Business cultures: Hungary Lecture 1. Hungary - geography Location: Central Europe Area: total: 93,028 sq km country comparison to the world: 111 land: 89,608 sq km water: 3,420 sq km border countries: Austria 321 km, Croatia 348 km, Romania 424 km, Serbia 164 km, Slovakia 627 km, Slovenia 94 km, Ukraine 128 km Capital: Budapest (1.737 million (2011)) Climate: temperate; cold, cloudy, humid winters; warm summers Terrain: mostly flat to rolling plains; hills and low mountains on the Slovakian border Elevation extremes: lowest point: Tisza River 78 m highest point: Kekes 1,014 m Natural resources: bauxite, coal, natural gas, fertile soils, arable land Land use: arable land: 48.5% Hungary – people and society Population: 9,825,704 (July 2018 est.); country comparison to the world: 92 Ethnic groups: Hungarian 85.6%, Romani 3.2%, German 1.9%, other 2.6%, unspecified 14.1% (2011 est.) Languages: Hungarian is the mother tongue of 98.9% of Hungarian speakers Religions: Roman Catholic 37.2%, Calvinist 11.6%, Lutheran 2.2%, Greek Catholic 1.8%, other 1.9%, none 18.2%, unspecified 27.2% (2011 est.) Age structure: 0-14 years: 14.66% (male 741,624 /female 698,905) 15-24 years: 10.76% (male 546,437 /female 511,214) 25-54 years: 42.01% (male 2,077,449 /female 2,050,330) 55-64 years: 13.07% (male 593,250 /female 690,784) 65 years and over: 19.5% (male 725,728 /female 1,189,983) (2018 est.) Urbanisation: urban population: 71.4% of total population (2018) 1.759 million BUDAPEST (capital) (2018) Hungary - government Government type: parliamentary republic Administrative divisions: Capital city: Budapest, 19 counties (e.g. Hajdú-Bihar) 23 cities with county rights (e.g. Debrecen) National holidays: 1 January: New Year’s Day 15 March: 1848 Revolution Memorial Day Good Friday and Easter Sunday Day and Monday (19, 21-22 April in 2019) 1 May: Labour Day Whit Sunday and Monday (9-10 June in 2019) 20 August: Saint Stephen's Day 23 October: 1956 Revolution Memorial Day 1 November: All Saints’ Day 6 December: Saint Nicolas Day 24-25-26 Christmas 31 December New Year’s Eve • National symbol: Holy Crown of Hungary (Crown of Saint Stephen) • National anthem: Hymn (Himnusz) lyrics/music: Ferenc KOLCSEY/Ferenc ERKEL NUTS 1 regions of Hungary (3) NUTS 3 regions of Hungary (20) NUTS 2 regions of Hungary (7) Hungary - economy GDP (purchasing power parity): $289.6 billion (2017 est.); $278.5 billion (2016 est.); $272.5 billion (2015 est.) country comparison to the world: 59 GDP real growth rate: 4% (2017 est.) GDP per capita: $19,800 (2013 est.) country comparison to the world: 76 country comparison to the world: 68 GDP composition, by sector of origin: agriculture: 3.9% (2017 est.) industry: 31.3% (2017 est.) services: 64.8% (2017 est.) Agricultural products: wheat, corn, sunflower seed, potato, sugar beet; pig, cattle, poultry, dairy products Industries: mining, metallurgy, construction materials, processed foods, textiles, chemicals (especially pharmaceuticals), motor vehicles Hungary - economy Labour force: 4.599 million (2017 est.) Labour force by occupation: agriculture: 4.9% industry: 30.3% services: 64.5% (2015 est.) Unemployment rate: 4.2% (2017 est.) Poulation below poverty line: 14.9% (2015 est.) Hungary – brief history The beginning: Hungarians were nomadic people, moved to the Carpathian basin and took over the land around 895 In 1000, King Stephen I founded the state of Hungary and accepted the Catholic religion as a standard (holy crown of Hungary – now displayed in the Parliament building) In 1241-42 invasion of the Mongols caused serious destructions After a Turkish conquering army defeated the Hungarian royal army in 1526, the country split into three parts: the Hungarian Kingdom, the Habsburg dominion and the Turkish dominion → it took 150 years to stand up to this situation, reunite and drive out the Turks The country became part of the Habsburg dominion → but in 1711 with signing the Treaty of Peace Hungarians partly took back their independence 1848: independence revolution: tried to remove the boundaries of the Habsburg dominion 1867: agreement with the Habsburgs, the dualistic system of the Austrian-Hungarian Monarchy was born World War I: 1918: the Monarchy broke up, the first government