(ke qi), means courtesy and politeness. (he qi), means harmony. Chinese people feel comfortable to be keqi and heqi in a relationship. Showing an- ger or annoyance may ruin the relationship between you and your Chinese partners.
Guanxi in China
Guanxi (relationship between people) is equally important in the West as it is in Asia. In the West it is just not that much discussed. Maybe in Chinese context, guanxi (relationship between people) sometimes gets confused with guanxi - relationship between business and government oicials.
In my experience that government guanxi is the one that sets China really apart from doing business in the West, and it's the guanxi you really need to make your business successful.
--Ingo M. Späth, BDM Asia
After reading more of the comments from months ago it seems like many fall into the same discussion regarding guan-xi as any other discussion of China and what's important for business. In the UK we have the Old Boys Network- if you have the right school tie you it the club nicely, thankyou very much. I'm sure most countries have some form of guan-xi style network. I have found these in many foreign countries and help is always at hand from a fellow countryman. The concept of guan-xi in itself is not unique.
Learn the language, be polite and don't forget where you come from and what yourown values are before you start psyching yourself out about dealing with people who have rather diferent business practices. Remember, they are as keen to do business with you as you are to do busi- ness with them. If you are not Chinese you have no 'face' - this can freak them out as they don't know how to deal with you -in the same manner that you maybe confused by 'face'you must give them.
--Joel Summerhayes, Waking Dragon Management Consultants Ltd
In contrast to the West, where building relationships has less importance due to the strict laws and a cul- ture that supports contractual obligations, without guanxi a westerner entering China is like entering an abyss. Understanding guanxi is a challenging process for a westerner, studying guanxixue and building a guanxiwang is fundamentally important. It is prudent for a western company to recruit the right people with the appropriate guanxiwang to avoid being locked out of the world’s fastest growing market.
Guanxi vs. Contract
While the Western conducts business through the contract, Chinese look at the guanxi, which is beyond the contract, for sincere commitment. Guanxi often entwines with business relationships in China and plays a more important role than a contract.
Guanxi vs. Trade
Guanxi is a critical factor of the networks which serve as a bridge between the traders. For supplier, it means that they can stay on the value chain of a manufacturer as long as they maintain good guanxi. For buyer, it means a favorable terms and conditions of the deal which would be impossible without a good guanxi.
Guanxi vs. Reciprocity
To keep the good guanxi, both parties must reciprocate. In Chinese philosophy, “No one knows when you will be in trouble and a friend in need is a friend indeed”. This relects the necessity of reciprocity.
Guanxi vs. Problem solving
If there is a dispute between the parties, the for- eigner should avoid the court procedure. The best way to solve the problem is through guanxi which solving the problem without damaging the good business relationships.
--Josh Chan, Ph.D, Senior Research Fellow at Oxford International Busi- ness College
As an insider of Chinese culture, I have been observ- ing how foreign business people communicate with their Chinese partners. Some succeeded some failed.
Regarding doing business with a Chinese business person, here are some taboos to remember:
1. Never embarrass your Chinese partner in any situation. No matter how western style he/she is, mianzi is the in-deep philosophy. If you treat Chinese well, they will treat you well. Chinese regard the obligations of repaying favors as very important thing.
2. Don't be too pushy. Westerners love to thinklogically (scientiic) but Chinese love to feel (artistic). You can talk big with Chinese but always start from small point to make sure they feel comfortable to do business with you. Once you have good rela- tionship and successful irst corporation with your Chinese partner, they will feel you trustworthy, there will be more business low naturally to you. Never push. Always be polite and patient.
3. Don’t be very direct in refusing a favor asked: The best way to deal with a request you’re uncomfort- able with is to avoid putting yourself in that
situation in the first place. If you do ind yourself in such a situation, though, refuse without using very direct language to help the other party
save face. In many cases, rather than saying you can’t do it, it’s better to say something to the efect of “it may be difficult.” Then try to think of a compromise you’re comfortable with.
--Mimi Wei, Product Manager at Focus Technology
Price and Quality
The key thing is that people 'want' to do business - but you have to be very clear of your expectations on them in terms of delivery, shipping, quality etc. You need to be aware of these'restrictions'and make sure that you are being 'realistic' about price and performance...you don't get a top product for bottom dollar- anywhere!
You cannot be assuming that a company 'knows' how to ship something overseas 'safely and correct- ly!’ knows how the item will be sold/marketed and hence 'visual quality'of packaging or knowing how it will be used in your market hence'safety quality/ materials quality'. Most 'small' Chinese companies make one product really well-but they don't neces- sarily have the sophistication of packaging/market- ing/export - allow for this.
Your 'commonsense' is not a paradigm that Chinese people can easily understand (because every re- quirement is diferent plus a language barrier!).
