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The Influence of China and UKs’ Cultures on Doing Business th 24 April 2007 Melville Petrie MA MBA FCIL FCILT Business Development and Inter-cultural Training for China 26 Apr 07 PAI Ltd Part One Introduction to The United Kingdom – The Country, The Geography, The History and The Culture The Role of Government in business in UK Foreigners in The UK Working with the British 26 Apr 07 PAI Ltd Part 2 Introduction to China The Geography, The People, The History and The Culture The Role of Government in business in China Expectations of Chinese professionals coming to UK Working with the Chinese 26 Apr 07 PAI Ltd Part One Introduction to The United Kingdom – The Country, The Geography, The History and The Culture The Role of Government in business in UK Foreigners in The UK Working with the British 26 Apr 07 PAI Ltd United Kingdom – Geography, History and Place in Europe 26 Apr 07 PAI Ltd United Kingdom - Geography Small group of western European islands Geologically ancient in North West of Scotland - Torridonian Range of rocks include alluvial valleys and sandy heaths in east make for wide range of landscapes in a small area Longest road journeys only about 800 miles Major centres of population - London, Birmingham, Manchester and Glasgow Industry becoming increasingly service rather than manufacturing based. 59 Million People - continuing immigration over past 2 thousand years England, Scotland, Wales and Northern Ireland all have separate identities 26 Apr 07 PAI Ltd Universal suffrage United Kingdom - History Little contact with outside world until 1st Century BC - Roman Invasion Successive invasions from Europe 5th to 10th Centuries AD Frequent wars in Europe 10th to 20th Centuries Britain strongest country in Europe in 19th Century with vast empire enabled by a powerful navy No longer colonial or world power nor yet fully part of Europe Historically a monarchy, the UK’s democracy now increasingly governed from Brussels 26 Apr 07 PAI Ltd United Kingdom - Place in Europe Public opinion on Britain’s membership of European Union deeply divided. Mistrust over possible loss of the British pound and joining Euro. This has major implications for international trade. Great national pride that British economy is performing better than European nation’s economies. UK’s wars with and in Europe strengthen the people’s view of being ‘British’. Recent history in Middle East has increased mistrust of USA and made people more open to European neighbours. 26 Apr 07 PAI Ltd ‘International’ in UK can mean ‘European’. Cross-cultural Issues To many people in Britain, the game of cricket is synonymous with their view of British culture. Professor Geert Hofstede of the University of Limburg in Maastricht defined culture as the collective programming of the mind which distinguishes the members of one group of people from another 26 Apr 07 PAI Ltd Cross-cultural Issues Hofstede’s Four Concepts Power Distance - the social distance between individuals at different levels within a hierarchy Uncertainty Avoidance - greater or lesser need to avoid uncertainty about the future Individualism versus Collectivism - the relationship between the individual and the blood-family/group/community Masculinity versus Femininity - the division of roles and values within a society 26 Apr 07 PAI Ltd What makes UK what it is? Small, crowded island Island Race Views of ‘foreigners’ Multicultural Individualistic Time-oriented Work oriented Work-Life balance Success-oriented Respect for tradition Education Society in transition? Economy in transition? 26 Apr 07 PAI Ltd British Business Culture Direct approach to business Establish relationships Self-effacing Understatement Humour Meetings Deadlines Respect for management and the right to challenge and interrupt Political Correctness Women in business CVs 26 Apr 07 PAI Ltd British Business Culture The British have a good regard for Chinese and respect their business skills The British are analytical and think in abstract terms In negotiation they believe only objective facts Understatement and humour hide real seriousness and achievement Individual initiative and individual achievement are prized The British take pride in working for respected companies The British get anxious about meeting deadlines and achieving results The British are