Culture Briefing

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Understand the Culture, Get the Business

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How to get started Congratulations! Whether you are traveling to China on business, or simply want to learn more about one of the worlds most exotic cultures, you have already taken an important step toward having a more successful and fulfilling trip by accessing important information about Chinese cultural behavior, contained in your Culture Briefing China. Here you can find not only information about everything from the correct way to greet someone to successful business negotiating techniques with the Chinese, but also a better understanding of what makes the extraordinary Chinese tick: their underlying values and belief systems which drive the sometimes exquisite, sometimes challenging, behaviors that they present to us when we visit China. You might be reading this in preparation for your trip, perhaps just before going to sleep, just before packing, or while on the plane. Wherever you are, and whatever stage of your travels you are at, Culture Briefing China is filled with practical and immediately usable tips for getting the most out of your trip to The Middle Kingdom. Other travel briefings can tell you where to go and what to see, but you already know that. Your Culture Briefing China will tell you how to get along. Lets start with some general information on culture. What it is and where its implications can be found. Then well continue with some background information on the Chinese: the people, after all, who live in China, whom you will be dealing with, who make China all that it is. After this well look at important business protocols that will give you that critical edge when working in China, and your final social etiquette section will review all you need to know about socializing, visiting and traveling successfully through China. Introduction to Culture Intercultural management is about the management of paradoxes, of ambivalences and ambiguities. It is also about accommodating a range of structural and behavioural dimensions that address different facets of (organizational) functioning. Intercultural management is expensive (in money and/or time), but also yields a high return on investment (in money and/or time). The demands on managers on all levels in multi-national organizations are constantly increasing. It seems like they need to be a jack of all trades, with the chance they turn out to be a master of none. I define managers as anyone who operates in an organization, and for the specific purpose of this culture briefing, an international organization. Anyone who operates in an organization? Yes. Because you might be an individual who manages people, but very often employees need to somehow, at some level, manage their boss, colleagues and others. Managers in international organizations need to have a strategic view and insight, able to translate this to tactics and operational actions. They need to be able to work as an individual, but also be a team player. And when they manage people, there must be personal tact and people skills present.
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All in all modern managers are supposed to be the jack of all trades. When working in an international environment there is an intercultural aspect on all of the above mentioned management aspects (strategic view, tactics, team work, people skills). The ones mentioned are only a view. There are many more. On the subject of intercultural management, many books have been written. Almost all of them are based on the original research work from the 1960s of Geert Hofstede. Further developed by many to give their own view of how national culture should be interpreted (e.g. Trompenaars). For the purpose of this book I will make use of the work of professor Hofstede. On the subject of management, how-to manage, what to do under what circumstances, and management techniques also many books have been written. Management books come dominantly from the Anglo-Saxon business world. Management gurus like Kotler, Porter, Peters, Senge, are all North-American. Most academic books used at business schools and universities are originally written in English. Mainly because this is the native tongue of the writers. Being born, raised, and educated in a specific environment (AngloSaxon in this case) brings with it a culturally biased view on life, society and how business and management is or should be done. To give a parallel example: history is not culturally neutral. Each country (re)writes its own history in its own way. Not per se how it really is. Books on cultural management cover how to manage different cultures. Most books on the issue of culture only describe cultures! Books on the issue of management techniques tell you how to manage. Most often written for (but not necessarily only aimed at) the Anglo-Saxon world. The combination of management techniques AND cultural management is rarely made. Only Mintzberg has made certain distinctions between organizational models and their workability in different cultures. International business views culture from the perspective of an environment that faces an organization. Intercultural management views culture both within the organization and externally on that organization. For international business, culture and its consequences make up only one dimension of the many dimensions that are stressed. The other dimensions international business specifically examines include the external political environment, the external legal environment, the external economic environment, governmental influences, world financial institutions, and strategic management of various functional systems. Culture first As described in the introduction section the cultural model of professor Geert Hofstede will be used to describe and quantify cultural differences. Most international orientated people (including managers) speak a decent level of English. English is the business language of the world. Although speaking the same language and coming from different cultures is clearly not a guarantee for effective