So taking care to realize this, deine these qualities very well and dwell on the important items makes sure that the Chinese partner will focus on the things that you want.
--Gareth Humphris, Principal Consultant atEdVantage ChinaNegotiation in China
One more point is that, we foreigners must understand that lower pric- es, tight schedule, language and culture barriers will obviously lead in diferent results than if you do it in your country. So you have to do compromise between quality and costs. If you want quality products in China it is 100% possible to get it. But don't expect to have for such a low price, as for- eigners usually think.
--Anthony Garcia Senior, IT Project Manager looking for opportunities in Beijing
Chinese'positive body language'signs in meetings and negotiationshow 'understanding', not 'agree- ment'.
A contract is an invitation to continue'negotiation' for the life of the relationship- not a 'binding'docu- ment. A handshake is just touching hands!A gentle- man's 'word'is a leafluttering in the wind!
Negotiation in China
Chinese'positive body language'signs in meetings and negotiationshow 'understanding', not 'agreement'. A contract is an invitation to continue 'negotiation' for the life of the relationship- not a 'binding' document. A handshake is just touching hands!A gentle- man's 'word' is a leafluttering in the wind!
Be aware that people may speak perfect English but show no sign - most university-trained Chinese can read English well enough to get information from documents. If you want to investigate or have 'freedom of movement', do not accept a lift from your host - hire your own car.
Question every price - make sure they can cover their expenses in manufacture - some salesmen, keen on making sales will ofer 'low prices' that change on first shipment - allow for it! Really question'low prices'that just scrape in on RMC cost or are lower!
Never show displeasure openly- never chastise any- one in public.
Realize you 'interpreter' must follow Chinese proto- cols of guanxi and hierarchy -follow their lead. Retire politely if you need to!
Guanxi says: A'low' person cannot question a 'high' person - your staf cannot telephone a manager in another company and demand anything!
Don't'manage by secretary'- relying on one person to translate everything for you sets up resentment and guanxi issues in factories oroices you control.
The bosses 'father-in-law will be the security guard or the gar- denerin 'family run businesses', be respectful to all people in companies.
Check factory capability - specify that they must not 'subcontract'in the agreement and when the inevi- tably do, you have something to discuss with them.
Negotiations are always luid - you will revisit terms many times so be patient and always check the re- vised documents thoroughly. Make sure you are available after negotiations for a meal - this 'seals the deal' - pay attention to who is there, the big boss arriving says you have lost big time in the negotiations!
Never believe any 'advice'you get on forums - Chinese business is changing and so are attitudes and understandings- in small family businesses that are away from major centers you may ind many of the 'ideas'here to be 'true', but be very adaptable and as thorough as you can - a respectful personal approach works best!
--Gareth Humphris,Principal Consultant at EdVantage China
Are Chinese people conservative?
After some supericial contact with Chinese culture, a Westerner can easily get the impression that Chi- nese people are conservative.
In China,being conservative is considered as a posi- tive virtue. But Chinese people are progressive. Also, please be noted that China is a huge country with different regions developed quite differently. You can not generalize Chinese people with one word. People living in big cities are of more quite western style. People living in inner-land cities are more con- servative. Also, age is a big factor. Elder people are often more conservative than young generation. Young people born in 1990s are typical generation that would be quite interesting to study. China is just so huge and customs can be quite different from the north to the south, from west to the east.
If you blend Eastern leadership styles with Western methodologies - do you end up with a better company?
My JV runs based on a hybrid management with my Chinese partners leading the relationship with customers and employees, while as foreign partner we take care of the system, advanced technology and quality management. Although there are some overlaps where compromise is needed, but the result is quite impressive. Undoubtedly the hybrid approach works better than either applying only eastern or only western management, it is simply the sum of strengths from both sides.
--MajdiAlhmah, General Manager at BFG International China
Are Chinese difficult to work with?
Good working relationship with clear defined re- quirement worked for me, there are huge cultural diferences and there are also regional and genera- tion diferences and you have to address all when building a team in China. I have seen many people fail as they fail to ensure the message they have relayed has been fully understood, even Chinese to Chinese have diicult so you have to be very clear and ensure that they repeat what has been request- ed and the timelines required. If you are clear hon- est, straightforward and willing to communicate at all levels respectfully you can achieve your goal. Chinese work best in teams and with a good leader.
--Gary Shatwell, CFOatGZ Industries Ltd
“No problem.”
Chinese people like to say “no problem.”Or something like“Yes, we can do everything.” It’s not about boasting. In Chinese philosophy, saying “no” is considered as impolite and they believe by say- ing something negative might make people feel embarrassed. If you want to make sure that your Chinese partner do understand you and will deliver the exact result as what you expect, it is always wise to make your requirements clear, and dwell on the important points.
