Negotiating with Chinese: success of initial meetings is the key
Yunxia Zhu and Bernard McKenna
UQ Business School, University of Queensland, Ipswich, Australia, and
Genertec Advertising International Co. Ltd, Beijing, People’s Republic of ChinaAbstract
Purpose – Negotiating with the Chinese is an important topic in international business and crosscultural management since China is playing an increasingly active role in doing business with the western countries. The purpose of this paper is to study initial meetings with the Chinese during business negotiation processes. In particular, it seeks to explore the processes of negotiation betweenthe Chinese, Australian and American cultures. Design/methodology/approach – The discussion is based on authentic cases collected from meetings which took place in both China and Australia, and the negotiation cases are analysed in the theoretical framework based on cross-cultural negotiation processes and intercultural dimensions. Findings – The findings indicate that success of initial meetingsis an important key to determine success for business negotiations. Originality/value – The paper is of value through highlighting the fact that initial meetings with the Chinese can be seen as essential to negotiation since the Chinese tend to develop relationship or guanxi first before the actual negotiation takes place. Keywords China, International business, Negotiating, National cultures,Cross-cultural studies Paper type Case study
Cross Cultural Management: An International Journal Vol. 14 No. 4, 2007 pp. 354-364 # Emerald Group Publishing Limited 1352-7606 DOI 10.1108/13527600710830368
Introduction More and more countries are involved in negotiating with Chinese in international business since China started its economic opening-up around the 1980’s. So negotiating with Chineseis also becoming increasingly important for international business successes in particular, since after China joined WTO in December 2001. It is anticipated that more frequent negotiations with Chinese will take place as China is going through free trade negotiations with a number of western countries. However, negotiating with Chinese can be very challenging and Chinese have been sometimesrecognized as some of the toughest negotiators in the world (e.g. Young, 1994). People from other cultural backgrounds, especially those from the west, often find the behaviour of Chinese negotiators to be difficult and unintelligible. This is the reason why much attention has been given to studying Chinese negotiation styles. To our knowledge, the research on this topic has mainly focused on allthe negotiation styles and very little has been done to examine the importance of initial meetings in business negotiations. The initial meetings with Chinese can be seen as essential to negotiation since Chinese tend to develop relationship or guanxi (Fang, 1999) first before the actual negotiation takes place. Based on the authors’ consultancy experience, initial meetings are of great importanceto subsequent processes of negotiation. This paper will take this initiative of investigating into the importance of initial business meetings that may lead to successful negotiations. In the meantime, it will also look into the factors at the initial meetings that may interrupt negotiations. The cases analysed in this paper derived from a series of business meetings that took place in eitherAustralia and China since from 1999. Business managers’ views are also incorporated to substantiate our arguments.
The following research questions are proposed. First, what roles does culture play in the initial meetings of business negotiations with Chinese? Second, what are the specific cultural factors that affect the development of business negotiation processes? To answer these questions,...