» Management in Vietnam: Guide to Intercultural Management

Being a Manager in Vietnam

To ensure successful cross cultural management in Vietnam, it is essential to maintain harmonious relationships and be cognizant of the need for people to retain face in all transactions.

In business it is important that you treat people with respect and deference at all times as this saves face. Public criticism or displaying anger causes a loss of face and may jeopardize future business relationships.

The business climate is undergoing a gradual transformation into market-orientation. Vietnamese companies are open to working with foreign firms. Some businesspeople remain suspicious of foreigners, perhaps as a holdover from the Communist regime.

The government is undertaking a form of privatization, called "equitization" where companies are made public, with the government retaining a minority stake of about 20%. This means that many negotiations with private companies may entail dealing with a government agency as well.

The Role of a Manager

Cross cultural management is more likely to succeed when working in Vietnam, if you bear in mind that each person has a very distinct role within the organization, and maintaining that role helps to keep order. People believe that their supervisors have been chosen because they have more experience and greater knowledge than those they manage, and it is, therefore, unnecessary, and even inappropriate for them to consult with lower-ranking individuals when decision-making.

In Vietnam, as in other hierarchical societies, managers may take a somewhat paternalistic attitude to their employees.

Approach to Change

Vietnam’s intercultural adaptability and readiness for risk is minimal. Change is difficult to bring about and the idea of it is not received with enthusiasm. In order for change to take hold, the idea needs to be perceived as good for the group and be accepted by the group.

Approach to Time and Priorities

Vietnam is very relaxed with its attitude towards schedules and timelines. Vietnamese will not upset others in order to force meeting a deadline, and while appointments and schedules need to be set in advance, these should be viewed as flexible. Patience is a necessary attribute to successful cross cultural management in Vietnam.

Global and intercultural expansion means that some managers may have a greater appreciation of the need to enforce timescales and as such, agreed deadlines are more likely to be met.

Decision Making

Although changing, Vietnam’s ingrained bureaucracy is still evident in government agencies and SOEs. Since this is a hierarchical culture, most decisions are made at the top and then given to the employees to implement. There may be informal networking among employees or between managers and subordinates, although actual power is generally held in the hands of a few key people at the top of the organization.

Government or SOE employees are not comfortable taking initiative as they are risk averse as a result of years of communist rule so some cross cultural awareness is essential.

Boss or Team Player

If you are working in Vietnam, it is important to remember that face and reputation play an important role. If you would like to encourage participation it is important first to clearly establish a non-threatening work environment and communicate fully that their participation is desired.

When meeting together and moderating ideas, intercultural sensitivity is necessary. It is important to qualify ideas that are raised in a gentle manner, protecting the reputation of those bringing up ideas, so no one is shamed.

Communication and Negotiation Styles

Personal relationships are required for successful business relationships. The initial meeting is viewed as an introductory meeting where you get to know one another. You should wait for your Vietnamese counterpart to raise the business subject.

Many meetings are conducted in Vietnamese and to ensure you avoid any potential cross cultural miscommunication you will need a translator. Vietnamese put a higher value on keeping one’s word than on contracts. Never commit yourself verbally unless you are prepared to stand by your word.

Negotiations move at a slow pace and patience will be a necessary cross cultural attribute. It is important to speak to all stakeholders, which often includes government officials. When recommending a proposal, it is a good idea to offer several ways the other party could structure the deal. Vietnamese like to consider options. Vietnamese are skilled negotiators.