What you should know about Germans before doing business with them

About a year ago I was asked by Becky Park DeStigter to contribute a piece for her business website, The International Entrepreneur. I “knew” Becky only via Twitter (@intlentreprenr) where she’s posting a cornucopia of valuable nuggets on international business. My participation was published as an interview in a series of “expert Q&As” on the topic of cultural advice for international businesses and entrepreneurs.

TheInternationalEntrepreneur

Since its publication I received a lot of (mainly positive) feedback and I still see the piece re-posted on Twitter a year later. It also took me a year to realize that I never published the article on my own blog. Stupid, I know. But it’s never too late. And since the piece hasn’t lost any of its relevance I am copying it here now for all you Schnitzel aficionados. If you feel like posting it on Twitter I’d appreciate a cc: (@hoeferle). For more information about the obvious and the hidden obstacles of transatlantic business I encourage you to contact me and/or visit our website. Thanks!

The International Entrepreneur – Cultural Tips on Germany: an Interview with Christian Hoeferle

Becky Park DeStigter: What do you see as unique cultural characteristics of German people that are reflected in Germany’s business culture?

Christian Hoeferle: Germans are known for valuing diligence, thoroughness, education, manners, and structure. An old German idiom says “Ordnung muss sein!”, loosely translated into “there has to be order!” This almost proverbial desire for a sense of order goes hand in hand with a willingness to be regulated. Overall, Germans also tend to be very risk-averse which is owed to their history. Sometimes this translates into business practices which may appear slow or reactive to other cultures.

BPD: In your opinion, what are Germany’s most competitive industries in world markets?

CH: The obvious answer is the automotive world, along with other manufacturing industries, engineering, and the chemical industry. Since Germany is one of the most eco-minded nations by international standards, German green energy and renewables businesses consider themselves global leaders in their sector. You will also find that many German small and mid-sized businesses in the craft & trade professions are at the top of their field.

BPD: What’s the best way to find potential German business contacts?

CH: Peer referral might be the best way to expand your network. But that isn’t always an option, especially if you are just beginning to establish a presence in Germany. That is why I encourage businesses to attend trade fairs. German companies are usually strong supporters of the “Messe” for their respective industry. These industry expos are both, a stage to showcase your company’s expertise, products, and services as well as a terrific platform for networking and business development. Try to identify the leading German B2B trade publications which cater to your industry. Most of these outlets have company registries. You will likely have to pay to access their information but it can be a good investment. Bi-national Chambers of Commerce have also proven to be helpful in developing new contacts.

BPD: What do you wish people knew about doing business in Germany before they arrive in country?

CH: Typically it can take a while to earn a German’s trust. So be prepared to be persistent – and trustworthy. Do as you say and say what you mean. Be polite and respect rank. But if in doubt how to communicate, candor trumps diplomacy. Not only are Germans not risk-takers, they also want to avoid ambiguity. Try to be as clear as you can in your communication. If you don’t speak German (or only little), then communication normally defaults to English. Most German professionals speak English, however, they do so with varying degrees of proficiency. Using simple English and avoiding culture-specific idiomatic language helps to address that. Americans, Australians and Britons tend to use many sports analogies in their English which can cause misunderstandings and/or puzzled looks. Starting a business relationship right off the bat isn’t something Germans are comfortable with. In fact you’re throwing them a curve ball or you’ll even catch them off base.

Over the past decades many businesses around the world have gradually implemented a US-American model of management and leadership. While this can also be true for several German companies, I think most newcomers to the German market should be aware that team management and leadership styles in Germany still differ quite significantly from the US model. Therefore, intercultural and global team leadership trainings should be considered a must during your company’s strategy development for expansion in Germany.

BPD: From your perspective, what’s the business climate like for entrepreneurs (supportive vs. unsupported, culturally accepted profession vs. not accepted, etc.)?

CH: Germans are strong believers in fairness. Hence, business models that appear to take advantage of or exploit others are frowned upon.

You will find that since the mid-1990s Germany has reworked much of its welfare system, the tax code and outdated subsidy programs. Whereas it was then known as the “sick man of Europe” it currently is the best performing nation within the European Union. Foreign investment is sought-after and government agencies like Germany Trade & Invest (gtai), the Federal Ministry of Economics (and its subsidiaries) and other economic development agencies coordinate the support efforts, including government grants, tax abatements, tariff regulations, or site selection.

Since Germans take pride in their educational system – both, higher and vocational education – it is important to know that degrees matter to them. For example, a Master Electrician or a PhD in Chemical Engineering will likely display a subconscious sense of superiority towards their foreign counterparts, unless you can present a comparable degree. To many non-Germans this may seem arrogant and overbearing. Not to worry, though. It’s an example of the Germans’ submission to their “universal” order. Very rarely is it meant to be taken personal.

For the original version of the interview click here.

Thank you, Becky!


ch (April'14).2Christian is a cultural trainer, coach, and consultant with extensive experience in working with multinational companies and especially in developing global leaders. He is the President and CEO of The Culture Mastery, LLC, where he leads a team of dedicated training, destination services, and expat support specialists. Christian works with global organizations (or those who are going global) to help their employees overcome cultural differences. Typically he only uses the word “normal” in quotation marks and he is an advocate for helping people understand the why of behaviors – not just the dos & don’ts. Most just call him “The Culture Guy”. Find out more about Christian here and follow him on Twitter. You can also see him, listen to him, and experience his work – just invite him!



14 thoughts on “What you should know about Germans before doing business with them

  1. Great post, When I worked in 1993 for an American pharmaceutical company in Freiburg, I remember one ritual that nobody would miss: around 9:30 am everybody will go the company’s cafeteria to have ” Frühstück”, (breakfast). It was important and no business meetings could happen during this time. That enraged most of the American colleagues. This reflects what you said about building trust and team spirit. Germans respect rules while in France trying to avoid them is a national sport so sometimes the two cultures clash.

  2. Thank you for reading, liking, and commenting, Anne.
    A risk-avoiding culture like the German accepts rules more willingly and can easily disapprove of more risk-taking cultures and their “careless attitude” toward regulations.

  3. Christian, great summary! I think it gives a very good sense for the key aspects in German business culture. By getting closer you will notice differences between the regions. Just as an example: Munich and Stuttgart have a different “vibe” than Berlin. South-Germany is more conservative, and a bit more reserved, where the latter has developed a great start-up and international art/design culture over the recent years – also because it is overall more affordable, especially compared to other European capitals.

    • Wolfgang,
      Thank you for reading and leaving a comment.
      I very much agree with your point on regional differences within Germany. Not sure, though, if I’d subscribe to your South = conservative/reserved assessment. However, the unique vibe of Berlin is undeniable.
      Knowing about the regional differences and being able to apply this knowledge to your business dealings can be quite helpful.

  4. Both your article and the comments are very much to the point. A little addition: In architects’ and building trades’ offices, it is often difficult for Americans to get used to Cognac drinking on the job to toast on a successful bid or any other joyful event.

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  8. I very much enjoyed and agreed with this! I’m American and my job requires me to visit Germany several times throughout the year for trade shows etc. The level of formality [highlighted in a different post of yours] is absolutely spot-on! It takes a significant amount of time (and business-dealings) before someone will use my first name or address me as ‘du’ instead of ‘Sie’; and they typically ask first! Similarly, I use “Sehr geehrte/r Frau/Herr…” when addressing emails to lesser-known German contacts.

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