Economics assignment help : China cultural clashes – conflicts
Intend of this essay is to talk about importance of culture in China and cultural clashes with other countries. In this regard, influence of Confucianism has been illustrated and compared with the value systems presented by Hofstede and Schwartz. It is a vital question whether culture and history of China makes any sort of impact on the way Chinese do business or not. The answer is simple and definite in this regard- yes. Culture of any nation plays a significant role and essential part of its identity. Therefore, it is important for every individual from top to bottom level of management including front line staff to understand the broader perspective of Chinese culture and its influence on business related negotiations and partnerships. Moreover, inclusive knowledge and understanding of China’s culture, values and traditions driving the Chinese people will be helpful and effective during any business. Thus, business persons would be able to make significant decisions and changes to the modern business environment (Bangkok Bank, n.d).
Taking China’s culture into consideration, experience of people has revealed the importance of group co-operation in their survival. As per the continuation of their culture, Chinese people are very much loyal and obedient with their families and this also falls over in the world of business. Additionally, there is a concept of Guanxi in China which is considered best for establishing business relationships. It also mixes up the concepts of face, reciprocity, hierarchy and obligation. Similarly, it is a primary element of business in China (Hilton, 2012). It has been debated that every business should understand the importance of Guanxi in China because business persons can minimize the risks, dissatisfaction and disturbance while doing business. Apart from this, organizations in China can also minimize the unavoidable risks and barriers if they have right networking of Guanxi. Furthermore, another keystone of Chinese culture and society is Confucius’ teachings which also make an impact on business environment in China. Therefore, next section of the paper will highlight the teachings on Confucius and its influence on business environment and relationships (Fox, 2012).
It refers to an ideological context established by Confucius. He created it on the basis of Xia, Shang’s and Zhou’s dynasties’ traditional culture. Confucius made the greatest influence over the multiple characters and the society of China till 20th century. When Confucius’ teachings started influencing the society, people began accepting his ideas and teachings for their strong principles. There were several areas of Chinese society that were affected by his teachings such as education, public & private approaches, government and etiquettes. Moreover, his teachings have made an impact on Chinese business as well for more than about thousand years (Travel China Guide, 2012).
One of the surveys made for viewing Confucianism’s influence on Chinese business, a survey was made in 2007. This survey revealed that around 70% business persons building long-term connections and partnerships with other and creating a strong and right network of Guanxi. In addition, on the basis of that survey, it was found that more than nearly 50.55% business people are paying attention to the harmony in their businesses. While connecting with the customers and contractors, Chinese businessmen were showing patient, kind and appealing attitude toward them. This was the influence of Confucianism. According to one of his teachings, people may lose their mutual face and harmony while quarrelling in public (Cultural China, 2010).
(Source: Li, 2009)
Therefore, this also made an impact on Chinese society and business persons are very much quite while making negotiations, deals and signing partnerships with other nation or countries. Confucianism is quite similar to socialism and fosters community interests and welfare of community. In simple words, it can be stated that both of the ideas of harmony and face presented by Confucius are still alive in business world and make Chinese people win everywhere. Furthermore, as Confucius had proposed a framework of interdependent relationships in society among people it worked out in Chinese business environment as well. Lower level in a family or in a business respects and gives obedience to the higher level. Consequently, respect for both authority and age can be noticed in Chinese culture in a considerable amount. In short, Confucius’ teachings were related to collectivism rather than individualism (Li, 2009).
Confucianism’s influence has been compared with the value systems of Hofstede and Schwartz in the next segment of this paper creating the difference between individualism and collectivism concept in culture of China.
Hofstede provided five key elements of culture power/distance, individualism, masculinity, uncertainty/avoidance index and long term orientation. First, power and distance of Hofstede refers to existing inequalities’ extent. He demonstrated that there can be both high level and low level of power in society and business world. According to him, power’s unequal distribution is accepted by the people in business and thus they understand their place and value in the framework (Hofstede, 1984). Similarly, Schwartz also illustrated ten basic values noticeable in diverse cultures. These values are self direction, stimulation, hedonism that is pleasure and intense satisfaction for oneself, achievement, power, security, conformity, tradition, benevolence, and universalism (Schwartz & Boehnke, 2004).
Subsequently, on the basis of these values’ comparison with Confucianism, it can be said that both Hofstede and Schwartz concerned about welfare, well-being and social justice of an individual, whereas Confucianism focused on the nurturing of virtue and maintenance of values and ethics. Moreover, Confucius talked about the qualities and ethics a person should have while making deals, participations, and negotiations and Hofstede’s value system focused on geographic and macro-economic variables. On the other façade of comparison of their value systems, Confucius’ main parts of concentration were humanism, etiquette, loyalty, relationships, perfect man, rectification of names, and Ren, that is an obligation of humanity for other person within a society or business. Besides, Hofstede and Schwartz’s thoughts and systems were presented from the perspective of society as a whole and Confucius proposed his teachings from an individual point of view stating the values every individual should have. In this regard, Schwartz’ tradition and benevolence values are similar to Confucius’ provided virtues because these are particularly close stimulus. One more difference can also be dictated on the basis of comparison made that Hofstede and Schwartz’s systems focused on promoting cooperative and encouraging social relationships where Confucius taught to improve individual’s virtue and then influence the society and business as whole (Schwartz, 2005a).
