A recent article over on the Harvard Business Review on China Myths, China Facts reminded me how China is starting to change and how my advice in my recent post on overcoming cultural differences in international trade with China to take time to get to know the people you will be dealing with because their behaviour may be nothing like the usual behaviour of the country in which they reside is becoming truer and truer by the day in some parts of China (that deal regularly with the west).
According to the article, which isn’t entirely accurate (just ask our resident Global Trade expert) the following are myths:
According the article, Individualism is the reality. While this is becoming true of the emerging “New China”, especially in the urban middle class, the “Old China”, which still makes up the majority of China, is still collectively oriented and, as the article points out, decisions, particularly in the business world, are still made in groups.
- Long-term Deliberation
According to the article, real-time reaction is the reality. While the “New China” that has been dealing with the west for the last two decades (or so) has learned to “react” at western speeds, there is still a lot of deliberation that goes on behind the scenes, and quick decisions are often the result of policies that were decided as the result of long-term deliberations.
- Risk Aversion
According to the article, risk tolerance is the norm. Well, this one is half true. The reality is that the Chinese are neither risk-averse or risk-tolerance. They are what I’d call “risk-comfortable”. You have to remember that China is one of the oldest civilizations on the planet. They can trace their history back millennia, while we struggle to trace ours back a few centuries. They are more aware of risk and used to dealing with it than we could ever imagine. It’s just another part of everyday life to them … that sometimes comes and goes in waves. They know that some risks can never be completely mitigated and that others can never be predicted. As a result, they don’t feel the need to needlessly analyze something to the nth degree when they know nothing will be gained from the exercise. So they make a decision, execute, and accept what comes. We could learn a thing or two from them.
What’s happening is that, just like Japan transformed itself from the “Old Japan” to the “New Japan” over the last few decades, China is in the process of transforming itself from the “Current China” to the “Next China”. This will happen over the next few decades as it claws its way back to global supremacy. So, are you ready?