If you are planning to open your business in Spain or start working in the country as a foreigner, keep on reading. The Spanish business culture is very peculiar, and in this article we will show you the main pillars that will help you understand how to do business in the country successfully. From how meetings work, how to negotiate, main business etiquette issues, and everything about structure and management culture.
The first thing to consider is how companies are structured in the country, as this will be the perfect base on which to develop the following points.
If we use the Hofstede ranking and choose the cultural dimension of power distance, Spain scores a 57 (vs 40 in the United States, for example).
This shows us a clear appreciation for the internal hierarchies. Most companies still have a fairly rigid and vertical structure in which identifying clear leaders and who their subordinates are is easy.
Unlike countries like the U.S., group leadership or multidisciplinary teams are very rare, encountering clearly separated divisions led by managers with a lot of power.
This is especially true if we are talking about traditional companies or family-owned businesses.
However, today this is changing for the following reasons:
- The emergence of many startups that adopt new and more dynamic organizational models
- The entry of international workers with a different business culture
- The fact that many leaders of Spanish companies have studied and been trained abroad, acquiring a much more modern mentality
If we go back to the cultural dimensions of Hofstede we can also obtain very relevant information about the future orientation within the Spanish working environment. In this case, the country is in the middle of the table, with a score of 48.
This means that Spaniards are quite short-term oriented. When any kind of problem arises in the company they will look for a quick solution, leaving aside the long-term consequences it might have, as long as the chosen path is effective now.
This becomes even more true when we incorporate the fact that nationals are very risk-averse.
And it is because of all this that they prefer a well-defined organizational structure, with clearly established senior leadership, in order to find those quick and definitive solutions.
On the other hand, while they seek quick solutions to problems, meeting objectives takes on the opposite demeanor. The usual work style is much more relaxed and slow, taking the deadlines with a certain degree of calm.
Strategy and decision making in the company is usually led by senior management in a fairly centralized manner. Again, because of the company’s structure, lower management often has little power to influence.
Although it is true that nowadays a lower-level employee who takes the initiative, is proactive, and proposes new ways of moving forward is more valued, traditionally that has been seen as “overstepping”. Why? Because there was a very fixed idea that you had to own your list of tasks and nothing else. Doing anything extra was not the right thing to do, it was not your thing.
However, this is now changing, and Spanish companies are adopting a much more horizontal, open, and empowering culture for workers at all levels.
The figure of the company leader is conceived as strong, and in many cases she is not allowed to “doubt” or make concessions, as his main function is to lead and to just lead.
So much so that Spanish workers value interpersonal or emotional skills such as resilience or direction in a boss much more than factual experience or knowledge.
How to win a negotiation in Spain
If there is something important to negotiate with a Spanish client it is the relationship you establish with him. Personal treatment, liking that person, and ice-breaking conversations that have nothing to do with business are fundamental.
How are Spaniards when it comes to negotiating?
We are talking about a relational business culture, and if you expect to win the negotiation because you have the best statistics or empirical data, this is not your country.
Real interest in the other person and trust comes first. And that makes relationships in the business world long term.
So, during a negotiation, you can expect to talk about personal or family issues, and that will be completely normal. In fact, it is key for succeeding in your meetings.
And how do you build such relationships? Especially with lunch and dinner, but through social gatherings of all kinds. While it is true that phone calls (and to a lesser extent emails) can help, personal face-to-face contact takes precedence over all.
If we refer to negotiations within the company itself, we must reconsider the rigid organizational structure that exists in the vast majority of the cases. This will mean that you will always have to talk to your superior, and never go directly to the one who makes the final decision if she is at a higher position.
Skipping the hierarchical levels of the business ladder will not allow you to achieve your goals, so keep that in mind.
If you ask a foreigner how he would define meetings in Spain with one word the most common answer will be chaotic.
To do business in the country you have to stop understanding a meeting as a group of people with a clear objective in mind (solve X issue) in the shortest time possible.
In Spain it does not work like that: there is a lot more to a meeting than just solving a problem or communicating a decision.
And that’s because meetings in the country are not 100% formal. It is common to start talking about personal and family issues, and therefore the gathering will last longer.
If you come from another country you may feel that you are “wasting your time” by not addressing the topic of the meeting at all times. But that is the way to create the warm atmosphere necessary to continue in the country.
In addition, interruptions are common, and speaking turns are not always respected. But that is completely normal, and it can even mean that the other person is interested in what you are saying.
