You have arrived and it’s not a holiday that you have planned but actually moving yourself and your family to Shanghai to work and live with all those aspects it involves. One comforting aspect of your relocation to China is that you are not alone.

Being a foreign manager in a multinational organization in China involves substantial challenges and stressful situations as you will be working in a new environment with different cultural and business values. So how can you best overcome these challenges and ensure that your daily life and long-term business are reached as effectively as possible?

Doing business in China is quite different from doing business in Western and in other Asian countries. Not only is the Chinese culture different from the neighboring countries, but the country also differs greatly in terms of its political system and by the fact that the country has just recently become open to the influence of international business practices.

When you are working in new environment, all the habits and behaviors that you were comfortable with back home seems not to work anymore. Simple office tasks that used to be left-hand work for you, all of a sudden becomes overwhelming and uncontrollable.

People are different and handle these situations differently. In general, be open-minded to new suggestions and methods, particularly suggested by those who have experience in your field and have been doing business in China for a longer period of time.

There do however seem to be some phases that most people go through over a period of time. First there is the honeymoon period, where everything seems different and exciting in a very positive way. You are full of optimism regarding your work situation and the family is thriving as well, feeding on new experiences.

Then after a while, the culture shock sets in. Since you no longer have any familiar behavioral norms to follow and even the family life has changes, a period with discomfort, confusion, frustration and for some even withdrawal appears. As most people are different, they also handle the situation differently but it’s important to reflect over your new life and focus on the things that are working out for you, either at work or at home. The third phase gradually comes as you are getting more familiar with the ways things run in your ‘home-country’. Shopping is no longer the struggle it used to be and you will get more friends that you can share your experiences with and the community seems to be more open to you.

In the final phase, you have reached a level of adaptability and adjustment that allows you to function well in your position and maybe even create an extra level of energy that will enable you to do even more things to settle in such as taking Chinese classes or join different network and/or business groups.

During this period of time, you mood may fluctuate and slight depressions may set in and some people may never adjust and remain negative and without the chances of having many – if any - positive experiences during their posting in China while others will adapt almost immediately and function as complete beings from day 1.

Not matter which type you are and how long it may take you to reach a level where you are happy with your life, do try to stay positive and remember that this is an experience that proves awarding in the long run and allow for personal growth and cultural understanding that many of your friends back home will never experience.

Guanxi

Guanxi is that magic thing that seems to be at work in virtually every aspect of a Chinese person's dealings with other people. The usual translation is relation or relationship but connection, as in "I've got good connections", is perhaps more accurate. A good relationship is a connection. Connections are maintained between individuals and families through keeping contact and doing favors and are not transferable between individuals or to organizations. In order to succeed in China a foreigner must be aware of the concept of guanxi and cultivate long term relationships.

The average expatriate has no connections upon arrival to China. You may have knowledge about the organizations and the people your predecessor was working with, but this is information, not a connection. Your predecessor’s introduction of you to these people is only the cue for you to create your own connection with them.

To build a good relationship with your Chinese counterparts will take a lot of time. Good ways to do it is to go bowling, play golf, or any activity you think is suitable. This is definitely an alternative to repeated banquets. Karaoke is essential for business in China, and you will find that the Chinese often have had a lot more practice of it than you have!

It is also good to send a greeting card at Chinese New Year, to give your company's calendar at the end of the year, ask how the daughter is doing now that she has started university, etc. This is not a business relationship only based on contract, but also on trust and understanding. If you are invited to a Chinese home, you have indeed managed to establish a good relationship - foreigners are rarely invited to visit their business contacts' homes.

Personal relationships can carry more weight than written contracts. It is not uncommon to find that a written contract with a Chinese company has been voided or arbitrarily changed simply because the key contact person on the Chinese side has left the company. Legal recourse to address this problem is becoming more available, but it continues to be a problem. You may also experience the same situation if the key person on your side leaves the company.

