ISPD Etienne Ferian CORPORATE DIPLOMACY & CORPORATE DIPLOMACY IN BRAZIL Brussels ©Copyright by Etienne Ferian 2013. CORPORATE DIPLOMACY & CORPORATE DIPLOMACY IN BRAZIL Supervisor: APPROVED BY SUPERVISING COMMITTEE: ______________________ Sandra Schott ______________________ Corporate Diplomacy & Corporate Diplomacy in Brazil by Etienne Ferian Presented to the Faculty of International School of Protocol in Partial Fulfilment of the the Requirements for the Degree title of Master of Arts in Protocol & soft Diplomacy. The International School of Protocol & Diplomacy – Universidad Camilo José Cela 09/13. I dedicate this work to God and to Blessed Virgin Mary To my parents, Ailton and Cristina ACKNOWLEDGMENTS I would like to thank, first, God for giving me the ability, strength and courage to achieve my goals. To Virgin Mary, by being always present as a mother, having helped me at various times. . I dedicate this work and all my life achievements to my beloved parents; they never gave up and never stopped believing me, giving me full support throughout the journey. To my husband Andre, as with much affection, always was present and supported me at all times. To the ISPD, for the opportunity given to me, to study and learn much more than I thought I would do. To all teachers of the course, that transmitted in each class all their passion and expertise, making me not only learn but also fall in love with the subject. Certainly, I learned much more that I could write on this book or in any other piece of paper. I could absolve from each teacher and friends, knowledge for the life. I’ve woken up for new point of views, new cultures, new insights. All expertise and culture passed to me by all people that I met on this period would not fit in this acknowledgments. ABSTRACT Corporate Diplomacy & Corporate Diplomacy in Brazil By Etienne Ferian, International School of Protocol Brussels, and 2013 supervisor: Sandra Schott. Countries that were previously considered incapables off expanding abroad commercially, are today considered as economic references that assist in the handling of international business. Due to a number of determinant factors, such as technology, education, infrastructure, Brazil and other countries considered as “Second World nations” have taken a strategic position in the world market and have turned the heat up on the economy. The set of these determinant factors above mentioned, used by these countries, depends also on a good professional to put it into practice, which brings a new field of International Relations: Corporate Diplomacy. The innovative capacity of a country depends on the quality of its professionals, who must have a solid background, be prepared to understand the technologies and have the understanding of the world language in order to achieve favorable market levels in the current competitiveness. Companies all over the world, mainly including Brazilian, gained market in world financial situation thanks to the quality of its professionals who brought their products to meet market needs. The corporate diplomat must always be aware of all kinds of changes that occurring, be constantly updated and seek new innovations; as they are the vital link between the business and financial success in the world market. Key-words: diplomacy. business. enterprises. globalization. market. RESUMO Diplomacia Corporativa & Diplomacia Corporativa no Brasil por Etienne Ferian, International School of Protocol Brussels, and 2013 supervisora: Sandra Schott. Países antes considerados incapazes para expandir suas fronteiras comerciais hoje são referencias financeiras que auxiliam na movimentação dos negócios internacionais. Graças a um conjunto determinante de fatores, como tecnologia, educação, infra-estrutura, entre outros, o Brasil e outros países considerados de segundo mundo tomam posições estratégicas no mercado mundial, e aquecem a economia. Não basta aglomerar um conjunto de técnicas inovadoras sem que haja um bom profissional para colocá-las em prática, para isso, surge um novo ramo das relações internacionais: A Diplomacia Corporativa. A capacidade inovadora de um determinado país depende da qualidade de seus profissionais que devem ter uma base de ensino sólida, entender as tecnologias dispostas para cada época e saber compreender a linguagem mundial para atingir patamares favoráveis em meio a competitividade do mercado atual. Empresas de todo mundo, incluindo principalmente as brasileiras, ganharam espaço no cenário financeiro mundial graças à qualidade de seus profissionais que levaram seus produtos para suprir as necessidades do mercado. O diplomata corporativo deve ater-se a todo tipo de mudança para que estejam constantemente atualizados e atentos as inovações, eles são o elo entre a empresa e o sucesso financeiro no mercado mundial. Palavras-chave: diplomacia. comércio. empresas. globalização. mercado. TABLE OF CONTENTS INTRODUCTION....................................................................... 1 1 CONCEPT OF CORPORATE DIPLOMACY............................. 4 1.1 The Rise Of Corporate Diplomacy............................................ 8 1.2 The Role Of The Corporate Diplomat........................................ 10 1.3 Corporate Diplomacy In Brazil And Its Utilization ..................... 12 2 MEDIA....................................................................................... 18 3 CROSS-CULTURAL COMMUNICATION................................. 24 4 CORPORATE PROTOCOL....................................................... 34 4.1 Concept Of Corporative Protocol............................................... 34 4.2 The Rise And Use Of Corporate Protocol................................. 35 4.3 When To Use It.......................................................................... 36 4.4 Business Protocol in Brazil........................................................ 41 5 NEGOTIATION SKILLS............................................................. 44 6 PERCEPTION........................................................................... 48 CONCLUSION........................................................................... 57 APPENDIX............................................................................... 61 BIBLIOGRAPHY...................................................................... 72 INTRODUCTION The international market is rapidly growing trade relations between countries are improving and the search for the best deal is gaining importance in the global situation; strengthening the economy of producing regions and feeding the needs of buyers around the world. Currently, companies are focused upon a new world view, whereas a in the past their vision for international relations was very restricted. Today, businessmen have come to realize that the world needs varied resources, which results in competition within the marketplace becoming increasingly aggressive. Countries with a strong tendency to commercialize their products have a subsequently developed the ability to expand their borders and reach sectors of the economy never before imagined, especially with regards to developing diplomatic relationships. We can include examples such as China and South Africa. These countries were not considered as “developed countries”, however today they are much further advanced than they were years ago. It is possible to note a significant growth in these countries, and even question whether China has the potential to be a new superpower which may soon be equal to the U.S. What about Brazil? Brazil wasn’t considered a first world country either, but it is well known that Brazil has undergone considerable economic growth, in addition to opening its "doors" in terms of national and international negotiations. It is true that Brazil has gained prominence within the economy and the Brazilian image in other countries has improved, especially in Europe. The current desire of international companies to do business in Brazil is remarkable. With international companies attacking Brazil, Brazilian companies must strike back in order to keep growing. It is necessary for Brazil to expand its national businesses to other countries. However, although we live in an era of globalization, only a few companies truly understand what it means to internationalize its activities. Unfortunately, Brazil is taking too long to realize and adapt to this need for internalization and this might be the reason it has not yet become a superpower. The difference is the way in which entrepreneurs from other countries have learnt to deal with constant growth and fluctuations in the economy, and have understood and adhered to the new mode, Corporate Diplomacy; this is considered to be the secret source of success in negotiations for many entrepreneurs. When discussing Corporate Diplomacy, Brazil is quite far behind; the aim of this paper is to introduce, explain and address the importance of Corporate Diplomacy for small, medium and large businesses. It also aims to show that Corporate Diplomacy has a direct influence not only to the growth of the business, but also on the growth of the country in general. As it will be presented, this work is not about State Diplomacy but it is about Corporate Diplomacy. As Business/Corporate Diplomacy is the central theme of this dissertation, there will be a special chapter about its conceptualization; it should be clear that this new branch of diplomacy has a strong strategic focus which will assist companies of all sizes in the process of internationalization. A problematic issue relating to this theme is the understanding of the work carried out by the corporate/business diplomat. It has been discussed whether this should be a new position or simply an extra activity related to another position, such as sales manager. A good supplier needs qualified managers to launch the companies’ best products in the market successfully. The objective of this study is to demonstrate that international trade is not just about the import or export of goods to complete the consumption chain; several other factors must be treated as a priority, this is where the corporate diplomat steps in to guide the entrepreneurs, to ensure they don’t lose competitiveness and negotiations simply because they don’t understand the world language. Understanding the world language doesn’t simply mean fluency in several languages, it also relates to understanding what the market needs to do in order not to struggle by trying to innovate using outdated technologies and negotiations. By collecting data, analyzing articles and practical experiences, a qualitative approach to the subject will be implemented methodologically. By observing the behavior patterns of professionals working in business diplomacy it will be possible to develop and clarify the particularities in this innovative sector which helps to keep the world economy moving. In order to achieve successful business relations, Corporate Diplomacy cannot act alone, it must be surrounded and assisted by other areas and factors. The act of working together with a skilled corporate diplomat results in a new branch, corporate protocol; this will also be addressed in this thesis. But how will the corporate protocol assist the corporate diplomat? The corporate protocol might be the main tool used by the corporate diplomat to face the adversities created by the current world market. Knowing how to behave in a meeting with foreign companies/entrepreneurs, the dress code, how to receive people from different cultures and nationalities are only some of the many roles developed by the corporate protocol. In no area and under no circumstances should a professional act on their own, without the assistance of the tools that corporatism offers. It will be addressed in this thesis how important it is for the entrepreneur or the corporate diplomat to always be well informed and alert about the constant changes in the business world. 1. CONCEPT OF CORPORATE DIPLOMACY The international market has grown considerably, companies are increasingly international and competitive, creating the need for effective planning to make the process of buying and selling, both in the national and international market, more lucrative. Corporate Diplomacy, also called Business Diplomacy, emerges as a way to assist companies with business strategies, outlining a plan to determine the international dimensions within which the company will act. It is understood that Corporate Diplomacy and Business Diplomacy have the same meaning, and each author uses the terminology of their choice. In this paper Corporate Diplomacy will be given preference, although Business Diplomacy will also be used. In Brazil, this field of study is relatively new and there are only a few studies available on the subject. Two Brazilian authors have been referenced in this study; Gilberto Sarfati, who prefers to use the term Corporate Diplomacy, and the diplomat Mark Troyjo, who uses Business Diplomacy. Different concepts are found for this subject; therefore, we will evaluate them according to the doctrinal understanding. Corporate Diplomacy, also called Business Diplomacy, is a new modality which arose due to the growth of the world economy, in order to meet the interests of business and non-governmental organizations. According to Mark Prado Troyjo, Corporate Diplomacy is: the right to exercise diplomacy throughout a professional who seeks to promote and represent his company, an international organization, non-governmental organization or a State before an international or transnational organization in matters of vies economic / commercial . According to Professor Alberto Asquer: (…) the term 'Corporate Diplomacy' is occasionally employed in both the scholarly and professional literatures, the same concept has never gained any prominent role in either organizational analysis or managerial discourse. The term is sometimes used by public authorities or other bodies (e.g., chambers of commerce abroad), while it is rarely explicitly discussed in studies made in the fields of political economy, organization studies, and business strategy. Steger (2003), for instance, discusses the role of Corporate Diplomacy within the context of the relationships between the firm and its environment. Strange (2000) considers Corporate Diplomacy within the international political economy, especially related to the relationships between firms and firms and the governments. Finally, Ordeix-Rigo and Duarte (2009), examine how Corporate Diplomacy contributes enhancing the legitimacy and influence of firms within a given social system. On the whole, generally Corporate Diplomacy is not considered a central subject of study, nor a concept that calls for effort to define its meaning and traits . It is also possible to find different definitions for Corporate Diplomacy, as described in the summary of the understanding of the text of Charles Crowrford . According to a new view of the Corporate Diplomacy, companies’ brands are identified with a certain country. For example, Coke is identified with the United States, or America in general. But what does it mean in practice? In 1999, the award of Corporate Excellence was introduced by the State Department of the United States of America.. This award had the goal of recognizing companies that display best business practices, strong community service programs, and exemplary corporate social responsibility practices abroad. . It was suggested that Corporate Diplomacy is also a process whereby companies wish to be recognized as representatives of something; it might be a concept ,a country or its related values. In order for the company to have a healthy relationship with its stakeholders, it is necessary to adapt the corporate values to the societal values. In this sense, Corporate Diplomacy is committed to the society, in particular its public institutions, which in turn improves its power within a given social system. Great diplomats know that alliances must be built in order to achievetheir goals. Oppositions to these alliances will occur, but it’s the role of the diplomat to foresee and overcome these. To achieve an effective Corporate Diplomacy, it is necessary to have a deep alignment and agenda understanding. Leaders