Leading Chinese CEOs talk about their business culture and what their UK counterparts need to know when it comes to doing business in China.
China offers many opportunities for companies looking for growth. One of the biggest challenges facing these businesses is how to adapt to the different business culture in China.
The following business insights reveal some of the differences between Eastern and Western management styles, and also how they might blend. They have been gleaned from our new book of interviews with leading Chinese chairmen, CEOs and company owners, The Thoughts of Chairmen Now. For more information, visit the official ‘Chairmen Now’ website.
Here are just five of the key issues highlighted in the book.
1. A new blend of East and West
‘Chairmen Now’ clearly shows that China’s senior executives are listening carefully to Western approaches and seeking to understand them better so they can blend them appropriately into the Chinese Way. This 'blending' and mixing of Western and Chinese management approaches offers an interesting approach: to take the 'best of the best' to meet the ever changing dynamics of the Chinese marketplace.
So how does this happen in practice? Liu Xunfeng, chairman of chemical giant, Shanghai Huayi, says: “I have many working partners from foreign capital investment enterprises, and we exchange tips and experiences with each other. We hold an annual half-day CEO round tables. We invite high-level management from foreign investment enterprises, such as BASF, BP and DuPont.”
2. Finding the middle way
When doing business in China, the business culture can be quite different. It is less about aggressively pushing for the best deal and more about seeking a win-win resolution for both sides.
Chairwoman Wang Xianrong (pictured), from C&D Corporation, says: "In the West, everything in business is black and white. But in China it is about balance. To find the middle way, to achieve balance, the win-win situation in everything we do… To succeed in China, Western people need to understand this approach. To draw back and be reflective before acting is not bad."
Wang Longchu, chairman of logistics company Xiamen Xiangyu Corporation, agrees: “It is very important to have balance between the head and the heart. Chinese business is about balance, much more so than I see in the West.”
3. Learning the art of patience
The Chinese are comfortable in the grey area, rather than the black and white, of business. Learning to navigate these circumstances takes willingness to be patient, observant and non-judgmental. Taking the time to understand the Chinese way can be rewarding both professionally and personally.
Alice Fan Yang, assistant president of the New China Asset Management Company, adds: “When you do business in Chinese society, you need to have a feeling for what’s unsaid between the lines… Western business people need to learn more about the Chinese culture and society; about how Chinese people think (because) business thinking is rooted deeply in Chinese culture.”
4. Breaking the culture of silence
One of the biggest challenges for senior Chinese managers is to create a communicative environment where people feel they can share their thoughts and ideas.
David Sun, CEO of Home Inns & Hotel Management Inc, says: "You never know what Chinese people are thinking. Sometimes Chinese people don't know what their colleagues are thinking!"
5. For the good of the many
China’s heritage and culture – including Buddhist and Confucian thinking – has an on-going major influence on Chinese management style. Consequently, businesses that are thinking of investing or doing business in China would be wise to review and consider the major philosophical beliefs underpinning Chinese society.
For example, Wang Longchu of Xiamen Xiangyu Corporation says: “We have learnt to be very resilient through our hard history. We want not only to win profits, but also do good things for China... The group is first and the individual is second."
So what does this mean for UK businesses?
Understanding Chinese culture and how to build relationships is key to succeeding in China. To achieve this, it is important to listen carefully with humility and patience. Observe how business is done by Chinese and how they build trusted relationships. Building deep personal relationships is the gateway to sustained business success. Flexibility is also vital.
If your business is already operating in China, breaking the culture of silence is important to ensure that your employees communicate and share their thoughts and ideas. It is essential that management creates a relaxed environment to encourage them to be proactive.
Remember that for Chinese people, giving back to society is fundamental and it's part of their corporate mission – it has a major influence on the way leaders run their businesses.
Chinese leaders are increasingly aware of the benefits of blending the best of Western and Eastern cultures. Western business leaders are advised to adopt the same approach to blending to get the best of both worlds when operating in China.
Get further insights from ‘Chairmen Now’
- Visit the website: TheThoughtsofChairmenNow.com.
- Get the ‘Chairman Now’ iPad app.
- Watch a video webinar with the authors rounding up the key insights.
For further information, contact the book’s co-author, Jon Geldart, Global Head of Marketing and Communications at Grant Thornton International, on Jonathan.Geldart@gti.gt.com.
Image of Chairwoman Wang Xianrong: © The Thoughts of Chairmen Now