Cross Cultural Management Guide for Peru

The guide below is for managers who want to learn more about the management style and business culture of Peru.

It provides some useful information for managers who are relocating to the country for employment as well as those who may have Peruvian employees in their global or multicultural teams.

Topics include:

• Hierarchy
• Leadership style
• Time and scheduling
• Communication style
• Negotiation

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Being a Manager in Peru

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The business set-up in Peru is very formal and foreign managers will be more successful if they bear in mind the importance of being courteous at all times.

• Treat those in positions of authority with particular respect and deference.
• It is better to err on the side of being overly formal rather than jeopardize a business relationship by being too informal and appearing flippant.
• Spend time cultivating relationships and maintaining them once they are formed.
• This is a country where "who you know" is often more important than "what you know".
• Interpersonal relationships ("personalismo"), including loyalty to family and friends, are the linchpin of successful business interactions.

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The Role of a Manager

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Foreigners will be more effective when managing in Peru if you keep in mind that each person has a very distinct role within the organization.

• People believe that their supervisors have been chosen because they have more experience than those they manage.
• Therefore, unnecessary, and even inappropriate for them to consult with lower-ranking individuals when decision-making.
• In Peru, as in other hierarchical societies, managers may take a somewhat paternalistic attitude toward their employees.
• They may demonstrate a concern for employees that goes beyond the workplace and strictly professional concerns.
• This may include involvement in their family, housing, health, and other practical life issues.

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Approach to Change

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Peru’s cultural appetite for change is developing all the time. Peru is seen to have a medium tolerance for change and risk. It is important for innovations to have a track record or history noting the benefits if they are to be accepted and implemented.

• The fear of exposure, and the potential embarrassment that may accompany failure, bring about an aversion to risk and the need to thoroughly examine the potential negative implications.
• While in risk-tolerant environments, failure is perceived as a learning process that encourages confidence in future ventures, failure in Peru causes a long-term loss of confidence by the individual as well as by others.
• Because of this attitude, cultural sensitivity is going to be required, especially when conducting group meetings and discussing contributions made by participating individuals.

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Approach to Time and Priorities

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Deadlines and timescales are fluid in Peru. It is important to bear in mind therefore, that patience plays an essential part in successful management.

• While timescales and deadlines need to be set well in advance and reiterated carefully, it should be understood that these will be viewed as flexible.
• Global and intercultural expansion means that some managers may have a greater appreciation of the need to enforce timescales.
• As such, agreed deadlines are more likely to be met.

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Decision Making

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Decisions are reached at the top of the company, often after seeking input from all the stakeholders.

• Since Peruvians believe business should be "win-win" scenarios, they attempt to find solutions that are in the best interest of all concerned.
• Managers are more autocratic than in many other countries. They tell subordinates what they want done and how they expect them to perform the task.
• Subordinates follow a manager’s instructions without comment, as it would be rude to challenge someone of a higher status.

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Boss or Team Player?

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If you are working with people from Peru an understanding of the importance that hierarchy plays is needed.

• Traditionally, the supervisor is seen to hold that position because of superior knowledge and skills.
• It would traditionally have been unthinkable for someone of a higher position to collaborate with someone from a lower status.
• This is changing somewhat in younger generations, particularly those employed by multinational corporations.

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Communication and Negotiation Styles

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Personal relationships are important in dealing with Peruvians. They prefer to deal with those they trust therefore much time is spent in developing the relationship. It will usually take several visits to close a deal as Peruvians need to know who they are doing business with before they can come to an agreement.

• Relationships are more important than business documents.
• Negotiations and decisions take a long time and patience may be a necessary personal attribute.
• Avoid high-pressure sales tactics as they are seen as confrontational.
• Companies are hierarchical and decisions are made by the person with the most authority.
• Peruvians are skilled negotiators and drive hard bargains.

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