Part II in a series of 3 blogs on doing business in China.
Trust is a fascinating concept in an international setting. Different cultures mean different things when they talk about ‘trusting each other’ (see ‘When Cultures Collide, by Lewis [Lewis 2006]). Many Western (Anglo-Saxon) cultures see trust as a sign of reliability: when you tell me to be here at 16 hrs, I can trust you when you really show up at that time. You are reliable, I can trust you. This is why many Western cultures have difficulty with countries where people are not punctual and have a different view of time: these people loose our trust (which by their definition of trust is very unfair).
Mediterranean, Latin American and many Middle Eastern countries see trust as a deeply personal thing: trust is something that can only be built up between two people. Trust relies on getting to know each other personally and feeling you can rely on that person to not do anything that will harm you. The third form of trust is the Asian form, where trust is something reciprocal: when there is trust, two parties will help each other in good and bad times, and they will return favors even when this extends over long periods of time. In these cultures, trust also is a deeply personal thing. The only reason for talking about ‘two parties’ is that the mutual obligations in a relationship of trust extend to the group: families or other collectives can take the role of meeting the social and personal obligations that belong to the trusting relationship.
This reciprocal form of trust is central to doing business in China.
Doing business in China is not easy. In the previous blog I already emphasized that Western logic will not be sufficient to understand everything that impacts your business. Hierarchy, company rules and government regulations can very well get in the way of doing business, and Western logic will not help you understand this. In China you will need the help of your Chinese friends to get over (or around) these barriers. That’s where your network comes in.
Networks are very important in China: the culture revolves around relationships, both between people and between groups. It is a personal network that people build up over a lifetime, and where complex relationships between people (elder vs. younger, teacher vs. student, manager vs. subordinate) get a meaning in daily life. Without help, it is quite impossible for foreigners to build up a meaningful network (‘guanxi’) and existing networks are difficult to enter fora n outsider without proper introductions by the right people. Networking in China is much more than shaking hands and linking with as many people as possible on LinkedIn. Instead, it is an art that the Chinese have mastered, and that they learn from their early days. In order to establish an adequate network and meet the right people, a local intermediary who knows the ins and outs of social intercourse and is well respected is very valuable. Coming to a fruitful cooperation is a long road and, to the Chinese, the road to get there is just as valuable as the results you accomplish.
So what can you do to build up or strengthen your network in China?
1. Ask locals
You will need the help from locals to connect to the right people. Locals have a feeling for relationships that Westerners simply do not have. Westerners have a tendency to think digital in terms of relations: you are connected to somebody or you are not. Chinese network are organic and very refined, and the complexity and subtlety of interpersonal relations in China cannot be mastered by people living there for a few years, and certainly not by occasional visitors. So ask locals to help you succeed in your mission.
2. Find out who is who
In meetings, you will generally find quite a large number of Chinese on the other side of the table. Make sure you know who is who, and what their relative positions are. Invest some time in doing so, ask for support and, if necessary, put your questions directly to the person with whom you have already established a relationship. If you do not invest this time, your business will fail: you need to know whom to address and who makes the final decisions. When you don’t know who are the people you deal with: ask!
3. Be patient
Things in China take time. With the Western focus on immediate success you will get disappointed. Chinese know that things take time, and hurrying the process will not work. Even stronger, it will be strongly disapproved by your Chinese partners when you try to rush thing through when they told you already it is difficult. The best you can do is get back to steps 1 and 2: connect, build up your network, and then go to 4: ask your network for help. In the meantime: be patient. Patience and modesty are virtues that the Chinese reslect, and mastering these skills will help you be accepted as a valuable partner.
4. Ask for help
Westerners are individualists: we take pride in realizing something that for others is hard to realize. Our carreer advances when we get things done individually. Realize that Chinese live and work in groups: to stand out as an individual is not appreciated. Therefore, take a modest approach, and frequently ask your Chinese partners for advice rather than being too vocal about your own opinion. Listening well to the advices you get is likely to boost your Chinese adventures. Chinese respect good listeners.
5. Come back and enjoy
The Chinese will need to see you frequently in order to consider you as “one of them”. Building relationships requires regular face-to-face meetings, and yes, this takes time and yes, this takes money. Investing this time and money is not a luxury: it is a necessity to be successful in China. Enjoy the time you invest in buiding relationships. Suppress your Western mindset that tells you that if a relationship s to be built, you’d better start now. Take the time, and have a drink and a dinner. Enjoying good restaurants and karaoke bars with your Chinese hosts will not only help your business adventures: it is fun as well!
And most of all, remember that the Chinese have different expectations about the trust you build up with them. Remember that for them, trust is reciprocal: being trusted involves doing favors for each other and expecting the other person to do favors for you as well. So when the Chinese come back on a contract that was already signed, they are not distrustful: on the opposite they ask for a favor as their business circumstances have changed, and they kindly ask a respected and trusted partner like you for help. Your (business) choice is to help or not.
Next week’s blog is part 3 of this series, and deals with the – often limited – mandate your Chinese business partners have when doing business with you.
[Lewis 2006] Lewis, R.D. (2006). When Cultures Collide. Leading Across Cultures. Nicolas Brealey International.