The United Arab Emirates is made up of seven states, the two best known of which are Abu Dhabi and Dubai. For the past few years both cities have changed into booming areas with huge projects financed by international investors. The capital of UAE is Abu Dhabi which is also the centre for the oil and gas industry. Dubai is more commercialised with its huge malls and also currently holds the record for the world’s tallest building, the Burj Khalifa.
Country specific communication
Particular local habits: doing business in the UAE is always personal. For centuries the Emiratis have been successful traders and trading is a way of life for many. Tribalism, which is still very important in the UAE with its strong emphasis on warm relationship, paternalistic leadership and family solidarity, intensifies the link between business and personal life. The better this kind of approach to business is understood, the better one will be equipped to avoid frustrations, understand tactics and handle meetings, turning them into business opportunities.
This ‘Business is Personal’ perspective is different from modern western societies. The first remarkable difference is that the Emirati culture is more a ‘contact’ than a ‘contract’ culture. This means that doing business in UAE comes after establishing a confident and trustworthy relationship that has been built up after a quite long time, investing time on the personal level before any business talk or negotiation can begin. Contact with the Emiratis is very important to keeping the relationship alive. Being absent for a long period is not a good idea. Schedule regular visits, but when this is not possible it is advisable to hold frequent telephone conversations. Do not talk about business during these conversations, but discuss personal things and exchange news. Knowing your Emirati counterpart in detail makes it easy to network in the UAE. The classic Arabic proverb “you should have a strong shoulder” means that you should know people who could help you in bad situations, or when you are trying to achieve a good result while doing business. Business transactions take longer time than many are used to.
Social interaction: business cards should be translated and printed in Arabic with the full title and qualifications of the holder. Choose a good translator and have the translation checked by a reliable Arab friend. The receiver of your business card should get a good picture of who you are, therefore give as much information as possible. Avoid titles such as ‘representative’ and ‘coordinator’ because they could be meaningless in the Arabic language. As an alternative, add ‘manager’ to your title. While printing your business card in Arabic, English should be printed on the other side. Also do this with brochures or other promotional literature.
Body language: Arabs are tactile and body language is an important factor in communication. They sit much closer to each other and might touch others to emphasise a point or confirm that they have one’s attention. Always maintain eye contact during a conversation so that you will appear trustworthy. You should also be aware of the directions in which you look; looking away while talking may be interpreted as being evasive, looking down as being subservient and looking up as condescending. The right hand is used traditionally for shaking hands, drinking, eating and for all public functions. Minimize the use of your left, it is considered unclean. It is impolite if you sit cross-legged and the sole of your foot points to someone’s face. Try to avoid gesticulating while talking; this is also considered impolite.
Communication style: Emiratis and all Arabs are high-context communicators. You should always take the general mood into consideration. ‘Insha’Allah’ has several meanings, it could mean ‘If God wills’, ‘I will do my best’, ‘I need more time to think about it’, or ‘you are my friend and I do not want to cause you to lose face by saying no’. Moreover, you should always look at the body language accompanying the words, together with the tone in which it is said. And do not forget to your own body language, you will be judged in the same way. Emiratis do not use the same written communications as Westerners. Emiratis are highly verbal. Answering an e-mail can take days or weeks, so making a phone call will make more sense with Emiratis. Moreover, a personal visit will have the biggest impact. Only when being in a face-to-face situation you can absorb the full meaning of what is being said.
In the Arab culture there is a ‘particular’ way of listening during a negotiation. Constant interruptions and interjections are normal at business meetings, so it is not unusual for outside people to join a meeting (sitting down) or for a host to meet with others at the same time. There is an eye for personal interaction and formality is not a high priority. Simultaneous activities including talking on the phone can take place during a meeting. This is a moment to make new contacts and show your counterparts that you know the business rules in the UAE.
The language spoken in the UAE is mostly Arabic, however, Dubai has a large expat community from India and Pakistan. Their languages, Urdu and Hindi are also very common on the streets. Moreover, English is widely spoken in the UAE. Arabs in general come across as being expansive and flowery in their use of the language. However, during business meetings Arabs are using a lots of euphemisms and proverbs and will often tell stories which can be interpreted as indirectness or deliberate ambiguity. Emiratis are indirect to show their politeness and people are expected to read between the lines. They also use body language to express themselves, this could help a foreigner to read between the lines.
