United States: Debunking Romanian Myths

There is a prevalent and unflattering joke told to caution visiting foreign businessmen about doing business with Romanians: "How do you make Romanian chicken soup?" they ask. "First you have to steal the chicken." Or there’s the infamous tale of the goat – the one in which the Bulgarian farmer gets one free wish and asks for a goat to feed and play with his children, while the Romanian farmer for his one wish looks over the fence at his neighbor’s goat and expresses his wish to "kill his goat" – meaning that the Romanian would rather remain impoverished than see his neighbor succeed. They all boil down to the derogatory notion that all Romanians are thieves and liars, and a spiteful people. Rubbish.

While it is said that truth lies behind humor, discerning the nature of that truth is not always easy. In the case of Romania, it is downright knotty. But the impact of these slurs on Romania results in an injection of false notions of the Romanian character into the psyche of foreign business people and this affects the way in which they perceive Romanians and Romanian business opportunities. These false characterizations have probably cost Romania billions of dollars in investment, and its been going on for a long time. Raised to almost folkloric proportions is the opinion of Czar Nicholas II who said that "Romania is not a country – it’s a profession."

With all due respect to the Czar, the myths of Romanian dishonesty are, for the most part, smoke that conceals Romanian’s lack of a western business sophistication and an ingrained inability to admit it – a potent combination that results in bad business practices. This is not to say that official corruption and the insidious business culture that it feeds are myths. Sadly, they are all too real and all too pervasive, but they are not indicative of the nature of an entire people. While the failure of successive governments to tackle the very real issue of corruption has cost Romania dearly, the insidious misconceptions about its people have made the situation even worse. The key to understanding the Romanian character and succeeding in business in Romania lies in comprehending the cultural distinctions that cause those misconceptions.

Romanian’s lack of western business sophistication and an ingrained inability to admit it – a potent combination that results in bad business practices. This is not to say that official corruption and the insidious business culture that it feeds are myths. Sadly, they are all too real and all too pervasive, but they are not indicative of the nature of an entire people. While the failure of successive governments to tackle the very real issue of corruption has cost Romania dearly, the insidious misconceptions about its people have made the situation even worse. The key to understanding the Romanian character and succeeding in business in Romania lies in comprehending the cultural distinctions that cause those misconceptions.

The descriptions below are general and as with all generalizations, they are not representative of every Romanian businessperson and certainly not of the emerging group of business people who have become westernized in their approach and successful in their businesses. Nevertheless, most Romanian business people would have you believe that they know everything there is to know about doing business with foreigners. They don’t. In fact, most of them haven’t got a clue. They view western businessmen as deep pockets out of which they can extract inflated prices for exaggerated products of overstated value – not because they are wicked, but because they are unfamiliar with global business practices. Many Romanian business people also lack financial acumen. Most know it, some don’t; but no one admits it. The fear of making a mistake breeds excessive pricing, and the lack of understanding of western business creates the very false impressions among foreigners that doom so many ventures in Romania. If a foreigner comprehends this, it will be much easier to understand why the deal seems to be so screwed up. It might explain why the pricing is off the wall or the product unsuitable for a particular market. And most of all, it will provide the clues to fix the problem and get on with the transaction.

Meetings in Romania can be very different from meetings in New York. A good meeting in New York means that the issues were resolved and the parties got the deal done. The fact that they yelled and screamed during the whole affair means very little as long as matters were resolved. But a good meeting in Romania is one in which everyone was pleasant and walked away contented. You might not have resolved a thing, but everyone seemed nice. Romanians do not like saying no – "we’ll try," is easier on the ears, although often misperceived by foreigners as deceitful. The foreign business person ends up not understanding that they were politely put off and then, when nothing happens, they rail at the Romanians for not following through on something that the Romanians never intended to do in the first place. The problem is that Romanians are among the most courteous people in the world, but courtesies do not work well in a decision-oriented business environment.

Never ever raise your voice in a meeting. Once you lose your cool, your effectiveness will have dissipated and most Romanians will have stopped listening.

Follow-through is not a Romanian forte. Everything takes a long time. Everything. After all, Romania is a Latin country and some things really are more important than business. Anyway, Romanians seem to prefer to wait until there is crisis before resolving anything. And for this, you need patience, and when your patience is exhausted, go out and get some more. Romanians have an infinite supply of patience and they can wait you out for a very long time. Sometimes the wait is due to the fact that you haven’t gotten the hint that they are not going to do your deal. Other times, the wait is a studied attempt to gain an advantage.