cannot scrimp when it comes to efforts regarding creating and keeping the relationships of his company. Every good leader knows that a relationship must be built anticipating future necessities, it is not viable to create relationships in turbulent times. Effective corporate diplomats often build alliances with people with whom they have no significant continuous relationships. Cariguittard explains that the behavior, traditions and customs of a guest must be respected, even when they are far from their country, that is one way diplomatic skills can be used to build relationships. Companies with complex structures, operations and supply chains can expect to face disputes over their impacts on communities and other stakeholders, however good their policies, monitoring and auditing systems are. How do companies respond to these conflicts? If not resolved satisfactorily, these conflicts can turn into an enormous risk for the company. Lost productivity, high staff turnover, strikes, attacks on infrastructure, lost reputation and brand value, lawsuits and lost business opportunities are just some of the risks. Observing examples from cases where diplomats or former diplomats are involved, it is notable that in the vast majority of cases the diplomats had a meaningful value to the company and to the society. According to Michael Watkins, Corporate Diplomacy is the creation of alliances with key external players: as I have discovered recently in my own work on Corporate Diplomacy, which I've defined as the role senior executives play in advancing the corporate interest by negotiating and creating alliances with key external players including governments, analysts, the media and non-governmental organizations (NGOs) . Analyzing the number of different definitions for Corporate Diplomacy, it can be said that Corporate Diplomacy is much more than a simple, single definition. There are no concrete words that can define it, since it can cover different areas: customers, regulators, environmental issues, social activities, employees, communication and responsibility, among others. It can be used to individually within these sectors or combine them with each other. “Corporate Diplomacy is not the art of spin, but the practice of being upfront and communicative with a wide variety of people directly and successfully.” Antony Burgmans, (CEO, Unilever), November 2002 . Not only is it is necessary to be fluent in more than one language in order to successfully manage negotiations, conflict resolution or any other actions of Corporate Diplomacy, it is also important to know cultural differences, cultural diplomacy, cross cultural communication and identity (including identifying and understanding the different groups, people, religions, customs, etc.). As well as being familiar with all of the above, it is extremely important to have an open mind in order to deal with "other matters" that are of paramount importance to complement the study and diplomatic understanding. It is understood that Corporate Diplomacy is the most “complete” diplomacy as it is a mixture of all others diplomacies. The administrator in the international context has to be able to understand cultural nuances, the impact of various laws and regulations, as well as balance the risks and political opportunities in environments completely separate from the Brazilian. Knowing several languages is important in international business but completely insufficient to deal with business people from various parts of the world . 1.1 The Rise of Corporate Diplomacy Due to globalization and easier access to the media, large and medium-sized companies are increasingly active in the market, thereby increasing their relationships with other companies interested in their products. The consequence of this is a considerable increase of production. These companies have not only become more active in the domestic market, but have also gained ground in the international market, expanding their covering area. Within the growth of production, companies have been forced to create new sectors/functions to provide proper support to the changing needs and high demands of the market. It has become apparent that marketing sectors, logistics, planning, and other critical sectors have started monitoring business growth more closely. As stated previously, companies were required to create various sectors to meet the needs of production demand in order to expand and innovate, but this would be the right strategy? To Michael Porter ³ , it is very clear in their competitive strategies that initiatives in innovation depend on the ability of each entity to develop a continuous process of knowledge production, industry analysis (sector) and especially in the process of relationship with the market. This market today is nothing more than the world. Since the 90s, the major changes experienced by Brazil - trade liberalization, privatization, inflation control, consolidation of a competitive currency (the real) integration process (MERCOSUL) - allowed the country to move closer, commercially, to other States. As discussed below, the country has used the Corporate Diplomacy in expanding business in ways that encompass mergers and acquisitions, joint ventures, mergers, and other mechanisms that colaborates in promising fields for their business States no longer meet all expectations over these constant changes and on the speed that they occur, and recognize that transnational corporations are organizations, able to deal with the requirements of the new market. All this factors requires an adaptation of Traditional Diplomacy to the current international economic relations of foreign investments and greater effort to deal with the competition between the companies . As noted in the above quote, Brazil has been thorough major economic changes; therefore the issue of business innovation has gained importance. However, companies have not become as competitive as imagined and that is holding back a bigger economic growth. Certain countries that are also considered ‘second world’, such as Brazil, have an ability to extend their views and borders, especially in developing public relations and diplomacy (in these cases, it is Business Diplomacy, not public diplomacy). Diplomacy business has a great strategic focus on guiding the business process for internationalization and innovation, and cause an internal vision of seeing the company beyond their capabilities, considering world demand and not just regional. There are possibilities of new scenarios and boundaries . Many countries have observed the branch of Business Diplomacy, but in Brazil there is still a big gap. Many companies still have "closed" minds to this new modality, or simply do not yet know about it. This can cause great harm to those who are not innovative in their business relationships. Brazilian companies must take a new look at the world, a new vision of international relations, realize that the world wants to negotiate with Brazil, but in a competitive and aggressive way. A young diplomat, Marcos Troyjo, has created the concept of business diplomacy a few years ago, as he realized that many Brazilian companies around the world lose competitiveness and negotiations for not understanding the language of the world, and when they try to innovate they are behind the others. Innovation and business diplomacy are related concepts. Innovation depends on a lot of product intelligence, depends on actions to integrate with other cultures and worldviews. Many of the innovative products are products to the world. Brazil needs to innovate, and companies need to be diplomatic. 1.2 The Role of the Corporate Diplomat In the last decade, the corporate diplomat has playeda key role in the advancement of the global economy. This professional demonstrates an important number of skills in order for his/her function to be fulfilled successfully. Gilberto Sarfati defines a corporate diplomat as: …every employee of a company designated to perform and manage the corporate foreign policy. In other words, every employee is responsible for some dimension of the international strategy of the company. The fluency of another language other than their own is an important factor in the success of the corporate diplomat; however, the diplomat’s functions go beyond that. Listed below are several essential qualities, amongst others, for a corporate diplomat to successfully fulfill their function: • Ability to communicate and negotiate • Mastery of technologies • Be aware, with current information about the culture of the country/countries that are part of the negotiation • Have current knowledge aboutthe world economy and market trends. The corporate diplomat should rely on the above qualities in order to remain successful in his/her role. It is also important to be aware of everything that happens globally, because even indirect factors may influence negotiations. For many authors, the art of negotiating is a “plus” point for the Corporate Diplomacy professionals. What would be the use of fluency in Japanese, Arabic or French, for example, if the professional does not know what the perceptions of these groups are regarding the market? What would be the use of a corporate diplomat if they don’t know how to deal with entrepreneurs from certain countries, know their culture or the desires of the market? There are numerous factors that differentiate an outstanding professional from a regular professional. (...) The Corporate Diplomat is the new actor that militates in international interface, a sophisticated merchant, who makes transaction for the companies" and describes that in Brazil until the 80s, it was small the militancy of the Brazilian business. Furthermore, Corporate Diplomacy is the approach of the private sector into the field of International Relations. For Pfeifer "the demand by the interlocutors is big and there are few players in the country for this role" He adds that this field is restricted to the entrepreneur himself, he also explains that the labor market for this type of diplomacy is still incipient. "Unfortunately it is a space where amateurism prevails . The quote above states that the labor market is lacking such professionals, as it is not enough to have only one of the important skills to be a successful professional. For companies seeking this kind of professional, it has proven difficult to find a corporate diplomat who possesses all the desired skills to fulfill the position. The key to success for the corporate diplomat is preparation and dedication. These two skills will help the diplomat succeed in his/her career and bring successful business deals for their employer. 1.3 The corporate diplomacy in Brazil and its utilization In the last decades, the Brazilian economy boomed. It is notable that each day Brazilian’s companies are getting more and more international and expanding their business. Following the globalization, Brazil has opened its boundaries to the world market and it is current enjoying an international status never before imagined. But even with a different number of features available for national companies to expand to the foreign market, the lack of experience to act abroad still blocking many negotiations from being successful. [...] In the last years, not only Brazil but also an important part of countries worldwide has decreased their trade barriers against other countries. These trade barriers are actions (e.g., taxes and limitation of the amount imported) that blocks the entrance of the imported product. The second factor is about the comparative advantage. Each country and region, presents advantages on the production of certain product. For shirts, as per example, it is known that the most important production fact is the labor cost. Therefore, a country where there is a cheaper labor cost, will have a comparative advantage when producing a product intensive in labor as a shirt . The corporate diplomacy began to play a key role on the trade relation and became a tendency in overseas business. In order to succeed in their negotiation, as mentioned on other parts of this thesis, there are a number of important factors that the entrepreneurs should observe before achieve the target market. In order to better understand diplomacy in Brazil, it is worth knowing a brief summary of its background . Since the end of 19th century, Brazilian foreign policy was based on its intense proximity with the United States of America. Years later, Brazilian diplomacy had a historic milestone; the project Rio Branco. It was a project that led to the consolidation of the boundaries and national space. From the second half of the 1930’s Vargas government adopted an external policy with more independence from the U.S.A, increasing its bilateral business with Germany. The end of the 2nd World War was marked by the rise of a new political and economic scene, the USA being the new big international mentor. During this period, aside from economic issues, the alliance between Brazil and the USA was complete and turned to the rise of the bipolarity between the USA and Sovietic Union. Continuing the alliance from the previous decades, Brazil celebrated an agreement of military assistance from the USA. This agreement sought to guarantee the defense of national territory by receiving military equipment and training from the USA in exchange for essential raw materials. However, this relationship became weaker due to the high levels of commercial arrears, originating from the increase of imports, due the Korean War. The Government Café Filho, successor of Vargas after his death, intensified the alliance with the USA, signing an agreement regarding atomic energy and others, which allowed the wheat import to be paid with national currency. In the second half of the 50s, with Governor Juscelino Kubitschek – JK-, Brazil began a period of significant political and economic progress which that gave a new direction to Brazilian foreign policy. Japan, even though defeated in the 2nd World War became an important USA ally to control the spread of communism through Asian. Japan began its post-war reconstruction and re-industrialization with a new offer of USA resources, that was superior to any granted by the USA to Latin America. A similar situation was applied in European countries; the Marshall Plan funds could recover their investment capacity quickly. The JK government prepared a mandate pushing the USA for a higher level of participation in Latin America development; communicating an idea of independent foreign affairs. It was due to the acceleration of the investments of the reconstructed countries that the JK Government received and important allocation of resources, mainly from Germany and Japan. Germany had concentrated its investments in metallurgical, electronic and communication sectors, alongside consolidating an important contribution in the banking sector. On the other hand, Japan was attracted to the raw material available from Brazil, which could guarantee a permanent source for the Japanese industry. The Japanese investments during this period were concentrated on textile and steel sectors, with opportunities in the automotive and shipbuilding sector. Many trading companies were established in Brazil, specializing on important products for both markets In the 60s the Brazilian capital was transferred to Brasilia and Janio Quadros (the opposition of JK) was elected president. The political alliances which marked the end of 50s were interrupted from 1961 – by the independent foreign affairs of Janio Quadros – to 1964, with Joao Goulart With the installation of the military regime, from April 1964, the alliances with the USA were re-established, with the goal of restarting the foreign affairs and the continuation of ideological questions regarding the political bipolarity. This alliance continued unrestricted until 1968, when the Brazilian foreign policy assumed its own direction, separate to the American position. This independency will be later noted in the issue about the debts of the “Third World”. A strong alliance of military governments was noteable in the 70s, with the means of expanding the export activity. The 80s was marked by a strong shock to the world economy, caused by