Doing Business in Thailand: Working with Thai People

May 24 2010 Categories: Understanding Thailand No comments yet

Are Thai employees reliable?

Absolutely, however, as with everything there are always exceptions but if, you treat your Thai employees well and with respect, you will notice that they will give you the loyalty that you do not expect to find anymore.They will be hard working and, committed; they will protect your interests and the interests of your company as if it were theirs. Over time the company will become a second family for them up to the point where you will see an employee in tears informing you that she is leaving your company for a new job. Such moments, are a real reward.

How do you know that your Employees are happy?

You will know that you are doing the right thing when your employees start to call their friends to fill the vacancies in your company or when a departing employee introduce you to her successor on her farewell party or when former employees keep coming to the New Year dinner’s years after they departed.

If after a few years in Thailand, you still have a significant rate of rotation with your employees and if you still need to use advertising to search for new employees you have a problem.

Are Thai employees hard to keep?

Do not expect to keep younger employees (up to 35 years old) for more than 2 to 5 years.

Job hoping is the way young Thais look to get substantial salary raises and there is little you can do about it.
Fresh graduates in their first job will often leave after two years to study a master degree, often overseas.

Do not assume as I did that the team you’ve built will last forever. A young lawyer, one of my first employees, who started her career with me, became over the five years she was with us the keystone to our corporate department. Even though she was quiet and shy she was the leading force of our company.

When she decided to leave after five years, she was followed within six months by two of her colleagues that were as experienced and hard working as her. Her departure was not only a loss in itself as she was the most valuable and reliable employee but her departure affected and broke down the team dynamic. Once she left it was not the same anymore and the other members of her team all went their ways. Of course she never imagined for a minute that her departure could affect us so much. Since then I have rebuilt a new team but I have learnt a valuable lesson.

To what standards should you hold your Thai employees?

You can always expect the best from them, but you must also understand that when given a new task or placed into a new situation a Thai employee will need time to adapt.

One of the problems I have to deal with is that our firm caters for the needs of a wide range of customers customers, from average income earners to very wealthy individuals, from local SME to multinational companies. Not all our clients have the same level of qualities requirements.

My Thai employees sometimes have difficulties to adapt to the fact that the same level of service will be judged perfect by one customer but insufficient by another client. When faced with this situation the best thing to do will be to talk with both your employee and your client. Most often our clients understand that it takes a little time for the employees to adapt and usually the problem will resolve itself.

Are Thai women more reliable than Thai men?

In Thai history, images of women wielding swords are as common as images of women handling the cradle. A commonly cited Thai proverb “men are the front legs of the elephant: women are the hind legs of the elephant” is often used to demonstrate women’s subordinate position in Thai society.

In my opinion, this proverb could also be used to prove their complementariness and their indispensability because an elephant will not go far on its front legs. The difference between men and women is even more perceptible with lesser educated people. Thai women are often more focused and resourceful than men. Most of them have a plan for their lives while men have not. Most of all, women are nurturers. Even when husbands are working it is the mother’s salary that will put bread on the table and the kids through school while the men will waste their salaries on entertainment and so on.

There are always exceptions but Thai women are definitely more reliable, hard working, and loyal than men. What Thailand needs more than anything today is its own Margaret Thatcher or Hillary Clinton? I know that she is here somewhere and I’m just wondering what she is waiting for.

How good are Thai employee’s language skills?

Thailand has made a lot of progress in this sector and quite a lot of young graduate students have a working knowledge of English or other foreign languages.

One of the problems is that they are often better at reading and writing than at speaking because of inherent Thai timidity. Interviews are not really useful to determine whether an employee speaks English well or not. Most of the candidates are so stressed that they are barely able to put a sentence together even when they have a good level of English already.

One of the difficulties Thais face is the sonority which the Thai language is mostly based on. The same word can have several different meanings depending on the tonation. Thus Thai students that learn English with an Australian teacher will have difficulties understanding the English spoken by a French native because English words the French speaker uses do not sound the same as when they were taught by their Australian teacher.

