The Hofstede Cultural Dimensions analysis tool is the cultural value within a country. These values impact our businesses, home and family. Every country is different and in this example it outlines the differences from the United States with China. China will do things in ways that are completely opposite of the United States. In order to create and keep that relationship with China, a better understanding of their culture is needed. This in turn will decrease if not eliminate the barriers that commonly exist. The tools Hofstede has created will play a big role in uniting businesses and finding solutions much easier. The Hofstede model has six categories with which to focus our differences. They are; Power Distance, Individualism, Masculinity, Uncertainty Avoidance, Long-term Orientation and Indulgence.
2.2 Comparisons between China and the United States
(CHINA & UNITED STATES)
2.3 Continued Hofstede Analysis
Looking at the Hofstede Chart it shows how both countries differ in most things. The one area that is almost exactly the same is the masculinity dimension. Below are some ways that our company can better understand the majority of these stark differences.
Power distance – This is one of the biggest factors of culture difference between people and power. Individuals who are ranked high are largely impacted and power is not distributed fairly. United States' index is on the lower scale of 40. American citizens feel everybody should have different roles in the company, while making sure everyone is equal. China has a high index of 80, meaning China finds inequality acceptable and has no problem with it. Within China, superiors can abuse their power, formal authority and sanctions. The Chinese do not have the confidence of getting better positions and find that promotion is beyond their control.
Individualism- An aspect which explains how people within that country work together. United States has a score of 91 meaning we think more about ourselves than others. China on the other hand is a very collective society focused on their culture, traditions and families. Personal relationships are more important than work and they value each other's families to a high degree. China scored a mere 20 in this category making them aware more of others than oneself.
Masculinity- A high score in masculinity shows to what extent a society values achievement, competitive nature and success. A lower score or “femininity” is more focused on the quality of life and caring for others. China has a score of 66 and is success driven. Their focus is to have excellency even if it means sacrificing family and leisure time. For example, hairdressers stay open very late at night among many other businesses. They don't value leisure time and consider it laziness, while not being productive. The people of China travel great distances to find better work and pay in the cities leaving their families behind for long periods.
Uncertain avoidance- Some things cannot be controlled like the future. Every country has their way to try to avoid what might occur. The Chinese ambiguity is low, meaning they are accepting of change and their lack of control in some circumstances. In the United States it's very different. Many companies are from different countries and instead of ownership a lot of them are shareholders and in investors' money running the company.
Long-term orientation – Every society remembers the past while processing the challenges of the future. China is considered to be pragmatic, meaning sensibly, realistically and based on practicality rather than theoretical considerations. China believes that tradition is high on the list of importance, whereas the United States believes in innovation paving the way for the future. The belief that truth depends on societies natural tendencies to behave, save and invest.
Indulgence- This is how we become humans basically how humanity is made, how people control their desires and impulses according to how they are raised. United States has a high score of 68 more than most countries. China has a low score of 24 meaning they feel that their actions are restrained by social norms which includes themselves. They do not indulge in an array of things like recreation, leisure time, vacation time, and even desserts. A lot of that has to do with the power distance aspect and the majority of the population not being able to afford these indulgences.
2.4 Significant differences in scores and cultural characteristics
After comparing the differences from all the information above, the United States and China differ greatly on many things and most importantly cultures. Masculinity like mentioned above was the one area where both countries are similar. Both countries want to be successful and are very competitive, desiring achievements and wanting to be prosperous.
After looking at the differences from the chart and analyzing them, China and the United States have really different mindsets and most important cultures. There are two areas which are close and have similarity, but the rest have a big margin of difference. China is more focused on working together with personal relationships,
In the United States individualism is high, followed by indulgence and masculinity. It's not surprising that individualism is on top because the United States is a self-made country and people have wanted to be self-sufficient not relying on anyone. It's all about the winner who is on top and what to achieve. Everybody wants to be successful bringing the competitive out of everybody.
3.0 Historical and Cultural Characteristics
3.1 – Major Historical and Religious influences in China
China has one of the richest histories in the world. Its culture is more than 2000 years old. There are three main religions in China; Confucianism, Daoism and Buddhism. There is some debate, however, that Confucianism is more of a school of philosophy rather than a religion. The most prominent religion is Buddhism 佛教. It is believed that it started in 67 AD during the Han Dynasty 汉代 (206-220 BC). Ever since then its influence has made a significant impact in the Chinese culture. It has influenced their language, literature and society. For example, Buddhist temples are Holy Mountains which have become attractive tourist locations. Daoism is the next largest religion in China. The Chinese word dao 道 means “way”. So it is roughly translated as indicating a way of thought or life. Daoism was created by Lao-zi 老子 in about the 6th century and like Confucianism has an influence in Chinese culture. At first Daoism was only introduced to a select few. It was a complicated system of philosophical ideas, but in later years it became a communal religion. Some of the philosophies of Daoism include the idea of balance between yin 阴 and yang 阳 which seemingly opposites can have complimentary actions.