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cooperation. As was stated by Bill Snyder in Stanford Business, their on-line business publication: Although English is the official language of HPs standards group, not every non-native English-speaking employee finds it easy to communicate in a meeting, especially during a teleconference. As a result, those employees tend to be quiet, and the company loses the chance to benefit from their ideas. Now, what is culture? Historically the word derives from the Latin word colere, which could be translated as to build, to care for, to plant or to cultivate. Thus culture usually referred to something that is derived from, or created by the intervention of humans culture is cultivated. With this definition in mind, the word culture is often used to describe something refined, especially high culture, or describing the concept of selected, valuable and cultivated artefacts of a society. On a more basic level, culture has been used to describe the modus operandi of a group of people, such as implied by organizational culture. This concept of culture implies not only the shared modus operandi but also the shared values that underpin the modus operandi. Many books on culture have been written, many definitions are there. For this book, the following is used: Culture is the collective programming of the human mind which distinguishes the members of one group (a number of people in contact with each other) or category (people who, without necessarily having contact, have something in common). Culture is learned, it is not inherited. It stems from ones social environment, not from ones genes. Culture should be distinguished from human nature on one side, and from an individuals personality on the other. Although exactly where the borders lie between human nature and culture and personality, is a matter of discussion among social scientists. The learning of our culture starts with all of us as babies. Who ever raises us, is programming us. In other words, telling us what is right, what is wrong. Or good and bad; beautiful, ugly, etc. And all the shades of grey within these dichotomies. From there we move on to school, where the next wave of influence is the teaching environment, and not only the teachers and professors. This process goes on and on till we ourselves have offsprings whereby we act as the culture teachers. Quite often we find it difficult to describe or verbalize our own cultural values. Were able to indicate that we want something a certain way (e.g. how a meeting should be run) but we are often not quite capable describing why we want it like that. The different layers of culture As indicated above, culture consists of various levels. At the most rudimentary level, culture consists of two levels: a level of values, or an invisible level, and a visible level of resultant behaviour or artefacts of some form. This view of culture is embodied in the
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popular iceberg model of culture. The multilevel nature of culture is important because of several aspects: It identifies a visible area as well as an area that is not immediately visible, but that can be derived by careful attention to the visible elements of the cultural system as we understand it. However, regarding culture as merely a two-level system seems to be too rudimentary for a meaningful model of culture. Hofstede proposes a set of four layers, each of which encompasses the lower level, as it depends on the lower level, or is a result of the lower level. In his view, culture is like an onion: a system that can be peeled, layer by layer, in order to reveal the content. At the core of Hofstede's model of culture are values, or in his words: broad tendencies to prefer certain states of affairs over others. These values form the most hidden layer of culture. Values as such represent the ideas that people have about how things ought to be. As such, Hofstede also emphasizes the assumption that values are strongly influencing behaviour. Above the values, Hofstede describes three levels of culture that are more clearly observable: Rituals, such as ways of greeting and paying respect Heroes, such as admired persons who serve as an example for behaviour Symbols, such as words, colour or other artefacts that carry a special meaning In Hofstedes model practices, a set of visible practices that carry an invisible cultural meaning extends across all the three outer layers and includes these. The concept of practices is however somewhat confusing as it seems connected to some extend to rituals and symbols, yet distinct from these. In practice, Hofstedes model represents an extension of the previously discussed two-layered model of culture, where the outer layer has been extended to allow for a more refined analysis of the visible results of cultural values. A handle on culture The lack of precision, and the lack of a universally applicable framework for classifying cultural patterns, has been addressed by a number of researchers. The most famous and most often cited work in this area is (again) the research by the Dutch organizational anthropologist professor Geert Hofstede. Hofstede derived his culture dimensions from examining work-related values in employees of IBM during the 1970s. In his original work he divides culture into four dimensions at culture-level: 1. 2. 3. 4. Power distance Individualism /collectivism Masculinity/femininity Uncertainty avoidance 5