So when you start doing business in Thailand get used to the idea that your Thai employees will need an adjusting period before they understand you’re English. This can be frustrating, I have been there and I am still experiencing it.

Is it not wonderful to have employees said yes all the time?

This is another by-product of ‘Thainess’ that at first will please new comers, who are certainly not used to employees that always say yes. But what seems first a pleasant character trait is actually a hindrance and can, in the long run, be very frustrating for the employer.

The fact that an employee agrees to what you’re saying does not mean that they understood the task that has just be given them. Whenever you give a task to an employee do not forget to ask them the question again. Do not ask them whether they understood as will say they did.

Ask them instead what they understood? If you don’t you will end up having your employees doing things you never asked for while the one asked for isn’t. Secondly the yes attitude can be dangerous. We have seen the case of a foreign manufacturer that ended up with huge tax fines because the foreign finance director of the company once asked the Thai company accountants to record transactions as he would have recorded them in France.

But what is correct in France is not correct in Thailand and the company had to pay additional taxes, fines and interest to the Revenue Department. Thai employees never learn to be confrontational, they do not know how to argue or say no to their boss.

Often placed with a choice they will prefer to leave the company than to confront their boss even if they were right to do so. This is why I set up an accounting company in parallel with the law firm. When we send an accountant to a client’s office, and the client requests this accountant to do something that cannot be done in Thailand, our employee will not need to confront the client.

He simply calls his supervisor who will contact the client and discuss the issue with him. Many costly mistakes can be avoided this way. A smart foreign business man will spend time training their employees to become more outspoken or hire third party service suppliers to handle some functions within the company.

Are Thai employees creative?

In sectors such as design and architecture they are definitively creative. But creativity is not only about designing beautiful things or concepts. Creativity is also the capacity to react and solve unexpected problems or to find another way to do things when the situation arises. Unfortunately Thai people lack this type of creativity because spontaneity is somewhat at odds to their upbringing. Here again spend time training your employees to expect and react to the unexpected.

Should your employee’s parents pay a kindergarten fees?

If you are in the service business the chances are that among your staff there will be a fair share of female Thai Chinese. You will soon discover yourself dealing with an unexpected problem. Thai Chinese parents are overprotecting when it comes to their daughters and that can somewhat interfere with your business.

While our firm is based in Bangkok we often have to assist customers in the province. I once had to ask one of my employees if she could go in province for the day. She answered that she did not know yet because she had to first ask the permission of her father. Unfortunately her father said no initially. Eventually her father, after some time, understood that his daughter had to be able to fulfill her job requirements.

While my employees always deserve every satang of their salary I’ve always wondered whether I should consider charging some of their parents a kindergarten fee. I’ve given them a nick name of “baby lawyers”. The most surprising is that even those of my employees that have studied overseas for a few years had the same problem as those that never left home. Overall this is not a big problem to deal with but it speaks volumes about the Thai mentality. This goes to show the strong familial ties and somewhat interdependency among Thai parents and their children. This sets the course of conduct for future generations of Thais.

Should you allow your employees to eat at their work place?

Thai employees, especially women, love to eat snacks at anytime of the day. If the work place allowed it (office) let them eat as much as they want. Eating keeps your employees cheerful and cheerful employees do good work.

Should you allow your employees to eat at their work place?

Punctuality is not a quality that is inherent to Thai people. They have to work on this aspect. If you are in a business where you can afford some tolerance just do as I do. Tell your employees that they have to come before 09.30 and let them organize their working time. You will notice that they will all be here before 09.30 and that they will leave work according to their arrival time. If they are supposed to work eight hours they will do it by themselves without you having to say anything about it.

Is there a lot of absenteeism in Thailand

Surprisingly not. Thai employees rarely take sick leave or a vacation and there is not much absenteeism in Thailand. If you have female employees expect them to be missing work approximately 1 day per month.