There are major companies which have successfully done with their businesses with foreign countries. First is Carrefour department store which has become Europe’s second largest retailer company. Next are Microsoft technology and KFC which have made remarkable entry to the different countries and have won the culture of China with all its accepted terms and traditions (Scarlatelli, 2010). Moreover, Chinese telecom organizations such as Huawei and ZTE has made a remarkable entry to the diverse countries and expanded its business globally all over the world. These are the biggest winning organizations of China which made its scooped entry with its culture (Shenzhen, 2012).
On the other hand, there are a few companies which got failure in business. Groupon is one of them which could not get success in China due to its traditional culture focusing on Chinese people and their families (Zhu, 2011). Additionally, E-bay, Yahoo and more internet based organizations also did not get success in China because of their competitive approach which could not work out in Chinese culture (Barboza & Stone, 2010).
Cultures which do not clash and those which clash:
There are many cultures which clash with Chinese traditional culture and many do not. Culture of western countries such as America, UK, Australia, Europe, Malaysia, Africa, etc is different from the culture of China. Western countries’ main purpose is to maximize the value of their shareholders and serve them effectively where family’s interests are served prior to anything in Chinese business’ practices. Similarly, financial reports are kept open to public with transparency whereas financial information and reports are kept secret from business point of view. Moreover, financial sources in western countries are sale of securities publicly and China’s source of finance is people’s families and their friends of families. Therefore, the traditional culture of China binds everyone with one another strongly and helps ensuring the success of their business. But on the other hand, Chinese businessmen decrease their chances to meet with good negotiations and deals as they have society oriented culture in their business practices. Human being is served and taken care first according to Chinese culture while western cultures focus on their business’ objectives rather than focusing on human being’s interest (Payne, 2009).
Furthermore, Western countries promote their brands by advertising them through effective mediums and China makes it sales via multiple family networks. Therefore, business persons face challenges and difficulties in promoting their products as they do not prefer to go with advertising mediums for the product’s promotion. This results in poor negotiation with both the customers and the clients. Many westerns countries do not get ready to sign the deals and make partnership with China because of their traditional value systems’ practices in business. Additionally, Chinese business persons mainly emphasize upon the long-term prestige of employees’ families rather than shareholders’ value and bottom line profits unlike western countries do (Jisi & Sicheng, 1996).
Apart from this, there are many countries cultures of those do not clash with Chinese culture. These countries are Taiwan, Korea, Japan and Vietnam. These countries have been greatly influenced by Confucius’ teachings. Likewise, one of the territory settled by Chinese people Singapore is also affected by the culture of China and do not make any big differences with it while signing a new deal, making negotiations and partnerships and joining a new venture.
Handling with cultures which have clashes with china cultures:
Conflict may arise due to different cultures in business and it may also become a crisis if it is not handled effectively on time. Different countries have different type of cultures so there is a great possibility of conflicts and clashes taking place around the business environment. There are different resolutions styles for different countries on the basis of their cultures. Most preferred style for China’s conflict and clash resolution is compromising style and second preferred style is avoiding style. In other words, China can compromise with western culture of different countries while doing partnerships and deals with them or may avoid them easily if it is not as per their expectation. In this regard, if high-level projects and deals earning good profits for China are signed with other countries, China should compromise with it culture and accept the terms & (Axelrod & Johnson, 2005).
Moreover, USA is the most competitive country having different culture from China’s culture. In the case of making business negotiations and deals with USA, china has to compromise with its culture and follows integrative style and approach in business (Lather, Jain & Shukla, 2010).
On the basis of this paper, it can be understood that China is a diverse country and consists of a large degree of unity. It knows the importance of its culture and follows it at both individual and organizational level. Chinese culture is different from western culture. Chinese people and business persons give importance to the family first rather than anything else. China has understood the importance of culture in their business practices as it affects every single deal, negotiation and new venture. In this context, one of the concepts came forward in Chinese culture, Guanxi. A good networking is set with all other countries having different or similar culture with Chinese culture to develop the business. On the other hand, teachings of Confucius influenced the culture of Chinese people and brought about societal order and harmony among them. According to him, if every individual in this universe understands its rank in the society or the business, there would be proper harmony. Therefore, Chinese people accept the interdependent system of hierarchy and relationships in the business and society respectively. In sum, lower level values the status, role and behavior of upper level. In simple words, chain of command in Chinese business’ practices in followed and respected by the people.
It mainly focused on the collectivism and praised the work accomplished by a group, a team or an organization as a whole but other western countries emphasized individualism. This was the biggest difference between Chinese culture and western countries’ culture. Finally, the change in Chinese culture can also be interpreted. Now, China has its new style of compromising with western cultures while having deals and partnerships with them in business terms. Moreover, Confucius’ teachings made an impact on Chinese society and business and placed a level of harmony, individualism, group orientation and devotion in China.
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