CHINA
NEGOTIATION & DECISION-MAKING
 
 
 
 
 

NEGOTIATION

Negotiating
The most noticeable difference between the Western culture and the Chinese is in negotiations.  Quick decisions are alien to the Chinese.  They view quick decisions as a form of incompetence, which they can exploit when dealing with American's.  They prefer the slow and methodical approach.
When negotiating in China, it is imperative to realize their reverence for relationships and respect for others.  In order for foreigners to transact business in China they must invest considerable time and resources in developing the relationship.  Because the Chinese value relationships so heavily, American's are forced to make many trips to China prior to consummating a deal.  The Chinese are slow and methodical in their business dealings.  Additionally, the Chinese use this slow and tedious process to their advantage.  Research indicates that Chinese negotiators are greatly influenced by 3 cultural norms:  their innate politeness and emotional restraint; their emphasis on social obligations; and their belief in the interconnection of work, family, and friendship. 
Description Of Negotiator
A Chinese negotiator has the following traits:
  • Extremely respectful
  • Reverent belief in the Communist party, which pervades all decisions
  • Very quiet and thoughtful
  • Cautious about foreign input
  • Relies heavily on subjective feelings and personal experiences when making decisions
  • Avoids confrontation by not saying definitely no
  • Very private
  • Loyal to employer
   

 

DECISION-MAKING

Risk Tolerance
The Chinese are very risk averse, which stems from their fears of losing face.  This concept of face saving means everything to a Chinese person.  A poor decision could cause them to lose face amongst their peers, which would be devastating.  China tends to have strict procedures to which their people adhere closely, which is attributable to their strong nationalism.
Locus Of Control
Because the Chinese are slow and methodical with their decisions making process, they feel they have control over most outcomes.  It is only through a lengthy and arduous process that decisions are rendered. 
Autocratic Leadership vs. Participative Leadership
China's society is based on the superior making all of the decisions, because their value system presupposes the superior to be automatically the most wise.  This can be seen in the negotiation process where the Chinese workers rely on the leader's decision. 
Collectivist vs. Individualistic
Although China has autocratic leadership style, the society is highly collectivist.  This can be attributed to their cultural values whereby the Chinese worker's personal interest are subordinated by the greater goal of helping the group succeed.
Objective Approach vs. Subjective Approach
 The Chinese business's are more subjective in its approach, basing decisions on emotions.
Moral Idealism vs. Utilitarianism
Unlike their Western counterparts, the Chinese approach problems from a stand point of moral idealism; they consider the problems, alternatives and solutions from a long term social perspective as opposed to an individual perspective. 

 

Sources:  Deresky, Helen, International Management (Prentice Hall 2000) p190.
China Executive Planet, www.executiveplanet.com
China Hongkong Business, www.chinapoint.com/news/business/asia/china/culture/negotiating.htm