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About Indonesia

by: Erika Visser, Associate partner of Hofstede Insights
Currency: Indonesian Rupiah (IDR)                                       
Capital: Jakarta                                               
Time Zone: UTC +07:00
Official Language: Bahasa Indonesian
Religion: Muslim (88%), Protestant (5%), Roman Catholic (3%), Hindu (2%), Buddhist (1%), other  (1%)
Ethnic Groups: Javanese 45%, Sundanese 14%, Madurese 7.5%, coastal Malays 7.5%, other 26%

Overview

Indonesia is a unitary sovereign state, the largest of the ASEAN economies and hugely diverse as the world’s largest island country with more than 300 ethnic groups. Most people will define themselves locally before nationally. There are multiple cultural influences creating a mix of Chinese, European, Indian, and Malay. Even though poverty is reducing annually, it still remains one of the greatest challenges with employment growth - trying to keep up with a growing population of currently over 260 million people. Indonesia is a Muslim-majority country with the island of Java containing more than half of the country’s population. The Dutch colonised Indonesia for more than three and a half centuries, and the country gained its independence after the second World War.

Some cornerstones of Indonesian Culture

Family, religion and religious harmony are cornerstones of Indonesia. Family is central to Indonesian society, resulting in a great emphasis on unity, loyalty and respect for the elderly. The family structure provides emotional and financial support with each member contributing their time or money.

When in Indonesia

Good to know

  • Use both hands when lightly shaking someone’s hand
  • Do not use strong grip handshakes used in western countries
  • Keep your distance and avoid touching someone from the opposite sex, unless a handshake is initiated by them. A respectful smile and nod is acceptable
  • Be friendly and use a smile to show politeness, especially in Java
  • When approaching older people, nod or bend a bit as a sign of respect
  • Never place your hands on your hips when having a conversation with someone, it is seen as a disrespectful gesture
  • Never touch the top of someone’s head
  • Avoid writing in red as it shows anger
  • Always remove your shoes before entering someone’s home
  • Use your right hand to receive or handle food and objects
  • Never reject a meal or drink if offered to you
  • Same sex Indonesians will often hold hands in public to show friendship

Body Language

Good relationships involve a great deal of physical touching, however, make sure that you have established a strong connection with your Indonesian counterparts before getting too personal! The head is where the human spirit resides and thus touching the head is disrespectful. Place both feet on the ground and never point at someone with your feet. Never cross your legs as this action is also seen as a sign of disrespect. Avoid prolonged eye contact, it is perceived as staring and impolite. Point with your thumb and not with your forefinger. The left hand is seen as unclean and should not be used to handle food or objects. Patting someone on the shoulder can show approval, however avoid ‘backslapping’.

Dress Code

As a majority Muslim culture, dress modestly to avoid offending locals. Usually dress codes are fairly conservative, however more relaxed in bigger cities. Usually the rule is to cover your shoulders and to wear trousers or skirts covering your knees.
Keywords to describe Indonesian culture: Family / Religion / Harmony / Hierarchy / Relationships

 

Experts Recommendation

Trust is an important aspect and essential in building strong business relationships in Indonesia, and personal contact via face-to-face meetings with potential partners is required to establish strong relationships. A very light pressure handshake is customary as opposed to the Western strong grip, which shows a strong character. Paying respect to the eldest person in the the group is important and thus shake their hand first. Making decisions can be a lengthy process and requires patience and multiple discussions before a final decision is reached. The reason for this is due to deliberation and consensus that are needed before a decision can be made. Hurrying this process will cause offense and will damage good standing business relationships. Business cards should be translated to Bahasa Indonesian or Chinese depending on your business partners. Lastly, keep in mind that religious Muslims have certain dietary restrictions, they do not take alcohol and pray five times a day. All business meetings and business entertainment should be organized keeping these religious customs in mind.

The Concept of Face (or ‘malu’ in Indonesian)

As a foreign manager it is important to understand the concept of face and consider the consequences of one’s actions. Even though a loss of face or ‘malu’ is translated as embarrassment and shyness it goes beyond just being embarrassed or shy. It can be better translated as a form of social shame not only affecting the individual but also any group that they represent such as a company, team, department or family. The concept of face has to do with how an Indonesian is perceived and the fear that others might think badly of them or how they have let their group down. 

A small case study from Living in Indonesia 

Jack LeGrand is the V.P.-Operations for a Canadian multinational in Surabaya. Angered by the actions of one of his senior Indonesian managers, Jack loudly confronts him in the cubicle-filled, common work area of the office.
 
“Hell, you did it again! You know you have to follow the set company procedures when appointing suppliers. We have talked about this time after time. What is your problem?” He said slapping a folder down on a desk. “If you won't follow the rules, I don't need you here.” This was met by silence on the part of the manager and his office co-workers. The Indonesian manager even seemed to be smugly smiling which made Mr. LeGrand even more frustrated. “This isn't funny. Maybe you should consider how much you like working here.” he said as he left the room in the direction of the President Director's office. The Indonesian manager resigned the next day.
 
In this case the Indonesian manager was scolded and criticized in front of fellow workers causing him to lose face and impacting his position resulting in his resignation.