It is also good policy to have guanxi with the authorities that you deal with for personnel, office, cars, or any other aspect of your business that will need approval or inspection. You may want to take people out for dinners or present them with small gifts, your company's give away items with its logo, or a carton of imported cigarettes. Your Chinese staff will know when giving gifts are appropriate. There are rigorous rules about bribery and corruption, and a lavish gift may be self-defeating.

People

Many expatriates have little exposure to Chinese people other than their company's local staff, business contacts, and occasional taxi drivers, waitresses, or other people providing service to them. Language presents a large communication barrier not only for the expatriates, but also for the non-Shanghainese Chinese, because of the special local dialect Shanghainese.
Other differences are found in culture, daily living and work practices and living standard. Quite often, foreigners are effectively isolated in foreigners' compounds and buildings, where the Chinese cannot enter without signing in and stating their purpose of visit. As far as living standard goes, the average expatriate makes an amount per month that the vast majority of Chinese can only dream of. This isolation is true in leisure activities, choice of restaurants and the like. Such substantial differences explain why it is not easy for expatriates to make a lot of local friends.
Shanghainese are very proud to distinguish themselves from their neighbors in Jiangsu and Zhejiang although most city residents are only two or three generations separated from these provinces. There is some distinction among Shanghai residents based on provincial ethnicity and another distinction based on neighborhood affiliation, but these are not great and quite difficult for a non-resident to notice. Shanghainese is a local dialect that is not easy for non-Shanghainese to understand.
The Shanghainese pride them on being the most outward looking of all Chinese. Though China was closed to the outside world for decades, Shanghai has somehow developed its own tradition of modern cinema, art and literature that few other cities in China could match.
The Chinese in China have many similarities with other Chinese groups throughout the world, but the difference in the system of government, the living conditions and education levels obviously make a difference. Most Chinese people you see in Shanghai will behave according to Chinese customs and manners. Many young Chinese now have a lot of exposure to Western culture and have adopted many Western habits and customs, but they still behave and think quite differently from their western counterparts.
There has been little or no concept of privacy in China for hundreds of years. In the past, people were all packed together in tiny rooms and many of them still live that way today. It is not unusual for the cleaning lady to walk into your bedroom without knocking on your door first, or to open your mail. Visitors may show up at your door at all hours of the day and night without calling beforehand, and expect to be admitted graciously and offered a cup of tea. People you have just met will ask how old you are, how many cars you own and how much money you make. You may also be told how you should cook your food, clean your house better, or raise your children.
In China, you may be told that you are fat. Being fat has always been a sign of health, so older people will compliment you on it as part of your good health. Young Chinese, however, would not agree to this and think of it negatively. However, in general, the Chinese are more reserved and spend more time making small talk before coming to their point. Also, waiting in line in shops and getting on the bus one at a time is not the normal behavior and a foreigner acting according to his or her upbringing may very well end up never getting on the bus!
Even though there are many foreigners in Shanghai, you will sometimes still find yourself an object of great curiosity, especially to visitors from the countryside. Expect to be stared at quite openly. Some people may want to get their picture taken with a foreigner, especially with blond haired children.
The Chinese are very fond of children and China is a very safe place for bringing up children. People in the street are quite friendly to other people's children and will want to pick them up and play with them. You will be asked lots of questions about your children. If you are able to speak Chinese, you will possibly be given suggestions on the type of clothes your children should wear and food they should eat, etc. In China, because of the one child policy, the children have the full attention of their parents and grandparents, who often give whatever they have to the children to make them happy.
The Chinese often recognize this as a problem and there have been studies made on the possible effect on the country when generations of single children grow up. Unfortunately, Western children baby-sit by Chinese nannies receive the same treatment and it is often a struggle for the Western parents to keep their own children from being spoilt.

 

Language

The business language is Mandarin. Mandarin is the universal language in a country full of different dialects. People in Shanghai will most likely be speaking Shanghainese with other people from Shanghai and as such creating a group of language in which they feel comfortable and secure, but it also creates barrier for those outside Shanghai including the foreigners.

