By Ben Tavener, Senior Contributing Reporter
RIO DE JANEIRO, BRAZIL – A report by the Economist Intelligence Unit says that Brazil is among the worst at coping with the language barrier of the English-speaking world of business, and that deals are being hindered because of it. Experts are warning that, with increased international interest in businesses based in Brazil, the need to break down the barrier has never been more acute.
The report says that 74 percent of the Brazilians surveyed admitted their company has suffered “financial losses as a result of failed cross-border transactions” – much higher than the global average of around fifty percent.
The Brazilians who took part in the study seemed to recognize the issue – described in the report as a “significant hindrance to effective cross-border relations” for companies – as 77 percent of them believe better communications could improve productivity, while in the UK, for example, the figure is only 43 percent.
Although expanding internationally is always fraught with complications, the prospect was seen as most difficult by Brazilian companies – nearly eighty percent of Brazilians surveyed said cross-border difficulties hampered their expansion plans.
With the boundaries between old and new economies become increasingly interdependent, experts are warning that good communication skills have never been more critical. English is the recognized international language of the business world, and as such Monica Szwarc - cross-cultural coach and Country Manager for Bridge Brazil - stresses the importance.
“Internationalization is becoming each day more relevant to Brazilian companies in general as they start to move beyond the local market to grow further aiming at sustaining long term competitiveness and becoming major players in the global economy,” she says.
However Ms. Szwarc says that schools are taking the situation seriously, and are aware of the needs of the market in terms of the level of language control a student needs to exhibit – and to this end Bridge Brazil will be opening specialized, business-focused, and even oil-industry-focused courses from this August.
Ultimately, she concludes, the situation is definitely improving: “Young Brazilians are more familiar with English in general and very keen to invest in international education. Governmental programs have shown increased awareness of the need for English Proficiency and we now have kids that are able to face the challenge and compete at the best universities around the world.”
The language barrier can also be seen as an opportunity for those with an entrepreneurial initiative though, to capitalize on doing business where others dare not tread. As a positive example of work with Brazil, the report highlights the experience of Swedish truck manufacturer Scania, which now delivers more vehicles to Brazil than any other country.
Scania believes technology has played a huge role in improving the performance of cross-border teams, but that cultural barriers – particularly between Sweden and Brazil, whose work cultures the company describes as “pole apart” – are “always present and need to be constantly managed”, particularly at the outset.
Industry experts say that despite the possible setbacks caused by inefficient language communications, a multinational approach can yield the biggest gains, as long as initial cultural misunderstandings can be overcome.