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Power distance is defined by professor Geert Hofstede as "the extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally. The power distance concept is clearly more farreaching than the work place alone. Power distance is often reflected in the hierarchical organization of companies, the respect that is expected to be shown by the student towards her or his teacher, the political forms of decentralization and centralization, by the belief in society that inequalities among people should be minimized, or that they are expected and desired. The second dimension proposed by Hofstede is Individualism/Collectivism. The concept is one of the most frequently discussed and researched concepts. Hofstede defines this dimension as: "individualism pertains to societies in which the ties between individuals are loose: everyone is expected to look after himself or herself and his or her immediate family. Collectivism as its opposite pertains to societies in which people from birth onwards are integrated into strong, cohesive in-groups, which throughout peoples lifetime continue to protect them in exchange for unquestioning loyalty." This concept is the most popular among the Hofstede dimensions. It is frequently cited in a variety of intercultural research, as Hofstede points out, sometimes confusingly and confused with other dimensions. It may not be extremely surprising that this dimension is popular: It is the dimension that is most easily grasped and frequently encountered when looking at other cultural behavioural patterns.

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The work of Hofstede is probably the most popular work in the arena of culture research. Although the work provides a relatively general framework for analysis, the framework can be applied easily to many everyday intercultural encounters. It is particularly useful, as it reduces the complexities of culture and its interactions into five relatively easily understood cultural dimensions. Besides the work of Hofstede there are several other models available. Most of these models are based on or inspired by the work of Hofstede. For the sake of simplicity and practicality we have opted to use only one model (this one). A model is only a model, a psychological construct to reduce reality in something simpler, something measurable and something to work with. Converging versus diverging values Frequently we are asked whether the world of values is converging or diverging over time. If we reflect on political developments, we might conclude from the behaviour of the Basks in Spain, the Catholics in Northern Ireland and the Albanians in Kosovo or the Moluccans in Indonesia that cultures have an irresistible urge to diverge from each other. 6

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Divergence and convergence, are they mutually exclusive? Not necessarily. If a culture wants to create wealth, a certain divergence of values will simultaneously demand a convergent system of orientations and vice versa. This is happening in Europe. Convergence in Europe leads for example to countervailing separatism in the UK and Norway or Danish Euro-scepticism. You can observe the growth of a need for national identity as a response to cross-border influences. You can only diverge when you have something that holds you back to convergence. At times equality is mistakenly taken for similarity. North Americans have a typically protestant urge to codify, standardize and universalize. Asians and Europeans are more attracted to differences, diversity in the broad sense of the word. Clustering Cultures Clustering cultures serves the purpose of keeping an overview and a certain level of simplicity within the large array of individual countries, and their respective differences and unique characteristics. If there would be something like the man on the moon, we humans, would all look as one single culture. Zooming in slowly would actually show that indeed there are many differences. However for most Europeans an American is an American whether he is from the east coast or the west coast. The same is true vice versa. Often Americans go on holiday to Europe not to a specific country or city. They often see the continent of Europe as one culture. Westerners often see Asians as one culture. All of these are of course generalizations. While most scholars and residents of the nations in these country clusters recognize that there is considerably variability within each one, they provide a workable framework of what to expect in a given part of the world if you are not from that world. Simcha Ronen and Oded Shenkar developed a set of country clusters from a variety of culture research projects conducted through the early 1980s. Hofstedes project was important among these. 1=low 6=high Nordic Germanic Anglo Power Distance Individualism/ Collectivism Uncertainty Avoidance Masculine / Feminine

2 2 2

5 4 6

1 5 2

1 5 5

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Latin Eur. Latin Am. Far East Africa Japan

4 5 6 5 3

5 1 2 2 3

6 5 3 5 6

3 4 4 4 6

Countries in each cluster In the following list not all countries of the world are literally mentioned. The idea about clustering cultures is to give you, the reader, a general idea of cultural regions in the world. Below you will see a summary of those regions, followed by a brief description of each in terms of cultural values, and more specific in terms of business characteristics stemming from those values. Nordic: Finland, Norway, Denmark, Sweden, the Netherlands, Iceland. Germanic: Austria, Germany, Switzerland (German speaking), Hungary. Anglo: United States, Australia, Canada, New Zealand, United Kingdom, Ireland, South Africa (British educated). Latin European: Portugal, Spain, Italy, Belgium, France, Switzerland (French & Italian speaking). Latin American: Colombia, Peru, Mexico, Chile, Venezuela, Argentina, Brazil, middle America (but also Russia, Turkey, Greece, Bulgaria, Romania).

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Scores for China and its implications: Power distance score: 80 Implications: In high power distance countries and organizations, people don't question the decisions of their leaders. Leader/subordinate relationships are not close and leaders are expected to earn more money and respect. Subordinates expect to have their jobs
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and responsibilities dictated to them, and in some cases, will not articulate disagreement with authority for fear of the consequences for stirring up conflict. Strong Hierarchy: Authority are facts of life Class structures; Everyone has a specific place Those in power emphasize position Respect for authority Centralized authority Obedience to authority (parent, boss, officials) is expected Language filled with power or hierarchy indicators Managers / teachers tend to be autocratic while subordinates expect direct supervision. Low Business Implications of Hierarchy High (China=80) Less Flatter Smaller Fewer Consultative Same Status Centralization Structures Wage Differences Status Symbols Management style Manual vs. Clerical More Taller Greater More Paternalistic White Collar

