Cultural Tips on Doing Business in Indonesia

Indonesia is a growing market in a part of the world full of economic promise. As a result, more and more international companies and organisations are investing in the country and sending personnel to work with Indonesians.

In this blog we’ll cover some important tips around Indonesian business culture to help visitors to the country make the best impression possible.

As with any country or culture, the more you can learn, know and understand about it, the more you can capitalize on it, whether personally or professionally.

Cultural Awareness is about making sure your own pair of cultural lenses don’t get in the way of making good decisions.

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Ranked 47th, the country can be very challenging to navigate for foreigners, so here are our 5 top tips on doing business in Indonesia!

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#1 Who you know, not what you know.

Doing business in Indonesia is all about relationships.

People do business with people they like, who they trust and within Indonesia it's often about your larger family or community network as well.

These are a warm people who tend to blur the line between work and life. As a result, for foreigners coming into Indonesia it’s important to understand that initial focus should always be on building rapport and establishing a relationship.

 

#2 Understand the religious patchwork

Indonesia is a multicultural and multireligious country.

Despite its reputation as being the most populated Muslim country on earth, the presence of Buddhism, Hinduism, Christianity and other religions is still very obvious.

As a foreigner, it's essential to understand the local dynamics between the different groups as well as the differences you may find between them. For example, some of the etiquette you may show around Muslims would not make sense around Buddhists and vice-versa.

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Sign near a mosque in Banda Aceh, Sumatra, Indonesia. Banda Aceh is known for its implementation of Sharia law, something which distinguishes itself from the rest of the country.

Photo by Commisceo Global Consulting Ltd. available via Wikimedia and can be reused under the CC BY License.

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#3 Remember ‘yes’ does not mean ‘yes’

“Mulutmu harimaumu” – Indonesian phrase meaning “Your mouth is your tiger”

Indonesians are indirect communicators. They tend not to say what they think and withhold truths in order to maintain harmony and good relationships. One result of this is the tendency to never say “no” and answer any closed question with a “yes”, even if they don’t mean it.

This is basic Indonesian politeness which many foreigners misunderstand. As the listener, it’s up to your to try and tune into non-verbal signals, such as eye movement, tone or body language, to interpret what is really being said.

 

#4 Respect local hierarchies

Indonesians are a very collective and hierarchical culture.

On top of this, local customs, religious bonds and a social system rooted in honour mean that status and position within Indonesian culture are extremely important.

The business culture is therefore very formal and regimented when it comes to areas such as leadership, management, decision making and bureaucracy. It’s vital to understand the local hierarchies you could be working with and where true power lies.

 

#5 Patience is a virtue

Doing business in Indonesia is challenging for many foreigners due to the length of time it takes to get things done.

A highly bureaucratic system within a hierarchical framework means it can sometimes take weeks for the simplest of things to be achieved.

Losing your patience is the equivalent of losing your mind in Indonesian culture. You must be patient, always. This will be recognised. Give yourself longer and more realistic deadlines and manage expectations of those around you who maybe don’t appreciate how things work in Indonesia.

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Main image from Flickr (CC BY 2.0)