1.3 billion people – the largest in the world, 9.6 millions km² of land, vast amounts of valuable natural resources such as coal, oil, and minerals, and the leading consumer of four out of five core commodities; grain, meat, coal, and steel. China’s status is no longer that of a developing country but one of an emerging economic superpower, one that is writing economic history and shifting the power balance from West to East. China’s rapidly growing economy, massive market, and cost effective business infrastructure, is drawing companies and conglomerates to the country to set up shop. And although the country is getting globalized it still has its own local business culture, business etiquette, meeting protocols, mannerisms, etc.which need to be followed.
In this article we will discuss and explore certain cultural facts and how they influence business culture and etiquette.
Chinese follow the rule of Confucianism, which revolves around the concept of harmonious relationships, i.e obligations of people towards one another based upon their relationship. In particular Confucianism emphasizes duty, sincerity, loyalty, honour, filial piety, respect for age and seniority. Confucianism permeates every single fabric in society, including business practices. Although subtle, the manifestations are evident: an aversion to conflict, maintenance of proper demeanour and the preservation of ‘face’. The concept of ‘face’ roughly translates as ‘honour’, ‘reputation’ or ‘respect’ and is extremely important to Chinese people. It is essential that one gives face, saves face and shows face when doing business in China.
Greetings Greetings are part and parcel of any business meetings. In China, meetings start with the shaking of hands and a slight nod of the head. A firm but not overly vigorous handshake is recommended when shaking hands, anything more will be interpreted as being aggressive. The Chinese are not keen on physical contact – especially in a business setting. Even if you are familiar with the person, avoid slapping, patting or placing your arm around someone’s shoulders. In a business meeting, one should always be calm, collected and controlled. Watch out for your body posture and try not to slouch or look listless. A formal and attentive posture tells your associates that you have self-control and are worthy of respect. Business cards are usually exchanged on an initial meeting. Make sure one side of the card has been translated and if possible print the Chinese letters using gold ink as this is considered an auspicious color and reflects well upon your company. When giving your business card, mention your company, rank and any qualifications you hold, making sure you give and receive any business card with both hands. Rank is extremely important in business relationships and you must keep rank differences in mind when communicating. Treating them too informally, especially in front of their peers, may well ruin any potential deals.
Building Professional Relationships
One essential thing to remember when conducting business in China is that you are seen as a representative of your company therefore any interaction or dealings has to be professional. Never become too informal and avoid humour. Rather than a lack of humor of the Chinese’s part, it is the fact that jokes may be lost in translation and hence be awkward, redundant and even offensive (unless you speak very good Mandarin!) When doing business in China, it is important to engage an intermediary. As the Chinese don’t like doing business with companies they don’t know, the role of the intermediary is vital. This could be an individual or an organization who can make a formal introduction and vouch for the reliability of your company. In addition, the intermediary get act as an interpreter and navigate you through the bureaucracy, legal system and local business networks.
Giving Gifts Etiquette While this practice is considered a grey area in many countries and frowned upon in some, the giving of gifts in a professional business setting does not carry any negative connotations. The Chinese believe that gifts should always be exchanged for celebrations, as a thank you for assistance rendered, and even as a sweetener for future favors. However, it is important that gifts are only given for a good reason and in the presence of a witness as this may be construed differently in the absence of both. When the Chinese want to buy gifts, they will often be direct in asking what you would like – this is common. It is not considered bad manners to specify something you desire. That being said, it would be wise to demonstrate an appreciation of Chinese culture by asking for items such as traditional Chinese ink paintings or Chinese tea. Business gifts are always reciprocated in kind as they are seen as debts that must be repaid. When giving gifts do not give cash as it is too easily misconstrued as a bribe. The gifts need to be items of worth or beauty. Do not be too frugal with your choice of gift otherwise you will be seen as a cheap and tight person.
Meetings and Negotiations At the risk of stating the obvious, meetings must be schedule well in advance. It is considered good manners to forward some literature regarding your organization as a form of introduction. The ideal period for meetings are between April – June and September – October. Avoid all national holidays especially Chinese New Year. As punctuality is correlated to respect, it is important that you are not late. In fact getting to the meeting venue before the other party does sets a good tone for the meeting. Do not dive straight into your pitch, numbers, presentations etc. instead start with some brief small talk. If this is your first meeting then talk of your experiences in China so far. Keep the conversation positive (i.e no complains about food, weather, sleep etc as it’s considered bad form) and avoid anything political. Prior to any meeting, you should always send an agenda. This will allow you to have some control of the flow of the meeting as the Chinese approach meeting very differently. The main topic is discussed first followed by the side issues, so be prepared. Renowned for being tough negotiators, the Chinese’s primary aim in negotiations is ‘concessions’. Always bear this in mind when formulating your own strategy. Be prepared to show compromise and make them feel they have gained major concessions. For the Chinese, business negotiations are like going to war. They will plan meticulously and will know your business and possibly even you inside out. It’s like the ‘three kingdoms’ all over again but in business. One favorite move of Chinese negotiators is to show false humility and deference at the start, designed to make them look vulnerable and seemingly weak, this move exploits any weakness or ‘holes’ in the other camp.