Small Business Success in Siam - Culture is King?

In October 2004, I was standing chatting with a group of Thai business owners at an Australian Chamber of Commerce networking evening at a five-star hotel here in Bangkok. As I turned to order another drink from the bar, a Dutch gentleman briskly extended his hand in my direction, teeth blazing and introduced himself -“Hi I’m Hans (pseudonym) and I teach Thais how to communicate with the real world!” Fortunately, I don’t think that the Thai businessmen that were now standing behind me caught his verbal flatulence. With my curiosity stoked and my blood pressure starting to rise, I looked at him with a raised eyebrow and enquired

“Oh Really?”

He continued

“Well everyone knows that Thais can’t communicate like normal people. You ask them a simple question and by the time they’ve responded you’re none the wiser as to what their actual answer is – if you’re lucky! In most cases they’ll just nod their head, smile and say yes and in the end nothing gets done! My job is to go in and teach them how people in the real world should communicate and produce results”

I enquired with a plausible look of sincerity

“How long have you been doing this in Thailand for?”

“Almost 2 years” he replied.

“Really?” I responded astonished that he had lasted that long. “And how many Thais do you have working with you?”

“Oh no – I do it all myself. We can’t have the blind leading the blind now can we?” He said with a knowing chuckle as though the both of us belonged to the same fraternity.

Placing my drink back on the bar I asked him

“Have you ever thought that possibly they were communicating their message to you loudly and clearly already, albeit very politely. They might have figured that ‘if this guy isn’t sufficiently educated in basic social communication and etiquette as to be able to understand what I’m telling him, why should I compromise good manners and communicate in direct caveman grunts like he’s probably expecting from me?’”

Suddenly his eyes caught a glimpse of someone else on the other side of the bar. He excused himself and proceeded on to his next new friend-to-be armed with his name-card in one hand, other arm extended, palm face-down and smile beaming. Deep down, I was hoping that he would make just as good an impression on everyone else that he met that evening as he had with me. If he did, I was sure that he wouldn’t last out the rainy season. Foreigners come to Thailand for any number of reasons. Some come for the sun, some for the culture and many for the buffet of lifestyle activities that are seemingly on tap here – options that might not be as readily available in their homeland. Unless they came over here on an expatriate package with an international company, the choices that will allow them to stay in the Kingdom would most likely be one or all of the following:

  1. Run across the border every ninety-days on a ‘visa-run’ to renew their tourist vis
  2. Find a job locally that will give them a visa and a work-permit and allow them to stay in the kingdom for an extended period of time but on a reduced salary
  3. Start up a small business with just enough capital to qualify them for a business visa and work-permit

For the true ‘stayers’, option three seems to be the most popular, but is also the most hazardous. Dazzled by the mystique of living in this Southeast Asian paradise, many a foreigner has rushed into opening up a small business with a weak business model, not enough capital and even worse, a misunderstanding of the market and the local culture.

Callum Laing is founder and CEO of MobyElite, a CRM and loyalty agency with offices in Bangkok and Singapore. Additionally, he is the founder and chairman of Networking for Success an international networking group with members in over 40 countries. Laing has successfully started up small businesses in Thailand for a number of years now and has managed to find a way to balance western business models with the cultural context of Thailand and other countries in Southeast Asia.

When asked about the role of culture in running a small business in Thailand, Laing stated that “Understanding the culture in Thailand is undeniably relevant to running a successful business and you ignore it at your peril. Many people come in believing that they can ignore it. At the very least, if you’re going to be starting up, you have to understand that the culture here is very different from the west. In the west we’re much more target focused and we don’t delve into the personal lives of our staff, whereas here to work effectively, you need to develop close relationships with your staff. You have to be much more informal and work around issues in ways that would probably never work or be acceptable in the west.”

Many ‘Farang’ (a word used in Thailand to describe Caucasian foreigners – pronounced ‘fah-rahng’) come to Thailand and tend to only mix with other Farang, ‘internationalized’ Thais and other kinds of people that ‘Farang’ are stereotypically perceived by Thais to like to socialize with. They eat Farang food, patronize Farang friendly establishments, speak Farang languages, watch Farang television shows, read Farang newspapers, crack Farang jokes, use Farang emotions in the office and make Farang judgments on the way Thais go about their work and life in general. This isn’t in itself ‘evil’ (said with one’s pinkie between one’s teeth), but at the same time it also does not go unnoticed by the Thais. Making the slightest effort to learn about your Thai staff, their culture and their language is like dropping a stone into the center of a large pond. The ripples will continue to positively flow out into places that you might have never imagined and doors can be opened up to you professionally and personally that had previously remained closed to even the most veteran expatriates.

Two months ago during the first session of one of my Cracking Thai Fundamentals workshops, we were discussing ways of bursting the ‘Farang’ bubble that many expatriates live in to help facilitate becoming more proficient in the Thai language and improving the work environment in our Thai workplaces. I suggested learning to type a couple of common words in Thai and add them to their emails when corresponding with the staff in their office. At first some were hesitant, but during the next week they took up the challenge and even I was surprised at the results. One Australian gentleman who is a senior executive for an international resort development company had just moved to Thailand seven weeks earlier. He taught himself to type ‘hello’, ‘thank you’ and his own name in Thai, and included them in an email to his sales manager. His (un-confidential) email quickly sparked excitement in the office and was forwarded to all the other Thai employees. They started sending emails back to him with more and more Thai, along with brief translations in English. One word, five words, a sentence then a paragraph. Within the space of a week, this executive had captured the hearts of his employees with his broken but improving Thai typing and was able to build up knowledge of both the Thai language and culture, as well as establish new relationships with his staff that would have never have been possible otherwise. The staff relayed this ‘news’ of the Farang that types in Thai to other friends and companies that they associated with, and within a few days his company had received ‘face’ from peers within the industry in a way that wouldn’t have been imagined or even thought necessary the week before.

Another foreign executive from a US based multinational company typed something similar in an email to her Thai secretary and it started some healthy competition in the office amongst the other Farang (driven by the other Thai staff in her office ) to become more ‘Thai’ friendly and learn more about the language, culture and their staff. This senior executive has said that since sending the first email, her staff are more open to listening to what she has to say and seem to be taking more accountability in making deadlines for her.

Some foreigners might argue that they have been very successful in business in Thailand without having learned the language, becoming intimate with the culture and all the while having lived in the proverbial ‘Farang’ bubble during their time in the Kingdom. Playing the card of the ignorant Farang in some instances might allow some grace in business interactions and allow decisions to be made faster and even increase the rate of production in the immediate. This tack is normally more successful for expatriates working for multinational companies where lack of cultural understanding is compensated by a strong existing brand-name and good communication intermediaries that work tirelessly behind the scenes in making communications culturally palatable and maintaining (and sometimes even repairing) relationships with staff, suppliers and customers so that business can go on as usual. For small business, finding quality staff that can understand how to work between both cultures is difficult and expensive. Investing the time in personally learning about your staff and the software that drives them will become a priceless asset to any small business and can even shed light on new business opportunities in the local market that would not be so apparent to other foreign business owners operating in the Kingdom.



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Written by

Stuart Jay Raj