Filipino Business Norms, Etiquette and Style
From Pearl of the Orient Seas, 1999, Clarence Henderson
Henderson Consulting International, Manila, Philippines

Given the Philippines' American and Spanish heritage, it's easy to fall into the trap of assuming that you can do business here in standard Western mode. Manuel Quezon, the first President of the Philippine Commonwealth during the years before World War II, once said: "The Filipinos are the most occidental people of the Orient." However, as discussed in my case study column (Filipino Business World 101), there are many subtleties and nuances that make the business terrain here tricky for the newcomer. This column discusses a few things you should bear in mind.

Business Etiquette: Start out by addressing a new business acquaintance by his or her family name. "Mister" is obviously proper for men, while many married Filipinas prefer "Mrs."; use "Ms." sparingly, or at least until her preference is clear. Filipinos are status conscious, so be quick to use formal titles: Doctor Aquino, Attorney Rodriguez, Secretary de Ocampo. Avoid using someone's first name until they've known you for a while, or until they ask you to be more informal.

Many Filipinos have multiple names: Enrique Ramon, Juan Jesus, Maria Teresita. Always ask what they prefer to be called, then make a note regarding both formal names and nicknames (with proper spelling). Nicknames, some of them seemingly flippant, are common: Johnnyboy, Peachy, Babes, Junior, Booboy. In written form, the nickname is often enclosed in quotations as a middle name: Antonio "Tonyboy" Cojuangco, Ferdinand "Bong Bong" Marcos.

The rules on handshakes are about the same as in the West, although Filipinos may use a little more contact (a pat on the side of the arm as gesture of hospitality or friendship). If there is a clear status differential, or you are meeting a senior executive, it may be best to let him/her offer the handshake first.

Filipinos have fascinating nonverbal language, much of it involving facial expressions. Lifting the eyebrows without smiling means no -- but lifting the eyebrows while smiling is used to greet a friend. Filipinos often point by pursing their lips. Pointing your finger is a definite no-no, and you should avoid too-direct eye contact.

Time Orientation in General: Although there is a tendency to think of the Philippines as a place where it's fine to be late, this is no longer true. Businesspeople have gradually come to appreciate the important of punctuality, and it's best to arrive on time. I generally allow extra time for traffic congestion and unexpected delays, figuring its better to kill some time in a coffee shop than to be an hour late for a key meeting. It's always a good idea to call ahead to confirm a business appointment, either earlier the same day or the afternoon before the meeting.

For most social occasions, it is almost rude to arrive at the stated time. Fashionably late is the name of the game, by as much as an hour. At a party, the more important the guest, the later he or she arrives. More generally, expect slow and indifferent service wherever you go. Integrate that concept and don't try to fight it, as it won't do you any good to complain except on a situational basis. Try to adapt a Zen frame of mind when shopping or dealing with crowds rather than fuming or doing a slow burn. No point.

Time Orientation as Related to Business Deals: The pace of doing business in the Philippines is casual and leisurely, to say the least. Things usually unfold at a snail's pace that can be downright excruciating for the results-oriented Westerner (I can and do so testify). However, it has been like that here for centuries and current trends toward Westernized modes of business interaction have yet to make a significant dent in long-established custom. If you aren't a patient person, it might be a good idea to practice deep breathing and mental imagery; getting upset about it is probably going to be counterproductive.

The pace and content of meetings is different than Westerners are used to. There may be several minutes of small talk before getting down to business (about the stock market, basketball, the latest flap at Malacañang, whatever). People like to hang around afterwards for more of the same, even if the meeting itself has been tense. It would be impolite to hop up and immediately take your leave, even if you're running late for another meeting or you've just lost a difficult negotiation. Mend fences, leave with a smile and hearty farewell, and return to do battle another day.

Gandhi in the Philippines: Many Westerners are used to organizational cultures in which confrontation is the norm. In meetings, folks show their feelings, glare and gesticulate, criticize and even yell one another. But -- hey, no hard feelings -- they end up going out for a drink after work or watching a ball game together that weekend.

