Contrast Between Hong Kong And United Kingdom Business Essay

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The land was occupied by United Kingdom in 1841, then the power was given to China under the promise of one country, two formula rule in July 1997, that land is known as Hong Kong. Hong Kong has a population of 7,153,519 (July 2012 est.) whose ethnic groups are comprised of 95 % Chinese, less than 2% Filipino and Indonesian and 2% various mixed. The official language is Chinese (Cantonese), whereas 3.2% speak English and 6.4% populous speak other Chinese dialects.

Hong Kong is one of the most densely populated area, with seven million people and is also known as a place where "east meets west" reflecting the culture mix. Positioned in Eastern Asia, Hong Kong; shares boundaries with the South China Sea and the state of China. Hong Kong has more than 200 islands. The land of Limited Democracy has been the main centre of attraction for different investors.

Hong Kong has a free market dependant heavily on international trade and finance. The great island rests on one of the best deepwater harbors hence promoting a great deal of import and export. The region is a major corporate and banking center with majority trade with China. Among the famous trading partners of Hong Kong are China, America and Japan. The economy of Hong Kong have also suffered with time but with the help of China in easing their travel restrictions, consumer confidence is back and with extensive exports has helped Hong Kong grow stronger over rough times. Hong Kong must import food and raw materials whereas natural resources are limited.

Hong Kong's economy has seen uplift as majority companies in Hong Kong stock exchange are China's companies which constituted about 43% of the firms listed on the Hong Kong Stock Exchange and accounted for about 56% of the Exchange's market capitalization. Boundaries of Hong Kong are guarded by PLA which stands for China's People's Liberation Army which is under direct control of Central Military Commission in Beijing and the administrative control is under Guangzhou Military Region. With less space for expansion across its hilly areas, high-rise Hong Kong has highest population density in the world due to which the city is known for modern architecture and the world's most vertical city. Mainly comprising of skyscrapers and temples, shopping malls and traditional markets sit side by side. Hong Kong has one of the highest per capita income in the world. The dense space has led to a highly sophisticated transportation network in the world with exceeding 90% of public transport travelling rate in the world.

Hong Kong's climate is rated as sub-tropical monsoon. Ranging from cool and dry in the winter season which is from mid December to February, whereas spring is full of rain and shower starting from March till mid May. Summer is hot steamy and rainy starting from late May to mid September where as autumn is clear, warm and sunny which is from late September to early December.


Contrast between Hong Kong and United Kingdom

While doing the difference and similarities between London and Hong Kong it can be said that both cities can learn from each other. On the other hand, it was realized that there is more than one correct way for a city to do things and there is more than one wrong way to do things that create certain types of problems. One of the biggest similarities between Hong King and United Kingdom is that both have the same population figure. Both are important globally and consider themselves as main financial players. Both London and Hong Kong are considered to be cosmopolitan cities. United Kingdom is more of mix of people for example Latin Americans, Koreans, Bangladeshis, Nigerians, Middle Easterners, Eastern Europeans and the list goes on whereas in Hong Kong 95% are ethnic Chinese.

In United Kingdom, people when meeting with other people use personal names followed with a handshake. In Hong Kong people uses one surname often followed by generational name then a personal name followed by either a nod, slight bow, or offer their hands when they are greeting. In Hong Kong it is not a custom to have a handshake, and if they do handshake it is considered to be very light. In Hong Kong acquaintances are greeted with their professional title for example Vice President or Managers along with their surname and if the person does not have a professional title name then he is addressed as Mister, Mrs., and Miss. Whereas in United Kingdom acquaintances are usually greeted by Sir and Madam. Hong Kong Chinese lower their eyes as a sign of respect when they are greeting someone or they try to maintain eye contact as it is considered impolite if you don't maintain eye contact during the conversation. They also avoid using words like "let's discuss later" or "perhaps". While in United Kingdom people feel uncomfortable if you maintain a long eye contact and they feel free for any kind of response.

In business meetings, the first thing businessmen in Hong Kong do is that they exchange their business card and the details are mentioned both in English and Chinese whereas in United Kingdom business cards are normally given at the end of the business meeting. Hong Kong people greet the person holding the most senior position and the rest are acknowledged according to their hierarchical order and this can also be said for United Kingdom.

In Hong Kong table manners are really important, it is said that if you are having fish in dinner that it is considered to be unlucky if you turn the fish over. Chopsticks are used in Hong Kong and it is advisable to use them properly. Chopsticks should not be positioned upright in the rice bowl, as it is considered impolite. Rice is considered to be the staple diet hence it is served with every course. Leaving little food at the end of the meal is considered that the person is satisfied with the food and he is full. In United Kingdom it is advisable to use cutlery for example knives and forks. It is considered rude to start before everyone is served until and unless the hosts insist that you don't have to wait. Do not talk while eating.

People of Hong Kong greet everyone in the social gatherings and the host is normally present with gifts this manners can also been seen in United Kingdom. Both in Hong Kong and United Kingdom it is advisable to be on time, punctuality in the meeting and social gatherings are considered supreme in both cultures.

