In small talk situations Americans seldom jump directly into the business subject matter. For Americans business is always to certain degree a personal matter. In fact, Americans prefer to work with people they like, and who like them.
Germans, on the other hand, can and will do business with you even if you have little or no personal relationship. Most importantly, they want to know if you are good at what you do. Personal is nice. Professional is better.
The present is always the starting point for any action. The present is current, a result of what was decided, of what has been done, of action taken. To understand the present means to first understand how it became what it is, to understand its history.
Before Germans can be persuaded by any future action, they have to be convinced that the presenter has understood the present – the starting point – via its past.
Formal presentations are rarely the final step in a German decision making process. Rarely do German managers make a critical decision shortly after having listened to the presentation of various options.
Instead they will take time to reflect, discuss with their direct reports, get additional input from subject area experts, use colleagues at different management levels as sounding boards.
The act of persuasion in the German business context is seldom aimed at getting a specific decision. Truly persuasive argumentation seeks to influence, steer, route the thinking to or in the direction of a desired decision.
All processes have a rhythm, made up of the individual process steps, their sequence and the time allotted to them. Processes do not exist in a vacuum, however. Every process and its rhythm is subject to external factors.
Germans do their best to prevent external factors from influencing the rhythm of their processes, however. They believe that if a given decision making process has proven to be effective, if it has led to good decisions, it should not be interrupted or distracted.
If the decision is an important one, if the decision making process has proven to be robust, Germans will do their best to shield it from external factors.
Horst Brandstätter, the founder of Playmobil, dies at 81.
“Although a billionaire by the end of his life, he was a world champion in economizing, the younger Mr. Brandstätter (son Conny) said, citing as an example his father’s insistence on using cheap packs of cards for his favorite card game.
Mindful of his cash flow as the world oil crisis drove up the cost of plastics in the 1970s, Mr. Brandstätter summoned his chief designer and asked him to come up with toys that would use less plastic.
Mr. Beck came up with Playmobil, whose miniature models and environments are said to have been inspired by children’s drawings and the figurines of traditional Christmas crèches. At about 3 inches high, the figures have round faces, movable arms and legs, and hands that can grasp a pirate’s sword, a carpenter’s saw or a firefighter’s hose.”
Source: New York Times, June 11, 2015. By Alison Smale
On May 7th, 1998 Jürgen Schrempp, CEO of Daimler, and Bob Eaton, CEO of Chrysler appeared together at a press conference in London to announce a merger between the two companies. It was emphasized that this was not a takeover by one company of the other, but rather a fusion between equal parties. Schrempp deemed the merger of Daimler and Chrysler “a match made in heaven”.
After two years, Co-chairman Eaton announced his resignation, leaving Schrempp to be the sole head. In 2006 Schrempp passed this position on to Dieter Zetsche. By March 2007 the first speculations began to emerge that DaimlerChrysler would sell the ChryslerGroup.
Since the merger, Chrysler had reduced its net worth by 35 billion Euros, while the net worth of DaimlerChrysler has been reduced by another 50 billion by the end of Schrempp’s resignation in 2005. On May 14th, 2007 the sale of ChryslerGroup to Cerberus was announced. During a special general assembly on October 4th, 2007 it was officially decided to rename the company Daimler AG.
For Mercedes-Benz this merger to DaimlerChrysler AG seriously damaged the company’s image, which many attribute to quality issues and cost-cutting. The leading role which Daimler-Benz AG once had in the auto industry has still not been completely restored.
A study conducted by the consulting firm McKinsey estimated that the company’s value had dropped during Schrempp’s reign by 74 billion dollars.
A willingness to take risks and a desire to make decisions are the basic requirements for starting a business. Germany is not a land of entrepreneurs.
According to Global Entrepreneurship Monitor (GEM), an annual joint publication of the University of Hannover and the Institute for Jobmarket and Career Research of the German Federal Agency for Employment, only 2.5% of adults in Germany started a business which they could live from. This placed Germany in spot 10 of the 22 compared.
Rolf Sternberg, an economist, considers one reason for the weak culture of entrepreneurship to be the widespread desire toward security:
“The tendency to strive towards security is much more prevalent in Germany than in Anglo-American countries”. This is the flipside of having a well-developed social security system.
Yvonne Stolpmann of Chamber of Commerce in Nürnberg summarizes the situation as such: “Those who give up a permanent position here stand to lose a lot of security. It’s different in the USA”.
The Handelsblatt Global Edition from April 23, 2015 reported: Philipp Gloeckler’s business idea was a failure, and he doesn’t mind admitting it. He had what he thought was the perfect concept, an impeccable business plan and great press coverage. Yet, his app, Whyownit, was a disaster.
This is how he found himself at the F***UpNight event in Berlin, a get-together where failed start-up entrepreneurs pick through the bones of their mistakes in the hope that they can do better next time.
“Business failure is often equated to personal failure in this country,” said Rolf Sternberg, a researcher at Leibniz University in Hanover, who recently co-authored a study on young entrepreneurs. “We would win a lot if we would accept failure as a new chance,” he added.
Other than SAP, the software giant founded in 1972, no German tech company has made it onto the global stage. Instead German entrepreneurs are better known for their pursuit of perfection, and finding success within established structures, such as the car industry.
“I am convinced we need to talk about mistakes,” said Béa Beste, whose toy app, which allowed users to subscribe to a toy delivery service for kids, collapsed with the loss of all her investor’s capital as well as her own €300,000 ($322,000). “The worst mistake is being afraid of mistakes,” Ms. Beste said.
Venture capital is scarce in Germany’s risk-averse, conservative economy, so entrepreneurs usually turn to bank loans for funding. But if their business fails and debts are called in, they must go through a lengthy insolvency process which can demand up to six years of “good conduct” before the slate is wiped clean.
Martin Wehrle, a German managment coach, writes career-articles for DIE ZEIT. In a recent article he advises: Nicht aufdrängen! – Don’t be pushy! He notes that many job applicants are far too aggressive, as early as in the initial sentences of their cover letter.
“Because I am a perfect fit for the position, I am sending you my application ….” Starting off like that almost guarantees an immediate rejection, writes Wehrle.
Instead of allowing the reader to make her own judgement, the applicant makes it for them. Personnel departments want to make their own decision who is right for the company. That’s what they get paid for.
Wehrle recommends: “Intelligent applicants act like witnesses before a jury. They don’t push the jury to a decision. Instead they simply state the facts, objectively.
The more objective the witness comes across, the more they are believed. The best applicants don’t speak for their application. Their application speaks for them.
German investors have a safety first mentality when it comes to money. Their aversion to risk is often attributed to the economic turmoil of the 20th century. The hyperinflation of the 1920s and the devastation of two world wars have burned themselves into the nation’s psyche.
Since early 2009, the share prices of DAX-listed companies have tripled on average — an increase of €800 billion, or $860 billion. Germans park their money in safe investments like savings deposits or life insurance policies.
54.3 percent of shares in the DAX are held by foreign investors — more than ever before. U.S. investors are the biggest single group of foreign investors. Every fifth DAX share is owned by North American investors.