was established and the country became the Republic of Hungary. After losing the war, the allied Atlantic countries overran Hungary and in accordance with the Treaty of Trianon, split up the country. The Hungary of more than 20 million became a small country of less than 8 million. Hungary was now in the shape we know today. Hungary – brief history World War II: brought more tribulations to the people of Hungary. The Germans overran Hungary → hundreds of thousands died during the war or deported to German concentration camps. After the Germans were beaten by the Allies, Soviets took over the country, drove out the Germans and stayed for 44 years. 1956: tried to force the leadership to stop this domination and dictatorship by the soviets, but the attempt was unsuccessful and was punished unmercifully. The soviet domination lasted until 1989, when Hungary finally became an independent democracy. 1999: Hungary joined the NATO 2004: member of the EU ∑ List of invasions / foreign rules of Hungary: 1. Tartars-Mongols (c. 1241-42) 2. Turks for about 150 years (from c. 1526-1686) 3. Austrians for about 230 years (c. 1686-1916) 4. Nazi Germans (1944-45) 5. Soviets for 44 years (1945-1989) Traditional Hungarian cuisine Stew (pörkölt) Fisherman’s soup (halászlé) Cake called „bejgli” Stuffed cabbage (töltött káposzta) (next page) Pancake filled with veal: hortobágyi pancake (hortobágyi húsos palacsinta) Goulash soup, Slambuc Újházi chicken soup (újházi tyúkhúsleves) Lecsó Chimney cake (kürtős kalács) Sponge cake spilled with rich chocolate souce and topped with light whipped cream (somlói galuska) Dobos cake (dobos torta) Pancakes with marmalade, cocoa powder, chocolate, walnut, vanilla sauce…… Gulash soup Stuffed cabbage variations „Lecsó” variations: Kürtős kalács (chimney cake) Somlói galuska Gulash soup Dobos torta (Dobos cake) Palacsinta (pancake) Hungary’s high achievers Inventors: Albert Szent-Györgyi- Vitamin C; Ede Teller: atomic bomb; László József Bíró: ballpoint pen; Ernő Rubik: world’s best known toy or puzzle – the Magic cube; József Galamb: Ford Model T; János Irinyi: safety matches; Dénes Gábor: holography; John Goerge Kemény: co-developing the BASIC programming language in 1964; John von Neumann: application of operator theory and quantum mechanics Music: Frenc Liszt, Béla Bartók, Zoltán Kodály, Márta Sebestyén, … Books, movies and photography: Imre Kertész: author, Nobel Prize 2002; Joseph Pulitzer: Hungarian-American publisher, originator of the Pulitzer prize; Tony Curtis: actor; Bela Lugosi: Hungarian born American actor – Dracula; István Szabó: director; William Fox: founder of the film studio 20th Century Fox; Vilmos Zsigmond: academy award for the best cinematography; Lajos Koltai: film director and cinematographer; Zsa Zsa Gabor: actress; Joe Esterhas: Hungarian-American writer; Andy Vajna: film producer; Rober Capa: photographer Etc…. Some Hungarikums (Agriculture and Food Industry) Palinka, Grape Palinka UNICUM herbal liqueur Csabai and Gyulai Sausage Debrecen double sausage Tokaj aszú Spitzer Food products from fattened goose Alföld chamomille Soda water Chimney cake Ground paprika from Kalocsa and Szeged Piros Arany paprika creme and Erős Pista Pick and HERZ „Winter” salami TÖRLEY sparkling wine Hungarian acacia and Hungarian acacia honey Egri Bikavér Hungarian shepherd and hunting dogs Red onions from Makó Hungarian grey cattle Official site of Hungarikums: http://www.hungarikum.hu/sites/default/files/hungarikumok-lista.pdf Hungary – business etiquette and protocol Language of business Status, formality, hierarchies, business protocol Large power distance, rather formal (~ German, French) Hierarchies are evident in the top-down approach to management Masculine culture → much fewer women business managers than e.g. in Finland or Denmark Dress code: men: conservative suits and ties; women: dresses or suits Meeting and greeting (hand shake, eye contact) Forms of address: professional or academic title plus family name; later first name Business card: organisational position, title and any advanced degrees; the just received cards are usually kept on the table to remind the counterparts of names and titles Hungary – business etiquette and protocol Gift giving: not