Does the Portuguese mindset hurt business?

 In Doing business, News, Opinion

Opinion: Anna Mulock Houwer, Board Director | Advisor | Fuelling Growth & Innovation in Health

Some of my Portuguese friends, known for their sarcasm, have teasingly accused me of ‘drinking the Portuguese Koolade’, suggesting that I naively romanticise and ‘over-love’ their country.

While it’s true that I find immense inspiration in Portugal (to the extent that I write poetry about it at www.loveandlisbon.com), I am a businessperson and thus interested in meaningful ventures and professional progress.

While many business discussions with the Portuguese and ‘expats’ alike end up as animated debates about politics and the economy, some hint at the elusive ‘Portuguese mindset’ as a culprit for various business issues.

I decided to dig into my own (three-year-long) experience and produce a subjective list of three mindset characteristics observed in my well-loved new home.

Maybe my list explains why foreign executives running Portuguese businesses generally do not last long. Or why my entrepreneurial Portuguese friends often find doing business in their own country frustrating.

Or perhaps why Portugal has not been as expansive towards the world as other small European countries like Denmark, Ireland or the Netherlands:

1️⃣ HIERARCHY IS KING: Historically, Portuguese business culture has been more hierarchical and strict than elsewhere.

Senior executives may still hold a supreme commander status, too often leading to parochial attitudes and hindering organisational talent. Decisions are usually deferred to the top rather than made organically throughout the organisation.

There is a widespread caution in challenging the status quo and ‘rocking the boat’ (no matter how gently) as it may be a career-limiting move.

This type of a hierarchical, top-down mindset used to be prevalent in other parts of Europe too but underwent a complete change in the past decade or two, rendering Portuguese ways of working somewhat archaic in comparison.

2️⃣ FEAR OF FAILURE: In Portuguese business culture, failure is habitually stigmatised rather than seen as a step towards success. There’s a tendency to focus on a person’s or project’s weaknesses instead of strengths.

This blame culture aims to prevent ‘losing face’ but instead negatively impacts business. When I challenge an opinion, I often feel the need to add disclaimers so it is not seen as a personal attack but a part of a normal business conversation.

In a risk-avoidant culture, suggestions for improvement or change (especially those coming from ‘below’) may be ignored or seen as a direct challenge and therefore stifled.

3️⃣ COMFORT ZONE: In my observations, Portuguese business culture is highly cautious and risk-averse. Bold thinking and fast moves are less accepted than in other parts of Europe and the US, contrasting sharply with the nation’s history as proud discoverers and world explorers.

This tight, measured, conservative style limits global growth vision and ambition. The extreme form of caution sometimes manifests itself as hyper-vigilance and suspiciousness which are counterproductive for collaborations and partnerships.

I have witnessed ‘zero-sum’ perceptions that the business ‘cake’ is small, rather than seeing the potential to create a much bigger cake in collaboration with others.

You might conclude that points two and three derive from point one. Improving any of these three areas could significantly boost business dynamism and innovation, allowing Portugal to lead more confidently.

From conversations with Portuguese CEOs, it’s clear that this traditional mindset is evolving (read: becoming less rigid and ‘stuck’) with the rise of the younger generation, the influx of foreigners, and the return of some of the dynamic and globally aware Portuguese executives and entrepreneurs from abroad.

Although I may face criticism for this post, it’s worth the risk; I see it as a public service of sorts.

Portuguese leaders and boards should spotlight mindset issues to drive innovation and create a better business environment. Business practices and ways of working need to be urgently modernised to embrace collaborative agility and risk-taking while normalising controlled failure as a natural part of the business journey.

Encouraging risk-taking and innovation through entrepreneurial and international executive education and support programmes, hiring foreign and returning executives, showcasing best practices and de-formalising culture will go a long way, not only to driving innovation and competitiveness, but also creating a better, kinder, lighter business environment in which more people in Portugal can be winners.

Some laugh when I call Portugal the ‘sleeping tiger of Europe’, but I live here permanently and love this country. I want to see Portugal rise and claim its rightful place where it belongs – at the top.

Anna Mulock Houwer is a Cascais-based consultant, non-executive director, director and strategy advisor. Her professional focus is on fuelling growth and innovation in healthcare. Find more about Anna on LinkedIn.