Business monthly January 07
 
EDITOR'S NOTE COVER STORY EXECUTIVE LIFE
VIEWPOINT IN PERSON SUBSCRIPTION FORM
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IN DEPTH CORPORATE CLINIC THE CHAMBER
 
  • The Chinese do not like to do business with strangers, and will make frequent use of go-betweens. As China modernizes, it should become easier for foreign businesspeople to contact a company or organization directly.
  • However, whenever possible, try to use established relationships or an intermediary known by both sides to make the first contact. When going in without an intermediary, it is very helpful to provide as much detailed information about your company as possible.
  • Also, be prepared for many sessions of warming up talks and information-scrutinizing meetings.
  • Chinese prefer to be formally introduced to someone new. This applies to both Chinese and foreigners.
  • The Chinese may seem unfriendly when being introduced. They are taught not to show excessive emotion, thus the reference to Chinese and other Asians as inscrutable.
  • On the other hand, do not be surprised if you are applauded. Be sure to applaud back.
  • Always stand up when being introduced and remain standing throughout the introductions.
  • When being introduced to Chinese, the accepted form of greeting is the handshake, even among Chinese. Chinese may also nod or slightly bow.
  • Unlike the Japanese, the Chinese bow from the shoulders rather than the waist.
  • Use both hands when presenting business cards and be sure the writing faces the person to whom you are presenting your card.
  • Cards should also be received with both hands. Do not immediately put the card in a pocket or bag – this is considered rude.
  • Follow with “I am pleased to meet you/how are you? – Ni hao in Chinese.
  • When seated, place cards on the table. This shows respect and is also an excellent way to remember names.
  • Never “deal out” your cards across the table like a game of cards – this is very rude.
  • Business cards should be printed in English on one side and Chinese on the other.
  • Use translations as short and easy as possible, omitting initials, which can cause confusion.
  • Be sure to use simplified Chinese characters for China, not the classical characters used in Hong Kong and Taiwan. If traveling to China and Taiwan or Hong Kong, it is a good idea to put the different cards in separate boxes to avoid mix-ups.
  • Make sure to put your highest business position and academic title on it. Remember, Chinese are very class and status conscious.
  • The Chinese will state their last name first, followed by the given name (may be one or two syllables). For example, Liu Jianguo, in Chinese would be Mr. Jianguo Liu using the western style.
  • Never call someone by only his or her last name. Unless specifically asked, do not call someone by his or her first name.
  • Addressing someone by his or her courtesy or professional title and last name conveys respect. In Chinese the name precedes the title. For example, Liu Xiansheng for Mr. Liu, and Liu Jingli for Manager Liu.
  • Women’s names cannot be distinguished from men’s names. Chinese women use their maiden names even after marriage, but may indicate marital status by using Mrs., Ms., Miss or Madam. Mrs. Wang might be married to Mr. Liu.
  • Courtesy titles for women include:
    • Taitai or Furen = Mrs. or Madam
    • Nushi = Ms.
    • Xiaojie = Miss
  • Foreign women may be addressed by using Miss plus the first name. Jane Smith may be Miss Jane.
  • Chinese who frequently deal with foreigners or travel abroad on business may adopt a western first name, such as David Liu. They may request that they be referred to as David, once a relationship has been established.
  • Do not use the term “comrade” in China.
  • Among themselves, Chinese often call each other “Lao” Li, or “Xiao” Li, in which Lao means senior or older and Xiao means young and junior. People are comfortable to relate to each other with the age factor spelt out in their addressing each other as their tradition stresses respect for the old and care for the young.
  • Among themselves, the Chinese may refer to foreigners as quei lou, lao wai, meaning “foreign devil” or “barbarian.” Do not take it personally. These expressions have been around for a long time and merely refer to all foreigners.
  • The Chinese have always considered China to be the “Middle Kingdom” and you are either Chinese or foreign.
  • Do not be surprised when asked personal questions regarding age, marital status, children, family, income, job, etc. This is done to seek common ground.
  • On the other hand, the Chinese will be uncomfortable with American familiarity, particularly early in a relationship. The arm around the shoulder or pat on the back with “just call me Bob” approach should be left at home.
  • Unlike the western custom, compliments are not graciously accepted with a “thank you,” but rather with “not at all” or “it was nothing.” Accepting and giving direct praise is considered poor etiquette. Do not be gushy with thank you’s.
  • A common Chinese phrase is nali, meaning “where.” However, the Chinese will use this expression to convey “not at all” or “it really isn’t anything.”
  • However, among the younger generation and those who often deal with foreigners, they often respond to compliments with a “thank you.”

