India is a country of differences in languages and religion. The most important languages are Hindi and English, and the most important religions are Buddhism and Hinduism, although people with Islamic, Christian or Sikh backgrounds are also represented. From 1858 onwards, India had been a colony of the United Kingdom. In 1920, Mahatma Gandhi started a non-violent movement leading to independence for India.
After the independence, it took the country over 30 years to open up to the rest of the world and create trading partners. From this point onwards, the number of well-educated middle-class people increased fast because of fast developments in industry.
Unfortunately, this economic growth as a result of the fast developments is just one side of the coin. The country still has the ‘caste system’ that leaves very little space for personal growth. As Monir H. Tayeb describes it in his book International Human Resource Management: A Multinational Company Perspective: "Unlike social class, where people can move up by marriage or by acquiring wealth and getting better jobs, the caste system is rigid in that individuals are born into their parents' caste and die as a member of that caste, no matter what educational qualification, professional status, wealth or anything else they might achieve in life.”
Like the county’s organizational structure, the Indian management style also largely reflects a strong hierarchy. In the book Strategy Safari: A Guided Tour through the Wilds of Strategic Mangament, a hierarchical structure is described as a system that allows authority to allocate power to the hierarchy, or the people responsible for the current strategies. Characteristics of the Indian business culture have been researched by Tayeb4. He has developed a list of cultural characteristics that have an influence on the Indian business culture. The most important factors are collectivism, a large power distance, risk aversion, and disciplined people.
Because of the country’s complicated structure and hierarchical business culture, Indian both business structures and government structures are led by a boss. The boss shows his or her power for example when he or she uses it to indicate promotions for subordinates of his or her choice.
A large portion of the Indian workforce is not able to read and has a low level of technical skills. Together with their characteristic of risk aversion, the Indian workforce would prefer working under supervision. They will seek the manager’s approval before making decisions in order to show their respect towards authority.