LA SALLE UNIVERSITY

MANAGEMENT AND INTERNATIONAL BUSINESS

MEMBERS:

-CASTELO DEL CASTILLO VÍCTOR AMED

-FLORES CAHUANA ALLISON SALOME

-GUISBERT TORRES VALESKA

-MACEDO MOTTA CESAR AUGUSTO

-SALAS SIERRA SOFIA PATRICIA

AREQUIPA

2024
Introduction

In an increasingly globalized world, understanding cultural differences is essential for success

in international negotiations. Peru and Germany, although both are part of the global
community, present significant contrasts in their cultures, including their approaches and
negotiation styles. This document aims to explore and compare the general culture,
negotiation culture and negotiation styles of these two countries, in order to offer a clear and
practical vision for those who wish to establish commercial or diplomatic relations between
these two nations.

Peruvian culture, with its rich indigenous heritage and colonial influences, is characterized by
its warmth and emphasis on personal relationships. Peruvians value trust and respect, which
is reflected in their negotiation style, where establishing a good personal relationship can be
as important as the agreement itself. In contrast, German culture, known for its precision and
efficiency, tends to be more direct and results-oriented in negotiations. Germans value clarity,
punctuality and strict compliance with agreements.

By understanding these differences, negotiators can better prepare for cross-cultural

interactions, avoiding misunderstandings and facilitating successful agreements. This analysis
will not only highlight the particularities of each culture, but will also provide practical
strategies to successfully navigate negotiations between Peru and Germany.
Development

1. The culture of the destination country (Germany) and Peru

For this research we collected data, statistics, important graphs from official websites to see
similarities and/or differences of both countries, apart from the culture we will look at
inequalities, values, etc. as these factors are directly related to the society and how it has
evolved to the present day.

On the page ‘The Culture Factor’ it is interesting to note that without the national culture
there can be no organisational culture and instead of seeing it in a negative way it has to play
in one's favour; on this page both countries were compared with the following factors.

- Power distance

Reference to status/position as in the work environment of boss and co-worker

(bureaucracy).

In Germany with 35 points it shows that all individuals are equal (as the country is
decentralised and has a strong middle class population, leadership is challenged (not
obsessive control).

In the case of Peru it is the opposite with 64 points, the country is more centralised, higher
proportion of supervisory staff and high wage differentials.

- Individualism

Reference to whether a population tends to be more collectivist or individualistic.

In the case of Peru, the majority of people prefer to work in large companies rather than
starting their own business with 20 points, while in Germany the opposite is the case with 79
points.

- Motivation towards achievement and success

In the case of Peru, which is lower than 50 points, it is known as ‘consensus-oriented’ and
refers to the fact that more importance is attached to the determining values of society, in this
case human and family quality, rather than recognition and wealth; the opposite is the case in
Germany, which has 66 points, the opposite of ‘decisive’.

- Uncertainty avoidance

How a society approaches the future

In Peru, with 87 points, it is interesting to note that corruption is widespread (as in other
neighbouring countries that were previously conquered by the Spanish empire), the creation
of laws that are often not complied with, so that others are created; however, there can be
legal loopholes, legal contradictions, so that any abuse or transgression can find a loophole
that redeems or justifies it.

In the case of Germany with 65 points, the opposite tends to be the case: prevention, planning
for a better future, importance is given to deductive rather than inductive approaches, and
more so with the ease of decentralisation and the low level of bureaucracy.

- Long-term orientation

Reference in some normative societies, some people prefer to maintain established traditions
and norms and are wary of social change, while others take a more practical approach,
encouraging savings and modern education to prepare for the future (these are the pragmatic
societies).

Peru with 5 points is a normative society, respecting traditions, in some parts they are strict in
their rules and tend to think more about the present than the future, so they do not tend to
save much.

Germany with 57 points is a pragmatic society, they adapt according to the moment, time or
situation and think more about the future and therefore save more.