Buyer has the superior power when negotiation takes place, this can be either London or Hong Kong. But in Hong Kong when negotiation takes place they have a distributive and contingency bargaining. It is expected that both sides of the business deal should reach a mutual agreement. They expect long term relationship with their business partners and focus mainly on the long term benefits. Hong Kong negotiators are considered to be very competitive. On the other hand, In Britain while negotiating it is a joint problem solving process. The main focus is on near term benefits of the business deal. The negotiating style is cooperative and often comprising if required.

When making a decision, Hong Kong companies follow a strict hierarchical structure and the decisions are normally taken by the most superior person and people normally follow the given line of authority. While making a decision they consider specific situations rather than applying universal principles. Personal feelings and experiences may weigh more strongly than empirical evidence, but they also consider objective facts. In London, employees in a company apply universal principles rather than considering specific situations. British tend to follow established rules and practices. Empirical evidence and other facts are given more importance when making a decision. British people are low risk takers.

My Recommendation

The theory consists of four main components that are individualism-collectivism, uncertainty avoidance, power distance and masculinity-femininity. The model was proposed by Geert Hofstede. The main focus of the study was on factor analysis which consists of cultural dimensions which describes the effect of society's culture on the value of its members and how these values transmit to behavior. Due to this approach the theory made its name in cross culture psychology and has been used by many consultants in many different fields relating to communication and international business. The following diagram shows the model:

Hofstede also described about Organisation Culture using the five factors described in the above diagram. He argued that regional and national factors add up to the culture of the organisation and later influence the behavior of the employees working in the organisation. I will be using the model to explain the difference between Hong Kong and United Kingdom, as to how different they are when it comes to culture, business and behaviors.

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In the above diagram (PDI) Power distance of Hong Kong is 68 which show that inequalities among people are acceptable. The people are inclined towards recognized authority and individuals are generally optimistic about people's capability towards leadership. There is no protection against power abuse and people are biased towards superior-subordinate relationship. Whereas for United Kingdom PDI score is 35, individuals believe that inequalities should be minimized. The people are against the typical British class system hence showing the culture tension. People should be treated in equal manner.

For Individualism (IDV), Hong Kong score is 25 which highlights that it has collectivist culture hence showing the people tend to work for the group rather than for themselves. The main preference is given to family members. Hostile environment for outsiders and co-operative behavior for insiders for example: promotions. While during communication they try to keep harmony and avoid conflicts. In UK the score is 89, which means that the individuals only thinks of themselves and their route to success is in personal achievements. The individuals believe in individualism and their lives are very private.

Hong Kong is a Masculine (MAS) society, which has 57 in score. Success is driving force in the country. Students are asked to score good scores in their exams that are the criteria for success and employees' work hard showing that they want to succeed. Whereas UK has 66 score which shows goals driven ambitions. The society faces confusion between the British modest culture and the goal driven mentality, in short saying that people in United Kingdom live to work and are highly motivated towards their goals.

(UAI) Uncertainty Avoidance in Hong Kong is 29 which show that individuals are entrepreneurial and adaptable. People are more practical and they change themselves according to different situations. The individuals are quite comfortable with some uncertainty in their lives. On the other hand, UK scored 35, this shows that the society does not care about the future or uncertainty. The people in UK take life as it comes to them. They don't show urgency in achieving their goals their ambition is life is clear. Creativity and innovation is high.

Hong Kong has a very high score of 96 in Long Term Orientation (LTO), which means that relationship are according to status and they make sure that the order is preserved. The society is seemed to believe in long term goals where diligence is normal. People believe in long term investments utilizing their resources without wastages. Whereas UK scored 25, which indicates that the individuals believe in short term goals and the people have great respect for history. In United Kingdom, the business main emphasis is on short term and quick results.

The second model is Iceberg Model which explains the three behavioral patterns.


The model explains the three psychological trends that the individual in any society feels. The three steps include feeling and thinking which is under the water just like an iceberg and doing is at the surface. The main implication of the model shows that the feelings of the individual are hidden and it is only felt by him. This can also be related that when the individual is exposed to the new culture. Whereas the thinking shows the norms and the values that the individual receives from his culture and what is considered his values and tradition. The doing trend shows the point where when an individual is exposed to a new culture then how he reacts given a situation or when the feelings of the individual comes up to the surface and he starts to perform according to the new culture and the things that he has learnt.

The advice that I would like to give is that world today as we know it is becoming a global village and everything is connected now. There is a growing trend of International Organisation Culture. More and more people are doing business internationally, as more and more markets are emerging all over the globe. The main steps that can be followed before doing business can be that the executive should have a summary of the traditions and background of the culture of the land he is conducting his business in. The executive or the manager should be alert with the business interaction is taking place he should make sure the information that he gathered has any impact on the other party or not. The two models that I have explained above shows the same findings that if you are interested in doing business to another country then their culture should be understood and respected one simple way of doing this is reading books, talking to a person who is already in terms with the country he is already doing business with, attend the museum to have a better understanding about the culture or think of the advantage that the manager will get if he succeed in the business meeting. The Hofstede and the Iceberg model also help us in explaining what the individual expects while carrying out the business negotiation, communication and decision making processes. It highlights the different steps that should be understood with the help of theory. The different types of cultures and the reaction of the people and what they expect should be understood using different academics models. There should be a sense of respect for the both cultures or the new culture that you are planning to do your business with.