The decision-making style in the UAE is slow decisions and non-confrontational. Meetings between locals and their western counterparts can be affected by several factors. Scheduling and planning should be approached very flexibly. It is very difficult to set an agenda or even set a time for a meeting with an Emirati businessman. Allowing a great deal of flexibility to a UAE-based host of a meeting is a must. However, for a foreigner to reschedule or cancel a meeting is not good for his image. Patience is a virtue, since schedules are rarely adhered to. Decision-making in the UAE is hardly ever a transparent process. There may be people outside the corporate structure with immense influence over decisions (e.g. patriarchal influence in family-owned firms). Nepotism, family loyalty and favouritism are also important to further decision-making structures. But while making an important decision we see that the owner of a company is the decision maker.
Management or hierarchy characteristics
The UAE culture is based on ‘waasta’ and ‘favours’ (something asking to clout or the ability to translate relationships into leverage). Favours are deeply entrenched in local culture and business. To create a network, ‘waasta’ and ‘favours’ can help a lot. A solid relationship generally equals good business. Furthermore, having built up a 'goodwill budget' one can utilize this in times of need. Business in the UAE compared to Western business perception can be described as hierarchical, competitive, family oriented and bureaucratic. The manager of a company is a ‘father figure’, who uses a ‘top down’ strategy towards his employees. Actually, when making a decision consensus is preferred. When a relationship is built between business partners, the trust will always stay and negotiations tend to be easier. Economic progress in the UAE has changed the hierarchy between women and men. Women are mostly employed in the wealth or education aspects of working life. Women and men have equal rights in Arab society, but there are areas where women are not employed widely. Religion and politics are two of these ‘grey’ areas.
UAE culture is relationship driven, which means that personal contact is a must. In business terms we could call the UAE culture rather a ‘contact’ than a ‘contract’ culture. “It is not what you know but who you know”. The Emirati’s refer to powerful people, because it’s a must while doing business. In the UAE it is almost impossible to do business without knowing someone who could introduce you to potential business partners. Doors will open once a reliable relationship has been established. What at first seemed impossible can be achieved. Research has shown that Arab culture is categorized as being group-oriented and collective and this is remarkable in all aspects of business and life. Therefore, family, honour, face, tribe harmony, consensus and networking are very important in UAE culture.
Remembering that many nationalities live and work in the UAE (Emirati's are a minority in their own country) it is necessary to use different negotiation styles. If you sit down to negotiate a business deal with an Indian company (based in the UAE), your strategy will be different than when you negotiate with a Lebanese company or an Emirati company. This is also a challenge for many business leaders in the UAE. There are companies in the UAE with 12 different nationalities (12 different cultures) and they all want to ensure that their negotiation teams are moving in the same direction. The basis of good team work is loyalty and trust. The manager of a company should make decisions that will bring benefits for the whole organization. The negotiation style of Arab culture tends to be ‘collective’, because a lot of people are involved in this process but it is quite important to know your ‘key decision partner’, because that person will be the most powerful during your business deal.
Contracts, legal concepts
The UAE has a variety of contracts and legal concepts. Even at places where the law is concerned, there is rarely a clear cut style. What could you expect while finalising your business negotiation? During a business meeting, you can expect traditional Arab coffee and dishes. This hospitality shows the importance that Emirati’s give to their business relation.. You should use the right hand, when shaking hands, eating, drinking or signing a business contract. During a meeting to sign a business contract, the things that are said by partners will weigh more than written aspects. A business compromise reaches her final stadium, when both counterparts are totally agree with the result. Before that, the negotiation will go further, signing a contract doesn’t weight much in the eyes of an Emirati. The most important things before signing a contract with a company manager in the UAE are personal relationships and the price. When you realised a good relationship with your counterpart, your word can be your bond.
Authors: Aynur Devre & Othman Chahid