- Indulgence

Reference to the control of desires and impulses of people in a society, although in the graph
there is a slight difference Peru is at a score in between almost, in Germany with 40 points is
different they are more restricted, do not control free time and control the gratification of
their desires, people with this orientation have the perception that their actions are restricted
by social norms and feel that indulgence is somewhat wrong.
 Other interesting data that we see as important within a society are the ‘human development
reports’ of the United Nations.

Therefore we will highlight the ‘Human Development Index HDI’, ‘Gender Development
Index GDI’, ‘Gender Social Norms Index’ with the following graphs.

- Human Development Index HDI

It examines 3 basic dimensions of human development: a long and healthy life, access to
knowledge and a decent standard of living.

Germany -> For the year 2022 it is 0.950 , which places the country in the very high
human development category, ranking it 7th out of 193 countries and territories.
 Peru -> By 2022 it is 0.762 , which places the country in the High Human
Development category, ranking 87th out of 193 countries and territories.

- Gender Development Index GDI

It examines the gender gap in 3 primary domains, health - life expectancy, education -
measured by expected years of schooling for women and men for children and average years
of schooling for adults aged 25 and standard of living - estimated GNI per capita for women
and men.

Germany
Peru
- Gender Social Norms Indices GSNI

The GSNI assesses the impact of social beliefs on gender equality in four dimensions,
including political, educational, economic and physical integrity. It is based on data from 91
countries, covering waves 5 (2005-2009), 6 (2010-2014) and 7 (2017-2022) of the World
Values Survey, with the latest update reflecting information as of 12 January 2023.

Germany
 Peru

2. The business culture of the country where you negotiated and the business culture of
Peru

Business culture that Peru has

In Peru, it is essential to know people well before doing business, since building trust and
good personal relationships is key. Having friends and acquaintances who can introduce you
to others is very helpful. The way of speaking is polite and formal, using titles such as "Sir"
or "Madam" and surnames. Maintaining eye contact and positive body language is important,
and a firm handshake is the common way to greet. Although Spanish is the primary language,
knowing a few Spanish words can be helpful, especially since many executives also speak
English. Negotiations can take time, and it is common to have several meetings before
making important decisions. It is important to be willing to compromise and adjust proposals,
as negotiations are flexible and can involve a lot of discussion.

Companies in Peru usually have a clear hierarchical structure, where bosses make decisions.
Showing respect to superiors is crucial. Although punctuality is valued, schedules can be
flexible, and meetings may not start at the exact time. The workday is Monday through
Friday, with a long lunch break, and meetings are usually in the morning or after lunch. As
for attire, business attire is preferred, with men wearing suits and ties, and women dressing
elegantly and professionally. It's common to mix business with social events like lunches or
dinners, and accepting invitations can strengthen relationships. Bringing a small gift as a
gesture of courtesy can be seen well, especially if you are visiting a house or receiving a
special invitation.

Peru has a lot of cultural and regional diversity, and customs can vary between Lima and
other regions. Showing interest and respect for Peruvian culture and traditions can help build
better relationships. In general, knowing these aspects and adapting to them will allow you to
do business effectively in Peru and build solid and lasting relationships.

Business culture that Germany has

Germany is one of the most important markets in the European Union, which is why it has
become a strategic commercial ally for several countries around the world that want to enter
or are already part of the market of this European giant, which is why many products and
similar services are in constant competition. This is why the characteristics and quality of the
products are the main requirement to enter the German market, as well as the way in which
those interested in doing business with this country present their company is quite important.
So it is not only about the quality of the products and services offered, but also about the
quality of the personnel designated to establish commercial relationships.

It is clear that around the world there are many cultures and social guidelines that must be
known and taken into account when starting a business relationship, whether they take place
at different business fairs or directly at the facilities of your company or those of their future
partners. In any case, knowing and appropriately applying the German business culture, the
needs and expectations of the market will give you an advantage over your competition and
will lead you to generate sufficient trust in the first instance to successfully close your
negotiations.