Communication

As a high context culture Indonesians greatly rely on nonverbals. As for verbal communication, English is very common in Indonesia. However, the quality might not be as good as in Malaysia and Singapore leading to possible misunderstandings. Communication should preferably be conducted in soft low tones as showing anger or frustration will disrupt the harmony and harm relationships with your Indonesian business counterparts. Speaking your mind in public is also seen as disrespectful and thus the right protocol should be followed when communicating with your Indonesian counterparts. This mainly includes being respectful, implicit and allowing silences between discussions as a way to show that you have thought about what you are saying and also giving your Indonesian counterparts time to respond without rushing them or interrupting their thinking. ‘Yes’ does not always mean ‘yes’ - it can be interpreted as ‘yes I have heard you’ and not ‘yes I agree with you’. It is important for foreigners to distinguish between these subtle nuances. A third party person with a good understanding of Indonesian culture can be employed to culturally translate these subtle differences. A way to show that Indonesians are not in favour of what has been said is to suck the air through their teeth. This usually indicates that there is a problem. Evasion of a topic can also indicate a clear ‘no’ or in some situations Indonesians might pretend as if they haven’t heard the question - this also is an indication that they are not in favour of what is being discussed. Indonesians might use laughter in situations that seem inappropriate to foreigners to hide their embarrassment, shyness bitterness or discord.  

Meeting and Greeting

Punctuality is expected from foreigners, however, Indonesians do not hurry as it is seen as impolite. They do not like to follow rigid structures and will do the tasks that they feel are achievable. The future cannot be predicted and thus patience and flexibility are essentials when managing or negotiating business deals in Indonesia. The long-term relationship is more important than the deal, and business dealings mostly occur through introductions. Relationships should be nurtured as long-term investments rather than short-term gains. Take your time when making introductions, do not rush as it can be seen as being disrespectful. When greeting a Muslim Indonesian use the word ‘selamat’ meaning peace.

 

Dimensions

Indonesia scores high on the Power Distance dimension with a score of 78, which means that Indonesia is a very hierarchical society with unequal rights between power holders and non-power holders. Leaders have to be paternalistic caring for staff in the workplace and they should always be aware of issues at home and give guidance when needed. Bosses need to be directive giving instructions on what needs to be done and how it needs to be done, always checking, inspecting and delegating tasks (not power) ensuring that there is adequate resources and skill to complete tasks within a reasonable timeframe. Without checking and inspecting, staff might not ‘respect’ the task at hand and thus might not complete what they were asked to do. Power is centralized and managers count on the obedience of their team members in return for protection from the power holders. Indonesian people believe that their supervisors have been chosen because they have more experience and greater knowledge than those they manage and it is therefore unnecessary, and even inappropriate, for them to consult with lower-ranking individuals when making decisions. The manager/boss is expected to make decisions. Titles play an important role and it will help Indonesian people place their colleagues or counterparts in the hierarchy, allowing them to give appropriate respect to superiors.
 
Indonesia scores low on the Individualism dimension with a score of 14, indicative of a collectivist culture that is organised and centered around relationships (in-groups) rather than tasks. Family is central to Indonesian society, resulting in a great emphasis on unity, loyalty and respect for the elderly. Loyalty to the in-group in a collectivist culture is paramount, and overrides most other societal rules and regulations.  In order to preserve the in-group, Indonesians are not confrontational and in their communication a “Yes” may not mean an acceptance or agreement. Communication is indirect and negative feedback hidden, staff do not want the boss to lose face and will share information a boss wants to hear rather than volunteering bad news which creates bigger problems in the long-run. A trusting relationship, and showing that a boss can patiently receive staff questions, objections, and opinions, can help to extract bad news. A boss should create a good working environment, social and business relationships for staff are mostly blurred and thus a boss should avoid competition between staff and create group incentives rather than individual bonuses. The focus should always be on relationships and not the task, and time should be invested to strengthen relationships with staff in return for their loyalty. The boss should never single out or embarrass employees as this will erode trust and disrupt the harmony.
 
Indonesia scores below 50 on the Masculinity dimension with a score of 46 and is thus considered more Feminine. In Indonesia, status and visible symbols of success are important but it is not always material gain that brings motivation, but rather consensus and a good quality of life. Conflicts are resolved by compromise and negotiation. Incentives such as free time and flexibility are favoured. An effective manager is a supportive one, and decision making is achieved through involvement.
 
Indonesia scores below 50 on the Uncertainty Avoidance dimension with a score of 48, and thus shows a slight preference to avoid unpredictability. When a person is upset, it is habitual for the Indonesian not to show negative emotion or anger externally. They will keep smiling and be polite, no matter how angry they are inside. This also means that maintaining workplace and relationship harmony is very important in Indonesia. Direct Communication as a method of conflict resolution is often seen to be a threatening situation and one that the Indonesian is uncomfortable in. A tried and tested, successful method of conflict diffusion or resolution is to take the more familiar route of using a third party intermediary, which has many benefits. It permits the exchange of views without loss of face as well as since one of the main manifestations of Indonesia’s Uncertainty Avoidance is to maintain the appearance of harmony in the workplace; an intermediary removes the uncertainty associated with a confrontation.
 
Indonesia scores relatively high on the Long-Term Orientation dimension with a score of 62, indicating a longer-term orientation. This can be seen by the long-term relationships required in order to successfully conduct business in Indonesia or by the way that longer-term business plans are created looking not only at the past or present but at opportunities in the market in the future.
 
Indonesia scores relatively low on the Indulgence dimension with a score of 38, indicative of a culture of restraint with a tendency to cynicism and pessimism. Indonesian society does not put much emphasis on leisure time and Indonesians control the gratification of their desires. Indonesian people have the perception that their actions are restrained by social norms and feel that indulging themselves is somewhat wrong.

For a more detailed analysis on the Cultural Dimensions, and how Indonesia compares to other countries, please visit Hofstede Insights’ Country Comparison tool.
 

References & Interesting Links