|Tips for Doing Business in Spain|
I. Management Tips
1. Currently, the most important business issues for managers (natives and expats) in Spain are:
The economic crisis, rising unemployment, and a huge drop in consumer spending. Modernization of ailing infrastructures, water, electricity, telephone lines (the latter in many places still distributed via overhead cables). The modernization of the rail infrastructure with the “AVE” (high speed train) now available between Madrid and Barcelona. The link between Spain and France will be completed in the next few years. The need to open up to external markets. There is great emphasis now being placed on teaching English in Companies and in schools at all levels. In the last few years the employment market has been flooded by immigrants arriving from North Africa, many of whom arrive illegally by boat from places such as South American countries, Romania, Poland and Russia. In the past, Spain was a country of emigrants and there has been a need to change to be a receptor of immigrants. Spain is a country divided into 17 autonomous areas and each area had its own local government and regional laws. Dealing with Terrorism stemming from the Basque Country is still high on the national agenda.
2. Effective leadership in Spain includes for following behaviors:
Expertise in the field that you are managing. Academic qualifications and experience gained outside Spain. English language. Formal protocols exist and formality is expected between managers and their staff members. Building strong relationships is important and these are still important in recruitment processes and for information gathering before decisions are taken. Paternalistic management is prevalent, particularly with the very high number of family-run companies in the Spanish economy. It is common to be spoken to or at, without the speaker engaging the listener. Show and tell is also very common.
3. Business is not conducted during the following times and or occasions:
There are 14 national holidays in Spain and these vary between towns and regions. Each town has two local feast days to celebrate the patron Saints, so no business occurs on these days. The month of August is traditionally the time when businesses close, although it is now becoming common for people to split holidays between summer and another period, say Christmas. Lunch time is traditionally two hours and the working day continues until 19.30 or later. More flexible working hours are becoming common, although a working day from 08.00-15.00hrs is considered a shorter work day and many women seek this option. There is a strong movement nationally to reconcile the working day with other European countries, so as to achieve stronger work life balance. Old habits die hard.
II. Expats in Spain
1. What are the most important issues for expat managers in Spain to get right?
The strong sense of family and local traditions. It is rare to be invited into a Spaniard’s home as an outsider, this is a sanctuary reserved for family and very close friends of long standing. Most entertaining takes place outside the home in restaurants. Emotions and feelings are expressed openly and in public. When national disasters or acts of terrorism take place, displays of grief, shock and solidarity are expressed by silent protests on the street. In fact the public arena is where much of life takes place. At the end of the day or at weekends, it is common to go for a walk in the local town, or shopping center just to be there, see what is going on and to meet others. It is very common to eat breakfast out of the house in the local bar, have a mid-morning snack and to go out to the local restaurant at lunch time. Gossip type television shows and magazines are very popular. Overall, newspaper style of writing is narrative and very descriptive, rather factual with plenty of data. Bureaucracy is heavy and demanding on time to deal with many different procedures. The local Notary is a very important person before whom many different types of contracts, financial agreements, wills and other legal agreements need to be signed. Time is treated in a synchronistic way. Many things tend to happen at the same time. Planning is often last minute and notification of meetings can occur only a few days before the event is due to happen.
2. How are expat managers typically perceived?
With curiosity and when the expat makes the effort to learn the local language, Spanish or one of the regional languages, there is greater acceptance. Prejudice is high depending on the country of origin of the expat, especially those people coming from Latin America.
3. Some actions and behaviors are appropriate for locals of Spain, yet should not be adopted by expats who are not completely fluent in Spain's practices and culture.
Criticism of someone else’s family. Inappropriate use of swear words and bad language. Using the informal version of “you” (“tu”) too early, before establishing a close relationship, especially in very formal situations. Do not talk about the civil war.
III. Clients and Business Development Tips for doing Business in Spain
1. How can vendors be effective at building rapport with potential clients in Spain?
Do not rush straight away to fix the deal. It is important to build a relationship first. Find out what the local market needs are. The autonomous regions are very different and local allegiances in certain areas such as Catalonia and the Basque Country are more important than feeling a part of Spain. Men on the whole love to talk about sports; football and basket ball are very important as is tennis. Women will also engage in sports talk, but are more interested in other themes.
2. What should vendors do when visiting a prospect or a client?
Be punctual but do not expect punctuality, take something to read or do whilst waiting. Be prepared for interruptions. Be aware of working hours and local holidays. Be aware of regional needs, language spoken and political challenges in relation to the whole country.
3. What should vendors avoid doing?
Being too informal to start with. Make assumptions about tastes, needs etc. Do not think about Spain as a whole, take into consideration regional laws, infrastructures and other political implications. Be aware not to damage a person’s pride, this is a very important Spanish characteristic, especially between men.
4. What are the most important things to keep in mind when negotiating with prospects or clients from Spain?
Regional differences. Spain is a fairly high context society, so there is less emphasis on written documentation, manuals etc. Contracts are heavy documents and are always usually read out aloud in front of the signing parties in the presence of the Notary.
5. What is considered a conflict and how are conflicts handled?
Insult to one’s pride, loss of face. Difficulties when mixing family life and business. Interference by extended family in a family run business. The issues of handing over power to the next generation in a family business. Legal action, mediation. Rifts between people, blockages in communication. In the worst cases, violence.
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:
Maintain the personal contact, regular phone calls, invitations to meals, special events, presentations, gifts etc.
For additional information, please contact ITAP Spain (Schubert Consulting).
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