Processes vs. Relationships

This article appeared in the Handelsblatt Global Edition on October 27, 2018.

Germans believe that processes — how the work is done — is the key to success. Americans, however, favor relationships, or how to gain and retain customers.

By tradition, Germany is more a culture of artisans (Handwerkerkultur) than of traders (Händlerkultur). The Germans have always made things. And they believe that process — how the work is done — is the key to success. Good processes lead to good products, bad processes to bad ones.

One well-known German manager, Klaus-Hardy Mühdeck, the CIO of ThyssenKrupp, is even nicknamed the “process pope” and has changed his title to Chief Process Officer. Because processes govern the internal workings of a company, whoever has the say over process has the say over the company. Process is power. Germans want the power.

The United States, by contrast, is a culture of traders more than of artisans. Americans do make things, but they also buy and sell things, including whole companies. Americans believe that business revolves around the needs of the customer. Good relationships lead to good customers, bad relationships lead to no customers. And because those relationships drive what the company does, whoever has the say over relationships has the say over the company. Relationships are power. Americans want the power.

The more product-oriented a company is, the less important are its customer relationships and the lower the prestige of its teams in business development, marketing, and sales. This is why in many German companies scientists and engineers are the kings. German-engineered products should sell themselves. Because Americans allegedly don’t understand this primacy of product, and therefore process, Germans are happy to leave marketing, sales etc. to the Americans.

The more customer-oriented a company is, the less important are science and engineering. Which is why in US companies the kings are often in business development, relationship management, marketing or sales. Products don’t sell themselves, they are sold by people. Because Germans don’t understand this market- and customer-orientation, Americans are often happy to leave internal debates about processes to the Germans.

My advice to Germans: If processes are crucial to success, convince your American colleagues to take processes seriously. Don’t create processes without involving them. Otherwise, you’ll produce German processes which won’t work in the US. If process is power, share that power.

My advice to Americans: If interacting with customers is key to success, get your German colleagues involved. Give them full access to your strategic thinking, about how you go to market. Involve them in your most important business relationships. Take them with you to the customers. If relationships are power, share that power.

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