the oil price increase, but Brazil overcame this through the expansion of its exports activity. This situation led to a significant increase of the debts of the non-developed countries. As a consequence, many countries declared a moratorium on payments. At the end of the military regime, the Brazilian economic scenario lost its negotiation capability due to a strong external vulnerability, caused by the “crisis of the third world debts”. In this period there was a new alliance with the USA, which established a way to regain relations with the main global consumer market. Brazilians exports to the USA increased from 17% in 1980 to 29% in 1987. The partnership between the State and the industrial sector, formed in 1950 began to dissolve in 1970 due to deterioration at management level of the State and the degeneration of the developed model of import substitution. Therefore, as of the 80s, it was harder to include Brazil in the distinguished group of developed countries. This fact caused high levels of discontentment among many Brazilians. Brazilian foreign policy historically saw the USA as central to its growth, with a key role in the economic development of the country. However, the relationship between Brazil and the USA, does not occupy this historic place anymore. Brazil is now open to new opportunities and economics partners. Within this new concept of an international system, which started in the 90s, the goal of the Brazilian foreign policy was to develop the country with public politics aimed to translate internal necessities into external possibilities. In this new concept, the external politics should get involved with State issues and have representatives from international institutions. Brazilian diplomacy is, by law, forbidden to represent private interests;, therefore, arising from this to ensure that the private sector gets similar treatment to the Brazilian State,Corporate Diplomacy has been utilized for some time. Various details that surround this type of activity can result in the success or failure of the entrepreneurs who wish to expand their business. Specialists have indicated a high number of opportunities, and the Brazilian market has plans for expansion in the global market. The question is where these multinationals or smaller companies can act? The corporate diplomat must be aware of all possibilities offered by the market. He has to recognize which region is lacking the product that can be offered by his company. Brazil has become a big exporter of raw material and labor. Consequently a demand for qualified professionals, able to intervene in company business is highly required; professionals who can assist the foreign customer, who can speak their language whilst at the same time being connected to customer needs and respecting their culture and customs. Natural factors are important for the exercise of various types of activity. Each region in the world has its own particularities regarding the climate and soil, among others factors which are crucial for some raw material production. This is a key point for the utilization of the Corporate Diplomacy: to act in countries that lack a specific, offering something which is in abundance in another region. Among the economic sectors that use the Corporate Diplomacy as a flagship during negotiations, it is notable the tendency of the agribusiness to use Corporate Diplomacy to achieve within the global market. With a wide range of options to act upon, the corporate diplomat has to be aware of the various factors required by the world market in order to be successful in his negotiations. A lack of certain services can also be found, not related exclusively to natural resources, but mainly skilled professionals to act where there is a need within the market. Civil construction is one of the most searched activities in the world. Another example is the information sector, which has grown exorbitantly in the last decades. The importance of Corporate Diplomacy is very visible. On the other hand, the loss that this field can bring, if not properly used or if ignored during commercial negotiations must be analyzed. In order to apply successful diplomacy in any area, it is imperative that strategic planning takes place before acting in the target market. This way, the market dimension refers about the internalization process of the companies. Summarizing, the planning on international business is a long process that involves since detailed investigations about the foreign market until changes in intern process to adapt product and people to the abroad relations Planning is imperative in any commercial relationship related to diplomacy; not only in strategies for exportation of a national product or labor, the corporate diplomat will also act when his company needs to acquire products from other countries. He will undertake searches regarding prices, best suppliers and advantageous offers, among other factors. The growth of the global economy requires the presence of the corporate diplomat regarding buying and selling relationships on a daily basis, for both products and services. This leads to a quick increase of professionals in these roles; Corporate Diplomacy begins to play a key role in these commercials relationships. 2. MEDIA The media is extremely important to this branch of diplomacy and is of paramount importance to Corporate Diplomacy. The subject to be addressed will not be marketing directly, which companies appreciate very much, though it will be a type of marketing, as it promotes the company well. We will look at how Corporate Diplomacy media can be used for business benefits. As we know, the media is the most powerful means of communication that exists; it is able to dictate fashions, trends, and influence public opinion. Ulrich Steger gives us an even better definition: “Why most powerful? Because the media determine which topics will receive attention, how problems are structured and perceived and only in exceptional cases how they are and should be solved.” Also according to the sociologist B.C Cohen : “The press may not be successful much of the time in telling people what to think, but is stunningly successful at telling its readers what to think about.” Due to the well-known influence of the media many businesses concern themselves excessively with their marketing departments., though to use the media as a means to promote a company it takes much more than simply creating a good advertisement. And that is the name o the game: much more depends on advertising revenues than reader/viewer subscriptions; the numbers count – every 24 hours of each day of the week (24/7). Gone are the days where you had “deadlines” in the media world. A lot of observers argue that such breathless competition with no “time-out” has taken its toll on quality. Dramatic images are favoured, with 30-second soundbites. A colorful, emotional language is needed for the “story line” – not the traditional differentiation between reporting and commentary – to beat the competition. And the person is the message – people probably know more intimate details about the management hero Jack Welch than they do about the wide range of products and services sold by General Electric. Companies have a strong need to build a relationship with the press, the media and the business enter the roles of Corporate Diplomacy in order to help build the image of managers, CEO's and the company. When we talk about the company's advertising, it is usually only on the positive side. We usually forget that the media, as a powerful communication tool, can also be dangerous to the company's image and reputation. This happens in politics, exhibitions of famous artists and with companies. But it is not only celebrity CEOs who are in the limelight – companies find themselves much more exposed, too. More intensive reporting has partly to do with the increase in stock ownership, but also because much more corporate information is easily available – and people are eager to comment on this: the chatting class in business are the (sell side) financial analysts, who are eager to offer their dedicated opinions on every corporate aspect to every media outlet – happy to aggravate opinions into headlines . The marketing aspect we will consider is advertising. It is not enough to just introduce new advertising techniques; a greater impact needs to be created whether the company is a large, medium or small sized company. The only thing that changes is how far it will reach in the market, for example, high impact and international media or lower impact using the media of their city. This is how big companies operate. If we look closely, it is possible to see that there are always positive images in the press about certain firms, which consequently attract public attention. With the media attention there is also an increase in the buying and selling of stocks, products, and investments and this happens if this company has a good image in the media. Many companies have used the environment and sustainability as a way to achieve this "good image", gaining the trust of the public and market. However, there is bad news for well-known companies: harassing corporations might always make a good story. Smash a couple of windows in McDonald´s and you are guaranteed to be selected for an interesting feature about anti-globalization.and so on. Good news, which many companies in between try to spread through a sophisticated Sustainability Reporting system, does not find a similar resonance. It is not because the media are biased toward companies; it is more that they are biased against good news, and the more long-term, complicated to understand issues in general. In the 24-hour fight for readers and viewers, many journalists have stopped looking beyond the “breaking news” for prime time . Let’s not forget social networks, these are important sources, as they are also forms of media. It’s incredible; even the terrorists know the importance of using the media as a source to convey a message. And even terrorists play by the rules and take the media impact into account when they make their plans, because their effectivenesss also depends on global media coverage. And media coverage can easily have far-reaching consequences. In today´s goldfish bowl transparency, events at the remotest of places are instantly disseminated to the centres. Moreover, the channels that use and process this information are plentiful. When SGS, the world´s largest inspection and certification company, as accused of corruption in order to get custom inspection contracts in Asian and African countries, it did not make headline news other than in the company´s hometown Tribune de Genéve newspaper. The successful anti-corruption watchdog, TI, used this case for promoting OECD guidelines, and the US government took a special interest in the SGS subsidiarity in the US, under the Foreign Corrupt Practices Act . If a company has not achieved its expected success, it is time to evaluate the "message" which is being emitted, as it may not be being echoed in the manner intended. The media "dictates" what should be seen, what the current affairs are and matters of the moment. The noise of the corporate fair is today as loud as on the political playground – with the same rules. The politicians have written down, now it is the turn is the corporations. Companies with or without their CEOs – are as long written down as they have been written up. You only need to look at all the Telecoms, Vivivends and DaimlerChryslers of this world to understand the pattern( we address the question of how companies can deal with this situation). Aware of the rules of the game, others have jumped on the band-wagon. The Ogoni Movement in Nigeria, for example, rose from obscurity as one of the many suppressed minorities in a multi-ethnic developing country by “streamlining” their message on “ecological warfare” against Shell . Given all this, how can companies "pounce" on the media in order to get the desired attention as well as convey the message correctly? This approach is of great importance. It is often seen in the media, on the news and in reports where there were unfortunate consequences or controversy, there will be a statement immediately where a particular person or company which was affected, states that the occurrence was not exactly as reported. This requires the professional, diplomat to also be an expert in media relations; he should be a professional who knows how to deal with the media. Mr. Wolfgang Streitenberger says that to succeed in media relations, is not science, it is experience and to achieve success you must have good relationships with journalists. Mr. Streitenberger states that a professional in such an area, should know that it is important to give to the journalist what is important to them. If it is not interesting to them it will not get published. What is in the media exists; what is not in the media doesn’t exist. Therefore, in order to exist, treat them in a special way. Listen to the journalist, don’t just tell them, listen to them. The Press normally needs material on long weekends, give it to them. A good relationship with the media will help build a good image, and this image can motivate your collaborators and bring customers. Another tip from Mr. Streitenberger is to never blackmail the press. With good relationships it is possible to prevent something from being published, but blackmail should never be an option. A bank which wants investors, must have a good reputation, otherwise people won´t invest their money there; therefore, build a good reputation with members of the media. Help them, and they will help you. Public relation is better than advertisement. Mr. Streitenberger also says that it’s important to avoid some risks; give basic and precise information only, a long speech can be shortened, with important information excluded. Don’t give all the information away at once; you must have something different for different journalists, and think about all media, local media, radio, internet, they are all important. As demonstrated above, media can completely destroy a company’s image. By paying more attention to a company’s mistakes or a product failure the media attracts the public attention to those issues, causing an economic impact. Therefore, the question is how to use the media favorably. Some good examples can be found on this matter, one is the Parmalat case. This was the case of a Small company which started to gain force thanks to a good image, which brought international investment. After rumors that Parmalat was in a crisis, the director’s members were informed that Parmalat had money on the Cayman Island and the crisis was muffled. The investments kept coming as long as the stock market kept working normally. Sometime later, the bank at Cayman announced that Parmalat had no money there; soon Parmalat’s bankruptcy was confirmed. Analyzing this case, it is possible to see how it was possible to cover up for such a long time the serious situation Parlmalat was in. Parmalat certainly used the media to muffle the first crisis, and extended their “life period”. Taking a more recent case, the case of the Lehman Brothers;, the Havard economist Kenneth Rogoff , analyses this case as the Parmalat one, he says that talk about the origin of the crisis is wrong, because the crisis started in 2007. The effects of the financial statements only appeared in the public in 2008. Again a case which was covered for a long time, gaining investments which would never had happened if the real situation was known. Now the public has access to the documentation which was used in the fraud. The question is, who could be covering it, how can these kinds of scandals be hidden for such a long time? Is the media behind it? That is believable by analyzing other cases which are principally political cases. The media can be strong enough to induce people to believe what they want them to. This selective process is exactly what makes people suspicious and the media less trustworthy. Instinctively, most people are aware that the media do not fairly represent real life. Even UK Greenpeace campaigner Chris Rose observed that the news on business was “The equivalent of covering the economy by only reporting bank robberies” And John Jennings, the Chairman of Shell Transport and Trading UK and probably one of the managers who suffered most from the Brent Spar incident, came to this conclusion: “It´s a CNN world,” And that means it´s a ‘show me’ world and not a ‘trust me’ world of the past” – because people don´t trust anybody, per se, any longer: not the media, nor the corporations, nor the politicians. Everybody has to earn trust through their actions. And for the media, the question is looming large as to whether they have gone beyond the reasonable, and that it is now time to bounce bank. But this does not exclude companies from putting their own house in order: the media represent outside pressure – they do not create it. After reviewing the players in the global village, let us now review how companies have managed Corporate Diplomacy so far . In addition to knowing how to relate to media members, it is necessary to build a relationship of trust. The image of the company is always of paramount importance. If you or your companies are not satisfied with the results it is worthwhile being aware of the image that is being portrayed. 