Doing Business in China 101

managers resource handbook

 

5 Tips for Working in China

 

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China is a vast and exotic place.  You will find dazzling skyscrapers like something out of Sci-Fi flick.  And you will find remote villages that make you feel like you’ve taking a trip back in time.  If you are going to China for the first time, take note: doing business in China is very different from in the West and can frustrate even the most experienced of professionals.

Between the language barrier, cultural etiquette, professional mannerisms and the extreme time zone difference from your home country, working in China will test your business and management skills like they’ve never been tested before. Negotiation takes on a whole new persona. Equally, the overall experience of working in China is extremely rewarding and enjoyable once you get the hang of it. Having spent several years working there, here are a few tips to prepare you for doing business in the People’s Republic:

1. Relationships Are Everything

 – While in the West, business is business, in China and many other parts of Asia, your interpersonal relationships will often be the deciding factor in locking in that deal.  For this reason, your first priority when working in China should be to focus on building a relationships with your Chinese business associates. Be prepared to go to several meetings with your client, supplier or business partner before any real business is discussed.  Initial meetings with Chinese counterparts will often be high level discussions – details and specifics are unlikely to surface until the other party feels they can trust you.  The meandering dialogue is customary and their way of testing you: your skills, your patience, and most of all, your knowledge. The Chinese are very good at business and want to make sure they are partnering and working with the best. Be patient and don’t try to force anything to happen.  Expect to leave your first few trips to China empty-handed.

RELATED: 5 Ways to Promote Cultural Awareness in the Workplace

2. Business Card Intimacy

 – Often times in the U.S. or other Western countries, business cards are simply a form of ID and contact information for business meetings.  We often pass them across the table like playing cards.  In China, however, the exchange of a business card is an intimate experience and should be handled with care. When exchanging business cards in China, hold your card using both hands, gripping the top corners such that the text faces the other party. The Chinese recipient will receive the card with two hands at the bottom corners and read the card in its entirety while you are standing in front of them.  When someone hands you a card, follow suit and receive it by holding the card at the bottom two corners.  Read it in its entirety, smile and shake hands.  Do not put the card in your pocket as it will be disrespectful; rather, leave the card on the table in front of you to help you remember the names.

3. Business Meals

 – Food is one of the central pillars of Chinese society.  While on business in China, you are likely to be invited by your hosts to a banquet dinner.  Should the opportunity arise, make it a point to taste everything on the table as your hosts will ask you for your opinion and it’s disrespectful to not try everything. In some cases, lavish amounts of food will be ordered, so it’s also important to pace yourself.  Recognize that while you may be eating, sharing the meal and clinking of glasses over the course of an evening is one of the primary means of building a relationship with the Chinese.  Don’t talk business and never talk politics unless you know your hosts very well; talk about family, food and friends and let the Chinese get to know you. Doing so will make you business dealing go much more smoothly.

4. Hire a Translator

 – English is the global business language, but plan to get a translator when working in China. While most young professionals in China speak English fluently, your Chinese hosts may refrain from speaking in English to save face, particularly when the relationship is in its infancy.  Most likely they will understand what you say, but bringing a translator is still the right move. Doing so will make your Chinese hosts feel more comfortable and ensure a more productive discussion.  Further, to make for a more effective meeting with the Chinese party, spend a couple of days with your translator ahead of time educating them on the topics of discussion so they are prepared.  Lastly, during the meetings with your Chinese counterparts, expect to frequently sit idle while your translator has a ten minute discussion without translating back into English.  This is customary and a sign of a more in-depth conversation. The better informed they are, the more productive the discussion will be.

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5. Hierarchy

 – Chinese society is heavily hierarchical, so expect this to emerge at some point during your meetings in China.  For instance, the person with whom you are meeting may suggest they cannot send you the information you seek until it is approved to send, even if it’s on the screen in front of you.  As another example, he or she may say they are unable to make a decision, even if it hinders progress. This behavior is more typical in government organizations, but can transcend into private businesses as well.  Rather than press the issue, be patient and simply bring it up again in the next meeting to sway things in your favor.  By the same token, by getting in contact and building relationships with people in authoritative positions, you can improve the productivity of your visit.

To summarize, as a general rule for doing business in China, it is important to be patient and be humble.  Overly aggressive and demanding styles will not be well received and will make it harder for your organization to earn the trust of your Chinese hosts. For more detailed discussion of working in China, I highly recommend the two books we spiked out on our ‘International Business’ page for China.  Notably, while Ming-Jer Chen’s Inside Chinese Business provides a more classical take on doing business in the People’s Republic, it mirrors my own experiences working in China.

Want more on doing business internationally and working through cultural canyons? Click Here.

 

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