Business Culture in the People’s Republic of China

To most Westerners, Asian culture is an enigma, and attempting to conduct business with Asian companies often feels like opening Pandora’s box. With its burgeoning economies and increasingly prominent and prestigious international status, however, doing business in Asia is a must for western businesses. Specifically, China’s astoundingly massive potential as both a consumer and a producer makes it one of the most desirable locations for doing business. Accordingly, since China’s Open and Reform Policy was instituted by second-generation communist leader Deng Xiaoping, American businessmen and women have been engaged in various and dynamic levels of business cooperation with local Chinese.

My own experience with Chinese business culture last summer (2009) was limited to my interaction with other businesses in Beijing. Our own company, Chin-EASE Corp, was dedicated to providing high-level logistical services to American executives and VIPs. Our primary competitors were companies and groups run by local Chinese. We therefore prided ourselves (and advertised) that each member of our company was a native English speaker—making it all the more convenient for the client to communicate intent, desire, confusion, etc. Though all the members of our organization spoke Chinese to some extent, our primary concern was the comfort and natural ease of our clients while in Beijing. Thus, my experience with Chinese business culture came from my position as a sort of go-between: translator, interpreter, tour guide, and travel companion.

Despite having no interaction with native Chinese within Chin-EASE Corp itself, my position allowed me to constantly interact with Chinese from other businesses and observe (to a limited extent) their internal and external cultural behavior. Among other things, I noticed two significant differences between congruent American and Chinese companies. The first (and most pronounced of the two) was the rigid Chinese tendency to refer to managers/directors/CEOs by their title rather than their name. The second (more subtle, yet still distinct) difference regards internal bureaucracy and decision-making.

For the Chinese, position is everything. Stemming from the Confucian emphasis on social order and proper respect for those in authority, the Chinese pay special attention to those whose official or vocational title is elevated in importance. I once had a Chinese friend tell me that most Chinese would prefer a more prestigious-sounding title to a raise or cash bonus. The reason? Within and without the company, individuals are very often introduced by their title or position, and being called by that title gives an individual a significant amount of face. For example, when I organized an event for the NBA (which had an envoy of players, coaches, trainers, staff, and family visiting for a “Basketball without Borders” campaign), I coordinated with a factory specializing in cloisonné to provide the NBA participants with an opportunity to purchase some traditional Chinese handicrafts. The managing director of sales, a Ms. Guo, referred to herself as “Director Guo” (or “郭经理”) whenever she addressed herself to me in emails, on the phone, or in person. Her staff, when they arrived at the hotel with her, also addressed her thus. Recognizing the importance of her title (both to her personally and in the eyes of her staff), I introduced her using the same title to our company’s CEO. Ms. Guo then introduced me by my title, “Director Burningham” (or “邵主任”). She and her staff seemed a bit amused when I told her that “Director” sounded too formal for my western ears and that they should all please call me by my given name, Ryan (or 邵康).

Perhaps titular importance stems from the inherent (and strict) Chinese adherence to bureaucracy and hierarchy within any given system. Generally, working with the Chinese was a pleasure, but when I needed a tough decision made, or when I needed to speak with someone on a sensitive subject, I was met with constant objections by staff on the lower end of the totem pole in other companies. Decisions could not be made without the direct consultation of the manager. Phone numbers could not be given out without direct consent from the manager. Mr. so-and-so was unavailable—or at least I was told he was unavailable until I managed to connect with his boss, who then immediately put me through.

One day I was particularly frustrated by this bit of business culture—the constant deferral to a figure of authority for matters of seemingly obvious natures or of even trivial importance. In organizing the aforementioned NBA event, I contacted a store that sold DVDs. I spoke to no fewer than four store “managers” (in succession, from one and then to another) before the “top manager” finally telephoned what he termed the “most top manager” and asked him for his opinion regarding whether their company should attend. The “most top manager” nearly shouted at the “top manager” for having made me wait so long (nearly forty minutes at this point), got on the phone with me, apologized for his employees’ apparent mental density, and asked if we could meet to discuss the details.

American businesspeople will undoubtedly encounter numerous confusing cultural differences between what they will assume to be generally congruent businesses. A little study and preparation goes a long way, but simply nothing can compare to having experienced doing business with the Chinese. When one becomes more accustomed to their particular quirks, the task actually becomes quite enjoyable—both for the American and his or her Chinese counterparts.

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2 comments

  1. interesting story! now i have to wonder why you didn’t call me director white when i was first training you… :/ it does not sound too formal for my ears!

  2. I agree with you, Ryan. You observed well and I like your conclusion. Doing business in China can be both incredibly frustrating and extreme fun at the same time!

    I lived and worked there for six years and came to appreciate the wisdom of the Yin-Yang symbol. Almost everything co-exists simultaneously with its opposite and could not exist without it.
    Regards
    Paul Howes

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