There is a tendency for foreign businessmen to be perceived as arrogant towards Romanians even when they are not. Having been locked up for so long in the prison that Ceausescu made of Romania, Romanians are still uncomfortable with confident and strong people from nations such as the United States with a long history of pride and independence. They perceive that confidence and strength of purpose to be arrogance. However, sometimes when foreigners sense that Romanians are unfamiliar with a western business practice or that the Romanians refuse to accept a particular approach to a problem that might be customary elsewhere, foreigners can become exasperated and then actually do become arrogant. That can ruin a deal. Self-effacement would not be a bad attribute for a foreigner to display in Romania.

Romanians are suspicious of everything. You can’t really blame them after fifty years in hell where neighbor spied upon neighbor. Consequently, Romanians never expect to have all the cards put on the table by the other side and they expect a measure of insincerity in business. Whatever you say, there is always a level of doubt as to your veracity. This extends beyond business into interpersonal relations. When you are in a negotiation or even in a discussion during a transaction, there is a never-ending analysis underway of the real reasons you are saying what you are saying or you did what you did.

Romania must be the birthplace of the "conspiracy theory." Everyone has several for just about everything that happens in the country. Indeed, this practice has been embraced by many expatriates in the country who will happily regal you with stories as to the real reasons behind whatever might be the subject of the day. You’d be considered a fool in Romania if you believed that the reason something stupid happened was due to inexperience, oversight or error, as opposed to cunning, arrangement or trickery. To be effective, a foreigner must come to terms with the inherent suspiciousness of Romanians and love for the surreptitious that they relish.

Romanians are resourceful. It’s a centuries old studied approach developed to outwit the various conquerors, military and economic, who sought to take advantage of Romanians. Whether it was the Romans, the Ottomans, the Austro-Hungarians, the Russians, or today’s Western capitalists, the Romanians seduced them into a form of submission. Never forget that you are in their country, playing on their court, with their ball, and they make the rules.

The ability of Romanians to get things done somehow and to almost always find a way to accomplish a legitimate end, can be misunderstood by people from more rigid cultures. Resourcefulness can sometimes be mistaken for chicanery. It usually isn’t. But a foreigner in Romania without experienced professionals to guide them may never divine the difference between a clever approach and an illegal act.

How To Succeed In Business With Romanians

Everyday, foreigners succeed in overcoming the obstacles and the risks of doing business in Romania and find the rewards to be gratifying. Their success can be measured, in part, on the ability to understand Romania’s business culture and work within it to achieve an acceptable solution. Two examples of situations in which cultural gaps can be bridged through better understanding might be helpful.

Shared Objectives: Recently, an American textile manufacturer producing a portion of its product line in Romania decided to expand its output through a joint venture with its Romanian counterpart. The American firm viewed the future joint venture as part of its Eastern European production and marketing strategy and wanted to source product from Romania as warranted by marketing conditions. The Romanians objected to producing product for the American company’s regional market at a price lower than it might receive from an unaffiliated purchaser. The Americans couldn’t understand why the Romanians did not see the profit in the venture for them through their participation in the joint venture company’s performance. What was the problem? The Romanians were suspicious that the Americans might have unstated goals that were inimical to the venture’s success. Differing priorities can lead to behavior that each participant considers inexplicable in the other. Patience and a straightforward discussion concerning the American company’s objectives diffused the Romanian company’s suspicions and demonstrated the value of their shared objectives.

Compensation: Joint ventures are sometimes plagued by jealousy from Romanian managers because of the differences in pay between them and an expatriate manager. While Romanian’s do understand that it is almost impossible to find experienced expatriates to come to Bucharest at Romanian wages, it is sometimes a contentious issue of pride that an expatriate is earning much more than a Romanian manager in his own country. Indeed, sometimes the Romanian manger is truly more knowledgeable and more significant to the overall success of a business than the foreigner whom the mother company plucked down in Bucharest. It is vital to understand and deal with this issue if a company is to have the respect and support of its Romanian personnel. One solution might be to pay the expatriate a separate fee through a management agreement, consistent with Romanian law, which avoids actually placing the expatriate on the venture’s payroll.

To paraphrase Mark Twain’s comment about Jews, Romanians are just like everybody else only more so.

There is an effervescent extremism in just about everything that goes on in Romania. However, one thing is absolutely certain. Far from being a land of brigands, swindlers and fools, Romania is a nation of cultured, literate and courteous people, whose unfortunate experiences and past calamities have isolated them to the extent that as they return to the European fold, they remain somewhat suspicious, a bit inexperienced and noticeably tortured by preceding decades. These are the realities that belie the myths of Romania.