Each province or major city have their own dialect that only people in that particular area are familiar with, this means that without Mandarin as common language, the Chinese would not be able to communicate with their own nationals.

An increasing number of young Chinese speak very good English, but if you are dealing with higher level managers or civil servants (i.e. generally older people) their English often is scarce or non-existing. You should also consider the fact that most people, Chinese or otherwise, dislike putting themselves in a weak position, which is what you do when negotiating in a foreign language.

Interpreters are available through the Diplomatic Service Bureau. However, in order to get an interpreter familiar with your business area, you might consider sending some of your Chinese staff on language training. Language training is often regarded as a fringe benefit, even if the training takes place after office hours. There are also consultants with experience in various fields that can assist in these situations. Accurate interpretation, both in commercial and technical negotiations, is imperative for success.

There are an increasing number of expatriates who speak good Chinese, but these have generally studied the language for a couple of years abroad, in China or Taiwan, and have a strong interest in the country itself. The average expatriate, though, comes to China from either their home country or from another posting abroad, and stays two or three years.

Chinese is difficult to learn, and an expatriate's workload is often such that attempts to learn the language many times result in giving-up but do give it try as even a few words or sentences in Chinese can be a great opener for any business meeting or event.

Meetings

Appointments are absolutely necessary. It is also good practice to present the issues you would like to discuss and to keep to them. For the first meeting, you may want to keep to a few general issues and leave the complicated issues for later meetings. When you have established that you are a good guy who wants a good relationship, the complicated issues will be easier to resolve later. Most expatriates will say that impatience is self-defeating. The Chinese counterpart may have difficulties in getting other Chinese units to cooperate, but they will not tell you so. You may even be having the meeting with the wrong people.

When meeting any business contact for the first time, shake hands and present your business card with both hands as you introduce yourself. When accepting a business card from someone, accept it with both hands read it and acknowledge that it will be remembered and kept in a safe place, if possible leave it on the table visible for all parts in the meetings and give it a casual glance from time to time. This shows respect and is an important Chinese custom.

Having your card printed in Chinese characters on one side is standard for expatriates, and greatly appreciated by the Chinese. It is also common to have your country's name included in your company's name, as many people you will be dealing with will not be familiar with your company, however well known in the West. Chinese surnames come before given names and you should always address people by their title and surname, i.e. Mr. Wang, Mrs. Zhao. Married women do not take their husband's surname. Never address someone familiarly by his or her given name until you are invited to do so.

Generally, the Chinese are much less blunt in business relations than Westerners. A foreigner being polite, frank and sincere is always appreciated by the Chinese. Guanxi is extremely important in getting anything done in China, and the Chinese will spend time getting to know you and your company before getting down to the main point of any major business transaction. A shortened version of this process is also common for smaller business transactions.

Negotiations

Be prepared for lengthy negotiations. The Chinese are skillful bargainers and will use your offer to lower your competitor's offer, and vice versa. Foreign business people have experienced the situation where they are seated in one conference room, the competitor in another, and the Chinese party walking between the two rooms comparing and negotiating. Not only are the commercial terms scrutinized to the slightest detail, but you must also expect in depth questioning on technical details and requests to make changes and adaptations to local conditions.

These negotiations can be terrible frustrating for foreigners that are used to up-front negotiations. However if you are here for a long-term period of time, try to adapt and learn from your counterpart, it will for sure prove awarding over time. And once you know and understand your business partner’s strategy and goal, it will be easier for you to control the negotiations in your direction and to your advantage. There are several business books that are discussing negotiations tactics in China and the above advices are only general.

Banquets

At the start of a long-term business relationship and throughout the year at special occasions such as the Chinese New Year, your Chinese business contacts will invite you to attend banquets. It is also inevitable after signing a big contract. This is an important part of establishing and maintaining the business relationship. The banquet is a time to socialize and get to know each other better -- business discussions are off limits. Your host may give a speech or propose a toast for the cooperation, and you should have a short, friendly speech prepared to reciprocate. The seating is usually important, and you should ask your Chinese staff for advice if you are not sure of the hierarchy.

