Can you make it in Mexico?

• Author: Gutierrez, Santiago
• Position: Includes related article - Special Report: What NAFTA Means to Your Firm

The time is now to decide how--and if--your company will fit into the U.S./Mexican trade alliance. Test your ability to adapt with this inside look at the rules of the game.

As the 20th century draws to a close, the headlines are filled with stories of change. Former Communist countries struggle to shift to a market-based system while the European markets grapple with unification. At the same time, competitive pressures intensify in a now global marketplace.

In this economic and political context, many U.S. companies with international intentions look toward Mexico. And the timing is right. Overall, there's growing confidence in the kind of opportunity Mexico offers foreign businesses, particularly U.S. businesses. Improvements in the Mexican economic, social and political climate have created a more favorable business environment for U.S. companies.

These improvements have brought about macroeconomic stability and fewer trade restrictions, accelerated privatization programs and created a booming stock market. Mexico's GDP growth has boosted market demand for goods and services, and the country has enjoyed political stability for more than 65 years. These circumstances, events and conditions have helped to improve Mexico's status as a world trading partner.

Success in Mexico isn't guaranteed, however. Prosperity for foreign companies will depend on a variety of factors, including, perhaps most importantly, their willingness to rethink and then to reshape business interaction styles.

BRIDGING THE U.S.-MEXICO CULTURAL GAP

Culture influences many aspects of business attitudes and behavior including basic work values, motivation, business socializing, making and keeping commitments, and more. What makes doing business in Mexico truly different from doing business in the United States are two distinct codes of business behavior, embedded in the American and Mexican cultures.

Eva S. Kras, in her book, Management in Two Cultures, looks at the Mexican CFO of an American operation in Mexico who recently made these comments on American business skills and protocol: "I have great admiration for the technological knowledge and administrative skills of the North Americans. However, when they attempt to impose their methods on us, incredible problems arise and we all feel frustrated and resentful, but don't know what to do about it. In my experience, the U.S. executive seems to be a cold, impersonal, discourteous and critical individual. His main objective seems to be dehumanize business as much as possible and to convert people into robots."

Kras continues that, when speaking of a particular American manager on assignment at this operation, the Mexican CFO comments, "What a boring life he must have. ... He seems to feel that all errors require instant criticism and are mostly inexcusable. He said once that personal feelings are not important and that we must learn to overcome our sensitivity to criticism. We just couldn't believe what we heard. I personally cannot accept the undiplomatic handling of inevitable...