Cultural intelligence is vastly important in terms of doing business in the Middle East. Nothing exemplifies this more than how Westerners view nepotism and Arabs view wasta.
Nepotism, the practice of giving positions of power to kin, is seen as a corrupt practice in the US, whether or not that family member is qualified. Wasta, on the other hand, is deeply embedded in Arab culture and can be positive and useful.
Wasta refers to the advantage and benefits one gains from being part of a particular group or having connections. As Charles Adwan of The World Bank explains, wasta can be used to gain jobs or licenses, cut through red tape and otherwise circumvent obstacles based on who you know.
Wasta originated in Middle Eastern culture based on evolution and survival. It was the way conflict was resolved, the way cooperation and loyalty were gained in order for different tribes of people to come together in more unified nation-states.
John Hooker of Carnegie Mellon University points out that what is viewed as corruption in one culture may actually be useful in another. This is important for multinational companies to consider and anyone doing business with someone from a different country.
Western countries have rule-based cultures while most other countries are relationship-based. A rule-based culture is characterized by transparency and laws. As Hooker points out: “Westerners tend to trust the system, while people elsewhere trust their friends and family. Westerners organize their business around discrete deals that are drawn up as contracts or agreements and enforced by a legal system. Other cultures may organize their business around human relationships that are cemented by personal honor, filial duty, friendship, or long-term mutual behavior.” What may seem like corruption to a Westerner is seen as morally correct in other cultures.
This distinction is especially important because rule-based cultures view these rules as universal. Relationship-based cultures rely on individuals to work. In an increasingly complex and globalized economy, relationships and trust are vital.
Another important difference between what is viewed as corrupt in the West and what is acceptable in relationship-based cultures is the fact that corrupt practices may forward the interests of an individual(s) over what is best for the company or the whole. Wasta, on the other hand, is meant to forward the interests of the individual and contribute to the betterment of the whole. In addition, belonging to a group and having wasta means that you are entitled to these advantages: you don’t necessarily owe someone for these favors. This practice creates a kind of belonging and loyalty that isn’t seen in many Western businesses.
Litigation in the West is so prevalent because these countries are rule-based rather than relationship-based. When individuals aren’t as accountable, cheating is common. Authority belongs to a structure rather than to persons. Individualism in the West means that people feel less personally invested or tied to others. Cont…