Banquets can be trying for foreigners, especially for newcomers. The food is one factor. A 12 or 15 course banquet is not unusual. You may be served unfamiliar delicacies, such as sea slug or deep fried scorpions, ordered in your honor. These dishes are very expensive, and you sho0uld try to eat some if you can. If you really cannot, pushing a few pieces around on your plate will give the illusion of having tried them.

Another factor is alcohol. Heavy drinking of beer and Chinese spirits is always a major part of the banquet, especially in the north of China. You will be asked to ‘gan-bei’, empty your glass, with the Chinese hosts in turn. If the Chinese greatly outnumber you, you may ask to ‘gan-bei’ with a group of them in turn, instead of with one person. Chinese spirits are very potent (42-60 alcohol percent), so be sure to have eaten before the toasts start. You may refer to religious reasons or to stomach problems to avoid drinking, but a good drinker is always appreciated.

Some expatriates try to avoid banquets by scheduling their meetings in the morning. After a morning meeting, there may be a formal lunch, with only two or three gan bei. However, the meeting might continue into the afternoon and you will end up having a banquet in the evening anyway.

Still another factor is the language. It is not unusual for foreigners to be the only representative from their company, and there are not always interpreters present at these occasions. If it is a natural thing for you to do, you can always try to communicate with your hosts anyway. A banquet is not necessarily a serious gathering, more likely the opposite. Show how much you have eaten, how you could not get another piece down, make an obvious attempt at cheating when you empty your glass, joke about your host’s ability to drink. Keep to simple subjects that will be understood through gestures, and you will be communicating with your hosts, which is the purpose of the banquet. You may even find that it is easier to become friends without a common language.

Loss of Face

As mentioned earlier, saving face is very important for the Chinese, and loss of face may prove very damaging to your business relations. If your Chinese counterpart is wrong, you must not point this out in front of colleagues or subordinates. Instead, suggest that there may be some problems doing it that way and that maybe there is another way to do it.

After a few days, your Chinese counterpart can come up with a better solution that allows him or her to save face, and allows you to get the result you wanted.

You may be promised that something will be delivered on a certain day when in fact it cannot be done that day. When the day arrives, various excuses will be offered for the delay. It is always preferred to help the person solve the problem without making him or her look bad. Showing anger and shouting at the person will usually make the situation worse. However, there are cases where showing your frustration has proved useful in prodding people, who are merely being uncooperative, into action.

The concept of loss of face also applies to your Chinese staff. Once you have made them loose face, it can be quite difficult to restore confidence.

Information

Although the situation is improving, accurate information can still be hard to come by in China. A common problem in foreign companies is that the expatriates stay only a few years, and a lot of information lies in the brains of the Chinese staff. It is good policy to keep records of regular contacts, whether it is customers, suppliers, or Chinese authorities. Information hoarding is not an unfamiliar phenomenon in the West, but the consequences may be direr in China.

Many expatriates feel relieved to delegate the contacts with authorities to the Chinese staff, but if the Chinese person in charge leaves the company, it may be found that nobody but that person is familiar with the procedures and contacts required for certain aspects of the business therefore make sure that you maintain regular contact with key persons within the government or your business partner.

Conversational Subjects

Few subjects will be taboo in social conversations. However, Chinese will not discuss delicate political matters in any great detail with a foreigner they do not know well. You may be asked for your opinion about the Tian’an men incident for instance, and a brief, truthful answer may build trust for later openness. Do not ask for your host's opinion unless in private. Taiwan and Tibet is a very sensitive issue that foreigners should refrain from discussing as the traditional Chinese viewpoint is that these are parts of the mainland.

