The greatest threat to companies with successful products or brand name is from intellectual property pirates. Any organization planning to do business in China is well advised to take adequate safeguards to protect their intellectual property rights. (Look Before You Leap: Essential Advice for Doing Business in China)
Cultural Considerations:
The business environment in China is very attractive and there are many organizations that have already made use of the opportunities offered there and many others are queing up to enter the business market of China. It is very important for these organizations to understand the cultural and business practices that are prevalent in China to avoid any kind of misunderstanding due to the major differences in the underluing cultural practices between the Chinese and Western cultures. These differences in cultures have an impact on the way people think and so the understanding of these differences becomes significant. The logic in the thought process of the Chinese is more indirect and round about in comparison to the Western world which is direct. This makes it more difficult for the Chinese to say no and so any disagreement is likely to be expressed in a non-verbal manner, as against the more argumentative and willingness to express disagreement verbally in the Western world. (Understanding Eastern & Western Culture and Business Practices)
The Western world tends to communicate more explicitly, while the Chinese communicate more through implied meanings or in a manner that the meaning has to be inferred. This means their language patterns is indirect. The Western world has a more overt manner of expression of honesty or to be more transparent. The Chinese in this aspect are less transparent tending to be subtle and non-verbal. The Chinese tend to use more receiver-sensitive expressions of themselves, while the Western world is seen to be more sender-oriented. The Chinese are likely to take context and specific situation into consideration for rule interpretation as against the more rule-based thought process of the Western world. The Chinese believe more in the duty of a group, while the Westerners tend to give more importance to the individual. These are some of the more significant differences in business practices of the Chinese that have come about due to their culture and has to be understood for any business operation to be successful in China. (Understanding Eastern & Western Culture and Business Practices)
Business Customs:
The business customs of the Chinese are an extension of their cultural practices. For the Chinese it is essential that a solid relationship develop before important business can be transacted. Written agreements are therefore secondary to their quan xi, which is a relationship that is hard to form and longlasting. Businesses trying to enter China need to understand this so that they do not keep changing their senior people in the country as the Chinese prefer to work with familiar faces. For the Chinese any settlement of business disputes is best done by mediation through third parties. Businesses used to lawyers and courts in this aspect...
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