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Sri Lanka

Business Culture

In such a richly diverse and complex country as Sri Lanka it is difficult to impart generic conclusions that can be used by those doing business there. Regionalism, religion, language and caste are all factors that need to be taken into account when doing business in Sri Lanka. Behaviour, etiquette and approach are all modified depending on whom you are addressing and the context in which they are being addressed.

Of all the cultural influences that most impact Sri Lanka business culture, hierarchy plays a key role. With its roots in Hinduism and the caste system, Sri Lankan society operates within a framework of strict hierarchy that defines people's roles, status and social order.

  • Family-owned businesses often reward allegiance more than competitive skills, which can frustrate younger professionals, some times
  • Young family members and scions are given charge of new businesses at a young age, despite inexperience in the chosen areas of business.

  • If your business dealings in Sri Lanka involve negotiations, always bear in mind that they can be slow. . If trust has not yet been established then concentrate efforts on building a rapport.

  • Decisions are always made at the highest level.  If the owner or Director of the company is not present, the chances are these are early stage negotiations.

  • Low price is a major factor in clinching deals, and financial negotiations can be bargained very hard.  However Sri Lankans tend to clue outwardly high quality.

  • Sri Lankans do not base their business decisions solely on statistics, empirical data and exciting PowerPoint presentations. They use intuition, feeling and faith to guide them. Always exercise patience, show good character and never exhibit frustration or anger.

  • Until money is actually put into the venture, everything is retractable and re-negotiable, technically and legally

  • Observe punctuality in keeping business appointments

  • When entering a meeting room you must always approach and greet the most senior figure first. Meetings should always commence with some conversation.

  • Disagreements are often acerbic and can lead to frustrating and vindictive conduct Manipulation, favouritism, tax evasion and speed money are part of business practices in Sri Lanka, and often, an executive's 'contacts' have considerable weight in career advancement. To an extent, adulteration and consumer/ investor fraud are also known to exist in Sri Lanka, exposed by scandals every few years. Social contribution and environment protection are generally not voluntary activities in corporate Sri Lanka, and are mostly induced by tax-saving schemes or strict rules by the Govt. or intervention by court acting on public interest.

  • Business hours are 8:30am to 5:00pm Monday through to Friday. Some businesses are open on Saturday mornings as well.

  • Important events, signatures and nowadays even the selection of a business site/ premises can be subjected to clearance by the family astrologer, after all negotiations are over.

  • When addressing an Sri Lankan whom you know personally, always use the appropriate formal title, or if you do not know their names then Sir or Madam will whether Professor, Doctor, Mr, Mrs suffice.

  • Doing business with foreigners is considered prestigious, and joint venture partnerships are coveted, and the prospecting stage is marked by lavish gifts, ostentatious hospitality, and invitations to family events such as weddings.

  • With foreigners, it is friendship before business. Personal rapport with the owner/key persons underlines business negotiations, and joint ventures are considered symbols of brotherhood and friendship rather than profit centres.

  • When negotiating avoid high-pressure tactics. Do not be confrontational or forceful. Criticisms and disagreements should be expressed only with the most diplomatic language. Sri Lankan society has an aversion to saying "no" as it is considered rude due to the possibility of causing disappointment or offence. Listen carefully to Indians' responses to your questions. If terms such as "We'll see", "I will try" or "possibly" are employed then the chances are that they are saying 'no'.

  • Once terms have been agreed you will be expected to honour them. When negotiations end successfully continue the relationship building process with a celebration dinner.
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