Business culture- China vs US
Presentation Outline
• Foundation of US ethics- basic discussion
• Comparison of Business culture-China vs
US
• Strategies and Managerial Implications
Cultural Foundation of American
Ethics
• Foundation based on Judeo-Christian and Western
socio-theological principles
• intrinsic underlying truth
• a sovereign moral authority--God
• God declines “right or wrong”
• Natural law -- “inalienable rights”
• life, liberty and pursuit of happiness
• Equality implies no prior claims against the rights
American ethics (continued)
• Limits on individual freedom are either
(1) voluntary
(2) lawfully imposed
• Results -- individualism and contract
• Individual’s right to choice is consistent with
market economy
• The functioning of a free market economy can be
described as “nexus of contracts”
• A business contract - spells out details of
relationships and is enforced by law if violated
Comparison of Business Culture:
China vs US
• Business culture - time-tested and
conventional practices
• China and US have a different business
culture -- result of different history and
practices
Notion of Harmony
China
• Everything is in
harmony
• Change is viewed as
disruptive
• Reason -- too many
people
US
• Efficiency and
effectiveness
• End result
• logical reasoning on
facts
• change to get desired
results
Importance of Relationship
• China
• 4 important social
groups: relatives,
schoolmates, personal
friends, and the
indirect relationship
from the 3
• Importance of
“guanxi” (connection)
• US
• constitutions guarantee
the rights
• a short history to
inherit traditions
• stress on individualism
for personal
achievement
Relationship (continued)
• Agricultural state
(small community
mentality)
• privacy is not highly
valued
• individualism is not
singled out
• “rule of man” over
“rule of law”
• Relatively few norms
• melting pot
• Increased tolerance on
diversity
• separate personal and
business relationship
• friendship can be
formed and dissolved
quickly
Subtlety and Explicitness
China
• Build on subtlety
• Language based on
abstraction of ideas
• Reduce confrontation
• Outspoken --not norm
(read the tea leaves-observe body, words,
tone)
• US
• Frank and open
Subtlety and Explicitness
(continued)
• Courtesy
(righteousness, ethics
and honor)-virtues
• Saving face
• Do not say “no” easily
• Hint to get help
• Self-control makes
people appear “shy”
Communication Style
China
• Silence for reflection
• Not to exaggerate
(implications on
marketing a product)
US
• uncomfortable with
gaps of silence
• Some American feel
ok to exaggerate
• fluency and gift of
gab--admirable
Communication-continued
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Non-linear thinking
pragmatic thinking
rare physical contact
no eye contact
“Yes” means “I am
listening” (not I
accept)
• Linear thinking
• pragmatic and look for
innovation
• normal touching
• eye contact is
important (implying I
have no harm)
• Hi- means friendly
Negotiation
• China
US
• contract is the end in
itself
• Americans think
Chinese use banquet
as the way to get
upper hand
• discuss openly costs
and benefits
Rule of Banquet
China
• Much attention to
eating and drinking
• Private rooms in
restaurant
• round table with
chopsticks
• Seats assigned
• Do not stretch arm for
food
US
• using club members
Taboos
• China
• Concerns with
numbers (symbol for
luck)
• Success factors:
fate, luck, fengshui,good deeds and
knowledge
US
• Hard work
Strategies of Resolving Conflict
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Avoiding
Forcing
Education and persuasion
Infiltration
Accommodation
Negotiation and compromise
Collaboration and problem solving