Not in the Philippines! A raised voice, the wrong intonation, the implication of incompetence, or excessive direct eye contact can do major damage. Although Mahatma Gandhi invented passive resistance in the fight for Indian independence, one might think it's actually an indigenous Philippine phenomenon. Once you're perceived as arrogant and pushy, you're in interpersonal quicksand. Among the forms taken by passive resistance in this context: not returning phone calls, missing deadlines, misinterpreting instructions, failure to follow through. Most of the time you won't even known what hit you until it's too late.

The Philippine Business as Family. The family is always of vital importance in the Philippines; not surprisingly, most business organizations are modeled on the Filipino family. The boss and subordinate often exist in a bata relationship, basically like that between parent and child (bata literally meaning "child"). As a consequence, paternalistic management styles are the norm.

Further, the Spanish compradzago system, with its dense networks of godparents and other quasi-relatives, affects most business settings. The Filipino family is defined quite broadly, and includes many people who are called "uncle" (Tito), "auntie" (Tita), and "cousin" (Pinsan), even though they are not related by blood. In many companies, a good proportion of employees fall into this category, which means they are not likely to be fired for inefficiency unless they really make a mess of things. In larger corporations, the nepotism may devolve to the departmental level and may be less salient, but it probably still exists.

As you might expect, such a paternalistic and hierarchical management structure implies that decision making in most organizations is done at the top. And unless you have some excellent inside connections or referrals, your initial contacts are not likely to be with the decision-maker. Getting to someone who can and will act on a proposal (i.e., sign a contract, write a check) often has be done through one or more gatekeepers, a process that can take a seeming eternity. However, once you finally push your way through to the top, the gears can shift quickly and deals completed at warp speed.

Unknown Vocabulary Word - "No!": In dealing with Filipinos, you soon discover that they don't much care for the word "no." In a Western setting, it's usually pretty clear when the other party isn't interested in your proposal, whatever it might be. The responsible executive simply looks you in the eye and says: "Sorry, but I'm afraid the answer no." If you ask why, he or she will probably tell you the reasons for the negative decision.

However, as usual, the Philippines is different. Given the culture value of pakikisama (group loyalty) and the importance of maintaining social harmony, disagreement or interpersonal tension of any sort is distasteful. As a result, business negotiations often have far more ambiguity than the typical Westerner is used to.

For example, when a Filipino executive feels that telling the truth might embarrass or offend, he or she will often beat around the bush. In this context, "yes" doesn't necessarily mean "yes." The word "yes" could also mean "maybe," "I guess that's what you want to hear," "Perhaps someday," "I have no idea," or "No." There are, of course, a wide array of subtle cues to the real meaning, some nonverbal and some in Tagalog. For example, the word mamaya implies "later today," while saka na means more like "sometime later, maybe tomorrow, maybe next month, or next year ... "

This unwillingness to say no affects the international businessperson in several ways. Many Filipino executives will always be "out" rather than answer a phone call or meet with someone they know they're going to have to turn down. This can be very frustrating when you're trying to nail down a contract or find out what's going on one way or the other. It can take a lot longer to get a firm negative answer than in other countries, a situation which can leave you hanging in a way that can be hard to explain to, let's say, the head office back in London.

Another consequence is ningas cogon, an idiomatic phrase referring to what happens when you set a blazing fire, only to watch it quickly fizzle out. The phrase refers to a rather unfortunate tendency to start projects and never finish them. Many meetings in Manila seem positive and productive, fueled by the adrenaline rush of money to be made, and sure to lead to great and wonderful things. All too often, the projects under discussion never get off the ground as the parties involved move on to other projects. This is usually because some participants were reluctant to show their reservations in the first place; they wanted to go along with the group consensus and share your fervor. While this has the short-term advantage of everyone leaving the meeting with a pleasant buzz, the longer-term consequences include puzzlement, frustration, and resentment.

Summary: In closing, I would stress that the communications and management styles described here are not dishonest or intended to cheat you. They simply reflect the Filipino culture and long-established way of doing things. The models and ideal types taught in Western-oriented MBA programs are based on certain assumptions, many of which are invalid in the Philippines. Although organizations here have most of the structures and formal procedures of Western business, actual day-to-day business processes and interactions necessarily proceed within the matrix of Filipino culture and values. Thus, the need for the Westerner to go "the extra mile" to understand what's really going on and adapt a culturally sensitive style of doing business.

...from Clarence Henderson's Pearl of the Orient Seas