self-critical but it is not a good idea to criticise them as well Do not be offended if the British are direct in their comments or challenges - offence is not meant Short-term results are preferred to long-term results The working day is Monday to Friday 9.00 a.m. to 5.00 p.m. generally Lunch is between 12.30 and 1.30 p.m. usually/often eaten in the office The British do not like to be made to take decisions quickly Gifts are not a normal part of business in Britain 26 Apr 07 PAI Ltd Part 2 Introduction to China The Geography, The People, The History and The Culture The Role of Government in business in China Expectations of Chinese professionals coming to UK Working with the Chinese 26 Apr 07 PAI Ltd The Land 9.6m sq.. km 1.3 bn population Coastline 14,500 km Land boundaries 22,147 km Afghanistan Macao Russia 26 Apr 07 PAI Ltd Bhutan Mongolia Tajikistan Hong Kong Myanmar Vietnam Kazakhstan Nepal Laos North Korea Pakistan The Land Geography Environment Climate Culture 26 Apr 07 PAI Ltd Mountains, high plateaux, deserts, plains, deltas, hills, huge and small rivers Greenhouse gases - Shanghai revolt Deforestation Desertification Endangered species Extremely diverse subarctic in North and tropical in South West 4,500 years of recorded history - Confucianism, Legalism, Daoism 50 years of Communism 15 years of Capitalism National Politics Executive - headed by President and Gen Sec of CCP including Standing Committee of Politburo and State Council Five main functions - Legislature Judiciary Military State Council – highest administrative body – the real power National People’s Congress – ‘parliament’ Chinese People’s Political Consultative Conference – undemocratic and answerable to noone Key personalities Hu Jintao- President and General Secretary of CCP Wen Jiabao – Premier/Head of Government Huang Ju – Executive Vice President Hui Liangyu – Vice President Zeng Peiyan – Vice President Zeng Qinghong – Vice President 26 Apr 07 PAI Ltd Local Politics Local Government – 23 Provinces – Anhui, Fujian, Gansu, Guangdong, Guizhou, Hainan, Hebei, Henan, Heilongjiang, Hubei, Hunan, Jiangsu, Jiangxi, Jilin, Liaoning, Qinghai, Shaanxi, Shandong, Shanxi, Sichuan, Taiwan, Yunan, Zhejiang 5 Autonomous Regions – Guanxi, Inner Mongolia, Ningxia, Tibet, Xinjiang 4 Municipalities – Beijing, Chongqing, Shanghai, Tianjin 2 Special Administrative Regions – Xianggang, Aomen The Local Mayor Local Party Officials 26 Apr 07 PAI Ltd Industry & Economy Economics China keeping West afloat last few years - ? GBP 10.5% growth (2006) GDP (purchasing power parity) US$10 trillion GDP – Per Capita (purchasing power parity) US$7,600 (2006) (US$460 (1979)) Overheating? Corruption? Foreign investment still hazardous - banking and railroads Production to foreign investment/acquisition, IBM/Lenovo, MG/Nanjing Auto The Future 26 Apr 07 PAI Ltd 19th Century - UK’s 20th Century - USA’s 21st Century - PRC’s? The People The change in their daily lives Almost total Personal freedom - education, clothes, business, employment Little political freedom Party Membership Increased personal wealth Limited Consumer goods East-West divide Increasing overseas engagement 26 Apr 07 PAI Ltd It is a man’s social being that determines his thinking. Once the correct ideas characteristic of the advanced class are grasped by the masses, these ideas turn into a material force which changes society and changes the world. Chairman Mao Zedong 26 Apr 07 PAI Ltd What Really Makes China What It Is? 4,500 years of civilisation and 600 years of the West 26 Apr 07 PAI Ltd What Really Makes China What It Is? Confucianism: 12th Century philosophy that still matters today 26 Apr 07 PAI Ltd What Really Makes China What It Is? The Dragon awakes - 50 dramatic years - from Revolution to Capitalism 26 Apr 07 PAI Ltd Communicating Effectively When to use Chinese and when to use English A few well-chosen and well-spoken phrases are received with tremendous natural good grace please learn a few! The Chinese become very suspicious indeed of foreigners who speak Chinese too well. There is a real anxiety about foreigners getting too close to the Inner Circle. Even if a foreigner speaks good Chinese, he or she must be very confident to negotiate in Chinese unsupported. 26 Apr 07 PAI Ltd Questions and Answers Thank you for your attention. Have you any questions? 26 Apr 07 PAI Ltd