An Intoduction to Chinese Business Etiquette

1. An Intoduction to Chinese Business Etiquette May 16, 2013. Zagreb Professor Yan Lidong, Chinese director of Confucius Institute at University of Zagreb Contact: jimmy4401@sina.com

2. We are different but live in oneworld • Understanding cultural differences • Avoiding misunderstandings • Developing business cooperation

3. Main topics • What is Business Etiquette? • What influences Business Etiquette? • How to interpret Chinese Business Etiquette?

4. 1. What is Business Etiquette? The importance of knowing the Acceptableway of doing things —what to say, how to dress, how to react in various situations – becomes more and more important as your rank becomes higher. • It is all that you do and say while others are looking at you and listening to you • It is the forms, manners and ceremonies established by convention as acceptable or required in social relations, professional relations or in a business setting • It dictates how people of differing or similar tastes relate to one another How doesbusiness etiquette benefit you?

5. 2. What influences Business Etiquette? • Business Etiquette is the behavior within a culture • Culture exists in the background through its fundamental impact on the behavior of people who are in the center of business relationships • Culture is the business of international business (Hofstede,1994) • Cultural understanding is difficult and sometimes hard to attain, but the rewards can be great

6. 2. What influences Business Etiquette? • In order to understand Chinese Business Etiquette, it is important that you try to understand the increasing diversification of the Chinese culture (especially Han culture)

7. 2. What influences Business Etiquette? • Age • Race • Ethnicity • Culture • Gender • Marital status • Physical status • Socio-economic status • Education • Religion • Political ideology

8. S.H. 18MIO B.J. 12MIO CH.DU 10MIO HARBIN 9MIO T.J. 9MIO WUHAN.7MIO 74 dialects 56 nationalities 3400KM 4450KM

9. Categorizations of Chinese culture 400sounds*4 tones=1600sounds 56,000characters/1600sounds=35 meanings per sound

10. Categorizations of Chinese culture • Main questions: • What forms the characteristics of Chinese culture as a whole? • What is the philosophical foundation of Chinese behavior?

11. Chinese culture • Characteristics of Chinese culture: • Long history and diversity (over 5000 years old with 56 ethnicities) • Social structure (family-oriented) • interperson-oriented, collectivistgroup loyalty (guanxi) • Network embedded (guanxiwang) • Philosophical foundation of Chinese culture: • Confucianism • Buddhism • Taoism These are the three philosophical traditions of Chinese culture

13. The Yin and Yang principle

14. 3. Business Etiquette in China

15. What’s wrong? Li Yong returns to China after one year abroad in the States. He marries Wang Lin, his childhood sweetheart, who has never traveled abroad and speaks very little English. Li's best friend in the States, Brown, comes to visit Li in China for the first time and is introduced to the bride of his best friend. "Gee, it's great to meet you", says Brown, "Li talked about you all the time back in Houston!" , and kisses Wang Lin heartily on both cheeks. Wang Lin is shocked. Questions: • Why did Brown and Wang Lin behave the way they did from a cultural perspective? • What behaviors caused the misunderstanding in the first place? • What corrections to their behavior would you suggest in order to avoid further misunderstandings?

16. What’s wrong? Jin Yi is a new teacher in a middle school. One day, one of her Chinese colleagues Yang Fan introduces her to their middle-aged foreign teacher Maggy. Yang: Jin Yi, this is Maggy, our English teacher from America. Maggy, this is Jin Yi, our new colleague. Jin and Maggy: How do you do? Maggy: Your sweater is so smart. Jin: Oh, it is only an old one, I bought it last year. Maggy: You are so young and smart, I am sure you are a good teacher. Jin: No, no. I am just a newcomer, I should learn from you old teachers. Maggy looks surprised and thinks, "I am really so old?“ Question: • What is the problem in this conversation?