  • The Chinese use silence very effectively. It can signify politeness by keeping quiet while the other party talks.
  • Silence in meetings and during discussions gives one the opportunity to carefully consider what is being said and formulate an appropriate response.
  • Silence is also used as a negotiating technique to gain time, to ferret out additional information, and to get the other side to offer concessions. Americans are typically uncomfortable and impatient with long periods of silence. Resist the urge to fill the silence and continue talking. Patience is indeed a virtue.
  • The Chinese concept of privacy differs significantly from that in the West, where people are used to having their own space, office, room. The Chinese are not accustomed to this luxury. Privacy to them relates to their own thoughts and emotions that they proudly keep to themselves.
  • Refusing requests and saying no can cause a loss of face and disrupt surface harmony.
  • The Chinese have many ways of indicating refusal without actually saying no.
  • Commonly you will hear “that would be inconvenient,” or “it will be taken under consideration” or “it is being discussed.”
  • Lying is considered less serious than a breach of surface harmony.
  • Sucking in air between clenched teeth is a sure sign of refusal or extreme frustration.
  • When departing, accompany guests beyond the door of the office or meeting room. Guests should be accompanied to the elevator.
  • The host will accompany a high-ranking guest all the way to the car, and wait until the car has departed before leaving. If you really can’t leave your office, be sure to apologize for not seeing the guest off. You may say “Bu yuan song le.”
  • Every culture defines proper distance. Westerners, particularly Americans, find that the Chinese comfort zone regarding distance is a bit too close for their comfort.
  • Instinctively Westerners may back up when others invade their space. Do not be surprised to find that the Chinese will simply step closer.
  • The Chinese do not like to be touched, particularly by strangers. Do not hug, back slap or put an arm around someone’s shoulder.
  • Do not be offended if you are pushed and shoved in a line. In some circumstances, the Chinese do not practice the art of lining up and courtesy to strangers in public places is not required.
  • People of the same sex may walk hand-in-hand as a gesture of friendship in China.

  • Western gestures that are taboo in China include:
    • Pointing the index finger; use the open hand instead.
    • Using the index finger to call someone; use the hand with fingers motioning downward as in waving
    • Do not snap fingers.
    • Do not put feet on a desk or coffee table. It is rude to show the soles of the shoes.
    • Whistling is considered rude.
    • Use both hands when handing someone an object, such as a teacup, a gift or a business card.
  • Western gestures that confuse:
    • Shrugging shoulders.
    • Winking.
    • The “OK” sign (Be cautions when using gestures – they don’t always translate across cultures).
  • Mutually-understood gestures:
    • Nodding the head up and down for agreement, side to side for disagreement.
    • Thumbs up indicating approval.
    • The smile.
    • Laughter. However, a note of caution: Although laughter is the response to something humorous, it can also mean someone is uncomfortable or in a situation where they do not know how to respond.
  • Chinese customs that are confusing to Westerners:
    • Waving the hand in front of the face to indicate “no”.
    • Pointing to the nose to indicate “oneself,” rather than to the chest.
  • Chinese customs that are annoying to Westerners:
    • Belching or spitting on the street.
    • Lack of consideration when smoking and failure to ask permission to smoke.
    • Staring at foreigners, particularly in remote areas.
    • Slurping food or making noises while eating.
    • Talking while eating.
  • Chinese meetings and get-togethers follow a rather strict protocol.
  • Before meetings are scheduled, proper introductions are needed as well as an exchange of detailed information and statement of purpose for the meeting.
  • The Chinese dislike surprises.
  • The Chinese do not like brainstorming meetings where new ideas are discussed and off-the-cuff decisions are required.
  • The leader of the group will act as the spokesperson for the group. Any differences of opinion among group members will be resolved privately before or after the meeting, never in public.
  • Because of the importance of the group and consensus, decisions are not usually made at the negotiating table.
  • Chinese gatherings and meetings begin with small talk. Resist the temptation to immediately “get down to business.” It is essential to build the relationship, and lay the foundation before business discussions begin.
  • Discussions are structured, with exchanges by the principals on both sides. Others in the meeting often just observe.
  • The host generally gives a short welcome after all the formalities are concluded.
  • The Chinese generally prefer to be in the position of reacting to ideas and requests, rather than acting and putting forth ideas and suggestions.
  • The Chinese will punctuate conversations with nods, sounds or expressions that indicate they have heard what was said. Do not automatically interpret these to mean agreement or acceptance.
  • It is important to understand who has the floor so as not to interrupt a speaker, which is considered rude. Acknowledge periods of silence and do not be eager to fill in the silence with conversation.
  • Meetings are more like “bowling” than “a tennis match.”
  • Meetings will almost always be held in rooms set up solely for this purpose. Rarely will the Chinese hold meetings in their offices.
  • Punctuality is extremely important. Do not arrive too early – the host will be caught off guard. If you have to be late, be sure to apologize.
  • Protocol begins when guests arrive. It is appropriate to greet guests and escort them to the meeting room.
  • It is important to have the right attendees for meetings, thus the Chinese desire to have guest lists, detailed information and meeting purpose clearly defined in advance.
  • Be sure the highest-ranking person enters the meeting room first, followed by the next ranking official and so on. Otherwise the Chinese may mistake the person entering first as the leader of the delegation. The only exception would be interpreters who need to stay with the leader of the group.

