Global Business Basics -- Putting Your Best Foot Forward

Success in China is frequently elusive, but a few simple tips may help minimize missteps.

While Japan and other Asian nations remain mired in recession, the People's Republic of China continues to grow. Last year China's economy grew at nearly 8%, outperforming the United States and most of the developed world. Today, thousands of businesspeople visit China, trying to catch a piece of the action. However, for every foreign success story in China, there are a dozen failures. China is a highly competitive market. As a foreigner, the odds stacked against you. You cannot afford to make missteps, yet many U.S. executives do just that. What can you do to avoid sabotaging your efforts and to maximize your chances of success? Here is a short list of concerns to keep in mind. It is by no means exhaustive. Use the Right Language They speak Chinese in China, right? Yes . . . but there are several dialects of Chinese. In fact, some linguists classify such Chinese variants as Mandarin, Cantonese, Fujianese and Shanghainese as different languages. When spoken, most of these variants are not mutually intelligible. Mandarin Chinese is the official language of the People's Republic, but not all Chinese speak it. Mandarin is the form of Chinese spoken in northern China, which includes the capital of Beijing. As you travel south from Beijing, you are less likely to find Mandarin speakers. Before you travel, gain some idea of what languages your Chinese counterpart speaks. While many educated Chinese speak Mandarin -- or even some English -- you cannot count on this. Hiring an English-Mandarin interpreter will do you little good if everyone you want to talk to speaks Shanghainese, and the error will cause you to lose face. What about your written materials? As you may know, all spoken versions of Chinese can be written in the same ideographic script. Written down, these different versions become readable to all literate Chinese. It is important to remember, however, that the written form of Chinese used on the mainland represents a reformed version of the written language. Many complex symbols were simplified. Also, the direction of writing was standardized from left to right in columns arranged horizontally (just like in the United States). By contrast, the form of written Chinese used in Taiwan is the traditional, unsimplified form. Furthermore, Taiwan's Chinese is often written from right to left in vertical columns. It is important to use the correct written form of Chinese for your destination. Always use reformed Chinese in the People's Republic of China. Using old-style Taiwanese writing on the mainland is considered an insult as it implies that you support the Taiwan over the People's Republic. Build Up Your Guanxi The Chinese do business through connections -- what they call guanxi. These connections are people with whom they have established relationships. To be connected is not just a position of trust; it implies that people owe you favors. For this reason, gift-giving is important in China. Everyone is trying to place someone else in a position of obligation. Be prepared to give gifts, and be sure to wrap them first. It is insulting to give an unwrapped gift, and gifts are not opened in the presence of the giver. Gift-giving has been associated with bribery in China, so it is important that companies learn how to properly handle this part of the business ritual. Remember, you can help build your guanxi in ways other than gifts. Doing someone a favor can be just as valuable. Favors range from quick and simple (such as introducing people), to the difficult and complex (helping the child of a Chinese businessperson get into a U.S. university). Establishing your guanxi network is important. If you accomplish nothing else on your first trip to China, start working on this network. Wining And Dining Chinese hospitality demands that hosts offer food and drink to guests. Indeed, the phrase "Have you eaten rice yet?" is a common Chinese greeting. At most business meetings, small cups of hot tea will be offered. Even if you don't like Chinese green tea (served unsweetened and without milk), you should accept graciously. If you absolutely can't drink the tea, just bring the cup to your lips without drinking. By the way, those small teacups are sometimes used as a visual aid. During a negotiation, your Chinese host may use the cups to demonstrate how close you are to an agreement. He or she will widely separate the cups to show how far apart the two of you were at the beginning, then bring them closer to display how much progress has been made. At least once during a successful trip, your hosts will invite you to a formal banquet. This probably will last for several hours and involve many courses and include delicacies that some U.S. executives may find unappetizing. Nevertheless, it is important to try each course, even if it consists of thousand-year-old eggs. At the very least, pretend to eat -- refusing a course entirely can be taken as an insult. The only acceptable excuse for declining a food is medical restriction on your diet. Some Western-trained Chinese hosts may adjust the formal banquet, shortening it or substituting traditional courses for foods Westerners find palatable. But you cannot count on this. Remember, the banquet is part of doing business -- failure to participate may endanger your entire deal. Also, don't be surprised if tea and alcohol are the only drinks served. The Chinese traditionally do not drink water at meals. In fact, cold drinks are regarded as unhealthy when consumed with hot food. If you need large amounts of water, ask for a bottle of mineral water. Drinking large amounts of alcohol is expected at banquets. Fiery local spirits are downed from small cups, accompanied by toasts of gan bei, (dry your cup), or sui bian, (as you wish). Like the Japanese, your Chinese hosts feel that "the real you" will be revealed if they can get you slightly tipsy. If you don't want to drink, use a medical excuse. Say "My doctor forbids me to drink alcohol" and stick to it. This is a better excuse in China than saying you are a recovering alcoholic or that your religion prohibits alcohol, even if those happen to be true. You should also host a banquet at some point. If you are staying at a good hotel, the easiest way hold a banquet is to hold it at your hotel. Hosting a banquet is part of building up your guanxi. Take Your Time Time is not money in China . . . at least not to the extent it is in the United States. The Chinese boast the world's oldest civilization and taking the long view comes more naturally to them. Not only is trying to rush your Chinese counterparts ineffective, it will demonstrate that you need them more than they need you. To be successful, you must learn to operate on Chinese time. China's 1 billion consumers remain a huge temptation for U.S. businesses. Success in China is often elusive. Learn from the mistakes of the many U.S. executives who have come to China and left empty handed. Don't harbor unrealistic expectations; expect your China trip to be challenging. Like Westerners, the Chinese believe that adversity makes one stronger -- or, as they put it: Gems are polished by rubbing, just as men are made brilliant by trials. Wayne A. Conaway is the co-author of Kiss, Bow or Shake Hands: How to Do Business in 60 Countries and Dun & Bradstreet's Guide to Doing Business Around the World. He can be reached at 610-429-8910 or at [email protected].

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