At around the 7th century, foreign religions and ideas were brought to China. Catholicism, Protestantism and Islam impacted China which led to more of a separation of church and state. Religious organizations ran without the aid or council of its government. In the 1960s-1970s there was a “cultural revolution”. This revolution had very negative effects in China. This would be the beginning of large scale communism in China. China's communist leader, Mao Zedong 毛泽东, believed the current government system was leading the country in the wrong direction. He led groups of radical followers to attack the current leadership and take authority. He shut down schools and formed them into paramilitary groups called the Red Guards. His influence can still be felt in the way China operates today. Although the Chinese Communist Party has implemented parts of capitalism, it is still classified as a communist nation. This is not to say it is a bad country. It has the world's second largest economy and one of the largest stock exchanges. In regards to the Hofstede dimensions, China has a large long-term orientation which means it maintains links with its own past while at the same time dealing with current and future challenges.
3.2 – Cultural Effects on Marketing Styles in China Since China has such high cultural influences, culture itself plays a significant part in the marketing process. Chinese culture plays a big step in the consumer buying process as well. Confucianism and Daoism taught values that focused on families, which is directly reflected in purchasing behaviors. Parents are wise and should be respected by their children. Children are the future of everybody in the family. So, in China children have an important role and have priority in a family, while identifying the needs of the children.
Other values such as health play a role in the marketing strategies in China. For example, in America, a country known to be unhealthy, would market “healthier” potato chips that say made with olive oil. In China health and medicine are different from the west. America would focus on taking things “out” such as fat and sodium, China would focus on putting healthier options “in”. They would use the terms “cool” and “heat”. It is related to the balance of yin 阴 (cool) and yang 阳 (heat). Hot foods would warm and improve circulation, dispel cold and stimulate the body. Cool food would remove heat and toxins and at the same time nourish the body. 3.3 – Cultural Effects on Management Styles in China China has some of the most successful companies in the world, this is due in part to its management styles. It is a very fast paced country and over time have learned to adapt to the turbulent environment. China's business leaders see their members of their organization as family, in turn demanding a lot from them. Some of the most successful businessmen have started from humble beginnings. This in turn causes them to build, develop and maintain with a strict code of conduct. China has a unique approach to reaching their business goal which comes from the teachings of Confucius. The outstanding companies has everyone report to upper management. This instills a deep fear which comes from China's past instability.
There is also substantial influence politically. Everything has to do with politics. Management must have a grasp of political and social trends so they can direct their businesses and communications to adapt. Businessmen must create two different strategies, a market strategy and a nonmarket strategy. The market strategy is a simple and traditional strategy, but the nonmarket strategy is based on building relationships that have the same interest within the government and its politicians.
4.0 Negotiation Style and Strategies
4.1 Common Negotiation Tactics and Styles Used in China
With a tremendous reputation focused on culture and traditions, China is in the process of building a new chapter in their long history. This chapter consists of leaving isolation to join the free trade market. There is a fine line to walk because there should still be an amount of respect shown to their history. You must acknowledge the history while recognizing their recent advancement into the world markets. The people of China are very smart and have studied other cultures, especially those in the western hemisphere, so you cannot act superior to them. Relationships must be formed on respect and trust. You cannot do anything to jeopardize this trust. China has a history of working together and creating strong networking bonds.
The people of China are soft spoken, and use gentle tones. Many times there may be periods of silence, and that is ok. Don't be afraid of the silence, but be aware of your body language as it is being watched and studied. They are not in a rush, so be prepared to take your time and build rapport with them. Due to a respect for their history names are very important, so address people using the family name followed by Mr./Mrs. Treat the matter seriously and do not joke or comment on the weather as it can be seen as a waste of time.
If there is a language barrier be prepared to have a strong intermediary. This person must conduct business with effectiveness and be able to build the relationship. This person must act on your behalf while being the leader in gaining trust. The Chinese word for negotiation is “huitan” 会谈 which combines the meaning of “discuss” and “judge.” The two teams must work together to benefit both, and not be unequal to one side.
The people of China love presentations, but make sure to bring enough copies and don't leave anyone out. Keep it simple and use many visuals. Red is the color of the Chinese culture, so using it in slides would be effective. Be prepared for anything and anticipate any twists or turns that could occur.
4.2 Negotiating tactics you will use and how your negotiating team can best prepare for and counter the strategies and tactics they will face.
To be successful in negotiations you must know their situation, intent, capabilities, and identify common ground that can built upon during the meetings. Be well prepared with the correct material and understand that you may be negotiating for some time. You must be very patient as part of their culture is moving slow, but be persistent to the matter discussed. Know their culture and traditions and realize that you must control emotions and ego. Finally, you must be respectful, trustworthy and sincere in all discussions and communication. Be prepared to wait on a decision, it will take some time for a group of deep thinkers to come to a conclusion. Do not rush them, let them take their time and be respectful during the process.
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