17. Greeting – getting to know each other • Greetings are the first step to observe a culture Common Chinese greetings:

18. Introduction to your Chinese partner • Introduce yourself through a third party • Introduce yourself through • Shaking hands • Exchange of business cards (mingpian名片) • A formal introduction Take care about the following: • Chinese don’t like to do business with strangers – introduce yourself through a person or an organization • Chinese like formal introductions – stand up, and keep standing throughout the introduction • Chinese don’t like direct body contact – a short handshake is acceptable, maybe a hug with an old friend

19. Introduction to your Chinese partner Rules for a succesful introduction: • Do not forget to ask a Chinese person which name is their family name • Address a Chinese person using his or her family name only • It is acceptable to call a person by their surname, together with a title • Avoid using someone’s first name unless you have known the person for a long time • Do not try to become intimate too fast • No touching like hugs or arm around the shoulder • Do not look people straight in the eye • A man is always introduced to a woman • A young person is always introduced to an old person • A less important person is always introduced to a more important person

20. Introduction to your Chinese partner • How to make an introduction? • Title • Surname • One/two syllable given name • How to use a business card? • What should be on a business card? • When do we exchange business cards?

21. Introduction to your Chinese partner • Rules for exchanging a business card: • Have one side of you business card translated to Chinese • Hold the card in both hands when offering it, the Chinese side facing the recipient • Business cards should never be exchanged over a table • Examine the card before putting it in a business card case • A handshake, nod or a slight bow should follow the exchange

22. Attending a meeting • Make an appointment in advance • Pay attention to the agenda • Dress properly • Promptness or early arrival is welcome • Keep body language limited • Hire an interpreterif necessary

23. Attending a meeting • Time orientation • Orderofenteringthemeetingroom • Introductions • Table shapeandseatingorder • VIPsandguests sit on theright • Leadersitsinthemiddlefacingtheleaderofthepartners • Principal hostsitsdirectlyopposite to the principal guest • Small talk inorder to breakthetension • Welcomespeech (bothsides, only senior members)

24. Attending a meeting – FAQ • Who should enter the meeting room first? • Senior members (usuallyescorted to theirseats) • What is thedresscode for a businessmeeting? • Conservativebusinesssuits • Whyshouldthestartingpriceleaveroom for negotiation? • It is notlikelythatanydecisionswillbemadeduringthemeeting • Bringthematerialsinbothlanguages • How to interpret „We’ll see.” or „We’ll thinkaboutit”? • Look for signsofdismay or surprise (such as sharpintakesofbreath) • Take care thatapplause is a commonformofgreetingin China, berespectfulandreturntheapplause.

25. Attending a businessdinner • Delicious and colorful Chinese food • Preparea short, friendly speech in response to the host’sspeech • Understandthe table manners • Seating arrangement • Some commonmissteps

26. Delicious and colorful Chinese food Lu Hang/Zhe Xiang Yue Hui Chuan Min Huaiyang

27. Attending a businessdinner • When to sit down? • Guestsfirst, host second; • Seniors first, juniorssecond; • Olderfirst, youngersecond. • The main tables and the important tablesfirst • What to order? • Drinks (beer, Baijiu or alcoholic beverage) • Starters(Tea, cold dishes) • Main courses (hot meats and vegetables) • Soup (with Rice, noodles or dumplings) • Publicchopsticksand spoons • Conversation • Paying the bill

28. Attending a businessdinner – table manners • Alldishes are placed on the table and shared • Chinese hosts willsometimesput food in your bowl or plate with public chopsticks • Do not stick your chopsticks upright in the rice bowl • Make sure thatthe spout of a teapot is not facing anyone • Do not turn over the fish • Do not tap your bowl with your chopsticks • Do notoverorderorovereat • Howto tell a Chinese “ I am really full”?

29. Building upGuānxì • What’s Guanxi? • Rolesoftheintermediary • Changes inpersonaldistance • Attention to different ranks • Formal invitation • Gift-giving

30. Building upGuānxì • How to buildupGuanxi? How to interpret „friendshipfirst, businesssecond”? • In China, guānxì provides the necessary social glue between parties who interact over an extended period. • In this context,Guānxìrefers to a long-term relationship based on mutual obligation. • One begins to build guānxì by doing small favors, taking one out to dinner, or bringing a gift. • Trust also grows with the relationship, and one relies on the honor of his guānxì partner rather than legal remedies to vouchsafe an agreement.