3. CROSS-CULTURAL COMMUNICATION Cross cultural communication is a topic of utmost importance for this thesis. Besides being very interesting, it is extremely useful in the career of a corporate diplomat. Negotiation is not as easy an art as it seems for many people, especially for Brazilians who are culturally very communicative and spontaneous. Based on the idea that it is easy to negotiate, many Brazilian companies do not consider hiring a professional, as they are generally satisfied with the way things are and choose to "save", instead investing in other sectors such as marketing and computing, while trying to enter the national or international market. But why do many of these companies and countries fail to achieve the best results in their negotiations and agreements? Why are they unable to achieve their goals? The Cross Cultural communication comes with the intuition to help a lot in negotiation matters, but also complements business in general as; some later examples will show how a company can become bankrupt, lose a lot of money and be unsuccessful for reasons never imagined. Intercultural problems can cost the growth of your company. It is necessary to understand that people's perceptions of others countries might be completely different. The behavior, self-image and especially the perception of other countries and cultures can vary from country to country; these are the main barriers found when reaching an agreement with a foreign culture. It is also important to point out that in addition to a completely different culture; there are other factors that can impact on your negotiations. For example, past influences and influences of the group you are working with; it takes much more than sitting in a meeting room with a good presentation and good merchandise to get the desired deal. This is a common error made by many companies. We can further highlight this by looking at the following example taken from S.Paul Verluyten: Everybody knows about Disney, Disneyland and Disneyworld and their success. When Disney decided to open the Eurodisney nearby Paris, there was no doubt that it would be a new success. At first, it was not. Believe it or not Eurodisney opened their doors and the losses accumulated very fast. Eurodisney lost approximately US$ 1 billion losses absorbed the company´s capital nearly entirely, and the price of Eurodisney shares dropped dramatically. In 1994 Eurodisney reported a 21% sales drop in comparison with the year before for the quarter ending June 30, even if quarterly losses decreased, mainly as a result of reduced administration costs and lease expenses and cancelled royalty payments to Walt Disney. Losses were still at approximately US$ 1 million a day in 1994-5 . On analyzing the situation it was found that many reasons contributed to the failure, all of which were in the cultural sector. Eurodisney didn´t predict that cultural differences could be a reason for their failure, and many companies don’t think about it. How can cultural facts affect business that much? The first reason was that Eurodisney was inaugurated a long time ago, to be more exact in 1955, in the USA. Later it expanded to another state in the USA and later still they opened a virtual park nearby to Tokyo, Japan. S. Paul Verluyten believes that the Europeans felt that they were “second rank customers” as it was only after deciding it was not advisable to open another park in the USA that it was decided to open one in Europe. Another reason was that Disney came to Europe as a non-adaptable product. The themes and parks continued to be the same. In the USA they have the cowboys sections; Americans take pride in the conquest of space, these are seen as the essence of American history. The European press noted that European history, essence, themes and preferences were not represented in Euro Disney. Everything remained the same way as Disney USA. Nothing was adapted according to the European background. Why would people go to Disney to see “fake” castles, when in Europe real old castles can be found everywhere? Another problem was the money spending, American´s tend to spend more money in a short period of time. Europeans tends to save more. “Eurodisney´s price structure and regulations, however, were more adapted to high density than to low density spending patterns” . The food was also a big problem; Americans it would seem are happy to grab a bite to snack on while going to the next attraction, whilst Europeans enjoy sitting at a table to eat. In Europe it is also common to have free tables to bring your own food and have a picnic, whilst for Americans it is not a problem to spend in restaurants. Different eating times also caused difficulties; the Germans are ready for dinner around 6 p.m., but in France restaurants open for dinner at around 7.00- 7.30pm until around 9.00-9.30pm, when the Spanish wanted to have a dinner at 10.00pm they found the restaurants closed and were unhappy with that. Even standing in line was considered a problem! Europeans become impatient very fast while standing in a line, while the Americans tend to wait patiently and organized in a line. Americans also tend to start a conversation with others in the line whilst the Europeans don’t; even the different languages could be a problem in that case. It is important also to note another matter; of course it was not possible to hire employees who speak Spanish, French, English, Dutch, German, Portuguese, etc. Although Eurodisney made an effort to hire multilingual employees, visitors who didn´t speak French or English could face some problems. To visit the park Americans visit individually and arrive there in the family car, in Europe visits were organized by excursions, going to the park on buses. On the day of the park´s opening, there were 40 buses for every bus parking space at the park´s entrance! In addition, European tour operators are very powerful, yet this position of power was not acknowledged during negotiations between them and the Eurodisney management. For instance, the tour operators were not granted the rebates they normally expect (even the bus driver had to pay their entrance fee to the park) and were liable for unoccupied hotel rooms in the blocks that were reserved for them, in a way that is not standard practice in Europe . There were alos drinks problems; alcoholic drinks were prohibited on Eurodisney’s premises, so people could not have drinks whilst having dinner or lunch. It is difficult for Belgians, French and for example Germans not to have a drink with their meals. Europeans don’t have these moralizing rules like Americans, this is valid also for cigarettes Eurodisney wanted to recreate a mini America inside Europe and it didn´t work! The final problem was the employment; in America it is acceptable to treat employees marginally and with a lot of strict rules, however in Europe it is not acceptable. Contracts controlling personal things such as no tattoos, no earrings, requested to pay for the housing rent but no visitors allowed overnight, perfume, mustaches, jeans, leather skirts and even make-up were are all prohibited and in their contracts it was stipulated that each employee was to always smile, to keep their weight down, to take a shower at least once a day, use deodorant, etc. This turned out to be a big problem for Disney. “Some employees brought the issue of these stipulations in their contracts before the French courts, and in 1995 the former head of personnel of Eurodisney was fined for some of the contracts he had made employees sign .” Several of these problems have been modified since, “[…]the American CEO Robert Fitzpatrick, who is reported to have said ‘Like the Japanese before them, the Europeans will adapt to our spirit’ .” but it was not the case. According to this information a Disney in South America, more specifically in Brazil could be better adapted to the Americans style than in Europe. Fortunately for Disney, everything seems to be solved currently. Problems like this can happen in all kinds of business, and there were definitely mistakes made during the local market research evaluation. Disney had studied all the costs, decided where would be a nice area to place the park, etc., things that most companies do before they start a new business. This is a real and fantastic example of how a lot of small culture problems can affect the business. Welcome to the Intercultural Communication world! Another short, real case was with the famous company Ford. Aiming for the advantage of scale production, Ford has launched three “world car” projects. The first one was the Ford Fiesta, with the entire production in Europe. Not taking into account regional tastes and the economic environment, Ford Fiesta was a tremendous success in Europe, but a big failure in the other continents. The 1980 Escort, was Ford’s second “world car”, in this project Ford decided to make it regionally, following local tastes. At the end of the project, the European and US Escorts shared only two parts in common; the ashtray and an instrument panel brace. On the third “world car” project, the Mondeo, Ford decided to produce it locally and share the design. As a result, the development took much more time than foreseen and was very costly . This Ford case highlights the importance of knowing the culture of each target market. It is unlikely that one single product will be successful globally withoutadaptions. These cross cultural factors must be considered as crucial at the start of the project in order to find the best way to overcome the local barriers of each target market. There are numerous studies based on cross cultural communication that can highlight the importance and vitality of the subject and how it can assist in corporate and public negotiations between countries. Before looking at these studies, it is worth talking about the executive Carlos Ghosn, the current CEO of Renault and Nissan groups. Carlos Ghosn, KBE (Guajará-Mirim1, March 9, 1954) is a Brazilian executive (naturalized French) and the current CEO of Nissan Renault groups. Carlos Ghosn is currently one of the 25 most influential executives in the world. He spent his childhood and youth in Lebanon and then in France - graduated in engineering at the Ecole Polytechnique and began his career at Michelin. When he held the position of President of Renault in 1999, he received the mission to recover Nissan, who had accumulated a loss of $ 6.5 billion and had a heavy structure and deficit. Serenely, he faced cultural differences, he moved with his family to Japan and, after forming a body of directors of both companies, he built a real success story – Six years later he is operating an income of $ 8 billion, and has turned Nissan into the automaker with more operating profit margin of the world (10%). Among his biggest challenges, he needed to close factories and lay off about 20,000 Nissan employees and therefore became known as the "cost killer". At the end of April 2007, Ghosn became president of Renault-Nissan, currently the fourth largest automotive company in the world, with sales of more than $ 130 billion. He aims to make this true empire as lucrative as Nissan” Carlos Ghosn is the author of "Shift: Inside Nissan's Historic Revival", whilst many others authors have also written books relating to his performance. The reason that Carlos Ghosn was hired by Nissan at the time was because he dealt with different cultures on a frequent basis. His success came because he effectively crossed the barriers of cultural differences and understood the importance of it in business, as mentioned in his book. Cultural Communication or Intercultural Communication especially in business, which is our subject, has been studied a lot. In this thesis Richard D. Lewis is going to be the object of study just because of his model, but in fact there are a lot of other authors and studies that could be used. Lewis is one of the famous authors from a cross cultural communication books called “When Cultures Collide: Managing Successfully across Cultures.” He is a British linguist, cross-cultural communication consultant, and author. He speaks 10 languages (French, Spanish, Italian, Portuguese, German, Swedish, Danish, Norwegian, Finnish and Japanese. His company, Richard Lewis Communications,[1] provides cross-cultural communication training, as well as language training for international executives. He founded the Berlitz School of Languages in Finland in 1955, and later opened a further 5 schools in Finland. In addition, he opened Berlitz schools in Norway in 1958 and in Portugal in 1959.[2]In 1966, Lewis founded the Berlitz School in Tokyo and spent the next 5 years living and working in Japan, where he became tutor to Empress Michiko.[2] In addition to his career running language schools, Lewis is also well known for his work on cross-cultural understanding, and gives cross-cultural seminars and keynote speeches to international corporations, as well as governments. Clients include UBS, Coca Cola, Deloitte, Gazprom, Nokia, Unilever and the World Bank . What is really interesting about this model is that he also created practical tests and boards that have an effective way of helping you find yourself and your BATNA, understand your values, drivers and behaviors, to analyze national cultures, create cultural profiles, and also find your weaknesses. In addition, you can check where improvement is needed with regards to your communication and negotiation abilities, set realistic expectations about others values, drivers and behaviors and enhance cross cultural communication. This is only one practical example, but his methodology is very complete and explains in much more detail. The experimental activity is based on a list; each person receives a list. This list contains social and business behavior. Individually your select and mark which option best describes your own behavior. When finished you count how many behaviors you selected in each color, when done you can check it. Figure 1 Figure 2: The core of the model classifies cultural norms into Linear-Active, Multi-Active and Re-Active, or some combination. Broadly speaking, Northern Europe, North America and related countries are predominantly Linear-Active, following tasks sequentially using Platonic, Cartesian logic. Southern European, Latin, African and Middle-Eastern countries are typified as Multi-Active, centred on relationships and often pursuing multiple goals simultaneously. East Asia is typically Re-Active, following harmonising, solidarity-based strategies . Figure 3: Whilst Lewis' writings recognise these can only be stereotypes, his model provides a practical framework for understanding and communicating with people of other cultures. The model can readily be expanded with other features, such as Hoefstede's cultural dimensions, seen in relation to Lewis' triangular representation . 