Middle Eastern Business Smarts: Make Friends, Not Deals

3 December 2019

By Neil Hathaway, Regional Middle East Manager

We’re all familiar with the hard sell. Sometimes, in the ruthless commercial culture that characterises much of the western world, it seems that all that matters is making the sale. It is well-documented in powerful Hollywood movies such as Tin Men and Glengarry Glen Ross. In a notorious scene in the latter film, Alec Baldwin’s character reads the riot act to a group of underperforming real estate salesmen: “It’s ABC,” he tells them. “Always Be Closing”.

That high-pressure environment might be tolerated in the US or the UK, but it is completely alien and counter-productive in the Middle East. At DCT, we’ve been building our business with the major oil states of the Persian Gulf for several years and we know that – no matter how good your product – success is ultimately about nurturing relationships, not doing deals. 

There is no such thing as a product that sells itself. Even the most desirable gadgets in the world, such as the iPhone, are carefully and intensively marketed. Similarly, at DCT, we are at the forefront of innovation in turbine technology, constantly pushing the boundaries and improving the product, just as Apple does. Our range of tools – from Turbocaser and Turborunner to our new generation of drill pipe swivels and casing cement breakers – are in demand as they demonstrably save time, money and reduce risk.

Yet we know that their unique selling points and massive benefits are not enough, on their own, to sell them to our customers in Kuwait, Oman, Saudi Arabia and the UAE.

In the Arab world, the business culture is different. Like most original equipment manufacturers, we work with local commercial partners to do business there. In the past this has been on a traditional principal/agent model, but we are increasingly moving to local entity and joint venture models, especially in Saudi Arabia.

For instance, we were recently awarded a corporate purchase agreement with the national oil major, Saudi Aramco. Our successful submission demonstrated how we would meet the 70% local content target (the so-called IKTVA, or In-Kingdom Total Value Add Program) by forming a local joint venture. 

But regardless of the form of the relationship, our local partners play a vital role in making introductions to their network of contacts, opening doors, pulling strings and getting us up to a higher level in the target customer’s organisation. They will also vouch for us and act as a reference.

Choosing the right partner is therefore vital to underpin our business expansion and ensure that our customers get to enjoy the benefits of our pioneering technology. AT DCT we look for four key qualities in our local partners:

Proactivity: A good partner is not just an administrative conduit who takes their commission just for allowing you to do business in their country. Instead, they will actively promote sales and seek out sales leads and opportunities.

Integrity: Trust is very important in the Arab world. It is earned over time. Arabs tend not to separate business relationships from personal relationships in the same way that westerners do. Partners must be trusted and respected in the business communities in which they operate.

Commitment: Partners need to follow through after the initial introduction has been made. It can take several meetings to establish relationships before any actual business gets done. ‘Buqra’ (‘tomorrow’) is a word that you hear a lot as decision-making takes much longer in the Arab world that it does in the west. Patience is a virtue. Partners must invest time and effort in building valuable relationships. 

Responsiveness: When we encounter a difficult situation, we want our agent to get onto it immediately and use their experience, knowledge, reputation and contacts to sort it out to everyone’s satisfaction. Negotiating and bargaining are prized skills in the Arab world as can be seen everywhere from haggling in the market to top-level business meetings. A lot of business is conducted face to face as verbal communication is considered much more important than email. Partners must be prepared to engage with that.

While English is widely used as a second language, the levels of fluency in understanding and speaking English may not be high. It is therefore important for your Arab-speaking local partner to quickly address any misunderstandings before problems develop.

 At DCT, we feel it is important to respect the position of our local partners and to work hard at building trust and respect with them. But it’s also essential to recognise the limitations of their role and to be clear about demarcation of responsibilities. 

We need to be alert to the risks of the local partner not fully understanding our proposition or our technology. That’s why DCT manages all communications with the end-user rather than leaving it all to our partners. They specialise in the introductions, establishing trust and managing the ongoing relationships. We deliver all the technical presentations and provide the product expertise.

Customer relationships, customer satisfaction and customer delight are at the heart of successfully doing business in the Middle East. But it does also help when you have a product that is highly rated and in demand. It may not sell itself but the right combination of agent and DCT sales team certainly does sell it. It’s not so much ‘always be closing’ as ‘always be opening’.