Three Myths about Chinese Business Culture

Many major corporations believe that the 2010s decade belongs to China and have been flooding it with managers filled with perceptions and stereotypes.

For these managers going to China, Harvard Business Review points out in its January-February edition three of the major misconceptions about Chinese business. The article, "China Myths, China Facts," by Erin Meyer and Elisabeth Yi Shen, clears up the three major myths.

The first myth is Chinese business and business people are collectivist. In reality, the modern generation, having lived in a repressive state, are now able to more freely express themselves and strive for their personal goals. From the article:

"Interview subjects cited the Cultural Revolution, the one-child policy, and mass migration to big cities as factors in the unraveling collective spirit."

Although collectivism is no longer a dominant theme in Chinese business, it is important understand that many decisions are made in a consultative, group environment. The upside to this behavior is that Chinese are "...highly skilled at working in teams."

A second myth is Chinese business is governed by long-term deliberation. As stated above, many decisions are made by groups, however, Chinese are making group decisions and executing very quickly, relative to Western decision making. The element of truth in the myth is that Chinese build long-term business relationships, as well as setting long-term government policies.

The final myth the article addresses is that Chinese business is marked by risk aversion. The article contrasts a Western view of deliberation, examination, and trial before action, while the current Chinese attitude is "Right, we've decided, boom, off we go!"

This rapid action, according to Edith Coron, a "...French intercultural consultant," is due to: "...(with) GDP is growing at 10% per year, it's understandable that the level of entrepreneurship and risk taking should be so high." This sentiment is echoed by "...Wei Chin, 'We don't want to lose a single minute. We have a lot of confidence, and we are very comfortable with risk."

Although risk tolerance is acceptable, deference to senior staff is still present. Workers are unlikely to share opinions in the presence of more senior individuals. This reluctance is an element of deference and not wishing to make more senior staff look foolish, as well as the desire to not appear brash.

As the volume of business with China increases, it is important to regularly examine personal beliefs, biases, and stereotypes. While there may elements of truth in these beliefs, a changing world brings changing behavior. As China develops a more mature economy, and hopefully less repressive regime, new behavior has emerged. Collectivism has been replaced by individualism, long-term deliberation with real-time reaction, and risk aversion with risk tolerance. Awareness of these changes makes for a more successful manager and business.