4. Corporate Protocol 4.1 Concept In the business world both small and large companies face common situations where they need to receive or be received by other companies worldwide. It seems to be a simple task, but the receptivity and the right behavior is the first step towards a successful negotiation. The professional life demands actions within certain behavior guidelines by entrepreneurs and corporate diplomats. These behaviors guidelines are important in order to achieve a good relationship both internally and externally to the company. A good executive must know some general behaviors such as the correct dress code for each situation, how to invite and to respond to an invitation, as well as being able to converse easily with anyone about anything or “small talk” as it is called by the English. A successful executive takes advantage of every situation to project positive images of himself. The corporate protocol does not aim to teach only the details of how to receive an important guest. The corporate protocol aims for a successful chain of relationships with all individuals of a certain environment, from the intern production assistant to the final customer. A popular expression says that the first impression is the last impression. Good manners, appropriated language and receptivity are all important factors for a company’s image. Building a good image is the main reason companies are investing so much in communication and image building. Skilled professionals are becoming more sought by companies to build a good image of the company, facilitating the closing of deals. The success of a negotiation is directly influenced by the proper behavior with the customs and collaborators. Therefore, the corporate protocol is used always with the goal to increase the image of an entrepreneur or of a company. The corporate protocol is defined by the group of actions of respect and good education that facilitates the interpersonal relations inside companies. Or as a group of formalities to be taken in account in the companies relations. The corporate protocol consists in an equal mix of good education and good sense. The protocol systematization helps when it is necessary something else than good education and good sense to solve unusual situations. Oscar Wilde used to say that “being part of the high society is only an annoyance. But be out of the high society is truly tragedy”. Without going so far, and to simplify, I believe, in most professions, social behavior plays an important role, and therefore the knowledge of business protocol help to be more successful 4.2 The Rise and Use of Corporate Protocol It seems that protocol or business manners are something new, but they are not. The historical background of business etiquette started in 17th century, as a strict guide to social and business behavior by the French royal courts, specifically by the King Louis XIV; it was the modern etiquette era. Later, it was enforced by the Victorian era, and during the 20th century it was updated by experts such as Emily Post and Amy Vanderbilt . Since that period people associate protocol with rules of flags or ceremonies between countries etc. In fact that is part of the protocol, but the protocol is not that alone. Protocol nowadays is not just a State matter. As in the historical background, protocol is always evolving; it is always changing and accompanying the growth of society. As society changes, manners change in unison. Protocol or business manners can facilitate not only companies’ relationships but also our lives in society, such as at home, or with friends etc. From the moment when men and women began to work together, the traditional rules and immemorial deference and protection in relation to the woman were questioned. And, therefore, the rules of conduct protocol had to adapt to new times and to life in modern enterprises. Thus arose the so-called "corporate protocol", which is a code of conduct that governs most life situations of a company: meetings, presentations, work programs and social programs, etc . The corporate protocol is like the diplomatic protocol, but less formal and more flexible as the market is always changing. The companies have the need to grow and change as quickly as the market and society. The corporate protocol needs to be more practical, to follow the changes of the market and society. On the other hand, as well as the diplomatic protocol, the corporate protocol is fundamentally involved with courtesy, attitudes, behavior and rules. 4.3 When to Use it It is already mentioned in this thesis how cultural differences can disrupt business and how to deal with them. The protocol acts as a guide for the determined person in behavior towards customers, society, media etc. It is useless for a company to understand the market and understand the local market characteristics, if he doesn’t know how to behave face to face with a customer; if the company doesn’t know how to keep a customer satisfied, how to conduct a meeting, event, dinners, business trip, etc. The company has a high risk of losing the customer or the deal, and all the work done, would be lost. The image of the entrepreneur or of the company is crucial. This is a very important issue nowadays, being addressed by many authors and business men. According to the expert Lydia Ramsey: No matter the quality of your product or level of your expertise, if you are unaware of the business practices and social customs of others, your business will suffer. One small misstep such as using first names inappropriately, ignoring the rules of timing or sending the wrong color flower to your client, can cost you the relationship, the deal or the sale. On the other hand being knowledgeable about international customs can improve your business relations and boost your bottom line . Cross-Cultural Communication and protocol are directly linked. The protocol is how to put the cross cultural communication into action, when face to face. The result is visible; one example is the Nissan case: In the 1970’s when Nissan was looking for the site for their first plant in the U.S., competition among the states was fierce. In the end, Tennessee won. It wasn’t just the location, the labor force, and the special incentives. The negotiating teams from Tennessee took the time to study the Japanese culture. They sent their top people, including the Governor, to the discussions. By doing so, they showed honor and respect, highly valued by the Japanese. They also matched the naturally slower pace and personal touch of the Japanese, and abandoned the American way of “Let’s get right down to business and get on with it . Etiquette can be a barrier to the negotiation; so why not learn and be informed as much as possible about the other part? In addition to being a good technique in negotiation, it can also be very interesting. Simple things can make a big difference like the dress code, whether to give a gift to a customer or not, what should be given in a fair as a gift, how to attract attention to your stand in a business fair, how to behave when at a lunch with a customer, how to greet the other person. The corporate protocol helps to answer all these normal doubts. The popular saying, the first impression is the last impression is very old, and correctly used until today. In addition to knowing the etiquettes of other cultures it is also good to get to know your own culture better. Many misunderstandings can be avoided when you know the other side’s etiquette. Below are some cases which have occurred. One example is a Latin American company negotiating with a Japanese company; it is important to know that Japanese companies are extremely superstitious. If your company is going to provide a presentation to them using portfolios, products, boxes of products or samples, the total amount given should not be 4 or 9 or contain one of these numbers, there will be a 95% chance that they will not close the deal. This may seem like a rather silly reason in many cultures and countries not to close a business deal, but it is a highly important factor in the Japanese culture. Furthermore, when giving a business card in Japan you should hold it with both hands and never, sign or scratch on it. They also appreciate the packaging of a gift much more than the gift itself. There are a large number of examples that can be used regarding other countries and cultures, because the diversity of cultures globally is huge and each country works in its own way. It is these small details which make big differences in negotiating. It is exactly at this point that the business diplomat enters the picture. They are able to guide enterprises through dealing with various situations, obtain the expected success in the negotiations and have many other advantages Gift giving and dinner: Once an American consultant has taken to an event, together with his team, some Chinese business people that they were dealing with. This American consultant, aware of Chinese tradition, gave to each of them very well wrapped gifts (photo book of the Pacific Northwest) to be opened later at home. At the same moment, members of the educational institution where the event was held announced that they also had gifts for the Chinese. After passing out all gifts, they urged the Chinese to open it, creating a very awful atmosphere. Pressed, the Chinese unwrapped the inexpensive gifts they were very embarrassed and couldn’t feign appreciation in order to save face for the givers. Therefore, all good mood from the beginning was lost due to a “small” details . This is only one example from many possible situations that can occur during toast and gift exchange in conventions, fairs, meetings, etc. Situation like this are possible to be avoided. Trying to avoid situations such as lunch or dinners with different cultures is not the ideal either. For many countries these outside meetings are crucial for the deal. On the other hand, when accepting the invitation, the company must be prepared and know how to behave. In many countries, France for example, these outside meeting have the intention of proving the education and culture of the other parties. In case of being the hostess, there are many other questions to be paid attention to such as who to invite, what kind of food,should there be a vegetarian offer, whether to offer alcohol or not (For some religions alcohol is not allowed), who pays the bill, how to arrange the seats at the dinner table, (For some cultures it is important to follow precedence), whether to invite an Arabic customer for a dinner (It is not acceptable during the Ramadã). All of tis is part of the protocol. Back to the gift exchange, the Japanese appreciate much more the package then the gift itself. For the Latin culture, it makes no sense. The Japanese keep the gift and open it only later when they are alone. For a culture that is not aware of that, the fact that the present is not open can seems like a slight, something rude, but that’s not the case. In Japan, it is polite to make slurping noises when eating a soup, in the West it is not. Westerns may be dismayed when Chinese spit on the ground, while Indonesians and Japanese will find the Western habit of blowing your nose in a handkerchief which you then carry around horrible . Another important thing in etiquette are the signals, for example, the ok sign in the West and Japan are totally inappropriate in Brazil, it is a disrespectful sign. Of course people know that foreigners may make mistakes with the rules and local etiquette, but when negotiating it is much more important to avoid misunderstandings, as it will be a differential in competitiveness. Here below can be found some curiosities and also some taboos that should be avoided completely: Hands, feet, head and losing face: In arab countries ( and in other muslim countries as well), using the left hand in social interaction is strongly taboo, and must be avoided completely ( this includes handing over or accepting something with both hands) . In Asian cultures saving face is of great importance, in no situation make someone lose face. Therefore, if there is someone with the dirty teeth after lunch for example, do not tell them. For the Brazilians it could be totally weird to not tell the person, as it seems impolite not to, but in Japanese culture, making someone lose face can have very serious consequences, and it could be costly for your business. Another interesting factor: In Buddhist countries, such as a Thailand, while the feet are the lowest and dirty part of the body, the head (and the hair in particular) is the loftiest. Touching someone’s head or hair must be avoided; one should not even rub a young child over the head in a gesture of affection Shoes should be taken off when entering an Asian´s house and in some American´s houses as well, showing the soles of the shoes is to be avoided in the Arabic culture and in the largest part of Asia as well. Even when sitting cross legged, putting your feet up should be avoided. Another group of important things should be considered such as how to give and to hold a business card and their colors. In fact colors are of great importance, as in many countries a specific colour could be considered a funeral color, or an unlucky color. Superstition should be considered in many countries. The non-verbal communications are very important too. Eye contact in many countries could be very embarrassing to the counter party, but in many other countries, it could be a signal of confidence. For some countries it is important to keep eye contact to show confidence and trustworthiness. In the protocol there are several details and etiquette rules that must be considered in order not to disappoint the counter party. In this thesis it won´t be possible to write about all the cultures in general or even all the must do´s and don’ts; this is just an introduction to the protocol and it is importance to business success. 4.4 Business Protocol in Brazil Compared to many countries, negotiating with the Brazilians seems to be quite easy. Brazilians are very open people, talkative and flexible; they are not a superstitious population. Beside that they are very open in religion and politics etc. Brazilians are not really worried about manners, colors, gifts or protocol in general. So why does it seems that for some people it is so difficult to do business with them? What are these people struggling with? As this is a thesis basically focused on Brazilian diplomacy, it is understandable to spend a chapter on Brazilian business protocol. The Geert Hofstede analysis for Brazil is similar to its Latin American neighbors. Uncertainty avoidance ranks highest which indicates a high concern for rules, regulations, controls and issues with career security – typically, a society that does not readily accept change and is risk adverse. A large power distance indicates that inequalities of power and wealth have been allowed to grow with Brazilian society. High long-term orientation ranking signifies Brazil has respect for tradition and supports a strong work ethic where long term rewards are expected as a result of today’s work . Greetings: Hand-shaking should be the greeting for business, unless there is already an open relationship between the parties involved, then the greeting might change to a kiss on the cheek (this would not be the case formal business, but in small companies or personal business). Take time to greet and to say good bye. Small talk before business is well appreciated, though not too much, just few comments about the country, soccer, or any other soft issue “to break the ice”. Going directly to the business might seem a bit rude to Brazilians, but don´t talk too much either. A safe point is to wait for your Brazilian colleague to raise the business subject. Meetings: Another struggle point for other cultures is the interruption. Brazilians will often interrupt you when you are talking. Even in a presentation, they might interrupt in case they have a question or want to point something out. Another important point is that Brazilians need to know who they are doing business with before they can work effectively. Many questions about your company will be asked. To get to know the counter party better, Brazilians prefer face to face meetings instead of telephone or just email communication. Be prepared to construct a relationship before doing business. The individual they deal with is more important than the company itself, so it is never a good idea to change completely your negotiation team or everything has to be started all over again. Brazilian business is hierarchical and centralized. Often people who are in the meetings have no decision-making authority. Therefore don’t expect to get a deal closed in the meeting. Brazilians take time when negotiating. Do not rush them or appear impatient. Expect a great deal of time to be spent reviewing details. You can expect to meet one person, and another is sent instead, therefore if your Portuguese is not fluent, it is advisable to hire a translator and use a local lawyer and accountants for negotiation, Brazilians resent an outside legal presence. Business appointments are required and can often be scheduled on short notice; however, it is best to make them 2 to 3 weeks in advance. Confirm the meeting in writing. It is not uncommon for appointments to be cancelled or changed at the last minute. In Sao Paulo and Brasilia it is important to arrive on time for meetings. In Rio de Janeiro and other cities it is acceptable to arrive a few minutes late. Do not appear impatient if you are kept waiting. Brazilians see time as something outside their control and the demands of relationships take precedence over adhering to a strict schedule. Dress Etiquette: Brazilians pride themselves on dressing well. Men should wear conservative, dark colored business suits. Three-piece suits typically indicate that someone is an executive. Women should wear suits or dresses that are elegant and feminine with good quality accessories. Manicures are expected. In general, according to some researchers, Europeans tend to be more direct and in Brazil it can seems very rude. Even when the Brazilians are not interested, they won´t be very direct. They will tell that they´re going to contact you later, but they won’t. It may seem confused to a very direct group. Brazilians also appreciate negotiations. Brazilians are quite an easy population to deal with, but some tips which can be given by a professional can help your companies, not only in Brazil but around the world, to achieve and to deal with the protocol etiquette . 