German traditions and customs that you need to know

Germany is known for its festivities, rich history, folklore, cuisine and much more.
Immersing yourself in their traditions provides a deeper understanding of German identity
and offers a fascinating insight into their cultural heritage. Therefore, at Deutsches Zentrum
we will explore various emblematic traditions and customs of Germany that are worth
knowing so that you can discover a little more about its culture.

German gastronomy and its traditional flavors

German gastronomy is a reflection of its rich history and regional variety. Traditional dishes
such as bratwurst, sauerkraut, schnitzel, apple strudel and pretzels are just a few examples of
Germany's rich culinary heritage. In addition, coffee and snack time is sacred in many
regions, where delicious pastries such as Baumkuchen, Black Forest and Stollen are enjoyed.
3. The Negotiation style of the Peruvian executive

● Informal and friendly communication, but not direct. Peruvians often use words like
"mañana" which do not necessarily mean the next day, but can be used to postpone a
situation or avoid saying no. Asking about the culture of the other country is a
rapprochement mechanism.
Lack of punctuality and exaggeration of situations. Peruvians do not plan meetings
before starting them nor do they respect the agreed upon hours. Approximately 80%
of executives delegate follow-up tasks agreed upon on business trips, and only 23%
respond immediately.
Importance of a sense of humor and bonds of friendship. Peruvians attach great
importance to a sense of humor when negotiating. Creating bonds of friendship, gifts,
and entertainment are common in negotiations.
Passive reaction to conflicts. Peruvians react passively to disputes and controversies
during negotiations.
Use more and more technology, although there is still room for improvement. New
generations are closing the gap in the use of technology in negotiations.
In summary, the negotiation style of the Peruvian executive is characterized by being
informal, not punctual, oriented towards creating personal ties and avoiding direct
confrontations, although with a tendency to adopt more technology. Understanding
these cultural characteristics is key to successfully negotiating with Peruvians.

4. The Negotiation style of the foreign executive

The negotiation style of the German executive is characterized by being formal,

structured and focused on quality and service. Next

● Formality and structure

Formal environment: Germans value formality in meetings and negotiation. It is

important to show a polite and courteous attitude in the first meetings.
Preparation and knowledge
Preparation: Germans are known for their preparation and detailed knowledge about
the market and global offerings in their sectors.

● Negotiation

Relaxed negotiation: Germans do not like to negotiate under pressure. Negotiation

focuses on quality and service, not aggressive or confrontational tactics.

● Use of intermediaries
 Commercial agents: Commercial agents are recommended due to their precise
knowledge of the market.
Business lunches and dinners
Lunches and dinners: Business lunches and dinners are common in Germany. It is
negotiated after eating, and is eaten from a common plate located in the center of the
table.

● Women's role

Role of women: The role of women is relegated to the background in German society,
which is reflected in business meetings.

● Industry standards

Industrial standards: The Germans comply with the "DIN" standards (Deutsche
Industrie Norme), an industrial standard agreed upon by the State and the industrial
sectors.

● Patience

Patience: Patience is essential in German negotiations. Negotiators can come off as

arrogant with a "take it or leave it" attitude.
Conclusions

- The analysis of the cultures, negotiation cultures and negotiation styles of Peru and
Germany reveals important differences and similarities that can significantly
influence the success of commercial and diplomatic interactions between these two
countries. While Peruvian culture places great emphasis on personal relationships and
trust, German culture values ​efficiency, punctuality, and clarity in communication.

- For Peruvian negotiators, it is crucial to understand and respect the direct and
structured guidance of the Germans, ensuring that presentations and proposals are
clear and well-documented. On the other hand, German negotiators must take into
account the importance of establishing a good personal relationship and trust with
their Peruvian counterparts, spending time building a solid relationship before
proceeding to the technical details of the agreement.

- Success in negotiations between Peruvians and Germans will depend largely on the
ability of both parties to adapt their approaches and styles, respecting and valuing
cultural differences. Cultural preparation and flexibility are essential to overcome
barriers and take advantage of opportunities that arise from diversity.
Bibliography:

https://www.hofstede-insights.com/country-comparison-tool?countries=germany%2Cperu

https://hdr.undp.org/data-center/country-insights#/ranks