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Review focus: Lifestyle, China, business relationships, business associates, Chinese, negotiations, business in China, networks, cultural differences, structured style
Asian Business Code Words Index NTC/Contemporary Publishing Company Asian Business Strategy & Street Intelligence Ezine
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As with most Asians, where ritual and personal relationships are a vital part of the smooth functioning of society, Chinese business people do not rush into discussion or negotiations as Westerners are wont to do. The Chinese want to get acquainted before they do business. They also want to extend hospitality to demonstrate their respect for others and their own appreciation of the finer things in life (eating and drinking) and, as some add, to soften their visitors up. There is usually a lot of small talk during the first full day, when the Chinese will try to learn as much as possible about the visitor and his goals. That evening during the welcoming banquet, they learn more, for it is in such a casual situations that the foreign visitors are most likely to reveal themselves. The Chinese have a highly structured style of negotiating that goes well beyond the usual Western practices. For example, the Chinese often make use of a shame technique to gain an advantage - making their adversaries feel ashamed about something and give way. They will also typically try to make the opposite side feel responsible for any problems or errors that might occur. Knowing that Westerners tend to be very impatient, they use this to their advantage, using go-slow tactics to encourage the opposite side to give away more than planned. Experienced foreign business people typically say the Chinese resort to a variety of tactics to get what they want, including using the visitors' lack of knowledge about the Chinese market, threats of taking their business elsewhere (to the Japanese, for example), and so on. The Chinese are past masters of the "bad cop - good cop" technique of negotiating and interrogating, and they use this strategy in almost every situation imaginable, in personal as well as business situations. They are also adept at keeping people on the psychological sharp edge, as a control technique to keep them from doing anything that might have a negative impact on the Chinese system (whatever the system is at that time). By sustaining this kind of psychological pressure, adversaries or potential offenders, especially if they are inexperienced with this approach, generally develop a paranoid personality. At the same time - and unlike the Japanese - the Chinese can be very direct and blunt in their dealings with foreigners. While claiming to operate on the principle of equality and mutual benefit, they will often point out that what may be fair to the foreigner has nothing to do with the circumstances in China. But as in Japan, the Chinese do not look at a contract as the end of negotiations and the beginning of wholehearted cooperation. To them it is just the beginning of a relationship that naturally changes from one day to the next and have to be reevaluated and renegotiated on an ongoing basis. Until very recently, one of the main challenges facing foreign business people negotiating or doing business in China was getting reliable information about China - whether it was business information or political information. For years, the Communist regime exhorted all Chinese to avoid providing foreigners with any information about the country, regardless of how trivial, making it confusing and difficult for foreigners in the country to function well in any capacity. This problem has been significantly alleviated on the highest official level, but it has not been fully accepted on lower levels and is still a handicap that often mystifies and stifles. There are generally two distinct phases of negotiating business deals in China - the technical phase, which comes first, and the commercial phase, and generally there are two negotiating teams. The technical phase is usually the most drawn-out and detailed. If the foreign side is also represented by two teams, it can be several days before the commercial team sees any action. If the foreign group is also divided into two teams, the commercial team is advised to attend the technical negotiating sessions as well (regardless of how long they take or how boring they might be) in order not to miss out on any aspect of the exchanges and to learn more about the process of interacting with the Chinese. Ian Stones, a bilingual, bi-cultural businessman with years of experience in China, notes that Chinese negotiators often use teacups in their negotiating. They use the crockery to represent the foreign side and themselves, moving it around to graphically illustrate the points they are making. Stones laughed and said he often mused that Chinese negotiators might be tongue-tied if they didn't have their teacups. Stones added that the days when senior negotiators readily showed their anger if things weren't going well are apparently over. "They make a serious effort to mask their feelings," he said, "but if you watch closely you often see them squeezing hell out of their chair arms".
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Boye Lafayette de Mente is one of our regular monthly columnists at the 
| This month's column is excerpted from Chinese Etiquette & Ethics in Business, by Boye Lafayette De Mente available from NTC/Contemporary Publishing Company |
© Boye Lafayette De Mente & the Asia Pacific Management Forum 1999
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