6.NEGOTIATION SKILLS The Centre of the study of International Relations is the Power. It is believed that the influence, the power of a country is mainly based on the leadership. This is the main study for a public diplomacy and it is really important to find out who the leader of the country is and which kind of power is used by him. The power can be divided into two; hard power or soft power. As in public diplomacy, it couldn´t be different to the private diplomacy, which is the object of this thesis, Corporate Diplomacy. To be a good negotiator, to achieve what you want, in addition to following all the other tips from the previous chapters, you must identify the leader and what kind of power is used by this leader. Negotiation is the process of discussion between two or more disputants, who seek to find a solution to a common problem, one that meets their needs and interests acceptably. Learning to be a skilled negotiator can help you make deals, solve problems, manage conflict, and preserve relationships . When speaking about negotiation, immediately we think about a table and a lot of executives discussing and doing business. Indeed, negotiations are really important in business, but in order to succeed in business and negotiation it is important to be a negotiator in general. What does this means? It means that it is also important to be a good negotiator with your employees, with suppliers, between different departments from a company etc. The focus cannot be only on new business and customers. Being a negotiator in general you can achieve the expected results in other fields too. After all, dealing successfully with suppliers, internal colleagues and your environment will bring a positive value to the final customers. This board above it is just to emphasize, real importance of negotiation in society life´s negotiation is not only for business. In a negotiation you can have different results: In this blackboard you can note, the win-lose negotiation, which is that one when one of the parts loose and only one have the gain. According to one article of Kent´s University , this kind of win-lose is based on persuasion: “This involves pursuing your own interests to the exclusion of others: I win: you lose! Persuading someone to do what you want them to do and ignoring their interests: "keeping your cards hidden". Pressure selling techniques involve this.” And it can be dangerous, because: “Whilst you might get short term gain, you will build up long term resentment which can be very disruptive if you ever need to work with these people again.” Or even if you want to work with them again, so for business never closes a door, let always you door open for business, you will never know when you might need the same people again. The same rule applies if you lose, you won´t be happy. Thoughts about negotiation are often imagined to be that it is hard to achieve the expected result. Or that one side has to lose to the other side win. Nobody wants to loose, right? A negotiation doesn’t need to have necessarily a loser. As mentioned in the above picture, only one negotiation satisfies both sides, which is the win-win negotiation. This tends to be the really successful negotiation as can last for a long time. Achieving a win-win negotiation certainly is a good way to start a good and trustworthy relationship with the counterpart. This is the kind of relationship that everybody wants to achieve, as in the public diplomacy as in the private diplomacy. But it is not easy and unfortunately it is not always possible to reach this result. That´s why it is important to be prepared, and to count on an experienced negotiator with diplomatic skills. It is not easy to get in a win-win situation, as said here, nobody wants to lose, or even give something that the other part wants to. But this has to be the result aimed from a negotiation. That’s the only way to guarantee a long and healthy partnership. On all the others, someone is unhappy and tend to try to change in the future. To be a good negotiator it is necessary to know your counterpart in advance, study about the people you are going to negotiate with, her style, her BATNA ( Best alternative for a negotiated agreement), weakness and also the BATNA and weakness from your negotiator. A good negotiator should not focus on agreements, but focus on people. Never goes into the stereotypes, it can be tricky. There are several tips, studies and even courses about negotiation skills and conflict resolution as seen through the chapter, everything is connected and it is part of the Corporate Diplomacy. One more time it is reinforced the importance of this subject to succeed, not only in business but for the social and personal life as well . 5. PERCEPTION This last chapter does not address any different subjects to the other chapters; it will demonstrate the perceptions some companies have about themselves and other countries, and how these perceptions can help or hinder them in business. Having conducted surveys with different companies who work either nationally or internationally, it was interesting to analyze their perception of other cultures and discover their points of view about the mains subjects of this thesis. “According to S. Paul Verluyten, perception is defined at all levels by our culture and the risks of relying on the SCR (Self reference criterion), in this case: ‘what I see is what you see’) are particularly present ”. Brazilians may see a gesture of arrogance while Americans will recognize the same gesture as being friendly The perceptions of a company’s executive board members and those of each employee participating in an international relationship are important factors for a healthy relationship with the counter party. What are the company’s perceptions about the international relations and the other cultures involved? How do they perceive the international negotiations, market, etc? Do they realize there are professionals who could help them? Do they learn from their own mistakes? Do they realize that there are greater opportunities for growth and success if they understand the other party correctly? This survey aims to discover how companies are dealing with the above issues. Without entering again the philosophical issue of whether or not there is an objective physical reality in the outside world and whether or not there is at least a stable, cross-cultural perception of objects, the undisputed fact that colors, sounds, smells and names are perceived differently in different cultures must be realized by businesspeople and marketing specialists . What makes a media or marketing professional successful? Their perception of the business market, certainly. It is similar with any business negotiation; the more you know and understand about a person or customer, the more you can do to be pleasant. If you know what the other party may like or dislike it is possible to provide or avoid it. In the business world, the more personal contact you have within a business relationship, the more comfortable your business relationship will feel. Through personal contact it is possible to learn how certain person like to be treated; making it easier to gain their trust. Nowadays people are more connected; creating more online relationships, as time is money. The personal contact can be an important alliance; it can be a differential in a world where everybody is in a hurry and have no time for the “Less important” stuff. This research begins primarily by asking if the company works in the international field or not. Some companies answered no, therefore we skipped to other questions where they were asked why not, whether they had tried it already and if so, what was their experience, and finally if they intend to become international in the future. For the companies who work internationally, more questions regarding their experience in negotiation with other cultures were raised. Firstly, five CEOs and owners (all Brazilians), could not answer the survey because it was in English. When asked if language is a barrier to becoming international, or if they were attending or looking for language courses, the general answer was that they were no longer studying a language or looking for a course, and in their opinions it was not an obstacle to working in the international field, as they can hire an interpreter for example, but they don´t require these services at present. From a European’s perception that probably sounds very strange; how can these business people not speak another language? How do they travel? Why don’t they consider achieving new markets? For Brazilians it is very common; in the majority they are not worried about learning other languages. The other group which could answer the survey in English, but do not do business outside the country, had different answers. Some said that they do not need to do business outside of the country as the have a large enough share of the local market. This was also given as the main reason for never having tried breaking into the international market. When asked about their vision for the company in the future, most said they saw them growing within others regions of Brazil, but still not becoming international. Their perception about business is that it is not easy to sustain your company in your own market; the market can be unstable and sometimes crises occur however they prefer to fight in the Brazilian market, their perception being that their kind of business is just for the Brazilian market, not for the international one. This group contained a mix of small, medium and large companies. Other companies, as “Pauleda” said, want to achieve status within the international market, but need more information about how and where to start. All companies interviewed said that they have never used business counseling, and have never heard about corporate diplomats. A common factor with all these groups was that when they were asked about their vision for their company’s future they all answered that they saw them growing, achieving goals and working hard, but none of them specified a planned strategy to achieve that. Combining the answers to this survey, to the studied material from previous chapters, it is possible to conclude that the Brazilian market has grown, but there is still potential for further growth. It is also possible to see that some companies are still close minded when it comes to new trials or experiences. Brazilians are known to be open people, but these “open people” are also very closed concerning business changes and developments. Being closed to the external market, consequently these companies are closing their doors to possible proposals which may come from outside the Brazilian market. Some of them have no idea whether their services or products might be of interest to foreign countries. Also, many foreigners may have difficulties in negotiating and entering the Brazilian market. And now, having proven what was reported in other chapter of this thesis, the general perception that Brazilians are very friendly, open people, with whom you would expect easy negotiations, cannot be entirely true; a professional and more accurate perception would be helpful. On the other hand, the companies who conduct international business reported the cultural differences which they have noticed and how they deal with them. No one who answered the survey reported any embarrassing situations they had encountered during negotiations or the presentation of their products or services. The companies who participated in this interview were Brazilian and Belgian companies. In the Brazilian companies the CEOs, directors and owners are all Brazilian. However, in the Belgium companies we could see a mix of Belgian, English and other nationalities working within the business. They were all able to give complete and very interesting answers, as can be seen in the appendix of this thesis. Some interviews were conducted by phone or via the internet; it was really good, we could go beyond the survey questions and ask more things according to their answers. It was also observed that the interviewee felt more confident in having a chat, as everything was not written on paper. Most companies reported negotiations with others who were already customers or partners. In these cases negotiation tended to be easier and generally about price, product or service quality. Not much attention was given to how these partnerships developed. However, on the phone, it was possible to ask the companies about their first contact, their first negotiations. The answers were that they hadn’t been in a difficult situation when negotiating, but they realized that in some meetings where everything seemed amicable, and they were pretty sure they had gained a new client and that a new business partnership was about to start they never heard from the client again. They admit that they may have done something wrong;, but in actuality they don’t know. Brazilian companies reported that they had working relationships with different cultures such as Saudi Arabia, Europe, Asia, and South America and the most difficult to deal with in their opinion are Asia and Saudi Arabia. But they have realized that these cultures have a different style of negotiation, some try to force a win-lose negotiation, while some of them go for the long-term win-win negotiation. Companies have reported that it is really difficult to deal with companies that forces a win-lose negotiation; it is a challenge for them. As reported by a Director of Avibrás; they have been doing business with Saudi Arabia for years but still today they must take care, even with an established trusted relationship they will cancel the business deal if you do something wrong, and not necessarily wrong in business terms, but something wrong in your personal relationship with them, you must really avoid personal mistakes. When the employees from Avibras go to Arabia they must eat with their left hand and follow other local habits in order to maintain good relationships. Ana Lídia, from Ericson said: “Not always