Understanding Different Ethnic Cultures in Indonesia and How They Do Business

by | Dec 17, 2020 | Study Insight | 0 comments

Part I: The Javanese, Sundanese and Balinese

Source: Wikipedia Commons

In our article, “A Foreign Business Deal in Indonesia”, we have established that Indonesia has a collectivist, face-saving and hierarchical national culture. The country, however, is also famously known for its diverse ethnicities. Despite its long contact with foreigners under the Dutch colonialism, Indonesians remain as “island people” with flourishing traditional cultures. They are very proud of their heritage and the period of history they went through together in reaching independence only solidified it. To what extent does the national culture apply to different ethnic groups? And how does this affect the way that international companies can do business in Indonesia?

We will now dive into the different ethnic group cultures in Indonesia in this three-part article series. Our research indicated that Indonesian culture can be further divided into “inside Java and Bali” and “outside Java and Bali” where different ethnic groups are more similar to each other. But because Indonesia has over 1,300 ethnic groups, we were not able to cover them all and instead focused on the more predominant groups. This first part of the article will cover the Javanese, Sundanese, and Balinese cultures.

The Javanese: Wong jowo iki gampang ditekuk-tekuk

Source: Pinterest

Making up over 40% of the total population, the Javanese people is the dominant group in Indonesia. They spread all over the country, mostly residing in the islands of Java. The majority of Javanese people are identified as Muslims, while others are Christians, Buddhists, and Hindus. They have also long been associated with Kejawen, a traditional animistic belief rooted in Javanese history. As the Javanese are extensive in numbers, they occupy almost every industry in Indonesia’s business landscape, most notably state-owned enterprises. They are also the dominant group in Indonesia’s political landscape. All seven of Indonesian presidents since independence had a Javanese ancestry, including the late 3rd president Bacharudin Jusuf Habibie who had a Javanese mother, was brought up in Javanese culture and married a Javanese priyayi nobility.

Similarities to the National Culture

The Javanese culture adheres to Indonesia’s national culture to a deeper level. They are exceedingly collectivist as they adopt a communal lifestyle and highly value the concept of kekeluargaan which underpin business communication and organizational culture. Therefore, the advice on building a relationship before any business deals highly apply.

The culture is also hierarchical since traditional Javanese society was heavily stratified. It was necessary to avoid eye contact with one’s superiors, whether it was the family’s patriarch or village chief. While this is not expected these days, if your company happens to go to a more rural region, it is polite if your company representatives avert their gaze if the host speaks. Another interesting tip to know about Javanese people is, when they greet each other in a formal setting, it is expected for the person of lower social status to touch their forehead to the back of their superior’s hand briefly as a greeting.

In terms of communicating, the Javanese are indirect, perhaps even more so than the average Indonesians. This is an important thing to note for business meetings. They are masters at controlling or hiding their true feelings; often smiling in all types of situations. Therefore, knowing what they are thinking or saying can be challenging. To save face, this ambiguity on their part may be appropriate. They dislike saying no and will rather leave things unsaid or say “not yet”.

Perhaps due to this tendency of speaking ambiguously, the negative stereotype that Javanese people are two-faced emerged. Rather than to save face, some speculate that this characteristic is more due to budaya Keraton (Javanese palace culture) in the past where people were compelled to show a positive attitude (in their speech and through facial expressions) to the rulers, whether they like them or not. In a more positive light, these kinds of ambiguous so-called “two-faced” characteristics proved to be useful in wars. Historically, the Javanese were experts in intricate surprise attacks and guerrilla schemes as demonstrated through the Diponegoro War, numerous Mataram Islamic Kingdom Succession wars and the Majapahit War against the Mongols.

The Uniqueness of Javanese Culture

The Javanese are known to be hardworking, ambitious, and quite serious. They historically have achieved many achievements such as building the Borobudur and Prambanan temples and created the great Majapahit kingdom. Fond of merantau (wandering or migrating), they are spread all over Indonesia and can usually very easily assimilate to the different cultures. They have the philosophy “wong jowo iki gampang ditekuk-tekuk” which highlights the importance of flexibility. According to the Javanese, flexibility is especially important for a successful business because one needs to adapt to market changes.

Indeed, based on experience, our consultants mentioned that the Javanese are very flexible and supportive. They are more willing to compromise compared to other ethnic groups outside of Java and Bali. More specifically, they are open to different business deal options and are more likely to consider your company even if it is not exactly what they are looking for. However, they are more risk-averse; skeptical to innovation unless better tangible results can be proven. It is also interesting to note that Javanese SMEs emphasize cash flows instead of profit, focusing more on daily performance rather than long-term metrics.

The Sundanese: Pindah cai, pindah takdir

Originated from the Western part of Java, Sundanese people make up 16% of the Indonesian population, making them the second-biggest ethnic group in the country. They traditionally inhabit the provinces of Banten, West Java and Jakarta. Like the Javanese, they are dispersed across different industries but notably in state-owned enterprises.