The main focus is usually not much brainstorming, but rather the communication by a superior of decisions that has already been made.
Because the perception of time is different, meetings start and end later than usual or than what planned, especially since punctuality is not a prevalent rule.
Due to the relaxed sense of time that Spaniards have, the working day starts at 9, although in many cases (and especially in high business ladder positions) there will be a breakfast with colleagues before, so the day could even start at 10.
After several hours of work, there is an important lunch break. This break is used by many people to either meet with friends (outside of their working environment), or for meetings. We will see this in more detail in the next section.
And while it is true that lunch is one of the most important breaks in the day, they are not the only ones. There is still a very important element in Spanish business culture: the coffee break.
This break usually takes place in the middle of the morning, between 11 and 12. It can be breakfast in a cafeteria or a simple 15-minute pit stop to chat with colleagues. Whichever form it takes, it is a habit that is very much ingrained in any worker.
The working day ends at 6 or 7 p.m., although it is very common to stay in the office working until after hours from 8 p.m. onwards.
Finally, we are forced to break a great myth. Contrary to what many people tend to think, naps (“siestas”) are for weekends. Within working hours they do not exist (unless you work as a freelancer and you can organize it).
On the other hand, when it comes to holidays, here you can find a complete list of all of them. As you will see, they are really dependant on Christian traditions.
Lunch, the main pillar of business
Lunch can be one of the most important parts of the day in the Spanish business environment.
It fulfills different functions, all of them very important.
First of all, it is the option chosen for many meetings with clients. It is common to meet in a good restaurant to discuss a business proposal or an agreement. In Spain, gaining confidence means enjoying an appetizing meal, in which tasting the dish is as or more important than the customer’s proposal.
On the other hand, it is also a crucial point of contact to strengthen relationships with other workers, hence lunch acquiring a function of socialization and group integration.
If we take that lunch relevance into account we now understand why within a normal working day it can take up to 2 full hours.
One of the most important pillars of business etiquette is greetings.
Within the Spanish territory, the most common thing is to shake hands, although depending on the level of relationship with the other person a hug can also be used.
As we have mentioned, commercial relations are usually long term, so it is usual for the “client” to become a “friend”. This would make the greeting much more intimate and close.
The two kisses are reserved only for people you have known for a long time and with whom you have a very close relationship.
In front of a stranger, an older person or to show respect (if, for example, we don’t know the other person’s position or we know that he or she has a superior position), the “usted” is usually used, although the most common thing is that you are quickly asked to eliminate formalities when speaking.
The following cultural norms have to do with non-verbal communication, which is very characteristic in the Spanish territory due to the relaxed and friendly demeanor that characterizes the nation.
The first thing we must take into account is that eye contact is strong and constant, much more than in other countries (and it is not perceived as threatening).
Proximity is another must. That’s why touching each other, whether on the arm, back, elbow, or shoulder are common during conversations. In fact, in the case of not having these elements we could say that the relationship is not prosperous, something that would go against our business objectives.
In addition, the personal space of each individual is quite reduced. People are in close proximity to each other, whether they are in larger groups or simply having a conversation between two people.
The usual humorous tone, always using irony and easy jokes in conversations, makes the most common facial expression the smile, present at almost every moment.
Dressing code and style
It is absolutely true that the dress code depends on the type of company we are talking about. If we focus on a very prestigious law firm or an international consulting company we can expect to see everyone wearing a suit.
Traditionally, the Spanish way of dressing at work has always been formal with a conservative touch.
If we compare with other countries in the European Union, we can say that in Spain people are more conscious of what they wear on a daily basis, and they take greater care of their looks. They place a lot of importance to their image and appearance, and looking good in the eyes of others is fundamental.
However, this is changing nowadays, especially with the irruption of many startups dominated by young talent where the most common thing is a pair of jeans and a plain short-sleeved t-shirt.
Finally, the last issue that you must understand to successfully conduct business is evertyghing related to the legal part of the culture.
Whether you are going to set up your own business or register as a self-employed person, bear in mind that any legal procedure and bureaucracy issues related to the day-to-day company operations are usually slow and consist of many different steps.
Thus, it is easy to get lost or go crazy about it.
But we have made it easy for you.
In this article you will find step-by-step information on setting up your company in Spain. It includes advice on what type of company is right for you, what taxes you will end pay, and other interesting facts.