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Business through the lens of Chinese history
China’s heritage has much to bear on its business customs. Understanding that in the West is critical to building trust, says Tammy Erickson
Every executive who has worked in multiple cultures will have noticed the differences between them. These differences could be as simple as the amount of time typically spent in a discussion before arriving at a decision, to far more complex differences, for example, regarding the relationship between individual companies and government policies.
Unfortunately, in many instances, it’s often an easy step from finding the other’s way different to concluding that they are somehow wrong or unfair.
Nowhere is the dichotomy greater than in the assumptions made by business leaders from Western democracies and China about the actions of the other. Rarely has there been a greater need for understanding between China and the West.
Today, as Western businesses work to succeed in China while Chinese companies seek to grow in global markets, it is understandable that leaders from both are increasingly unnerved by behaviours that, at best, they don’t recognise – or at worst perceive to be threatening or hostile.
Understanding how business customs have developed in the different regions could hold the key to successful China-West relationships in the future. The history and development of financial and governmental institutions in each region provide insight into the traditions and business practices considered normal and acceptable in each culture.
One of the most fundamental differences between China and the West stems from a bottom-line business question: what’s my source of capital? Answers to this simple question shape assumptions about where one owes loyalties and the obligations and relationship (or lack thereof) between the business and the community.