Similarities to the National Culture

Sundanese is very similar to Javanese culturally. Even some words in their languages are the same and have the same meaning. Therefore, the degree of collectivism and indirectness in communicating are of similar levels as Javanese culture. The Sundanese also have a communal lifestyle and highly values relationships. A difference is that Sundanese is more egalitarian than the feudal Javanese because the Keraton culture is more concentrated in the Eastern part of Java rather than the West.

The Uniqueness of Sundanese Culture

According to cultural practitioners, Sundanese people have long been known to be rarely involved in conflict wherever they migrate to. Their proverb “pindah cai, pindah takdir” illustrates this. The cultural practitioners Mulyadi and Dalton elaborated that this proverb in a sense means “When living in Java, you must look like a Javanese. When living in Sunda, you must look like a Sundanese. When living in Papua, you must look like Papuans”. Therefore in a business setting, Sundanese is more likely to be flexible and to easily adapt to differences in culture. Sundanese is also noted to be more humorous and less competitive in negotiations.

The Balinese: Tri Hita Karana

Source: Jakarta Globe

The Balinese people who are 1.7% of Indonesia’s population mostly live on the island of Bali. A significant number of others also live in Lombok and the easternmost regions of Java such as Banyuwangi. Some notable industries that the Balinese occupy include agriculture, textile, and tourism.

Similarities to the National Culture

Just like the Javanese and Sundanese, the Balinese culture highly conforms to the national culture and perhaps to a higher degree. It is extremely important to build relationships with partners to carry on business matters; people in Bali appreciate the trust and familiar contact with people they have a business with. Having a good sense of humor is a plus in meetings because most like it when foreigners know how to be laid back.

Hierarchy through class distinction is also prominent in Bali, as reflected by its varying levels of language to address different people. Make sure you know who is the oldest when introducing yourself to Balinese business partners. Recognizing the elderly first before the others is a respectable act. It is also a good way to give seniors a positive impression. Greeting them shows your politeness and humbleness.

In communicating, Balinese speak in a genial manner and rarely display negative emotions. They dislike confrontation, choosing instead to ignore it or use their smile to keep the situation calm. Therefore, it is considered bad manners to argue aggressively; you will lose face and respect if you get too emotional or loud.

The Uniqueness of Balinese Culture

While doing business in Bali, body language and manners are important. Do not touch anyone’s head or try to reach something by placing your arm over the head. Why? The head is considered as the most sacred body part as it contains the door of Siva where the soul enters the body. Thus, salutations are different from Java as mentioned earlier. While modern Balinese shake hands just like Westerners, the traditional salutation is the sembah salute that looks like the Indian namaste where the palms are joined together and placed vertically against the chest. In this position, one should say, Om Swastiastu (may peace be with you) to each other. Gestures to avoid: hands-on-hips (as this shows impatience or dissatisfaction), folding your arms (since this makes you seem cold and unfriendly), and pointing your index finger (because it is considered rude). Lastly, with the nickname of “land of smiles”, Balinese love to smile. You can easily connect to your Balinese partner by smiling.

An important philosophy that affects business in Bali is Tri Hita Karana or the “three causes of well-being”. It is a Balinese-Hindu lifestyle philosophy about maintaining a harmonious balance between Pawongan (mankind), Palemahan (the environment) and Parahyangan (God). This philosophy guides Balinese entrepreneurial orientation, corporate social responsibility, and affects several industries most notably hospitality. It is good for foreign companies to learn this philosophy prior to deals, and it will certainly make the local Balinese impressed. Our BRIGHT Indonesia consultants also commented that international companies might find it easier to collaborate with Balinese partners who have worked or studied overseas, or have worked together with overseas clients or partners.

Implications for International Companies (Part I)

All in all, among the Javanese, Sundanese and Balinese, relationships and hierarchy bear great importance in the culture, more so than the national culture. They are generally more indirect and compromising than the people in other islands such as Sumatra or Sulawesi. It is advised to use a more personal approach in negotiations (such as small talks and making them feel comfortable) because they are more likely to use their feelings to make deals compared to other ethnic groups.

Why are the cultures in Java and Bali so similar and different compared to other islands? The answer perhaps lies in their history of how they were similarly an agricultural society along with the fact that many great Indonesian empires of the past such as Tarumanegara, Padjajaran, Majapahit and Mataram mostly originated from Java and Bali. The common stereotype in Indonesia is that the people in Java and Bali are seen as meeker compared to other regions. So be cautious, polite, and be good listeners. Having local wisdom can be of great advantage. It also prevents the accidental violation of something taboo inherent to a certain culture.


Break the Barriers with BRIGHT Indonesia

With Indonesia’s diverse background, know about the cultural differences before entering Indonesia’s market. BRIGHT Indonesia can give a solution for global companies that want to invest and expand their companies in Indonesia/entering the Indonesian market. 

BRIGHT Indonesia can assist your business development in Indonesia. Our Market Insight Research, Business Partnership Engagement and Business Registration and Establishment  services can help you in expanding and developing your business, register and establish your products and company, as well as obtain the work and stay permit in Indonesia ((expatriates utilization plan (RPTKA), expatriates utilization permit (IMTA), limited stay permit (KITAS)) easier. 

We focus on supporting private sector clients with the development of corporate or business unit strategies and helping public sector organizations with public policy. For further information, email to info@brightindonesia.net.

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