China: More Complicated than Rice and Chopsticks

Soon, we’ll have the opportunity to undertake one of the most eagerly anticipated elements of our course: the class trip to China. (Meanwhile, some of the class will be venturing to sunny Brazil.) Apart from experiencing a tourist’s perspective of this vastly contrasting culture, we’ll enjoy many insights into the possibilities and challenges available in China for a foreign investor. Gaining these insights will offer not only the basic knowledge and skills necessary to succeed in this particular business environment, but will perhaps challenge some of our long-established convictions regarding the most efficient methods of operating a business or an economy. In many ways, the experience might even humble us.

The Chinese environment is often portrayed in literature as too complex for our understanding, so the task of comprehending it adds to its fascination. Witnessing the Chinese people in their own environment should yield unexpected observations, and might even deepen our appreciation for the might of their civilisation. During our first session of preparation for the class trip, we were treated to a number of presentations. One of the most striking phrases spoken by a speaker referred to China as “re-emerging”. Indeed, China is attributed with inventions such as silk, cast iron, pottery and the fork, introduced at the time when Europe was struggling to catch up as an emerging civilisation.

It seems that modern China’s complexity has resulted from the intertwining of a traditional, almost centralised economy, initiated by Mao’s ideals, and the modern global business environment, along with its pressures and opportunities. Nevertheless, for some believers in Marxism, China represents a glimpse of hope, though, to many more, it seems a land of commercial opportunities, demonstrating some of the symptoms that the USSR and its communist party suffered prior to its collapse. This complexity is further intensified by the extreme diversity evident throughout every aspect of Chinese life and land, including language, customs, landscape and even climate. The north typically experiences sub-zero temperatures in winter, at the same time it would be possible for a person to sunbathe in the sub-tropical south.

Online sources offered some interesting facts about the cultural differences a westerner should take into account when seeking to conduct business in China. One example is the importance of not causing another person to “lose face”. One incident detailed a negotiation process in which the Chinese delegation received unclear instructions regarding the hotel scheduled to host the meeting. (It appears that the event took place in the US.) They arrived late to the meeting, choosing not to seek clarification from the inviting party, fearing that they might cause offence through the implication that the instructions were unclear. This incident, though extreme, is still useful for gaining appreciation of how we should be sensitive to such cultural differences.

Another interesting aspect of China’s cultural differences noted involves the reluctance of the Chinese to complete a deal with someone they don’t know personally. While some caution in this respect might be understandable, it is much more extreme than in Europe. A Chinese person typically feels the need to really get to know the other party before business. The more qualities or interests both parties share in common, including details from each other’s personal life, the faster the process of arriving at a satisfactory deal will be. Negotiation processes are typically lengthy, compared to European norms, which is necessary for the Chinese not only to deal with the bureaucracy involved, but also to allow more time for various considerations than a westerner might take.

Saying “no” is not easy for the Chinese. They might ask further questions to avoid answering “no”, which might prove annoying to European temperaments, when the situation is not fully understood.

One of the most striking aspects of Chinese culture, or Asian culture for that matter, is their greater respect for the elderly, and for social status. For example, many sources state that, when offering a business card, it is imperative that it is offered to the most senior persons initially, and then to others, based on the order of rank. This also applies to any business-related documentation or brochures. Failing to adhere to this custom could lead to the awkward situation of various members passing the material to each other, until it reaches the most senior member, without offering any explanation. Addressing potential business partners by his or her first name, or without the relevant title, is also strongly discouraged.

I also discovered an interesting explanation of the Chinese word often translated into English as “business”, “trading”, “commerce” or “deal”: 生意 (sheng yi), which, like many Chinese words, signifies a much more complicated meaning. The first character means to be born, or to emerge, while the second refers to intention, a meaning, an idea and submission. It’s clear that we have much to learn about this enchanting land, and that a full understanding of Chinese ways involves a complicated process. We can’t take the lazy route of stereotypes and judging according to European customs; we must embrace Chinese culture, rather than reducing it – like the above phrase – to “a deal”.

Natasha Ibanez

– Natasha Ibanez, FT MBA 12/13