CHINESE BUSINESS CULTURE AND ETIQUETTE

Facts about ‘Face’ and ‘Guanxi’

Face is important in Chinese culture—a crucial foundation of Chinese society— it is often associated with the word respect, and is originally derived from Confucian thought. In Mandarin, it’s called ‘mianzi,’ which means dignity, prestige, image and reputation when translated into Western values. But a more realistic and usable definition comes from Sam Goodman in his book, “Where East Eats West: The Street-Smarts Guide to Business in China.” He states that face—in its most simple form—can be stated as ‘appearance over substance’.

Along with face, there is the important concept of ‘guanxi’ or relationships. To put it bluntly, the western statement that, “sometimes it’s not what you know, but who you know” should be easily reversed in China as, “who you know can be twenty, maybe fifty times more important” in negotiating a deal with your Chinese counterpart, a Chinese government official or department. It is given more weight than your experience, the regulations and often-flimsy law, or sometimes even the price.

The importance of guanxi in China is mainly for two reasons. One is a function of trust, which is very hard-earned in Chinese society and sometimes comes through an excruciatingly slow process. Deals without guanxi tend to be much slower than in the west, regardless of what your Chinese partner might say, as they slowly feel and test you out.

Secondly, it’s a function of face.

Remember this rule when dealing with Chinese counterparts: it’s all about face. When it’s not about face, it’s about guanxi, which is, most of the time, about face.  Knowing the right people and especially the right same people, not only gives you face, but can give your Chinese counterpart face, and improve their relationships with those right people.

In short, ‘mianzi and ‘guanxi’ are like the Yin and Yang of Chinese Business Culture—an excellent piece of imagery—to better understand Chinese business culture and dynamics.

Face: How can it affect you and your deal with your Chinese partner?

Saving Face – this is when a person’s reputation is under question or has been lost and it’s in the process of restoring it, with or without the help of another person that has face. This action provides a chance to the person who has lost his face to prove that he’s not wrong, or to show that the degree of his wrong-doing is relatively small. Usually the person with face endorses the one who has lost face in front of his colleagues. An example of saving face and how it might affect you is when you’re starting a business in China where you should not expect your employees to publicly or maybe even privately admit a mistake or wrong-doing. They will use every excuse and reason to escape responsibility as a face-saving tactic, whereas admitting the mistake would lose him face.

Having Face – this means having good ‘face’ or a good reputation to one’s colleagues and peers. If one has good face, he is deemed as bankable in Chinese culture. He is seen as someone who is reliable and safe to deal with in businesses, and even some smaller lending and bank institutions may rely on this fact. Having face is valuable in the business community and is also associated with the western concept that a man’s word is as good as gold.

Losing Face – this is the worst thing that could ever happen to a businessman in China. This person used to have a good face but an unprecedented situation caused him to commit a mistake. It can also be an act in error attributed to a person in public before his colleagues, partners or peers, which reduces his reputation.

Giving Face – this is where a person will give someone face through things such as compliments, gifts and favors.  One should remember the three F’s when dealing with government officials: flattery, favors and fancy gifts, as these will all give them good face, making the process easier, especially when dealing with small-time government officials in China.

Building relationships matter

Research on the Chinese market is always beneficial for western entrepreneurs, but it is always wise to remember that personal relationships—‘guanxi’ and ‘face’—are the currencies of the market you will need to succeed.

One must establish and maintain good rapport with key business contacts, government officials, and stakeholders to guarantee a smooth and steady process in your business dealings. If you’re uncomfortable with networking, maybe it’s time you rethink your social strategies, or attend networking events and conferences, to socialize and meet new contacts in the Chinese market. It’s best to attend these events, specifically within your industry scope, with the objectives of keeping in contact with key influencers in the market, possible investors, leads, and opportunities.

Meetings

Punctuality is highly important in Chinese business etiquette. While it’s good to be on time, it’s best to be there slightly before the meeting. This is regarded as ritualistic for the Chinese, which can either break or make your reputation as a businessman. They must see your sincerity and professionalism in your punctuality. Together with your Chinese translator or interpreter, make sure you arrive ahead of time to the event or place agreed.

Refrain from scheduling a meeting during national holidays due to transportation and logistics challenges. Make sure you are well versed with the Chinese calendar. Avoid scheduling meetings on Chinese New Year, Labor Day, and National Day, as this may lead to disappointments when it comes to communicating with key individuals.

On the topic of key individuals, you must always try to find out who the key decision maker is and try to get a face-to-face meeting, or be as close as possible to this person.  One Chinese negotiating tactic, among many, is to send in a junior individual or team to find out as much as they can get from you for free. They will generally wear you down by spending so much time with you and your team, just to find out later after constructing the entire deal that they are powerless to make a decision on it.

Arm yourself, including the interpreter and the team if applicable, with translated Chinese marketing materials to share with the hosts, such as brochures, catalogs, magazines, and presentations during the meeting. This will increase your chances to gain business deals. While some people in the organization may be fluent in English, the administrative heads and officials may not be at all. Their access to Chinese documents and presentations will make it much easier for you and the interpreter to walk them through the proposed deal, project, products or services.

Interpreters

Before hiring a professional interpreter, consider the location and dialect of your Chinese counterparts. Mandarin is the lingua franca of Mainland China, while Cantonese is used in Guangdong province and places outside of PRC, such as Hong Kong and Macau.

At Vivi’s Chinese Interpreters and Translation, we have a team of interpreters, specializing in different Chinese dialects. Whether it’s a Taiwan interpreter, Beijing interpreter, Mandarin interpreter or Cantonese-speaking translator, you will find professionals who are the best fit for your projects, events and meetings.

Do your homework before expanding your business into China. There are tons of resources available—both online and printed materials—that can teach you exactly what you need, especially about the concepts of Face and Guanxi. Practice these principles the Chinese way. If you need more guidance, we have written a FREE EBOOK on these and other subjects. Just book one of our interpreters and we will email it to you free of charge.

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