The Business Culture Gap Between China and the West is Growing

It’s the little differences. I mean, they got the same [stuff] over there that we got here, but it’s just…it’s just, there it’s a little different.” Vincent. Pulp Fiction. 1994

American cross-cultural managers are at the worst when they are trying to be their best. Americans still believe – honestly and generously – that the highest compliment they can pay someone from

Don’t ignore it in China just because you’ve seen it in America

another culture is to say, “you’re the same as us.”   Not only is this approach condescending and insulting, but it tends to lead to bad decision-making and unforeseen negative consequences – particularly in China.

A difference in degree can be a difference in kind
I recently had a familiar discussion with an American senior exec who has done business in major manufacturing centers around the world. We were talking about sources of conflict between US and Chinese negotiating teams, and she treated my concerns like a checklist. Relationships – yeah we got them too. Mianzi – yeah, respect matters here as well. Informal networks? They exist here also. Check. It took her about five minutes to reassure herself that bridging the China culture gap was simply a matter of vocabulary – and would not require any serious effort on her part.
It’s not that you can’t find similarities between structures in US and Chinese organizations – just as a scientist can find analogies between a dolphin’s flipper and a human hand.  But the proper business analysis focuses on the functional differences – not the superficial similarities.

Any cultural, managerial or business similarities are just coincidence.
I still cringe every time I hear the popular throw-away line, “more capitalists than the West – communism doesn’t exist anymore”. Yes they want to get paid and want to get rich. But that’s not what capitalism is, and it doesn’t put you on familiar ground. Americans tend to think that anyone seeking profit is playing on their home court. Chinese attitudes towards risk and partnership are completely unrelated to standard US managerial thinking – but when Chinese learn business English they simply pick up the phrases and concepts that we use.  It doesn’t mean they have decided to accept your approach. Chinese methods, regardless of what you may want to think, are not better or worse than ours – just different. We can work together if we try, but there has to be a discrete translation or accommodation step. American managers sow the seeds of failure when they convince themselves that they can skip that step, or worse – think the Chinese side is going to automatically accommodate the US team because that’s better for the Chinese. It isn’t – and they won’t.

They are different culture and they like it.
Americans think they are being politically correct and culturally sensitive by looking for similarities. To many Americans, the highest compliment that you can pay a Chinese person is to reassure him that he is basically the same as an American. In the mid 2000s it was common for American execs in Shanghai and Shenzhen to talk about the “end of the guanxi system” in China.  As it turned out, Western managers might come and go, but Chinese institutions like guanxi networks grow stronger and stronger. The better China does, the more it reinforces the notion that traditional systems are valid and effective. That’s why the cultural gap between China and the West is growing – not receding.

Inferred similarities lead to superficial agreement
American managers who ignored cultural differences between US and Chinese management practices are the ones that made rapid progress in the early stages of their China partnerships but hit a dead ends later. Or put another way – they were great at signing meaningless contracts and moving money, assets and technology into China, but found it impossible to run a business or make a profit. If you bulldoze Chinese culture, you’ll find it easy to spend – difficult to earn. 

Americans approach the China market looking for similarities. This isn’t a problem if you use similarities for exploring and understanding cross culture communication issues and challenges, but it’s a huge pitfall if you are declaring “mission accomplished”.

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