  • After everyone shakes hands, guests are seated.
  • The more formal the meeting, the more rigid the protocol. Guests are seated in descending rank with the interpreters seated behind.
  • The guest of honor and other VIPs are escorted to the seats of honor.
  • In rooms with seating around the perimeter, the honored guest is seated to the right of the host (on a sofa or chairs at the end of the room). Remaining guests are left to seat themselves. After all the guests have been seated, the remaining Chinese in the group will seat themselves.
  • When seated around large conference tables, the honored guest will be seated directly across from the host.

  • Entertaining guests at a Chinese banquet is a very popular and important way of establishing guanxi.
  • The same rules of etiquette apply to entertaining as for meetings regarding greeting guests and proper seating arrangements.
  • For more formal banquets, invitations will be sent and place cards will be at the table.
  • Guests should sample all of the dishes and leave something on the plate at the end of the meal. A clean plate indicates you are still hungry and it is the host’s responsibility to see that you are continually served food and drink.
  • Never place chopsticks standing up in the rice bowl. This symbolizes death. Always place on a chopsticks rest or horizontally on the side of a dish.
  • There are no firm rules regarding dinner conversation. Depending on the closeness of the relationship, business may or may not be discussed.
  • Drinking is an important part of Chinese entertaining and is considered a social lubricant. The drinking officially begins after the host offers a short toast.
  • It is always a good idea for the guest to return the toast either right away or after a few courses have been served.
  • Safe topics for toasts are friendship, pledges for cooperation, the desire to reciprocate the hospitality, and mutual benefit.
  • Remember that China is the People’s Republic of China and Taiwan is the Republic of China – this is a terrible gaffe.
  • The Chinese understand if you are unable to drink alcohol. You may use tea or a soft drink for the toast. Stating medical reasons is always a good way to get out of drinking alcohol.
  • The most common expression for toasting is “Gan bei,” meaning “dry cup,” or “bottoms up,” literally. Another expression, “Sui yi,” means “as you wish” or “at your own pace.” It is important to pace yourself throughout the evening. The Chinese are not as understanding of tipsy guests as are the Japanese or Koreans. If you feel you have had enough, smile and politely indicate this to your host.
  • It is not considered polite to pour your own drink. It is the responsibility of the host, not the waiter, to attend to the guests.
  • The host will see the guests to the door, although a member of the host group may see them to the car. The host will remain behind to pay the bill.
  • It is considered impolite to handle money in front of guests.
  • Tipping is not officially sanctioned in China and is still not common. Service staff in local restaurants, hotels and taxis do not expect tips. However, if you want to acknowledge special service or assistance, do it in private by slipping some money or a small gift to them.
  • Today in China, there are more opportunities for late-night entertainment. One of the most popular is karaoke, or singing.
  • Karaoke (pronounced ka ra OK, not kereoki) is the popular Japanese invention and means “empty orchestra” because singing is done to the accompaniment of music CDs and laser discs.
  • You are expected to participate but not expected to be a professional singer.
  • Do not underestimate the importance of participating in dining and after-dinner entertainment. It is an excellent way to build guanxi.
  • If invited by private individuals or organizations, try to reciprocate. The Chinese will always refuse your invitation for meals or drinks at the beginning but insist at least three times to show your sincerity.