we can meet people that can speak English, this is one of difficulties. Besides, it is hard to understand about their feelings during a negotiation.” It was also noted that for Brazilians, dealing with Europe is easier than dealing with Asia due the time zone and the majority of European countries speak English, but although Europe is considered the easiest continent to deal with, this is only when drawing comparisons to other continents and they emphasize that this does not mean that they don´t have difficulties. It was also reported that the Europeans have some business mannerisms which seem rude to Latin countries or have some problems in understanding each other’s way of thinking. The Belgian companies reported that they had the most difficulty dealing with Africa, Indonesia, and believe or not Brazil! The reason given for the trouble with doing business with Brazil was not due the negotiation itself, but due to the whole context of languages and bureaucracy, in addition they have to find a specialist for the negotiations to deal with the law or the system. In the case of Manuport, which have opened franchises in Brazil, the most difficult thing was also to conciliate the managers; employees were always having difficulty communication with them. They used to disagree about many things as one side could not understand the other, therefore to work as a team was difficult. The solution was an exchange of employees which has had a really positive result. Besides the above, to attend to some of the customers’ requests in Brazil was harder for the Belgians, as Brazilians understand each other “com o jeitinho brasileiro” (In the Brazilian way), reported the director. The majority of these companies said they find partners from the country they are going to deal with, so they save time researching about costumes, culture, etc.; this partner is the one who helps them enter the foreign market. When asked about a corporate diplomat, or if they had ever used a council to help them, all of them said they had never used these and had never heard about corporate diplomats. Some companies said they would like to learn more about it, as for them it would be great to have only one person that could have the different kind of roles encompassed by the corporate diplomat’s role. According to them, if it really works, instead of forming partnerships in separate countries, they could use a specialist person; the partnerships sometimes costs money and patience. When dealing with partners, some of them had problems such as dishonesty. They said it had to be analyzed against criteria of cost and benefits, to check if it really works. It was also reported that concerning the culture adaption, the employees exchange can be difficult. The majority of the companies have to send some employees to work in the country they are dealing with and this can be a nightmare according to them. To send an employee to another country costs a lot: a place to live, the monthly costs, taxes, visa, and it’s a company responsibility. Many times this employee does not do the job correctly then everything you have spent is wasted. And then you train another person, have the same costs and send another one. Sometimes they just come back because they cannot adapt to the new country, new culture, this is also another good example of the difference of culture between countries. Even people who have the support of a company cannot always adapt to a new culture. When the family goes together, it can be good support or sometimes it can be worse. It is a surprise box, and the risk is for the company. That is why it is so important for companies who have international relationships to be well prepared to deal with all the kinds of situations. Can you imagine a company who spent a lot of money investing in courses to prepare a team to send to another country and then they do not want to stay there anymore, or are not prepared to deal with the differences or are having problems with the partners; this costs the company business. The employees who go must be pretty well prepared in addition to the ones who stay so that one can support the other. It seems that Brazilians companies do not have many difficulties entering the outside market, not that they have reported, it would be good to hear about the beginning of the existing relationships, how did everything start, how was the first contact made? But it is also good to see that when they talk about the quality of their products and service it shows that they are very confident, for some of them, years ago it was difficult to imagine Brazilians so confident in the outside market. It seems that as the world is looking at Brazil, and is interested in their products, they are not really worried or looking for new customers, and if they do? They could also start exploring different continents. For the Europeans it seems that it is more difficult, is it maybe because the Brazilians are opened to sell their products, but entering into the Brazilian market it is not that easy. In the Chamber of commerce in Brussels, there was a conference especially for those who wanted to get into the Brazilian market, and it was unbelievable the quantity of entrepreneurs that reported all the kind of difficulties when entering the Brazilian market. There was a lady who worked in an international company, who had to finish their business in Brazil due to difficulties regarding tax, systems, people, etc. Her goal in the meeting was to get some direction in entering the Brazilian market again. The conference at the chamber of commerce was really good, taking in account the specificities of the Brazilian law, but it was a bit superficial when talking about other important cultural differences. . The chamber of commerce was also another target of the interview, asked to answer questions concerning cultural matters such as how do they advise the companies and whether they also have this kind of support; it is believable that they do, but they could not answer the question at the time of asking. Back to the interviews, many companies have never organized an event or fair, or ever been to one, but some of them use to participate and organize them; this is one problem also reported by them. They reported that they use to hire events companies but the majority of these were not really specialized in international events, and they noticed that many mistakes were made, but none so serious as to put the relationships at risk. Many of them are not used to using interpreters as many are used to the English language, but Avibras reported that interpreters are used by them many times. Many companies reported that contracts are in English, and the company itself can make it; international translators are used only in special circumstances. Those who deal with interpreters should pay attention, because a good interpreter not only translates really well, but they should also show the positive emotion or sometimes, perceive the situation and not transmit negativity. When not using translators, the speakers of the company, when they are not dealing with their mother language should really take care, as it is possible to say the wrong things or to not be interpreted well. The word used can sound weird; the pronunciation can sound like another word etc., especially when both sides are using English and it is not the mother language of either side, all efforts should be made to avoid bad interpretation. Contracts should be very clear and as simple as possible. A lot of details should be taken into consideration, even when dealing in your mother tongue, but specially when using different languages. It is possible to notice that many mistakes are made on a day to day basis by within the companies’ routines, as well many positives acts. It was also possible to notice that when interested in doing business, their counterpart in the country is also prepared to deal with different cultures and is not really concerned if something goes wrong, while still trying their best to make the deal. When the companies were asked how they see their businesses in the future, all of them said growing, working hard, continuing in the market, etc. However, no one really showed a strategy different from the market, not that they have reported, and some of them said they want to achieve new markets which they have not explored yet. Manuport reported that it is actually starting to explore new markets, and countries in development, it will be their bet for the future. As a new segment which is still growing, it is believable that the tendency for the future it is an increased use of Corporate Diplomacy. It is because the businesses outside need to grow also, the companies will need to expand to reach different markets if they want to grow in the proportion required, otherwise it is a risk to saturate some markets according to some research. Anyway, it is a tendency for the future, and even for the moment if your company can have a differential, it could be an advantage, especially when dealing internationally for the first time, and as it is known, the future market is going to be increasingly competitive. CONCLUSION In today’s world, we live surrounded by advanced technologies, with means of communication becoming more efficient, increasing daily the necessity of evolution in all sectors. The economic market has grown and surpassed physical boundaries. On the other hand, it has been facing difficulties in establishing profitable business due to the confrontation with different cultures around the world. The demand has increased and the cultural problems have gained importance as some entrepreneurs or companies cannot deal with language, customs and other cultural differences that are crucial for the success of a business. As seen in this thesis, these difficulties are not particular only for the small entrepreneurs. Big companies such as Ford and Disney also face cultural difference problems. Due to these difficulties experienced globally Corporate Diplomacy has emerged, a field very well used by many countries and in Brazil it is still rising. The Corporate Diplomacy, as studied in this thesis, has been shown to be a valuable tool for companies and entrepreneurs success, especially when it involves the buying and selling of products and services . It is important to point out that Corporate Diplomacy is not limited to the entrepreneurs, it should be known my managers or any employee that aspire to a better performance and a better relationship with his work environment and society. There are many professionals nowadays that are focused on assisting and guiding the customer or the company in its various sectors. But even for the most successful and competent of them, often they are still missing something; this “something” is exactly what’s needed to get deeper into the new questions faced by companies today. That is how and why the corporate diplomat has surged; a complete professional that has come to treat all issues that surround an international business negotiation. Business diplomacy or Corporate Diplomacy, depending on the terminology used by differing authors, can assist companies in many ways. A professional who masters several languages is one step ahead of the others. In studying Corporate Diplomacy, it was possible to note that the market lacks skilled professionals for this function. A corporate diplomat, in addition to the knowledge of foreign language, has to be audacious, aware of daily changes and trends, have experience in intercultural relations, have experience and good contacts with the media, knows about leadership, be an expert in protocol and mainly be a born negotiator. A corporate diplomat has to serve well in all these areas together. The lack of a skilled corporate diplomat might not cause serious problems to a company. But if a company seeks an added value, a differential, an expansion, to be more profitable, to improve their relations, to overcome a crisis or media persecution; hiring a corporate diplomat could be the right solution. Each region in the world has its own culture. What is a common habit for some, for others can be an attitude which shows a lack of education or something very disrespectful. A corporate diplomat is the “professional of the world” that has to know and understand the culture and habits of the counter party with whom they are establishing relations. He must study that culture and people, and also know what perception the other side have about the company’s culture. Corporate Diplomacy has reached considerable heights in the global economy. Companies of all sizes are adhering to it. Professionals acting in this area know that as in the public diplomacy, Corporate Diplomacy cannot be unlinked from the protocol. In addition to all the knowledge, something else is necessary for to assist in the commercial demands worldwide; the dress code, how to behave with different kinds of people and how to receive them etc. These are all key roles developed by corporate diplomats;;aimed to keep the corporate protocol as a support for their activities. As also addressed in this thesis, the corporate protocol is a tool of great importance which aims to assist professionals with how to act in the different situations that the business world can provide. In a business meeting, some details as flag positioning, seating arrangements, dress code and others can make all the difference. Another important tool, also linked with the protocol is the media. Media is a very powerful tool that can assist or destroy any company. By developing means of communication, especially with internet access, news or facts that were hardly known previously would todays be seen and explored anywhere in the world, in real time, with only a click. Through social networking, T.V and radio channels, magazines and newspapers the media with its manipulating power tends to formulate opinions and dictate tendencies. As mentioned, the media can be helpful in creating a good image for a company or destructive by creating a bad one. It is the corporate diplomat’s role to have a good relationship with the media and to make sure that it will be helpful for the company. In this competitive market, due to the large variety of products and services which are easily found, the main attraction when closing important deals is not always the best price or the best product/service. The receptivity relationship between buyers and sellers are currently being seeing as an attractive point when closing deals and are making the negotiations much more profitable. It is needed to be sensitive and understand what the customer needs, how to make him happy. Negotiation is not only a buying and selling mechanism, it is necessary to establish relationships in order to keep a customer. That is how the Corporate Diplomacy acts. Price and quality are important, but if the company is engaged in customer service and to a vision where the customer always feels attended to the business relationship can become even more attractive in the global scenario. Brazilians are still seen by the foreign countries as a Nation with some resistance to change. In writing this thesis, I read that many companies have difficulties when introducing new products or ideas in the Brazilian market. Talking to some Belgians colleagues from the export sector that lost some contracts in Brazil, I also noted that the problem was simple; miscommunication. I believe that many Brazilians companies are afraid of the new, but they are increasingly becoming open to it, because even when afraid, Brazilians companies are curious about the new. The tendency is that as the Brazilian market becomes more open to Corporate Diplomacy, because that’s how the market works, if one company takes the first steps, all the others will follow. Not only in the Brazilian market, but the world market is very interesting if a company knows how to reach it. I believe that incorporating the Corporate Diplomacy in Brazil would be a great step for Brazilian development. Even in small steps, Brazilians are finally ready for that. The world is open to seek for new business opportunities, and this is the right moment for entrepreneurs and companies to open their minds and be ready for new technologies, products, services and even for the new business offers from countries never before imagined as a business partner. The success of a business depends a lot on its relationships. A good relationship starts inside the company itself; appreciated employees are more productive and efficient and with the right profile can grow in the company as many successful leaders have. In order for a company to have efficient Corporate Diplomacy, it is a requirement for good communication and relationships starts inside the company, which can then be transferred to customers and target markets. The diplomacy involves leadership and excellence in communication. A good leader is someone who knows how to listen and does it very well, always trying not only to listen but also to understand; that is the role of the diplomat. You must know how to listen in order to know how to communicate. Not different to this is the corporate diplomat. Finally, in conclusion Corporate Diplomacy is a new and very interesting field. It can be discussed and developed in different aspects. Corporate Diplomacy is one of the most complete fields in the corporatism, because it involves precisely everything that a company needs to succeed overseas. It is a business consultancy summarized in only one field! And diplomacy is life. If we all knew how to be a diplomat in our day to day tasks and relationships, many achievements and discoveries would be reached. What a nice world it would be if everyone discovered and applied diplomacy. APPENDIX Survey Ericsson (www.ericsson.com/br‎) 1. Your name and your role in the company: Ana Lidia M.Domiciano de Souza – Sourcing Supervisor 2. Does your company make business outside the country? If yes, how long have you been working with international relations? ( x ) Yes ( ) No In the current Company=> 5 years 3. Where are located the main foreign partners from your company? Europe and Asia 4. Have you noticed important cultural differences among these countries (in meetings, dinners, fairs, etc)? Could you give an example? Yes, different cultures always have different habits and ways how to conduct meetings, dinners, etc. Asia, for instance, people are very proud to offer their food, which normally is quite different than ours, but it is kind to enjoy what they have to offer during lunch and dinner. European people normally are very sharp for meetings which are not really common for Latin America people. 