Case Study 4: Culture and Business in Saudi Arabia

1. What forces shaped modern Saudi culture? How similar or different are those forces from
those that shaped the culture of Western nations?

Saudi Arabian culture was shaped hundreds of years ago by both Islamic and Bedouin
beliefs and mannerisms. Islam promotes free enterprise, so long as its growth and success
is not done to the harm or expense of others, as well as property protections for “trustees”
(not owners), and stresses the importance of honoring contractual obligations, keeping
one’s word, and being honest in business and personal dealings. Saudi Arabia’s Bedouin
traditions emanate from their nomadic history. Survival in the harsh desert climate
required loyalty to family and tribe, a clear command hierarchy, a focus on cooperative
relationships and included a non-plussed, non-hurried sense of time. I can imagine a
parent saying to a child who asks, “When will we get there?” and a parent’s response,
“When we get there.” Western culture, in contrast, is more individualistic and time is not
so relative. Westerners believe “time is money” and the culture emphasizes a healthy
respect for it. I would say that humanity in general, regardless of nationality, considers
family and relationships to be important and that collectively being kind and considerate
of others, i.e., not purposely harming, cheating, or lying to others are positive traits. But
Western culture tends to place self before others and groups tend to be formed when they
are required. And though Western businesses certainly have organizational structures with
upper and middle management and employees in general, there is very little
stratifications between levels in the West as there are in Saudi Arabia. In Western
business culture it is not uncommon for a line worker to knock on the door of the CEO
and have a conversation. In Saudi Arabia, that would not happen.

2. What kinds of misunderstanding are likely to arise between an American company and a
Saudi enterprise, neither of which has experience dealing with the other?

The sources of misunderstanding that might be most likely to arise between an American
company and a Saudi enterprise would be misinterpretation of “timeliness”, frustration in
perceived delays in making decisions, and perceived disrespect in a meeting between
people with unequal stature. Saudis are not as time sensitive as Americans are. If I had a
meeting with my business counterpart in a Saudi office building, I’d be likely to arrive 5
to 10 minutes before the scheduled time and I would be annoyed if my counterpart
lackadaisically arrived 20 minutes later, not to mention potentially allowing others to
interrupt our meeting time. I might feel as if my meeting partner wasn’t interested in what
I had to say and worse, feels its unimportant or trivial. Saudis also like to consult friends
and family members before making business decisions, something that is very unlikely to
occur in an American business. An American might feel very frustrated to meet with a
business partner, expecting, perhaps, to move a joint venture along, only to have
movement forward delays because other non-business consultations had to take place,
first. Lastly, perceived disrespect or derailing of a project or initiative could occur if a
Saudi representative felt that the American representative, he was talking to was not his

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 business equivalent. I could see an American company sending a new or junior employee
to a meeting to gain valuable experience only to be turned away by a Saudi representative
because he or she doesn’t feel the American has the experience required, and thus earned
the right, to discuss matters.

3. If you were in a position to advise a Western company that was considering doing
business in Saudi Arabia for the first time, what would your advice be?

Akin to the ideas in question 2 above, I would advise a Western company to prepare for a
series of meetings and other interactions far in advance. This expanded timeline would
alleviate the sense of time pressure Westerner’s work under, allow time for their Saudi
business partner to consult others without feeling rushed or pushed along, and rather than
have fewer, longer meetings that may be interrupted, opt for shorter, more frequent
meetings where concentrated focus allows progress on matters one a time. I would also
advise the Western company to ensure that the person they send to conduct negotiations
or lead meetings is an equivalent rank, in time served and in experience/knowledge, as
their Saudi counterpart. And though I loathe to write it, I’d advise that initial meetings be
conducted by men. Though the Saudi culture is changing under the more progressive
leadership of Mohammed bin Salman, values and norms change slowly and it would be
folly to derail a potentially lucrative business partnership by haphazardly ignoring
centuries of culture. Women, who are certainly capable workers and leaders, can always
be brought on board the team once negotiations are under way.

4. Since 2017, Crown Prince Mohammed bin Salman, the effective ruler of the country, has
introduced a series of changes aiming at modernizing the country. These include relaxing
many of the traditional norms based on conservative Islam. Why do you think he doing
this? What are the risks here for his government? Are their risks for Western businesses
operating in the country?

I think Mohammed bin Salman is doing this foremostly because he is young and, despite
being a member of a culture rich with centuries of history, he is part of a different
generation living in a more democratic and progressive world, and in line with the
notions of Darwinism, he who does not evolve and adapt dies. I think he is also an
intelligent man and understands that the notion of royalty and succession rights is an
archaic governing mechanism, one that is also being fervently challenged in England. If
Mohammed bin Salman wants to continue being a leader of his people, I think he
understands, given the world such as it is, he needs to implement more progressive,
egalitarian, and democratic processes to ensure the economy of his country continues to
thrive. Nothing stays the same and change is the only constant. A risk for the Saudi
government could be that bin Salman moves too quickly, or doesn’t involve enough
voices, with some of his policy changes. As the text discusses, though people may be
wearing jeans, eating a Micky D’s burger, and drinking a coke it could be dangerous to
assume that historic cultural values and norms have changed as quickly. Another risk

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 could be overestimating the degree with which women desire change in the country.
From a Western point of view, I think giving Saudi women more freedom is long
overdue, and there is even an element, in the way its being delivered, that smacks of
patriarchal smugness but, how do women feel about it? Do they feel they are being
rushed into living a new way of life they may be hesitant to adopt? How about Saudi
men? Are they truly on board as well? Overestimation of perceived favorable adoption
could come back to bite Mohammed bin Salman, which could lead to wild, drastic swings
in decision making. The Taliban and their recent issuance and then revocation of girls’
and women’s rights comes to mind. And likewise, there are similar risks for Western
business. An American business could have done everything by the book with the Saudi
company they were working with, only at the last moment to have an initiative stalled or
back walked because someone’s father’s brother changed their mind. There is also a risk,
I believe, from taking too much time to do things. The world seems to be changing very
quickly and time does matter. I believe that the Saudi’s “stop and smell the roses”
approach could offer risk of de-railing, missed opportunities, changes in costs or policies,
or other such factors that business ventures depend on for implementation and success.

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