The Chinese Business Environment
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Published: Thu, 27 Apr 2017
American Acculturation to The Chinese Business Environment
About 2,000 years ago the “Silk Route” was established. It the earliest routes of trade to link the east with west and it was used to export silk, porcelain, spice, tea and other textiles from China. The “Silk Route” was an essential factor in the development of many great civilizations and helped to lay the foundations for the modern world. Since then China has been on the forefront of trade and will remain on the forefront of trade because of all the benefits of doing business with the Chinese.
Firms all over the world benefit from doing business in China simply because China’s wonderful government provides incentives for businesses that are export oriented, their cost of labor is very low and their productivity is increasing. China is also the world’s largest coal producer, they manufacture most of the textiles and apparel that we wear and they also have infinite patience and determination. In addition to these benefits American firms posses the comparative advantage over China which means Americans would benefit more by buying goods from China that the Chinese specializing in producing instead of producing it ourselves. This is why American firms are forced to globalize and do business in the Chinese Market to become more efficient ourselves. Now in order to do business with someone you first must learn to understand their culture and China has a very rich and diversified culture. Then you must learn their business etiquette, “their” proper way to do things and become knowledgeable in China’s silent language and how they communicate.
The purpose of this analysis is to assist the acculturation process of the modern American business man by providing cultural knowledge about China and cross examining the cultural differences between America and China to raise awareness. The analysis will also address some of the most important points of Chinese business etiquette that are vital for creating successful business relationships in China.
The Chinese culture differs from the American Culture in many ways but to be a triumphant business person we must learn how to conduct ourselves among the Chinese and to do this we must gain understanding of their culture and their philosophy. The Chinese are the prime cultural group in Asia and the Chinese Diaspora stretches through out East Asia (China, Vietnam, Taiwan, Indonesia, Malaysia, etc.). The whole Chinese culture is built entirely upon a foundation of philosophy laid down by the worldwide renowned philosopher Confucian who created an ancient Chinese ethical and philosophical system that developed from his early teachings called Confucianism. Confucianism is a complex system of social, moral, politacal, philosophical and religious thought which has had a great influence on the culture which focuses on hard work, respect for authority and harmony. American businesses value profit and gaining market share while the Chinese on the other hand value collective orientation, which is based on common welfare and social contacts.
American firms that want globalize and expand throughout Asia must understand that the western concepts of codified rules & regulations, and contracts do not apply to the Chinese business environment, which is run by unwritten rules and understandings like Guanxi. Guanxi is defined as “personal relations –in the Chinese culture extremely important to establish a good personal relationship with the principals on the other side. The better your relationship, the better chance you have of negotiating a viable agreement that benefits both parties.”
Once we understand their cultural back ground we can examine the Chinese business etiquette as far as their appearance, behavior and how they communicate so that modern American businessmen know how to conduct their selves among different cultures.
In China your appearance is very important. For business, men usually wear very casual suits with neutral colors. The women in china usually don’t show of much of their body, so short skirts and dresses should not be worn. The Chinese will usually be offended if a woman shows off too much of her body. Jeans are not acceptable to business meetings either but they may be worn on regular jobs.
The Chinese behavior is also totally different from ours. Unlike Americans who may keep personal contacts to the people they are doing business with the Chinese are strongly against that. Also try to avoid a lot of movements with the hand because people can find that obnoxious or just plain disturbing. When people give u gifts in China it can be a very sensitive issue. Some gifts such as clocks, straw sandals, handkerchiefs, anything white blue or black, or a stork or a cane can be linked to death and should not be given at any business meetings. If you want to give a gift, give a banquet; that is the most respectable gift that you can give. The Chinese also like good classy writing pens. When you give a gift it is better to give in private or to everybody at one time. The Chinese behavior differs from our drastically so you must stay on your game with your behavior.
Communication is important in greeting or doing business with anybody. When you come in contact with a Chinese person make sure they give their hand first. Also bowing or shaking your head up and down is a regular greeting for them. Unlike in America, being on time is also very important. You don’t want to be late to a business meeting in china because they will take it as a sign of disrespect. You should also make appointments while conducting business to show the Chinese people you are professional and mean business. Never leave a business meeting with the Chinese first, always allow them to leave. To be successful with the Chinese communication is the most important part of business.
China is a very unique country that follows an established set of business etiquettes and they have been relying on these set of rules for nearly 2500 years. China is a very homogenous society that is not very susceptible to change. Learning Chinese customs can benefit a person or firm in a variety of ways. If you are doing business with the Chinese your appearance, communication, and behavior are very important factors. A lot of our business is handled in China so we must gain cultural knowledge about China before we engage in any business transactions. No one gets very far in China without learning to reach the signals because what is not said is just as important as what is and how it is said. The Chinese were taught not to use a lot of emotions so when you meet them they may seem unfriendly or even rude to some people and that’s because the Chinese have different ways they communicate and handle business with others. The Chinese manage their social relationships by using the sayings “are you in the circle” or “outside of the circle”. They put many of there family, co workers, or friends inside the circle leaving the rest of the world outside of the circle. The Chinese culture is real tricky and while handling business they will try to swindle you and use bargaining tactics to persuade you because they know if you traveled around the world you must mean business. But, once you are familiar with their culture and their business etiquette, you must decide how you want to play their game. In order to enjoy successful business relationships with the Chinese, I believe strongly that respect for their point of view is considered necessary.
- Seligman, Scott D. Chinese Business Etiquette. New York: Warner Business Books, 1999
- Sabath, Ann Marie . International Business Etiquette. Lincoln: Career Press, 1999
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