5. From these countries, which one do you find easier to negotiate with? And which one do you find more difficult? Why? Easier => European, but because of the time zone difference, we have more chances to be in contact with. When we have more chances, then the contact is easier and helps to understand their culture and ways of negotiation. Difficult => Asia. Not always we can meet people that can speak English, this is one of difficulties. Besides, it is hard to understand about their feelings during a negotiation. 6. Could you report a challenging but successful negotiation case you ever had and how you manage to achieve that? The challenge was to close down a business agreement with a certain Supply reducing maximum the liabilities. The success was to work together negotiating the remaining materials offering them to other manufacturers; re-use possible materials as an alternative to avoid scrapping as much as possible. At the end of negotiation, we could reduce almost 80% of total amount due to the Supplier. It was really good negotiation either for our Company or to the Supplier. A lot of money was saved. 7. What are the steps normally taken by your company before and when entering in a new market? First, a business case is done to help on the decision to enter or not in a new market. If it is ok and approved, then we work on project management to follow all steps related to NPI (new product introduction). A time plan with all activities and the areas involved is done describing the action plan, responsible and due dates. 8. Does your company works with interpreters and/or contract translations in different languages? How is the difference in language managed? No, many people speak in English and all negotiations/contracts are done in English. 9. Have you or an employee ever had a cultural problem during a negotiation? If yes, could you share this experience? No. 10. Does your company have a partner or employee to assist on how to behavior when visiting a customer abroad (dress code, etiquette, important cultural information in general) or when receiving a foreign customer? No, actually this is described when you are hired. There is a kind of conduct manual to be followed and oriented. 11. Does your company have ever organized an international event, fair, etc? Yes 12. What ways your company seeks to survive and keep growing on the competitive market? Do you use any marketing? What kind of sources you prefer to work with? why? Our Company is market leader on its segment, but of course, always checking its competitiveness and develop new products to be introduced in the market is part of its strategy. The tool VOC (voice of Customer) is used all the time. Our Company has its own marketing area. 13. Have you ever used business counseling? How was your experience? Not so far. 14. Have you ever heard of Corporate diplomat? If yes, what do you know about it? Do you think it can bring an added value for the company on the international negotiations? How? No 15. How do you see your company in the future and what are the plans to achieve that? The plan is to keep being the market lead in the segment and provide I see the company keep being the market leader and mainly being the Provider of solutions to the Customer in advance. Innovating always, exceeding Customers Expectation. Survey Fábrica de Cursos (www.fabricadecursos.com.br) 1. Your name and your role in the company: Denis Herbach Director of Institutional Relations 2. Does your company make business outside the country? If yes, how long have you been working with international relations? ( ) Yes ( x) No (if no, skip to question 16) Answer the below only if you answer was “no” on question 3 16. Why does the company do not do business outside the country? Its reach and objective is basically local 17. Have you tried it already? If yes, could you report what happened? No. 18. Have you ever used business counseling? How was your experience? We have never used business counseling. 19. Do you consider entering in the international business on a near future? No 20. How do you see your company in the future and what are the plans to achieve that? Increasing Market Share in the brasilian e-learning industry. Survey Ozonebras (www.ozonebras.com.br) 1. Your name and your role in the company: Rafael de Souza Fonseca, CEO 2. Does your company make business outside the country? If yes, how long have you been working with international relations? ( X ) Yes ( ) No (if no, skip to question 16) 3. Where are located the main foreign partners from your company? South America 4. Have you noticed important cultural differences among these countries (in meetings, dinners, fairs, etc)? Could you give an example? They show similar behavior to us. They are receptive, calm and opened to make friends and talk about themes beyond business. 5. From these countries, which one do you find easier to negotiate with? And which one do you find more difficult? Why? People from Chile area easier to deal with. They are more interested in making business and try share the benefits of the deals. People from Argentina seems to be more “cleaver” and try to take more benefits during the negociations. 6. Could you report a challenging but successful negotiation case you ever had and how you manage to achieve that? Not much challenging negotiation. In each case you have to use different techniques, depending more on the person´s profile than the culture of a people. Each person requires a different treatment. During a negotiation, you have to feel the climate and, by using psychological techniques and sensibility, try to understand the personality, adapting its speech. 7. What are the steps normally taken by your company before and when entering in a new market? We don´t have a formal strategy, but we use to make partnership with representatives from the country, which understand the culture and traditions of his country. This person is capable to identify new opportunities and won´t waste time learning about the market and players. 8. Does your company works with interpreters and/or contract translations in different languages? How is the difference in language managed? Sometimes yes, when it evolves technical issues which requires specific translation or when a engineer is called to the meeting. Normally to English. 9. Have you or an employee ever had a cultural problem during a negotiation? If yes, could you share this experience? No, never. Our partners use to look for us, not the opposite. So, it use to be people who lives in Brazil for a long time and wants to take the opportunities from here to their country. 10.Does your company have a partner or employee to assist on how to behavior when visiting a customer abroad (dress code, etiquette, important cultural information in general) or when receiving a foreign customer? No, and It would be very interesting!! 11. Does your company have ever organized an international event, fair, etc? Never. We have been invited to missions, but never gone. 12. What ways your company seeks to survive and keep growing on the competitive market? Do you use any marketing? What kind of sources you prefer to work with? why? We always had a superior quality in services. It is recognized by the costumers as a value. Each new professional hired receive instructions to invest in quality in each and every job. 13. Have you ever used business counseling? How was your experience? Never. 14. Have you ever heard of Corporate diplomat? If yes, what do you know about it? Do you think it can bring an added value for the company on the international negotiations? How? Never. It would absolutely bring added value to the company. Seems to be a new niche. A necessary activity! The companies has its own core business and can´t waste time and resources managing these information, so a specialist would be interesting. 15. How do you see your company in the future and what are the plans to achieve that? I see as a multinational company, present in every country in Latin-America and Europe, selling products not only in the segment in which we are now. We expect to became leaders in Brazil in our actual segment. Survey Manuport Logistics (www.manuport.be) 1. Your name and your role in the company: Luc Geerts. I deal with a number of our biggest key account customers. Also business development and working out logistic projects / processes belong to my tasks. 2. Does your company make business outside the country? If yes, how long have you been working with international relations? ( X) Yes ( ) No (if no, skip to question 16) 3. Where are located the main foreign partners from your company ? Worldwide, but especially the surrounding European countries, Far East, Middle East and Brazil. 4. Have you noticed important cultural differences among these countries (in meetings, dinners, fairs, etc)? Could you give an example? Yes. One of the most obvious ones is handing over your business card with two hands instead of one to people from the Far East. Another one is that Americans first cut all their food into pieces and then start eating only with their fork. But you see even differences in approach to people from the north of Germany or the south of Germany. 5. From these countries, which one do you find easier to negotiate with? And which one do you find more difficult? Why? The challenge is in getting the result you are after and each nationality asks for a different approach. I love doing that. I like Americans the least because they have a feeling of superiority although they often have a narrow view on things. They also often decide based on figures without knowing what is behind those figures. 6. Could you report a challenging but successful negotiation case you ever had and how you manage to achieve that? Getting new business from the Brasilian subsidiary of one of our customers. This was done by joining forces with our office in Brasil and jointly tackle the doubts and expectations of this customer. 7. What are the steps normally taken by your company before and when entering in a new market? We are in such a process for the moment. We look for opportunities through existing customers in order to find a solid base to start with. Then we go locally to strengthen that basis either through an agent or by starting up an own office. 8. Does your company works with interpreters and/or contract translations in different languages? How is the difference in language managed? We are multilingual. And only for official documents / contracts, we will make use of outside companies for translations. 9. Have you or a colleague ever had a cultural problem during a negotiation? If yes, could you share this experience? In my first cooperation with a Chinese agent, I was to blunt and direct when they made a mistake. Chinese people do not like to admit mistakes so you have to bring it differently to them. 10. Does your company have a partner or employee to assist on how to behavior when visiting a customer abroad (dress code, etiquette, important cultural information in general) or when receiving a foreign customer? No. 11. Does your company have ever organized an international event, fair, etc? Organised not but participated yes. 12. What ways your company seeks to survive and keep growing on the competitive market? Is it any marketing used? What kind of sources you prefer to work with? why? We put performance and service up front. But competitive rates are inevitable. And we focus on where we think the opportunities are. 13. Have you ever used business counseling? How was your experience? No 14. Have you ever heard of Corporate diplomat? If yes, what do you know about it? Do you think it can bring an added value for the company on the international negotiations? How? No I have not heard of it and I can only guess what is the function behind it. So it is difficult to comment on your other questions. But I do think it can be usefull for certain businesses to break into a new market. 15. How do you see your company in the future and what are the plans to achieve that? The future is looking good. We have a clear strategy made out by management and supported within the company. Further we have plans for extra expansion abroad. Survey Pauleda (pauledapisos.com.br) 1. Your name and your role in the company: Paulo Roberto de Paula Junior owner 2. Does your company make business outside the country? If yes, how long have you been working with international relations? ( ) Yes ( X) No (if no, skip to question 16) 16. Why does the company do not do business outside the country? Well, till today we did not need. Brazil is a big country and we still have a lot to grow to cover it entirely. 17. Have you tried it already? If yes, could you report what happened? No. 18. Have you ever used business counseling? How was your experience? No. 19. Do you consider entering in the international business on a near future? Yes,I do. It is not the next strategy from the company, but why not? We first have to study the risks and opportunities for it. Certainly a good study has to be done before taking this step (bureaucracy here and at the other country, etc). 20. How do you see your company in the future and what are the plans to achieve that? I see my company in the future growing day by day with hard work, goals and objectives. BIBLIOGRAPHY PDUs for $200- Because Everyone Needs Negotiation Skills. Available at: . AMARAL, Isabel. Protocolo Empresarial. Available at: . ASQUER, Alberto. Lecturer of Business Strategy and Policy- Dipartimento di Scienze EconomicheedAziendali. Available at: . BAYART, Bertille. Tout n'est pas de la faute de Lehman Brothers Available at: . Brazil Business Etiquette & Culture. Available at: . CASSANO, Francisco Américo. Diplomacia empresarial: uma alternativa estratégica na gestão internacional. 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