Individualism score: 20 Implications: This dimension focuses on relationship between the individual and the group. Highly Individualistic cultures believe the individual is the most important unit. They encourage: People taking care of themselves Making decisions based on individual needs "I" mentality Highly collectivistic cultures believe group is most important unit (=China). They encourage: Primary loyalty to group (nuclear family, extended family, caste, organization) Decision-making based on what is best for the group.
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Dependence on organization and institutions (Expectation that organization / institution / group will take care of individual) "We" mentality

We oriented (China=20) Organization Group success relationships Relationship Face, Harmony Suppression Career responsibility Motivation Policies, practices Priority Communications Conflict

I oriented

Individual Self-actualization Apply equal to all Task Open, direct Confrontation

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KEYWORDS: Collectivism, Indirect, Loyal, Hierarchy, Indirect, Entrepreneurial

Social Interaction Meeting and Greeting Chinese tend to be quite formal and they tend to use last names. Particularly in formal situations (although the name protocol in China is different from western countries). It is not done to act as if you are in your own home when you visit someone. Clothes, speech and even behaviour are relatively informal. Although, in business, people will wear a formal suite (not always a tie). The Western group "wave" is NOT appreciated. When departing, it is important to say farewell with a quick bow to every individual present. The banquet host typically will announce when the banquet has come to an end, and that is your sign that the evening has ended: do not hang around chatting much longer, as it is expected that you leave. If you are the honored guest, you will be expected to make a toast or speech. Drinking MAO TAI (a very potent clear rice liquor) is the most common liquor. NEVER refill your own glass. Always refill your neighbors glass, and they will refill yours. If they do not, diplomatically indicate your need by pouring a little more drink into your neighbors glass, even if it doesnt really need it. Chopsticks If you simply cannot master chopsticks, ask for Western cutlery. Unless you have a little ceramic chopstick rests, you need to rest the "mouth" end of your chopsticks along the side of the plate; the idea being that the food end of the chopsticks should never touch the table. Chopsticks should rest parallel to each other, never separated, on the right side of the plate, with the mouth ends facing north. Avoid waving chopsticks around aimlessly over different dishes trying to select you want. Or sticking the chopsticks ends into the food like a spear. Or drawing a bowl towards you with your chopstick. Never stand your chopsticks up in a bowl of rice (this is a funeral rite). One is considered more well-bred, the more one can hold ones chopsticks as far up and away from the mouth end as possible. Family and Relationships It is common to involve the family in business relationships. Holidays are limited compared to other countries and the gap 11
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between work and home is often a small one. Chines put a high emphasis on building relationships. Building these relationships can be a lengthy process, where by the relationship is more important than the task at hand. In general, Chinese can be very friendly, but dont confuse friendliness with friendship. Business is still business and being friendly in most cases (but not all) is a means to an end. Attitude to Time Most Chinese think about time in same way they think about money: it is something to be spent or saved. In a more informal situation and relationships, time is seen as something repetitive (if it does not happen today, maybe tomorrow). Punctuality is a relative concept, and mostly depends on what the power holder instigates. If the boss (or (government) authority) dictates punctuality, generally people will be punctual. In a more social setting, agreeing on a time to get together merely indicates that we will meet. Not per se at the agreed time (do not make the mistake that Chinese cannot be on time. They might surprise you (if youre a Western) to be very punctual just to accommodate you).

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Useful Web links Web link http://www.youtube.com/watch?v=JK_NinOm FWw&feature=player_embedded http://www.world-newspapers.com/china.html http://en.wikipedia.org/wiki/Culture_of_the_Pe ople%27s_Republic_of_China https://www.cia.gov/library/publications/theworld-factbook/geos/ch.html http://www.google.com/webhp?hl=zh-CN http://www.youtube.com/watch?v=jU2gp3Qjn NU http://www.youtube.com/watch?v=R-SEVYfXl4 Description Commercial from HSBC about the importance of understanding local knowledge Chinese news papers in English Wikipedia link on modern china Link to the CIA World Fact book on China Googles Chinese website Professor Geert Hofstede on the culture dimension Power Distance Professor Geert Hofstede on the culture dimension Individualism / Collectivism

If any of these links do not work, are broken, faulty, or out of date, please report this to us by sending an email to links@culturebriefing.com. Should you find any information missing or would like to see information changed or added, please send an email to addthis@culturebriefing.com.
Disclaimer: Although we do our utmost to present the information in this Culture Briefing as accurate as possible, it is always possible that there are mistakes in whatever form or shape. You understand that we cannot and will not be held responsible for this. We also are not and will not be held responsible for any application of this Culture Briefing. Neither for business purposes, nor for private purposes, or anything in between. Sorry.

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