Doing business with chinese companies

Doing Business With Chinese Companies

                           Doing business in China is a delicate balance between understanding and respect 

  Doing business in China is a delicate affair for Western companies trying to navigate the cultural rivers  between the two societies, doing business in China is done at a slower pace more in tune with people.   A willingness to understand these differences between cultures and their individual ways of thinking about business and to modify traditional Western business methods and ways of thought are crucial.  To successfully navigating the rapids between these two highly structured cultures if Western businesses are to flourish in what experts are expecting to be the biggest market in the world in coming decades.  If a company goes to China and is successful it will not be conducting business as it does in North America, for even with the best of intentions what works in North America can result in failure in China.

 

  Learning about the culture of the people you plan to sell to is ultimately the most important factor if you are to learn to communicate with Asians.  I know, I was born one and as is the case with all human affair sometimes we don’t see eye to eye, so you an imagine the possible roadblocks if common ground like language and understanding of the culture you intend to operate a business in are ignored.  When we choose to adapt our behaviour out of respect for cultural differences, we start a possible process of building the deep human connection that Asians crave.  Emphasising on creating a bond will build trust and assure loyalty to your organization long into the future.  By acknowledging their culture you reinforce Chinese status and respect for their beliefs and ways of living and this will pay dividends down the road.

 

  A company has to under stand that the Chinese need for respect and acknowledgement governs all business communications and not just the negotiating process.  It takes careful planning and preparation to avoid costly cross-cultural mistakes.  Companies doing business with Asian customers, suppliers, and local staff by phone, fax and e-mail need to be just as aware of cross-cultural sensitivities as the business traveller who brings home the contract.

 

  The Chinese are highly adaptable, anxious to do business, and willing to overlook minor indiscretions.  But some Western behaviour can cause loss of face that will not be tolerated by most Chinese in business dealings.  This can have serious consequences, because a favourite way of preventing face loss is passive resistance.  No one will challenge you openly, because that would be rude.  Instead they will stay silent, submissive, and outwardly non-resistant when you place them in an unfeasible position.  This is the underlying reason for costly delays and production errors in many a business dealing.

 

  Once we know the Western conduct that draws out passive resistance, we can make the minor changes that have a major impact on business dealings.

 

1.        The decision making process differs

 

  The Western system of doing business rewards good independent decision making, it’s a skill valued that comes from our philosophy of individual accountability.  We are taught to speak right at the person making the decisions when customer issues arise, to demand someone take responsibility.  In China, while the senior person makes major decisions, lesser decisions are reached by a consensus of individuals involved, no one person is held responsible for failure.  So when you pressure your Asian colleague for a decision, you are asking them to disregard their cultural instincts.  This will lead to inaction because they cannot act alone, so the decision you request will freeze.

 

2.       The solutions to problems

 

  In Western business we often have freewheeling brainstorming sessions that go against rigorous hierarchical codes of conduct in Chinese society.  The Chinese believe that truly successful brainstorming requires everyone’s opinion to be heard equally, without hierarchy, and without regard for authority, since all ideas are possibly equally deserving of ridicule.  But in a status-conscious society like the west, where acknowledging position is critical to maintaining face, and where they are schooled to take business seriously and not make mistakes, this presents an impracticable environment that it is best to avoid.  You must problem solve logically, allow one person to speak at a time, and defer to the one in authority.  Start from the beginning and work through to a solution in a logical, step-by-step fashion.

 

3.       Come prepared

 

   North Americans have a habit of coming to a conversation only half prepared or with cocky attitude.  They feel confident in their ability to wing it and still look better than the competition.  If they don’t have all the information they will provide it for their Chinese business associates later.  The other side of this is we expect Asians to be fine with giving and getting incomplete answers, but your Chinese business associates are offended by your half-answers, I can assure you.  Lack of correct preparation can cause loss of face and loss of trust in the ability to deliver the goods.  Most Asians won’t get back to you until all the facts are known, so break your information requests into smaller packets and prepare correctly for every interaction between yourself and your Chinese contacts.  Do not present half-baked ideas and theories that have not been properly researched, verified and studied completely beforehand.  Do not look unprepared by deluging your Asian contact with partial answers and frequent updates that will only leave them wondering.  If you are unable to provide a full report, acknowledge the request, apologize for the inconvenience, and then provide a complete and accurate response when the facts are in.  Document in writing and in detail, making sure your facts are one hundred percent accurate at every point.  You will loose face and credibility if mistakes or errors exist and my fellow Asians will use this against you later.

 

4.       Present ideas in stand alone stages

 

   Prepare all reports and documentation as a stand by itself file, with background, rationale, analysis and logic built into the text.  Write clearly, using plain easy to read language, like you are writing for someone who doesn’t have a full grasp of all the nuances of the English language.  Use visual accompaniment whenever possible, including sketches, charts and diagrams that appeal to the visual bias of my fellow Asians.  Keep everyone in the communication loop by sending everybody copies of all written correspondence.  Remember most of my fellow Asians grew up speaking a different language and are not fluent in English even if they took the language in North America and assuming they understand every word could be costly.  One of the biggest mistakes you can make would be to assume you are communicating effectively; this could be a false impression digging you a hole you don’t even know you’re in.  Most Asians understand far less then they let on, they smile and we interpret this as meaning they understand.  Unfortunately, small changes in behaviour can impact severely on business results.  As an example, the way to communicate clearly is to talk in short sentences, listen more then you speak and pause frequently between sentences and ideas.  Find five or six easy phrases to say the same thing and never ask a question that can be answered with a simple yes.  Make a point to avoid all slang since they won’t have a reference upon which to understand what you mean.  Owe, and skip the jokes all together.

~ by warrenhayashi on October 16, 2007.