May you “go ballistic” in front of your Thai employees?

Everyone will tell you never to lose your temper in front of your employees or with your employees because it is not the Thai way to do things. They are right in the sense that blowing it is not part of Thainess. The problem is that we do not generally lose our temper for the pleasure of it. When we do, it is because there is a problem, and generally once we have lost our temper the first thing we will do will be to put the problem behind us (the stack is clean) to focus on the future. Losing your temper is as blowing steam to release the pressure. Never losing your temper is not a solution because the pressure is never released which will create its own range of new problems. How did I deal with it, simple, I refrain from losing my temper with my employees and whenever a problem occurred, I will try to discuss it with them to find a solution? If I still need to blow some steam I call a client who did not pay his bills on time; I will lose a client in the process but if feels so right sometimes…

How should you react when an employee make a mistake?

Whatever happens try to be open minded and fair to your employees. Mistakes will happen. If you are open minded with your employees they will come to you as soon as the mistake happens. If not, they will be afraid to tell you that they made a mistake and it will be too late to do anything about it. My model employee once asked me if I could meet with her in the conference room. Once we were seated she started to cry. For 10 minutes I could not get anything out of her but sobbing and tears. I was wondering what was happening (some tragic event was my best guest at the time). When I was finally able to calm her I learnt that she simply forgot to renew my work-permit on time and that we would have to apply for a new work permit. Of course to have to apply for a new work permit is a lot of paperwork; but the point is that if an employee, with a perfect record that had by the time this problem occurred, handled hundreds of work permit renewals without any problem feel so awful about missing what is after all a simple administrative formality, you imagine how the average Thai employee will feel when he has to report a mistake?

May you rely on your employees sense of secrecy?

In Europe, employees do not talk about their salaries. In Geneva it would be deemed impolite to ask a colleague what his/her salary is. In Thailand every employees know what the other employees’ salaries are and they all know what your salary is. They know if the company is doing good or not. If the company is doing well or if the company is having problems they will know about it so do not bother trying to hide information from them. Because we have employees working at our customers offices I sometimes hear of a problem at one of my clients offices before the client knows about it. Because of the university class network Thai lawyers from different firms will help each other when they have to deal with new problems that they do not know how to solve.

Should you learn how to interact with Thai people?

The more you learn about Thai people and Thainess the better you will be prepared for business. The problem however is that while learning is helpful nothing replace experience. Another problem is that while there are a lot of courses that train foreign managers to act with Thais no one ever bothered to teach Thai employees or Thai businessmen how to deal and act with foreigners. There is a need to be fulfilled here and I hope someone will one day think about a course that could help Thai to understand the expectation of foreign employers or businessmen.

What is the horizontal hierarchy?

One of the problems that foreign businessmen encounter is the problem of horizontal hierarchy. This is the problem that occurs in a company where a younger person is put in a position of management above a person with more seniority or who is older. This problem occurs between people with the same level of qualification (in fact you can have a factory manager younger than the workers as they are from different social backgrounds). What will happen in this kind a situation is that you will have a manager in name and another person in charge. In the long run this will create many problems therefore be careful how you manage promotions in your company.

About the Author:

The author Rene-Philippe DUBOUT is a lawyer since 1990 when he was admitted to Geneva bar (Switzerland). He practiced as a litigator there for 10 years until he moved to Thailand in 1999. In 2002 he founded with a group of Thai lawyers Rene Philippe & Partners Ltd a local law firm that specialized in Cross Borders Investments and Real Estate. He has been lecturing in several Thai Universities and a speaker to numerous conferences and seminars. He is the author of a must read book:”How to Purchase Real Estate Offshore Safely: The Case of Thailand”.

http//:www.renephilippe.com

Originally posted 2009-07-23 06:05:50.

Doing Business in Thailand