1. The Chinese Business Puzzle Summary
Chapter 1 – Business Environment Chapter 4 – Exchanging Gifts and Favours
This Chapter presents an overview of the relevant back- This Chapter details the protocol for exchanging gifts
ground to the business environment in which foreigners and favours between the Chinese and foreigners
may expect and be expected to work with the Chinese,
whether at home or in China, under four headings: Correct observance is based the underpinning influ-
ences and behaviours described in previous chapters,
n The logical starting point is the philosophical envi- and primarily generosity, as commended by Confucius
ronment of Confucianism - which, albeit out of fa-
Generosity takes many forms, of which two of the most
vour at present, has so permeated Chinese life for
obvious and tangible are: giving presents and doing fa-
the last 2,500 years that its effect is subconsciously
vours – or rather exchanging the same, following Confu-
all-present, including in business
cius’ Golden Rule of reciprocity and in the spirit of the
o Next is the political environment that has margin- Chinese proverb that: “courtesy demands reciprocity”
alised Confucianism to dominate China since 1949:
Moreover, it is not the gift that counts, but the act of giv-
Communism - which has evolved into “socialism
ing, according to the Chinese saying that: “the gift is
with Chinese characteristics”
nothing much, but it’s the thought that counts”
p Integral to her political environment is China’s eco-
Business is no exception: hence, an integral part of the
nomic environment - where “socialism with Chi-
Chinese business scene (at home and abroad) is ex-
nese characteristics” translates into a “market
changing gifts for the purpose of building “guanxi” (re-
economy with Chinese characteristics” and di-
lationships) - for which reason: giving gifts is not a “one-
rectly impacts on the opportunities for foreign busi-
off”, but should be repeated from time to time
ness
q Last but not least is the legal environment - that Chapter 5 – Negotiating Techniques
legislates how business should operate within the
preceding three environments
This Chapter:
Chapter 2 – Social Environment ¾ outlines the protocol and suggests tactics for nego-
tiations between the Chinese and foreigners - the
correct observance of which should improve the
This Chapter presents an overview of the relevant back- chances of the latter securing a successful outcome
ground to the social environment in which foreigners
may expect and be expected to work with the Chinese, ¾ assumes a basic knowledge and understanding of
whether at home or in China, under three headings: negotiating techniques in general, onto which such
n
specific protocol and tactics may be grafted
¾
First: the relevant aspects of her geography and
history that have moulded China’s cultural heri- concentrates, therefore, purely on the aspects pe-
tage culiar to China
o Then: the domestic environment in which the Chi-
Whilst the degree of formality may vary - according to
the nature and importance of the occasion and relation-
nese of today have been brought up
ship between the individuals involved - the underpinning
p Finally: the relationship that, consequently, the Chi- influences, behaviours and protocols are the same
nese enjoy with foreigners
Of these, the key is “guanxi” - since the Chinese may
set greater store by building a working relationship with
Chapter 3 – Underpinning Behaviours you than crossing every “T” and dotting every “I” of an
agreement. For the Chinese, personal trust is more im-
portant than paper-based contractual terms
This Chapter introduces the relevant behaviours that
underpin the business dealings of the Chinese as a con-
sequence of their Business and Social Environments Chapter 6 – Business Meetings
Although many Chinese are prepared to forgive your
lack of expertise - especially the younger and better- This Chapter details the protocol for business meetings
educated ones who may have travelled overseas and between the Chinese and foreigners - the correct obser-
hence understand what it is like to be on the “other side vance of which should improve the chances of the latter
of the fence” - there are those who still lay great store on securing a useful meeting and successful outcome
adherence to the rituals of gentlemanly politeness that
Whilst the degree of formality may vary - according to
distinguish the Confucian “Superior Man”; and for whom
the nature and importance of the occasion and relation-
outward form may be more important than inward motive
ship between the individuals involved - the underpinning
Hence the reason for devoting so much space in this
influences, behaviours and protocols are the same
and subsequent Chapters to the correct observance of
Chinese business etiquette
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2. The Chinese Business Puzzle Summary
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Chapter 7 – Business Entertaining Chapter 9 – Market Entry Strategies
This Chapter details the protocol for business entertain- This Chapter:
ing in general, and banquets in particular, between the
¾ briefly suggests various strategies for foreign busi-
Chinese and foreigners - the correct observance of
nesses still thinking or in the process of trying to en-
which should help build “guanxi”
ter the Chinese market
Whilst the degree of formality may vary - according to ¾ assumes a basic knowledge and understanding of
the nature and importance of the occasion, and the the underlying business principles - such as: gov-
number of and the relationship between the people in- ernment relations, marketing, sponsorship, strategic
volved – the underpinning influences, behaviours and thinking, JVs, due diligence etc.
protocols are the same, and primarily generosity
¾ concentrates, therefore, purely on the aspects pe-
Generosity takes many forms: one of the most obvious culiar to China
and tangible of which is entertaining
The suggested strategies include:
Business is no exception: hence, an integral part of the
Chinese business scene (at home and abroad) is enter- Political Profiling
taining, which normally takes the form of a banquet that Be recognised by the Chinese and your governments
gives the host an opportunity to exercise generosity and and regulatory authorities as meeting the legal re-
demonstrate prosperity by offering a wide range of quirements for an operating licence, and having the
dishes served successively – to the extent of purposely technical competence to operate a business, in China
over-ordering
Relationship Management
The common purpose is to build “guanxi”, for which
Sign a joint venture agreement with an acceptable
reason: constantly hosting and attending banquets is a
Chinese business partner
regular feature of doing business with the Chinese
Marketeering
Chapter 8 – Handling the Media Be ready to operate in any market likely to be open to
foreign companies in the short to medium term and
offering long-term profitable growth
This Chapter:
Human Resource Management
¾ outlines the protocol for handling the media in Have an occupationally competent local work force
China - the incorrect observance of which may eas-
ily spell disaster, even if proper adherence might not
necessarily have any beneficial impact Chapter 10 – Human Resource Management
¾ assumes a basic knowledge and understanding of
public relations in general, onto which such specific This Chapter examines the more important, but not all,
protocol may be grafted Human Resource issues facing foreigners who manage
¾ concentrates, therefore, purely on the aspects pe- or have management control over Chinese employees in
culiar to China a foreign-owned or foreign-invested company, respec-
tively, in China
Whilst the degree of formality may vary - according to
the nature and importance of the occasion, and the All the underpinning influences, protocols and behav-
number of and the relationship between the people in- iours have already been addressed in previous Chapters
volved – the underpinning behaviours and protocols are and many illustrated with examples and/or case studies
the same centred on those issues
The common purpose is the same as elsewhere, This Chapter, therefore, complements and expands on
namely: public relations, rather than and as distinct those examples and/or case studies – the majority of
from advertising – that is: to build and enhance market which are drawn from Chapter 3, as indicated above,
profile, presence and reputation and mainly fall into the two categories of “face” and
hierarchism – rather than repeat what has gone before
After all: why should the Chinese do business with
Western “foreign devils” unless we can win them over? The Chapter also:
assumes a basic knowledge and understanding of
To that end, we should clearly, appropriately and publicly
communicate to the Chinese people via the press and Human Resource Management best practice – for
media the same messages as we do privately to their example: as espoused in the UK by “Investors in
leaders at meetings and banquets People” or the Chartered Institute of Personnel and
Development (of which the author is a Chartered
Fellow)
concentrates, therefore, purely on the aspects pe-
culiar to China
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