Conflict Management in China

Presented by ChineseNegotiation.com

& ChinaSolved.com

Conflict Management in China PART II:

The 7 Words You Can’t Say in a Chinese Negotiation

(without thinking carefully)

A glossary of conflict laden phrases in Western-Chinese deal making.

Resolving conflict in China-Western business relationships is very difficult, but avoiding and controlling conflict is much more practical.

Beware of these phrases that SEEM harmless and crystal-clear, but may actually carry a different meaning in China than they do for you.

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Fighting Words:

1. Contract

2. Risk

3. Long Term

4. Truth

5. Harmony / justice.

6. Relationship

7. Transaction

1. Contract

• Westerners see a contract as an independent entity – external from the two counterparties.

• Chinese view a contract as a record of a meeting of the minds between two specific individuals at a certain time and place, under specific circumstances.

2. Risk

• Risk, as used by Westerners, encompasses two concepts.

– A) possibility of loss and

– B) uncertainty.

• To Westerners, these are two sides of the same coin.

• To Chinese, these are completely different things with wildly different ramifications.

Risk (con’t)

• Possibility of loss doesn’t frighten Chinese deal-makers, but uncertainty does. Confronted with an unclear or uncertain future, the wise Chinese deal-maker shuts down and waits for further information.

• When the Western side attempts to push him into action, the Chinese side smells trouble, deception and trickery. Conflict and mistrust ensue.

3. Long Term

• Chinese and Westerners involved in a negotiation frequently accuse the other side of being short sighted, one-off and win-lose, while THEY are long-term, cooperative and win-win.

• The irony is each side accuses the other of engaging in the same distrustful, deal-destroying behavior.

4. Is it truth – or is it Truth?

• Truth, Justice – and the American Way.

– Westerners view Truth as an external, universal constant. It is bigger than we mere mortals – or at least bigger than we Westerners.

• Asians think that this is nuts.

– Everything changes. Price levels, supply chain factors, weather conditions – the world is always in flux. Yin and Yang, ups and downs.

Truth (con’t)

• Westerners:

– A man’s word is his bond – or it isn’t .

– A righteous Westerner feels that the words you said yesterday bind you today.

• Chinese:

– A man’s nature is reliable and consistent – or it isn’t.

– A righteous Chinese feels that your intentions yesterday bind you today.

5. Harmony & Justice.

• China isn’t all fluidity and flux. One thing really is bigger than all of us – but it isn’t Truth. It’s Harmony.

– Westerners prefer rock-hard Justice – like the kind that judges and courts can dispense.

– Chinese prefer soft, eternal Harmony – like that kind that rises from the will of the People.

• Both are great – but they don’t live in the same house.

6. Relationship.

• Westerners tend to view relationships as organic, personal and based on familiarity and shared values. – They are desirable, but not required .

– They develop naturally over time.

• Chinese view relationships as carefully planned and delicately choreographed. – They are intrinsic to the deal process.

– They are systematic and intentional

7. Transaction

• For Westerners, relationships flow from successful transactions. – Test orders and contractual safeguards are standard

operating procedure.

– ‘Good fences make good neighbors’

• For Chinese, transactions flow from successful relationships. – Test orders and contracts undermine trusts.

– ‘Honest men don’t need contracts – dishonest men aren’t bound by them.’

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For more information:

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