Understanding China is vital for today's graduates

With China set to economically dominate the coming decades, it is more important than ever for today's new graduates to learn how business is done there. It's simple, says Mark Pettitt, just remember 'face' and 'connections'

Walking down West Nanjing Road, one of Shanghai’s busiest shopping streets, you may not immediately look at the shops and buildings around you and feel as though you are in the beating heart of one of China’s key cities. Sitting on the steps outside West Nanjing Road underground station, in the shade of trees lining the European inspired streets, surrounded by the comforting stores of Marks and Spencer, Zara and H&M, you may almost feel at home.

The urban centres of China, and in particular Shanghai, have rapidly developed an all too recognisable ‘Western’ façade. This façade is at first comforting – home comforts, or at least many of them, are readily available. Despite being just as likely to see a local Shanghainese eating a KFC, Starbucks or MacDonald’s as much as you are jiaozi, dumplings, or fèngzhǎo chicken feet, lying underneath this façade is a distinctly strong and traditional cultural Chinese identity. Knowledge and understanding of this underlying current is absolutely necessary for any aspiring young person seeking a successful career or work experience in China.

Doing business in China is not for the faint hearted. An excellent introduction and insight into just how complicated business affairs can get can be read in Tim Clissold’s ‘Mr China’. Failure to understand the complexities of Chinese business culture can place a ‘Western’ business person in a potentially stressful situation.

The old adage of ‘do as the Romans do’ could not be more appropriate in doing business with the Chinese. Recognising, accepting and understanding the key cultural concepts that naturally course through the veins of the Chinese, Mianzi and Guanxi, (“face” and “connections”) are vital as a prelude to success.

It is for this reason that CRCC Asia, which works in Chinese consultancy and recruitment, insists all participants attend an intensive and educational induction day. On their first full day in China, they explore these cultural concepts, and in doing so how – at an introductory level - to successfully navigate the choppy waters of Chinese business etiquette. Learning about Mianzi or ‘face’ might not be paramount in western business circles, but in a Chinese business environment, giving face is serious business.

The concept of Mianzi can catch out the most experienced of expats in China. It is necessary for an expat to adapt to China’s cultural landscape, learning how to read interactions with locals and respond as necessary. At a simple level for example, a newly recruited ‘Western’ intern at a Chinese company could be expected to be introduced to a client to show the company’s international credentials. The western intern should show humility in such a situation, to give face to his/her employer.

Luise Schafer, awarded an OBE in 2012 for her services to British businesses in China, believes that 'it is vital that those who expect to do business successfully and build relationships in China make an effort to understand something of China’s history and culture'.

"Being gracious and tactful are good attributes in any culture or context, but in China these qualities are highly prized. One’s behaviour can have a huge impact on one’s success. An appreciation and understanding of China’s business etiquette and culture should not be underestimated."

Mianzi goes hand-in-hand with another key concept, Guanxi, that of building relationships and networks. A lot of business in China is done through who you know and, due to a legal structure which developed differently from western legal frameworks, much negotiation works on trust as much as on contracts. It is not uncommon to find yourself building your networks late into the evening in a bar, swapping business cards, making new contacts through old friendships.

Business deals are traditionally negotiated based on trust, sometimes after a good banquet with flowing Baiju (Chinese liquor). Maintaining and building trust is a necessity, and to keep your levels of Guanxi high you must regularly keep in touch with contacts and return a favour if asked. It’s not unusual for business deals to be renegotiated after the contract has been signed by both parties - that’s when Chinese business culture gets interesting.

It is no surprise therefore that employers are rapidly seeking well rounded students and graduates who have first-hand experience of navigating China’s developing business environment. This rising interest in the Chinese market, coupled with the realisation that the Chinese operate on a different business platform, has led to a surge of young people seeking internship opportunities in China.

CRCC Asia is the leading provider of professional internship programs in China for university students and graduates. Mark Pettitt is CRCC's Government and Public Relations Manager.