  • A very important way of creating and building guanxi in China is through gifts.
  • Gifts are given for various reasons: gratitude and appreciation, gratuities, requests for favors, bribes or payoffs.
  • Gifts should be business, rather than personal, gifts.
  • Chinese etiquette requires that a person decline a gift, invitation and other offerings two or three times before accepting. It is expected that the giver will persist, gently, until the gift is accepted.
  • Be sensitive to genuine refusals. This can indicate an unwillingness to incur an obligation.
  • Chinese and Westerners differ in the approach to gifts. In the West, a sincere thank you or a thank you note is an acceptable way to extend appreciation. In China, a more tangible form, or gift, is preferred.
  • Be prepared to present a modest gift at the first meeting. Arriving without any gifts is not a good way to start building relationships.
  • Gifts of great value should not be given at the beginning of a relationship. It is only appropriate after business is concluded and even then should be done with caution.
  • Never give a gift that would make it impossible for the Chinese to reciprocate – this would cause a loss of face and place them in a very difficult position.
  • Gifts should be from your group to the Chinese group and presented by the group leader.
  • Gifts should be presented with both hands, and presented to the most senior member of the host group.
  • Gifts may be presented during your toast, or at the end of the banquet or meeting.
  • Small gifts may be placed for each individual at the banquet table.
  • Be sure to travel with enough gifts for everyone. If giving gifts to individuals in a company, be sure they are of equal value. Senior members should be given something of greater value.
  • The Chinese usually do not open gifts at the time they receive them.
  • When receiving gifts from the Chinese, do not open them unless they insist.
  • If you happen to be invited to a wedding, obtain a red envelope (hong bao) used for giving money. The amount given depends upon how well you know the person and the importance of the relationship.
  • Be sure not to give in denominations of four.
  • Don’t be surprised to receive a gift unwrapped. While the westernized Chinese normally wrap their gifts before presenting them to guests, many local Chinese still don’t have this habit of gift wrapping.

  • Gifts should reflect the giver and the recipient.
  • Consider gifts from your country, state or region.
  • Small items such as key chains, scarves, golf balls or calendars with a company logo are a good thing to take along.
  • Gifts with a company logo are of interest providing they do not include things that are considered taboo.
  • Gifts of foreign cigarettes, liquor such as cognac, brandy or fine whisky are acceptable. Table wine is gaining in popularity, and would be suitable if you come from a wine-producing region.
  • Other possibilities include: cigarette lighters, desk accessories, framed art, particularly if it is from your own area, and books.

  • Anything in sets of four.
  • Any gift which carries an association of death or funerals, such as clocks, cut flowers, white or black objects.
  • Do not give scissors or anything sharp as it symbolizes severing relations.
  • The Chinese do not particularly like dairy products such as cheese.
  • Be cautious when giving food items – it can suggest poverty.
  • Always wrap gifts, but do not use white or black paper – it symbolizes death.
  • Red and gold are the best. Avoid elaborately wrapping gifts.
  • Never write anything in red ink.

It is often said that imitation is the highest form of flattery. Taking time to learn something about Chinese culture and customs can only pay dividends.


Confucius, China’s greatest sage, established a system of ethics, morals, hierarchy and behavior, setting the rules for people dealing with other people, and establishing each person’s proper place in society.

THE FIVE MAJOR RELATIONSHIPS SET FORTH BY CONFUCIUS:

Ruler - Subject
Husband - Wife
Father - Son
Brother - Brother
Friend - Friend

  • Guanxi: Throughout much of Chinese history, the fundamental glue that has held society together is the concept of guanxi, relationships between people. Today this means who you know and what these people believe their obligations are to you. With a good network of contacts in China, almost anything can be accomplished. Guanxi is how things get done. The power of guanxi is one of the reasons given for why China does not have a reliable legal system.
  • Reciprocity: This refers to the exchanging of favors between individuals and groups. People will depend upon those with whom they have guanxi, and understand the need for returning favors.
  • Mianxi: Face – losing face, saving face and giving face – is very important and should be taken into consideration at all times. Loosing your temper, confronting someone, putting someone on the spot, arrogant behavior, or failing to accord proper respect can cause a loss of face.
  • Lijie and Surface Harmony: Originally li meant to sacrifice, but today it is translated as the art of being polite and courteous. Proper etiquette preserves harmony and face. Therefore, the true emotions of a person do not matter as long as surface harmony is maintained. For example, a public argument, or a boss reprimanding a staff member in front of others would disturb surface harmony and cause a loss of face. This is why the Chinese often use an intermediary to deliver bad news or unpleasant messages.
  • The most fundamental cultural difference between Chinese and Americans relates to the role of the individual. The Chinese place great importance on the group and consensus. There is no concept of equality in China – one’s status in society dictates how one treats others and is treated by others.
  • Keqi: Ke means guest and qi means behavior. It not only means considerate, polite and well mannered, but also represents humbleness and modesty. It is impolite to be arrogant and brag about oneself or one’s inner circle. The expression is most often used in the negative, as in “buyao keqi,” meaning “you shouldn’t be so kind and polite to me,” or “you’re welcome.”
  • Inner and Outer Circles: The rules of behavior set forth by Confucius apply to one’s inner circle, i.e. family, friends, colleagues and acquaintances. They do not, as a rule, apply to people outside the circle, i.e. strangers. It is not considered rude to bump into someone without offering an apology. The western concept of being kind to strangers seems strange to the Chinese. This also explains why there is no strong concept of philanthropy in China.

Reprinted with permission of www.culturalsavvy.com

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