chinese negotiating

7/25/2019 Chinese Negotiating

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Chinese Negotiating Style:

Commercial Approaches

and Cultural Principles

Written by Lucian W. Pye

Presentation by Lisa DeMello


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Point of This Book 1. Minimize future misunderstandings

in Chinese commercial negotiations

2. Provide guidance for government-

to-government negotiations


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Summary 1. Practice atience

2. !ccet as normal" rolonged

eriods of no movement

#. Practice control against

e$aggerated e$ectations

%. &'$ect the Chinese (ill try to

influence by shaming)


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Summary (cont.) *. +esist temtation to believe that

difficulties may be caused by one,s

o(n mistaes . /ry to understand Chinese cultural

traits" but don,t believe that you" as

a foreigner" can ractice thembetter than the Chinese.


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Sources of ifficulties General Difficulties are0

Problems that come from ne( relationshis" and

lac of e$erience on both sides Caitalist vs. ocialist economy

Conflicting cultural characteristics


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ifficulties (cont.) Cultural Factors are0

Chinese culture shuns legal considerations" and

instead favor ethical and moral rinciles. /he Chinese do not searate business from

olitics.


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Am!ience of Negotiations /he 3ome Court !dvantage0

!s hosts" the Chinese are in a osition to control

both the agenda and ace of negotiations. With this the Chinese gain the advantage of

surrise and uncertainty in agenda

arrangements.

/hese situations tend to create an$iety anda((ardness in negotiation oonents.


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Negotiations (cont.) When 4riendshi Clashes (ith the

Desire 4or the 5est0 /he Chinese vie( that all successful

negotiations should include0 mutual trust" resectand friendshi.

Chinese d(ell of the sub6ect of friendshi and its

recirocity is a rere7uisite for doing business inChina.

/he search for &only the best) conflicts (ith&friendshi)" and usually (ins out.


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"pening #o$es 8ou ho( 8our 3and 4irst0

9n Chinese negotiating" they insist that the other

arty reveal its interests (hile the Chinese mastheir interests and riorities.

/he first ste is a descrition by the !merican

comany of its entire line of roducts and

services" and ho( they may be a value for theother arties goals.


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"pening #o$es (cont.)!mbiguity !bout Letters of 9ntent

/he Chinese see agreement on general

rinciles and often taes form of signing a letterof intent.

/he future imortance of these letters areaffected by the Chinese attitudes to(ard ublicityabout agreements (ith foreign comanies.

!nnouncements of negotiating success mayinfluence investors and reassure tomanagement.


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The Negotiation Session Exploiting the Faults of the Other

Party

&Most Chinese are raised and taught throughnegative reinforcement or shaming.)

9t is a standard tactic to mae use of any

liabilities" mistaes and misstatements of the

oosing side. /hey feel that it strengthens their osition by

sueriority.


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The Negotiation Session (cont.) 9n 3orse /rading /here is !l(ays a

Loser0

/he Chinese are highly susicious of beingoutsmarted.

/hey are convinced that in any situation there

must be a (inner and a loser.

'ven (hen both are benefiting" one (ill benefitmore" so there is still a loser.


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%motions in Negotiations 5lending of :enohobia and :enohilia0

:enohobia are dee feelings of distrust and

distaste for most things foreign. :enohilia is the alluring attraction of the

industrialized (orld" articularly foreign

technologies.

/he right balance can be difficult to achieve. /he best solution is to be sensitive to the roblem

and not be surrised by changes in attitude;mood.


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%motions (cont.) 4ace and


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&n Conclusion 1. /he Chinese need time to digest all

information

2. /hey have a long-range vie( and areless in a hurry to mae decisions

#. /he Chinese distrust fast talers (ho

(ant to mae 7uic deals

%. >no( Chinese cultural

differences" but be yourself


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'ecommendation While this boo is not al(ays olitically

correct" it does rovide useful

guidance for conducting negotiationsin diverse cultures.

?ust over 1@@ ages

'asy to read and follo( in an outlineformat


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The %ndAuestions0

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