WHAT DOES HOLISTIC THINKING MEAN IN CHINESE BUSINESS ?

        As Confucianism is the philosophical foundation of the social code of conduct shaping the Chinese culture, there are some other values originating from this ancient ideology deeply rooted in the Chinese society, like the holistic thinking, because the Chinese way of thinking is in terms of the whole, in a sense that the Chinese are willing to discuss all issues haphazardly and simultaneously, while westerners think sequentially, separating the different tasks of the negotiation one by one( J.K Sebenius, C.Qian, 2008). 

        Things are usually discussed in the order they are outlined in the contract. The Chinese have a preference for the quite well-known technique, where the buyer wants to discuss and decide on every clause separately since you can then negotiate a low price in every issue, which is something that MNCs try to avoid. They do not mind discussing item by item, but when it comes to deciding on the different issues, western companies prefer to do that in conjunction with the other issues in order to form a package deal. For example, foreigners will tell their Chinese counterpart that they are willing to give them X but then they want Y in return, hence they prefer a certain reciprocity. If you decide on each issue separately, it is easy to get into a situation where you feel forced to cave in on every issue. Consequently, it seems like western companies prefer also a holistic thinking in this type, not only the Chinese.

      Empirical data does not comply with the literature, which rather states the opposite. J. Sebanius and C.Qian (2008) declare that the Chinese think in terms of the whole and not sequentially. However, breaking up complex negotiations into a series of smaller issues is essentially avoided by many international companies as well, this is mainly due to the amount of concessions that one could give in this type of approach. In the end, while exerting cross-cultural negotiations, the holistic thinking is rather an advantageous typical Chinese cultural trait which seems to gain more influence within Western companies.

WHAT DOES MIANZI/ FACE MEAN IN CHINESE BUSINESS ?

    The concept of face or “mianzi” is probably the most written-about cultural characteristic within the Chinese culture literature, face means dignity, respect, status, prestige and credibility, it can be saved, protected, lost or given by social behaviour, etiquette events like the organisation of banquets, giving gifts in a social area, to create a congenial atmosphere, which will be giving face to the counterparts and consequently opens the negotiation process (Beamer,1993). The easiest way to make a Chinese lose face is to criticise him in public, intentionally or unintentionally (J. Sebanius,C.Qian, 2008) that’s why respect, loyalty and politeness are major qualities to earn face from the Chinese. Graham and Lam (2003) called it social capital, it is mainly based on reputation and social standing, if Westerners cause the Chinese to lose it, it can be fatal for business negotiations. One of the sources of earning face is to have a good network of relationships, or what is commonly called in the literature “Guanxi”.

      Expatriate business managers admit that face is always enormously important in China. What makes a Chinese lose face is for example if you say “no” straight out to a suggestion he made, basically, that is enough to make the Chinese lose face. Of course, there are other matters that can make them lose face, generally speaking, that is everything that makes them feel that they are in an inferior position. The phenomenon of face is not only applicable to the Chinese but also to Westerners in a lesser extent.

       A situation where a Chinese person loses face can be aggravated if his/her colleagues or managers are present. If such a situation occurs then it can take a while before you are back on speaking terms with that person and in a worst-case scenario the persons involved might have to be replaced, situations like this are very rare but still they occur. Moreover, the reason why face is a more sensitive cultural trait in China than it is in western countries might be derived from the fact that if ones loses face in China, then that person’s Guanxi is negatively affected. If “X” loses face or gets an unfavourable reputation, then this can have a negative effect on the persons who know or have a connection to this person “X”. On the one hand, there is a Guanxi network behind every higher ranked individual and a change in that person’s face has a contagious effect, positive or negative, on the entire network. On the other hand, a person’s face can be significantly enhanced if you praise that person in front of his/her personnel or colleagues.