31. Building upGuānxì • Chinese people rarely do business with strangers • Personal space in China is closer than inthe West. • The person withthe higher rank should alwaysbe respected Personal Intimate Social Public 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

32. Building upGuānxì - gifts • Gifts are very important for Guānxìandfriendships • It is appropriate to bring a gift to a business meeting or a social event • Giving businessgifts • time • amount • wrapping(colorofthewrappingpaperandappropriate time to open)

33. Building upGuānxì - gifts • Do not give clocks, chrysanthemum, cut flowers, white objects which are associated with death • Wrap gifts: • red and gold colors for wrapping paper • Do not use black or white paper to wrap the gifts because they are the colors of mourning • Donot use red ink to write names • Chinese do not open gifts when they are received because it indicates that it is the thought that counts more than the material value

34. Saving face • Saving face, losing face, giving face • Saving face plays some roles in almost every culture, but in China and other southeastern Asian countries it is a constant preoccupation • One never speaks or acts in a social setting without consederingthe effect on reputation • A primary goal at a social or business gathering is to avoid embarrassing or offending one's associates • One does not show or provoke anger • “Thank you” is mainly spoken to strangers

35. Commonsymbolsandinterpretations • Symbolization is how people imagine or regard something, whichreflects the way people think • Meaning of symbols differs across cultures • Symbolic meaning of nonverbal communication can also cause problems • CommonChinesesymbols • Symbol oftheTwelve animals • Symbol of Wu Xing • Symbol oftheDragon • Color preference • Figure preference

36. Twelveanimals

37. Twelveanimals

38. Symbolofthe Dragon • We regardthedragon as God and say that we Chinese are the descendants of the dragon • The God of Dragons of the four seas takescharge of the rainfalls, so we sometimes also call it the God of the water or rain. • Dragon is imagined as snakelike, flowing in the sky most of the time • Its shape is a combination of the face of ahorse, the horns of adeer, the ears of anox, the body of asnake, the claws of aneagle, squama of a fish • Manyemperors in the history of China declared themselves to be the sons of dragons, woreclothingwiththe dragon symbol, had thronescarvedinthelikenessof a dragon • In the West, dragons, like dinosaurs, can stand on the ground with feet and fly with huge wings • They are regarded as dangerousdue to theirabilitytobreathefire- theyhaveeven become the symbol of the Devil

39. Symbolofthe Dragon

40. Colorpreference • In the APEC summit held in Shanghai in 2001, the presidents wore the traditional Chinese Dang suits and took a photo together. The colors of the suits were chosen by themselves freely. However, it’s quite interesting to find that most Eastern leaders chose red while most of the western leaders preferred blue. • To explain this, it’s easy to realize that what red means is almost opposite in the East and the West • Red means luck, fortune in China. We Chinese often use this color to decorate for festivals, such as red lanterns, red Chinese knots, red banners • red stands for blood, revolutions in the West.

41. Numberpreference

42. Holidays • Spring Festival The first day of Chinese lunar new year • Lantern Festival The fifteenth day ofthe Chinese lunar newYear • Qing Ming festival April 5th • Dragon Boat Festival May 5th Lunar year • Mid-Autumn Festival The fifteenth day of the eighth lunar month • Chong Yang Festival The ninth dayof the ninth month in lunar year

43. Holidaysandworkinghours • New Year’s day (January 1st) • Laborday (May 1st) • Children’s day (June 1st) • Army’s day (August 1st) • Women’s day (March 8th) • National day (October 1st) • Workinghours: • Monday to Friday, 8h a day • Extrapay for overtime

44. Golden RulesofdoingbusinesswiththeChinese • Everything is possible • Nothing is easy • Western business logic usuallydoes not apply • It is a fun project if there is no deadline • You must be patient - things willeventuallycome your way • “You don’t know China” means they disagree • “New regulation” means they found a new way to avoid doing something • When you are optimistic, think about Rule #2 • When you are discouraged, think about Rule #1

45. Do as the Chinese do… Havala and wish you a successful career!