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Chinese style

Last Man Standing Part 3: POV Counts.

POV counts. Chinese have opinions too.

In US China negotiation, POV changes everything.
POV changes everything in negotiation

Some westerners are pushing back against the idea that we are facing the risk of rising trade barriers or a breakdown in orderly trade regimes. Their logic is that, “The US has a lot of levers, and we can assert our rights without necessarily sparking a trade war that the Trump Administration doesn’t want.” Not wrong, but it makes the dangerous assumption that trade relations are going to be something Washington stays in control of.

Trade frictions almost always take on a life of their own due to a single inconvenient point: Both sides in a dispute get an opinion. If you don’t know the other guy’s point of view (POV) then you have absolutely no control over the final result.

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Microsoft Fails by Trying to Coast on Past Successes in China

Relationship Building Not a One-Off Activity in China

10 China Negotiating Mistakes - Buy the eBook on Kindle
Learn from the expensive mistakes of expats who have come before you.

In ChinaSolved’s latest book, “10 Common China Negotiating Mistakes”, 3 on the least wanted is “coasting on good starts and early successes”.  While this is one of the biggest dangers that deep-pocketed MNCs (and their representatives” face in a long-term China business, it can be very hard to anticipate.  Fortunately for us (but unfortunately for them), Microsoft provides a telling case study of how the best efforts don’t always yield successful outcomes.

At the end of May, 2014, the Chinese government’s procurement office announced a ban on MS Windows 8 – the latest generation of the Redmond giant’s operating system and greatest hope of making the leap to touch-screen tablets and mobile devices.

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Doing Business in China: Negotiate the Relationship From the Start

Negotiating in China means talking about the relationship. (Sorry guys.)

Western businesspeople already know that to do business in China you have to have a relationship. This is the whole basis of guanxi and harmony. The problem is the way Americans and Chinese view relationship. To us Westerners, “relationships” are emotional – they are a matter of personal chemistry. We hear the word relationship and we think of family, romance, marriage, and friendship. In China relationships are regarded differently. They are more like a due diligence investigation – and you definitely have to negotiate for access and openness.

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Negotiating with (Reluctantly) First-World Chinese Managers (Part 2)

How to do business with Chinese managers who are still in denial about their changing role in the world.

10 China Negotiating Mistakes - Buy the eBook on Kindle
Learn from the expensive mistakes of expat negotiators who have come before you…

Forget the Financial Times headlines about China’s rising international clout, and super-lux marketing campaigns targeting elite buyers in Beijing and Shanghai.  Chinese media is still carrying the Party line about China as the struggling developing market – and your Chinese negotiating counterparty believes it to some degree.  When approaching a Chinese negotiation, you have to take into account the conflicting roles that Chinese managers are grappling with.  On the one hand they are brought up to see the Chinese Nation as  perennial victim of foreign aggression, but they are also confident about their growing economic power.

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Chinese Negotiating Agendas Stated vs. Real (Part 3)

Uncovering the Chinese side’s true agenda. Method 2: Learn to the Lies

Some readers responded to our suggestion that western negotiators should ask direct Sign up for the ChinaSolved newsletterquestions to uncover their Chinese counter-party’s real agendas  with skepticism. Won’t aggressive and competitive negotiators simply lie? Yes, some certainly will (and as some people pointed out, that is by no means a purely Chinese phenomenon – but since we are concerned with Chinese negotiation tactics, that’s where we will focus).

If you feel your Chinese counter-party is deceiving you, your next task is to answer these questions:

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Chinese Negotiating Agendas – Stated vs. Real

To negotiate successfully in China, you have to figure out what their true motivations and goals are.  That’s not always easy.

What do Chinese negotiators want?

Sign up for the ChinaSolved newsletterChinese negotiators usually have two sets of negotiating agendas and motivations. One you see – one you don’t.   The one you see is probably very closely aligned with your own deal points and negotiating goals.  In many cases, novice western negotiators are pleasantly surprised to hear that the Chinese side’s negotiating agenda is so close to their own that it seems to be rephrasing of their introductory email.  It very well may be.

The Chinese agenda you don’t see is usually some combination of technology or other IP, financial assets, or markets.  In the old days it was always money, and then for a while technology was the most important thing. But now it’s a combination of technology and your client list. As the Chinese expand overseas you will still hear a lot of talk about branding and marketing tie ups, but what they really want is overseas real estate, businesses, farms, or other real assets – and client lists. They can buy the real estate but they’ll have to get the client list from you.

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Budgeting For Chinese Negotiations

Treat your China negotiation as a discrete operation with its own timetable, budget and manpower plan. Americans view negotiations as a hurdle they must cross in order to get to the business – Chinese feel that negotiating IS the business, and it doesn’t end as long as the relationship continues.