Recently when I was having a Business Mandarin coaching session with one of my students who is a Strategy Director for one of the major international consulting companies, we had a discussion about "Internationalisation of Chinese companies".
I asked: "Currently there are several popular examples of Chinese business internationalisation such as Lenovo's acquisition of IBM 's PC business, TCL's acquisition of Thomson (French TV business) and Haier's establishment of operation in US. So what is the key challenge for Chinese companies going global?"
My corporate advisor student said: Among others, cultural difference is the biggest challenge for both Chinese companies operating overseas and international companies operating in China alike. Cultural gap always exists and it takes great effort for businesses to realise this and try to bridge the gap. Lenovo and IBM for example are putting the top management (composed of half Chinese executives and half western executives) under cultural training. The result of the training will impose a crucial impact on the health of the marriage.
I have also read some articles with similar topics recently and these articles endorsed my student's viewpoint. The article commented on the difference in leadership and communication style of Chinese people and American people:
1. Leadership: Chinese people rely on leader's directions and American people are used to bi-lateral communication, constantly discussing and exchanging ideas, info and suggestions with the supervisors.
2. In a conversation, Chinese people tend to suppose that the counterparts already know all the background info, therefore they never explain the background and directly jump into discussion or conclusion. Their points are normally hidden in their facial expressions and gestures. While American people tend to suppose the counterparts do not know the background info and always explain the background first. Their points are obviously explained in the sentences - no need to explore further.
From personal experience, Brad and I sometimes have cultural conflict - when we realised that the conflict arose due to our totally different background, we would sit down and talk about it and explain to each other. We realised that if you put yourself in the others shoes and try to understand the other by effective communication, things will be much smoother.
Cultural difference is unavoidable; the key is how to effectively deal with it. Being positive, understanding and partaking in constant communication are the keys. I would thoroughly recommend that any company dealing with China invest some time and money in undertaking some cultural training for their management.
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