By J.A. Souza, February 18 2012
Brazil, is one of the members of BRIC, and is ranked as one of the world’s top five economies.
For analysts the Brazilian economy will be growing steadily, promoting external investments, broadening their commodities’ exportations, and raising expectations to a new lower middle class.
As a result, executives and companies are the ones interested in establishing solid bases in the country, considering the potential of growth opportunities. Companies and investors are not only projecting their ventures while thinking about the 2014 Soccer World Cup or 2016 Olympic Games , but they are also looking for possibilities beyond those events.
However, how are companies and investors reaching this valuable market? What are the tools they will need, in order to be successful players? What do International Executives need to learn, to be successful in their missions?
The composer Antonio Carlos Jobim (Tom Jobim) once said: “Brazil is not for beginners”. In the same way that immigrants face the lack of “Canadian experience ” when landing in Canada, experienced international executives will face cultural business differences, when working in Brazil.
People often ask: What are those business differences? In a global economy, why are businesses in Brazil not done in the same way that they are done in Canada, USA, England, and Germany? What are the different aspects between Brazilian executives and other international executives? The answer lies in the “Brazilian way”, an approximate translation of “jeitinho brasileiro”.
The “Brazilian way” can be defined as being a way to work in the country when confronted with:
– the lack of medium or long-term planning; the measures adopted to confront the giant bureaucracy; the overhead costs arising from inefficient public services; the deficient basic infrastructure; the poor security; the improvisation; and the lack of quality controls.
To face this difficult scenario, investors and international executives need to be trained, and be mentored by experienced counsellors and Brazilian executives. Those executives have a high level of international education and understand how to do business in the country. They are hard-driven and can be a valuable asset to companies starting-up their business within Brazil.
Another point to mention is that Brazilian executives like to build strong relationships with their business partners. Based on this strong relationship; then business can be done, process can be improved, and goals may be reached. Changing members of international teams are not recommended.
To build long-lasting relationships, is the basis of doing business successfully in Brazil. International executives cannot expect to start a venture during their first trip. It takes time to get favourable feedback from the Brazilian executives. A full understanding of the scenario, and the “terrain”, is mandatory. Alliances with seasoned local lawyers and accountants, is obligatory – and they can work as useful advisors to avoid pitfalls.
To conclude, international executives will be doing well if they are patient, flexible, and reliable when dealing with Brazilian partners.
A lot of patience is necessary in understanding the curves and the ups and downs of a negotiation. It takes time, and the international executives need to evaluate if they are dealing with the right people, as people are a big part of their decision process.
In some cases the process does not flow at the necessary speed because the negotiators are not the ones interested in reaching a final decision.
Also, international executives need to be flexible to find ways to deal with the complicated Brazilian bureaucracy.
At this point, the use of reliable forwarding agents (despachante) is recommended. They are able to speed process, follow rules and procedures – saving cost to international players.
Finally, reliable people are the foundation of successful negotiations.
Brazilian executives are experienced in doing business with consistent partners that they can count on. International executives cannot misinterpret “the Brazilian way” as an excuse to not follow rules or to be unethical, or breach contracts, or to dismiss previous arrangements.
Brazilian executives admire counterparts that are able to confront the country’s challenges with professionalism, passion, and knowledge surpassing momentary obstacles.
For International Executives dealing with Brazilian counterparts, please try to understand “the Brazilian way”.