Thursday, March 27, 2014

Avoid the Pitfalls of Business Networking in the Middle East (Northern Europeans Take Notice!)

How can I build business relationships in the Middle East? Is business networking in Dubai different from the networking in Abu Dhabi?

These questions were raised during a panel discussion which I recently moderated in Dubai as a part of the Middle Eastern launch of my book “Network Advantage: How to Unlock Value from Your Alliances and Partnerships”.  The discussion involved INSEAD MBA students and senior business leaders from the UAE, such as Mishal Kanoo (Deputy Chairman of the Kanoo Group), Gary Chapman (President of Group Services & dnata, The Emirates Group), Nicholas Clayton (CEO, Jumeirah Group), Mansour Hajjar (Managing Director, Chalhoub Group), Robin Mills (Head of Consulting, Manaar Energy) and Constantin Salameh (CEO, Al Ghurair Investment).

It will not come as a surprise that business networking among customers, suppliers and even competitors is important all around the world, but especially in the Middle East. All over the region, local business partners want to learn about you as a person way before they will do any deals with you. One panellist reflected on a situation when a Western colleague posed a question “How many cups of coffee does it take to close a deal in the Middle East?” The answer was “As many as it takes!” Companies in the Middle East, and especially in the UAE, are eager to do business with the West, but Western businessmen need to be sensitive to the Emiratis’ need to deeply understand the partner’s motivations. Some Western companies try to enter the region for short term gains and are ready to exit quickly. These are precisely the partners whom the local business people want to avoid.

To the Emirati community, the investment in the long term relationship is a key success factor for doing business. One panellist reflected on several instances when his company, the leading purveyor of luxury brands in the region, turned down offers for collaboration from partners who did not show deep commitment to staying in the relationship over the long term. That is, his firm was prepared to forego very attractive contracts that promised short term profits without the promise of the lengthy collaboration. Interestingly, the panellists suggested that businesspeople from the Northern Europe (Scandinavia and perhaps Germany) often fell into the trap of cutting the networking part short and going straight to business and were less willing to invest in a long term relationship. At the same time, Southern Europeans (presumably Italians and Greeks) often found it easier to understand the long term focus on networking in the region. Yet, one should not assume that the Emirati businesses are slow in decision-making! Once trust is built, the local partners make decisions very quickly and will open doors to many opportunities in the region.

It is also not correct to assume that people network the same way in all parts of the Middle East. One of the panellists indicated that there are significant differences even between networking in Dubai and networking in Abu Dhabi that are only 90 min on a highway. The Abu Dhabi’s business community places a much stronger emphasis on the establishment of long term relationships with prospective partners than their Dubai based counterparts. That is, one should be expected to make more investments (in terms of time, effort and, yes, drinking coffee) in getting to know the business partners in Abu Dhabi than in Dubai before the deals are actually struck.

My own reflection is that a very short term orientation for doing business in the region is perilous in another respect. The local business community has a lot of wisdom of how to navigate complex relationships among buyers, suppliers and competitors, and they can offer advice on the relative merits of different local business partners. This can give the newcomer a good perspective of the region’s social landscape. It’s a shame to fall into a temptation to short charge such potentially valuable insights that could only be obtained through long-term relationship building and go straight to business.  And, yes, the Arabic coffee coupled with marvellous local sweets are a great complement to a thoughtful discussion among (prospective) partners.

For more insights into business networking, please out my book at