William Kramer, president of the property and casualty adjuster firm, William Kramer & Associates, began traveling to Mexico on business in 1986. In this interview he talks about how U.S. businesspeople can best succeed when doing business south of the border.

What first brought you to Mexico?

I first traveled to Mexico on an insurance property claim adjustment in 1986. Three years later I had a $20 million claim to adjust in Mexico. In 1996 I settled a $250 million claim. Since then I’ve traveled to Mexico on several more claims and recently returned from delivering a three day seminar at one of Mexico’s largest industrial companies.

How would you describe the Mexican people and what makes them different from people in the U.S.?

They’re a warm and loving people. They expect to be dealt with fairly. They don’t want to be lectured to. Even in business they want to find relationships that are trusting and friendly. Once they find them they’ll stay with those relationships.

But is the business climate really that different?

Yes. The beliefs, expectations, and business and personal codes of social conduct in Mexico are very different from ours. In business, to be successful in Mexico you’ve got recognize these differences and adapt to their world. You will enjoy the experience.
For example, in the U.S. we’re often told to not do business with friends. In Mexico people grow up being told to only do business with friends. If you’re from the U.S. and you’re a great business person with the best product you will find it difficult to sell in Mexico if the people you’re dealing with don’t know you.

Does this emphasis on personal relationships in business affect what you’re able to accomplish on the phone?

Yes. It’s hard to get things done over the phone. Mexicans want to make decisions and hold discussions when they can look into your eyes.

Then, would you say that people who haven’t traveled to Mexico might have some misperceptions about the country and its people?

Yes, definitely. In the U.S. we have some old truths about Mexico. Those old truths are more old than true. People have a perception that there are lots of side deals and corruption in Mexico. Sure, they do exist but not to the great extent some outsiders think. The main company my firm deals with in Mexico is extremely professional. They want to get the bottom of financial situations and come up with the right answer regardless of how it might negatively impact them.

And things have changed in Mexico in recent years. Years ago it was difficult to have an open business dialogue with a Mexican company. The companies were very authoritarian. They might tell you in a very domineering way, “This is way things are going to be, period.” End of discussion (before it began). Now most of that’s gone.

Are there different work habits and schedules in Mexico?

Yes, in Mexico people arrive at work around 9 a.m. and work until about 2 or 2:30. They take a two and a half hour break, come back about 4:30 or 5 and work until 8 or 9 at night. Executives might be at work until ten or eleven at night.

Another difference is the attitude toward time. Mexicans are not as focused on the clock as people in the U.S. If you have a meeting scheduled for 11 a.m. and you show up at 11:15 that’s okay. Do the same thing in the U.S. and the person you were to meet might have gone off to do something else.

How about greetings?

You say hello and goodbye an awful lot in Mexico. Someone who is leaving the room just for an hour will say a formal goodbye and greet you hello again when he returns as he hasn’t seen you in a long time. Another difference is that men embrace each other much more frequently in Mexico.

I’ve heard that family takes first priority in Mexico. What are some of the ways this emphasis on the family plays itself out?

In Mexico the universities don’t have dormitories. College students live at home. After graduation they still live at home until they marry. The parents want to keep the kids at home. It’s unusual, perhaps even inappropriate for someone to leave home before they’re married. My partner in Mexico has a 28-year-old son. He graduated from a university with a degree in accounting. He lives at home. He’s doing well in business, making a good salary but he lives at home.

How about the decision-making process? Do Mexicans handle it differently?

In my experience, most Mexicans do not like to confront authority in a business setting. Usually they will not state conflicting opinions or try to persuade others to their point of view. They’re very polite and don’t want to hurt anyone’s feelings. They also don’t want to be the bearer of bad news.

Saying no to a business proposal can be tough for them. I’ve had Mexican businessmen say things to me like, “Well, I’ve made a careful study of your proposal and I can see we would probably have to say something negative about this, but there are other sides…” and they might go on and on. Sometimes I’ve had to stop them and ask, “Are you telling me that it’s no?” Only then do I get a direct answer.

Is it true that people with different job titles or status don’t typically interact with one another?

Well, a CEO wants to talk to another CEO. Never send a junior executive in to speak to a Mexican CEO. That’s insulting to them. A manager in a company will talk to the people who report directly to him but he certainly doesn’t want to be involved with people too far below him on the organization chart.

This relates to a blind spot most people in the U.S. have. Unless you’ve explored other countries and cultures you don’t realize how unusual it is to have a large middle class like the U.S. has. Mexico doesn’t have a large middle class. There are the rich and the poor and not too many in between. That’s true in many countries. Plus, people intermingle so much more in the U.S.. Here you can be a factory worker and go to the same bar where the factory’s CEO stops for a drink. Most other countries don’t have this type of movement among the classes.

Money is the main measure of status in the U.S. Is that true in Mexico?

No. In Mexico much more status is based on job titles and positions as opposed to money. Dress and grooming are status symbols there, whereas in the U.S. appearance is secondary to performance. Often, good jobs pay a low salary (compared to the U.S.), but they include many benefits that we’re not accustomed to. You’ll find people in Mexico who make $10,000 in salary but they have a company car, driver, and ten weeks of paid vacation. They also have domestic help at this salary level and, possibly, tutors for the children.

Does the language barrier affect doing business?

It’s not a great barrier. Many Mexicans speak some English, and at the professional level most of them speak English well. But it’s still a good idea to know some Spanish and use it. Doing so shows you’re interested in their culture and willing to learn.

I think one of the funny things about Spanish is that you almost have to use 50 percent more words than you do in English. Spanish is very flowery and there are lots of extraneous words or vague references in sentences. At the seminar we conducted in Mexico City last October this really became apparent to me. I’d say a few words and the translator seemed to go on twice as long. For example, in Mexico they might begin a seminar by saying something like, “We welcome you here today to talk about this very important issue,” when all I would say is “Good Morning.”

Is the law different in Mexico?

There’s a fundamental difference in the law in Mexico. They operate on the Napoleonic Code which basically says that you’re guilty until proven innocent. A simple example is automobile accidents. If you have a car accident with another motorist in Mexico they bring you both to jail. You tell your story at the jail and they decide who’s at fault. They let you out on bail, but presume you’re both guilty until you convince them otherwise. Many Latin America countries operate this way.

So what’s enabled you to build business relationships in Mexico?

Sometimes it’s the little things. For example, we were called in to adjust a claim when a Mexican gas plant exploded. The insured hired a large, well respected construction company to make the repairs. We thought the claim was so big that it would be good to have a second construction company provide a bid. I hired another company and took them down to meet the head of the Mexican company. I wanted him to know up front what we were doing and why. We met for just half an hour. I explained that involving the second construction company, at our expense (not his), would help assure him that he was getting a good deal. I also told him doing so would help us negotiate the claim with the insurer. He would get a complete copy of the second company’s report.

The fact that we met with him face to face and told him what we waned to do and why made all the difference. The reinsurers paid about $370,000 for that second opinion but everyone -- including the Mexican company -- felt good about it. It also helped us settle the insurance claim in 14 months when it usually takes about 5 years to settle a claim that large.

How would you sum up your advice on doing business in Mexico?

It’s a different culture from ours, but U.S. businesspeople can get things done in Mexico. It might take more time and you have to understand the culture, the people, the business practices. Don’t go to Mexico with your own road map of how you get things done in your own country. Adapt to the Mexican culture. Then you’ll have an opportunity to be successful.