Click here to purchase The difficulty Westerners have doing business in China is in the cultural differences that affect the commercial realities. Westerners identify an opportunity; thinking revolves around making that opportunity work financially in order to do the deal. If the figures stack up the game then becomes getting the customer, regardless of who she/he is, to sign on the dotted line.
A new book Think Like Chinese written by husband and wife team, Chinese born and educated Zhang Haihua (Helen Zhang) and Australian born and educated lawyer, Geoff Baker quickly exposes the folly of this thinking.
Haihua and Geoff, a former investment banker, have their own management consultant business China Time Inc based in Shanghai and their purpose for writing this book is to offer a practical perspective on the vexed issue of business dealings from the Chinese perspective.
Their proposition is that it is important to understand the cultural thinking of the Chinese in order to understand how a business negotiation plays out.
They identify 5 core elements that drive Chinese cultural thinking and that as a result influence business dealings.
1) Language shapes the mind
The Chinese language is pictorial and this affects the way the Chinese think. The use of symbols means the Chinese take a big picture approach rather than a text based analytical one. Chinese listen to how things are said and prefer "mind pictures" to remember things rather than taking notes and as a result they have trouble prioritizing. Ideas are processed simultaneously and decisions are based on feelings and impulse.
Contrast this against Westerners who listen to what is said, taking copious notes particularly of figures and numbers. Decisions are based by processing ideas sequentially and logically coming to conclusion step by step..
2) The Law of Yin and Yang
The value of Yin and Yang conceptually is that it synthesizes homeostasis for life in the Universe - with the good comes the bad, with the positive, the negative.
The balance of these opposing forces forms the foundation of Chinese thinking and thus the Chinese can live comfortably with a myriad of theories and principles that appear to be contradictory in nature.
In business transactions the Chinese look at the benefits as well as the negative impacts simultaneously and in so doing can make practical decisions without concern for the negative impacts as their view is that things may change later.
3) Chinese Connectedness
In the West we say we are all born equal. The Chinese say they are born connected emphasizing the importance of networks in doing business.
In China, it is not about becoming a celebrity businessman through individual effort. Chinese culture perceives it is not the result of the individual's effort but the effort of the individual's network that results in the network becoming successful that is vital, the more connected the network, the more important it becomes.
This concept of connectedness is crucial in understanding how to locate business opportunities in China. Make sure you do background check wherever possible to determine how successful and valuable the network is you are courting.
4) Midstream Living.
Midstream living develops the notion of finding balance, in this context balance within one's self. In business the midstream is vital. One should not be seen to be too ambitious, nor should one be seen as lazy or lacking drive.
Midstream living is perhaps best illustrated by describing where one should be in a meeting in China. You should not be in the front row if that is not appropriate and neither should you be at the rear. You should be near enough to the front to be seen that you are acknowledging the importance of the meeting and paying it respectful attention.
5) Mianzi - (face)
Zhang and Baker suggest this is the most difficult and at the same time probably the most important aspect of Chinese culture from a business point of view. They describe Mianzi as .."someone's reputation and social status as well as the image one establishes in the eyes of the other."
When dealing with Chinese it is important to let them know you understand and respect their mianzi. Equally it is important not to damage their mianzi even unintentionally because to damage one's mianzi is worse than physically hurting someone. Indeed damaging one's mianzi could mean the end of a business relationship.
Think Like Chines takes these elements and juxtaposes them against all the Westerner prejudices about the East and defuses them by highlighting the importance of cultural differences. This book is a must for those not experienced in all thing Chinese and who wish to do business there. The advice they offer as the conclusion is worth the price alone. It is also a great read if you are simply interested in the cultural differences between East and West.