Czech Business Structures

Czech Rep.:

As with many of the central and eastern European states it is very difficult to describe what is the ‘norm’ in the Czech Republic with regard to typical business structures.  The business environment is relatively new and is developing and transforming all the time.  After the political changes occurred, there was a vacuum with regard to business direction and models and the Czechs pulled in advice and assistance from all over the world.   So what has developed in the intervening years is a confused picture but it could be argued that  there are three different types of business structures to be encountered locally:

1. Ex-state monopoly enterprises.  These large operations suffer from a hangover from the former system of central planning, massive levels of bureaucracy and inertia. 

2. Foreign capital subsidiaries.
   Many international companies have branch offices in Poland and these branch offices will usually reflect the approach of the parent company.  Subsidiaries of a US firm will often have a strong US influence; subsidiaries of a German company will usually have a strong German feel etc.

3. Local start-up companies.
  There has been a proliferation of entrepreneur-led companies which will often share the hallmarks of such companies worldwide; fast-moving, lacking in process and with a short-termist approach

Therefore, before entering into negotiations with a Czech counter-party, do your homework.  What is the background of the company and what structure have they developed?

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