Wednesday, August 12, 2015

A Model For Explaining Chinese Business Culture 向外国人解释中国商业文化的模型


As a Westerner who’s spent some time in China, my Western friends and colleagues often ask me to explain something that has happened to them in their Chinese business.  Usually this is a question about something bad – they have a dispute with their Chinese partner; their sales pitch to a Chinese customer failed; they can’t find a reliable Chinese vendor. 


Given the huge differences between Chinese and Western culture, the answer is often complex.  Face, hierarchy, different views of time, China’s rapidly changing business landscape, massive urbanization, the growth of the Chinese middle class, and outdated views of China in the West all play a part.  But my friends don’t have time for a lecture about 5,000 years of Chinese history, or a complete overview of business practices in China – frequently they’re in the middle of the problem and are just looking for something that helps them understand what’s going on.


To make sense of these complex issues, and give my friends quick answers, I try to simplify and relate the problems to some of the most important cultural differences, facts of life in China, and trends in Chinese society.  So, for instance, when my friends ask why Chinese people often won’t say “yes” or “no” directly, but instead give softer, more nuanced answers, I explain this in terms of Face and Harmony: “The Chinese are very concerned about face, and about maintaining harmony in the group, so they communicate in an indirect way.  They don’t want you to be offended, so they don’t say things directly, they say them in a softer way.”


Face + Harmony = Indirect Communications

Or, when one of my colleagues asked why did a Chinese boss criticize an employee in public – wasn’t the boss worried about the employee’s face – I explain this in terms of Face and Hierarchy:  “No, face is hierarchical, so the Chinese boss doesn’t have the same obligation to protect the employee’s face as the employee has to protect the boss’ face.  The Chinese boss is relatively unconcerned about the face of his subordinates.”


Face + Hierarchy = Chinese people are relatively unconcerned about the face of people below them

My question to the LinkedIn community is which differences, facts and trends ARE the most important?  Which ones best help explain Chinese business to foreigners?  This is my initial list:
我对领英社区的问题是:哪些差异、事实和趋势是最重要的?哪些因素最能向外国人解释中国的商业? 下面是我草拟的一份列表:

Cultural Values Held By Most Chinese People

Relationships (guanxi) – Relationships are more important than rules

Hierarchy – All relationships are hierarchical and, thus, unequal

Face – Face is more important than facts; perception is more important than reality

Group Orientation – The group is more important than the individual

Long Term Orientation – The long term is more important than the short term

Incremental Improvement – Step by step improvements are better than revolutionary change

Pragmatism – It’s better to accomplish what you can without waiting around for the perfect answer; don’t let perfect be the enemy of good enough

Harmony – Things go better when everyone gets along, or at least don’t get too unhappy with others in the group

Important Facts Of Daily Life In China

Huge Number Of People – China is much bigger and has many more people than Western countries

Feudalism – You owe loyalty to your boss, who controls many things in your life (e.g. money and time).  This is sort of a combination of guanxi, hierarchy and group orientation

Cultural Revolution – The Cultural Revolution had a huge impact on Chinese society that is still being felt today.  For instance, the low level of trust Chinese people have in the government and in people they don’t know were made much worse by the Cultural Revolution

Rapidly Changing Environment – China is changing much faster than other countries, not only economically but socially, culturally, politically.  2005 was quite different than 2015; 1995 was almost like a different country

Niches – Chinese society and Chinese markets are not monolithic, they are made of many small niches

Age – China’s population is aging rapidly and this has many significant impacts on society and the economy

Gender – China has significant gender imbalances, both in the cities (where there tend to be more young women than young men) and in the countryside (where there are MANY more young men than young women)


Economic Development – China continues to develop economically, and at a very fast rate compared to other big economies

Quality and Luxury – Chinese consumers increasingly demand quality and luxury; they are not satisfied with low quality goods, even if they are very inexpensive

Urbanization – Over the past 30 years, a huge number of people have moved from the countryside to the city and this process is still going on

Infrastructure – China is building infrastructure at a rapid pace

Middle Class – The Chinese middle class is growing very fast

Technology – China is using technology to get ahead.  For instance, although it still lags in the “old” technology of making computer chips, it is far ahead in the “new” internet space

Are these the most significant cultural values, facts of life and trends in explaining China to foreigners?  If you had to relate every problem using only these elements, could you do it? 

Give me your thoughts.  I’m anxious to hear the experiences and perspectives of others.

1 comment:

  1. Thanks for sharing your insights about Chinese business culture, we've recently compiled a guide for Chinese business culture especially the dos and don'ts. Hope to hear from you about your opinions!