expected in Hungary (but at Christmas - New Year) invited to someone’s home for a meal (for man – lady of the house) Avoid: red roses – romantic implications, chrysanthemums – funerals, red carnations – cummunist party Appropriate topics of conversation: Hungarian cuisine, wine, music, sport (avoid politics and religion) Business entertaining: mainly at restaurants; rare to a Hungarian home Meals: breakfast, lunch, dinner; business lunch and dinner Toasts: when wine or spirits are served it is customary to propose a toast: Egészségedre! (To your health!) Tipping: in restaurants and taxis tipping is common (10% of the bill) Table manners: before the meal begins, wish ‚Good appetite!’ (Jó étvágyat!). If you are in a home, wait for your host and hostess to start eating. Social etiquette: a man is expected to walk to the left of a woman or of an honoured guest of either gender. Women precede men into theatres, cinemas and private homes, but follow them into rougher environments such as bars, restaurants and cafés. Hungary – business etiquette and protocol Office celebrations: namedays, birthdays, end of the year Personal relationships: strong relationship-orientation is characteristic of Hungarian culture; critical business issues → face-to-face communication! Frequent visits, phone calls are also required Non-verbal communication, space and touching: Voice volume moderate – avoid raising voice Interpersonal distance: medium (25-40 cm) There is more touching, but in business situations only handshakes Time: polycronic and (when getting involved in a lively discussion Hungarians loose all sense of time) monocronic features (meetings start on time, keeping schedules are appreciated) Hungary – business etiquette and protocol Negotiations, presentations: Small talk before getting down to business Business negotiations are more slow than rapid Usual style: discussing items on the agenda item by item „Hungarians are accomplished complainers.” „A nation of gripers, the have the ability to turn positives into negatives and appear to delight in doing so.” → „The Hungarian, it is said, will complain if the ice cream is cold.” On the other hand: have a good sense of humour and they appreciate it also in other people Emotion rather than traditional analysis often determines behaviour Often moody and raise problems without offering solutions. They seem to expect the other party to come up with a solution. Hungarians avoid saying no; often fail to answer questions directly → you have to learn to read between the lines. This indirectness is connected with the high-context culture. Decision making is usually done at the top; negotiations are leadership focused. When making a presentation: avoid starting off with a joke at the first meeting. Background information, facts, technical details are preferred. Hungary’s SWOT Analysis Strengths: • Well qualified workforce • Flexibility • Relatively developed infrastructure • EU membership • NATO membership Weaknesses: • Lack of natural resources • Pessimism • A rather high level of corruption • The dual character of the country: the western part is much more developed • A complicated system of high taxes • Not sufficient command of foreign languages • Nearness of the unstable Balkan region Opportunities: • Further development of the infrastructure • Development of command of foreign languages • Development of the eastern part of the country • Globalisation process • Decrease corruption • Increase positive thinking Threats: • Effects of the changes in the Eastern European political situation • Globalisation process – small country with limited ability for self-protection • Ethnic problems (external: Hungarian ethnic minorities in the neighbouring countries especially in Romania, Serbia, Slovakia; and internal: especially the Roma population) • Nearness of the unstable Balkan region • Not sufficient positive, optimistic thinking List of main literatures: • https://www.cia.gov/library/publications/the-worldfactbook/geos/hu.html • http://www.hungarikum.hu/sites/default/files/hungarikumoklista.pdf • Falkné Bánó Klára: Kultúraközi kommunikáció. Chapter IV: Cultural Aspects of Doing Business in Hungary, Perfekt Kiadó, 2008 Questions? Thank you for your attention!
