UNDERSTANDING CHINESE CULTURAL DIMENSIONS WITHIN BUSINESS

        The relationship between China and the rest of the world has expanded considerably since the implementation of the open-door policy after the “program of four modernizations”. Chinese growth continues at a rate often close to 10% per year, and the country attracts more foreign investments than any other country in the world. Transfer of technology, creation of joint ventures, foreign subsidiaries, facilities on the Chinese territory, equity in business and Chinese industry groups are the main events. All these transactions involve negotiations, that is to say, the implementation of an adjustment process is often long, complex, and punctuated with the unexpected. Negotiating with the Chinese gives rise to a very special mix of uncertainties and misunderstandings which become excessive sometimes. This is because the Chinese negotiator sits on his set of assumptions that are radically different from those underlying the approach of his Western interlocutors. This disjunction leads to reactions tinged with doubt and mistrust putting the foreign negotiator in the situation of a fisherman trying to catch the reflection of the moon in a pond.

          From one country to another, from one continent to another, a negotiation requires a prior knowledge in different registers. Out of respect for a climate of trust, to know the attitudes held during negotiations to adapt to different communication styles, to minimize the differences of meaning of terms such as design planning, commitment, to minimize risk errors, loss of time, it is crucial to discover, to know the culture of others. In this present article, we are more interested in the interaction between Western countries and China in terms of business negotiations, we do mean by Western countries: Northern America, Western Europe, Australia and New Zealand.

         During the second half of the 20th century, several scholars and practitioners had created substantive knowledge in the area of Western-Chinese business negotiations, especially since the implementation of the economic reform in China after the 1980’s. Many authors described cultural difference to be the most influential antecedent in Western-Chinese business negotiations (Boyacigiller et al. 1996, Pye 1982, Hofstede/Usunier 1996, Redding 1980, Shenkar/Ronen 1987). Hofstede (1980), who identifies five cultural dimensions which are : high long-term orientation, high collectivism, high masculinity, high power distance, and high uncertainty avoidance; he did use Hong Kong and Taiwan samples in his research to determine the rankings of China within these five dimensions, which  made the findings of his research questioned by Shenkar (1994) and Tung (1988). In contrast, the Chinese Cultural Connection (1987), an international scholars' network, outlined four Chinese cultural dimensions derived from Chinese cultural values which are: Integration, Confucian work dynamism, Human-heartedness, and Moral Discipline; but these dimensions remain general, because they are not tailored to a business paradigm for measuring Chinese culture (Shi, Xinping, 2001). Another point is that within the literature and the negotiation practice, it has been found that political, economical and institutional factors are the basic influences behind the Western-Chinese business negotiations (Tung, 1988), while Weiss (1993) highlighted in his analysis that relationship behaviours, and environmental conditions influence Chinese negotiations.

          Furthermore, Xiaohua Lin and Stephen J. Miller (2003) examined direct and indirect effects of national cultures from a West-East negotiation approach, they characterised two dimensions of Hofstede(1980) as direct effects of national culture, firstly, individualism-collectivism assuming that in China, group goals and needs are emphasized under the shadow of maintaining relational harmony (Hsu, 1985), this is why they are always seeking the middle or a moderated position in conflicts; and secondly, high-low contexts in communication assuming that the Chinese do not express their opinions directly and openly, they rely more on non-verbal communication, in addition to this, the tolerance of ambiguity is highly emphasized in Chinese culture as ambiguous expressions and thoughts serve social purposes, such as uncertainty of the future and believing in more than one truth(Leung, 1988). Concerning the indirect effects of national cultures, two other dimensions are characterised, firstly, ingroup-outgroup consciousness meaning that the Chinese are more likely to take different approaches while interacting with foreigners, to seek the relational harmony, even if Chinese negotiators do exchange information indirectly using influence in an intra-cultural negotiation, they do adapt their behaviour in an inter-cultural negotiation, while Western negotiators remain consistent in both settings. And secondly, the mode of exercising authority differs in China, where power is considered as a tool used to facilitate a collective process, rather than adopting top-down decisions, so that important problems should be coped with by consensus and not by majority of vote (Wang, 1992). 

PRIOR KNOWLEDGE TO CROSS-CULTURAL NEGOTIATIONS

      In a cross-cultural environment, if we look at the vast literature written on negotiations, we find that many different fields had been proven to be enriching to the topic, such as marketing and sales, communication and organisational behaviour and even social psychology. Negotiation is one of the highest challenges in business due to the need of communications skills, Gilsdorf (1997), while McCall and Warrington (1989) found that any negotiation is a mutual involvement from both parties to achieve an outcome, hope needs to be retained to achieve an acceptable one, a varying degree of power belongs to each party, as they have different interests and objectives. Banas and Parks (2002) do agree when they say that a business negotiation is trying to reach a mutually beneficial outcome meeting individual goals. Although, negotiating is considered to be a problem-solving exercise in the West, as Fisher (1980) stated that almost the whole literature on negotiation, dealing with tactics and strategies is emanating from Western scholars, while D. Whetten et al.(2000) distinguishes two predominant types of negotiation structure perception, the distributive approach where the negotiators are opponents, which leads to a win-lose result, and the integrative approach where negotiators are collaborating, which leads to a win-win result. 

       Furthermore, an interesting negotiation perception which is BATNA (Best Alternative To a Negotiated Agreement) is seen as the best outcome a negotiator can have if the negotiation process had led to an impasse (Fisher and Ury, 1981; Jaeger et al., 1999), so that the availability of better outside alternatives places the negotiator in a position of power (Lewicki and Litterer, 1985; Pinkley et al., 1994; Raiffa, 1982). As a result, these two perceptions of negotiation behavior will inevitably affect the negotiation process.

      In a mono-cultural environment, the obstacles of language and cultural differences does not exist, thus, negotiators can predict and understand easily the negotiation process using individual perceptions on negotiation behavior. Whereas in a cross-cultural environment, the impact of ethnic heritage (Hawrysh and Zaichkowsky, 1989), customs and attitudes (Shenkar and Ronen, 1987) determines individuals’ behavior and their way of thinking, reacting and feeling within their cultural background (Simintiras and Thomas, 1998). Therefore, an international business negotiator should, in addition to his basic skills, understand the cultural differences, and adapt his negotiation style accordingly. Carl Rodrigues (1996) observed that the idea of “what works in the home country is good enough for the rest of the world” is simply misconceived, far from the truth, and will result into failure. Actually, the main obstacles to overcome in an international business negotiation are:

1.  Learning the language or select an effective translator at least, 
2. Learning the local culture, its business practices and ethics or select an effective translator which is quite hard to do,
3. And having a thorough knowledge of the business matter being negotiated.

         It is not easy to learn the foreign culture, due to the multifaceted structures of any culture that are much too complex to understand. In this perspective, Usunier (2003) sees three facets of cultural differences affecting international negotiations, with binary oppositions for each element:

1. Behavioural predispositions of the parties:  whether the interpersonal orientation is either in harmony or in self-interest, the power orientation is formal or informal, and the willingness to take risks whether it relates to delegated decision-making or uncertainty.
2. Underlying concept of negotiation: whether negotiation strategies are based on trust or mistrust, and where the strategic time-frame is logical or an ongoing dialogue.
3. Negotiation process: whether the styles of negotiation follow concrete goals, or principles and concepts, and whether the outcome orientations are iron-cast deals or less explicit agreements.

      Eventually, we should be aware of these cultural facets in order to not fail in cross-cultural business negotiations.