachable and able to help your Indian team members with individual problems is of crucial importance,” he explains. From a German or European perspective this may sound over the top, but in India it is vital for a good relationship between management and staff and therefore for a well-functioning and harmonious workplace. “Being aware of these cultural differences is therefore not a trivial matter,” adds Klaus Maier.

M+V has a comprehensive business infrastructure in India with more than 150 members of staff, assisting companies with their operational organisation as well as with setting up production facilities on the subcontinent. In this, they often work alongside the client company’s own staff. Maintaining and preserving familiar organisational structures can bring a clear competitive advantage. In India, as elsewhere, the so-called “High Potentials” are rare and headhunting is widespread. Long-term and sustainable business success, however, requires local leadership personnel as well as a dependable, fully engaged and motivated local workforce.