Body Language

Chinese tend to be reserved in personal behavior. Avoid unnecessary physical contact or broad gesturing, especially with the opposite sex. Do not pat children on the head, but take special notice of them, as the Chinese are indulgent parents who dote on their kids.

Stress and Frustration

It is not uncommon that the Western businessperson experiences a lot of stress and frustration working in China. It is common that expatriates leave the country on R & R every three months to recharge their batteries. Sports are also a good way to relax, and to improve the working performance in general.

Business Hours and Holidays

Since May 1995, the official working week is 40 hours, i.e. Monday through Friday. Chinese business hours can vary according to the region and the season, but are generally Monday through Friday 8.30 to 17.30, with a longer or shorter lunch break. Some organizations close on Saturdays. You will find that some authorities have political studies one morning or afternoon a week, which means that the office will be closed. For shopping, many of the malls, supermarkets and shops are open from 10.00am- 10.00pm.

China has very few holidays. The most important is the Spring Festival (Chinese New Year) in January/February, when people, in theory, take three days off to go see their parents. However, you will notice that in practice many activities slow down significantly the week before and after Spring Festival. Any activities requiring cooperation from Chinese authorities or organizations will inevitably be delayed during this period, and there is nothing you can do about it. The holiday period lasts around one week.

The other big holiday is National Day on October 1. Usually everybody gets around one week off. If the day falls on a weekend, the government will allow for compensation holiday the following week. Other holidays are International Labor Day on May 1, and, less important, the Qingming on April 4-5, the Dragon Boat Festival in summer and Mid-Autumn Festival in autumn. These latter holidays do not involve time off, and the dates vary with the lunar year.

Dining

Food and dining is a crucial part of the Chinese culture and an important way for the families to gather, especially around Chinese New Year and other holidays. The Chinese kitchen is superb and consists of many different variants of tastes and ingredients depending on the particular region in China you are in, so to speak of Chinese food as one category does therefore rarely make sense.

All provinces and local areas have their own signature dishes and you will able to find many specialized restaurants in Shanghai such as Sichuan restaurants, Cantonese restaurants, Shanghainese restaurants, Dong Bei restaurants (north west), Muslim restaurants and Hangzhou restaurants just to mention a few.

When you are eating at a Chinese restaurant or at a private home, the host (or hostess), traditionally, will sit with his back to the entrance and the guest of honor will either be seated opposite or to the left of the host.

As a guest you should wait to be invited to sit. Men are often seated before women. When you eat with a family, the head of the family and his wife will normally sit together and the tables are usually round, making it easier for all people to converse freely and to feel equal.

The food is shared amongst the party and you will help yourself to individual food items from the plates with dishes that are placed in the center of the table. Using chopsticks, food should be taken from the container and brought to the plate before being eaten. Do feel free to check if you are unsure of anything – your host or the waiter will normally be happy to enlighten you about the food and customs.

The Chinese love food and often express praise when a dish is served, commenting on the appearance and then the taste. This praise will endear the guest to the host, as Chinese host always takes great care and thought in the choice of the food served. Whether you are a guest at home or in a restaurant, praise is appreciated but the host will insists that the meal is a simple one even if it is the most extravagant meal that is being served.

Tea

You will always be offered tea to the meals, and tea drinking is an important part of the Chinese culture. Tea is drunk to aid the digestion and comes many flavours. Green teas are highly thought of such as Longjing varieties and partially green tea as Oolong. There are also red teas and flower teas. When drinking tea throughout the meal, it is usually custom to top up others’ cups before your own and each time Chinese tea is poured for you, you should thank the person pouring. It would be discourteous not to drink some tea – at least a few sips – every time it is served.

You may observe Chinese gentlemen tapping their first two fingers of the right hand on the table when being served tea. This means ‘thank you’ and evolved during the Qing Dynasty. Emperor Qian Long was traveling the country incognito and poured tea for his fellow drinkers in a tea house and his bodyguard, unable to bow without revealing his master’s identity, tapped the table with his right index and middle finger in the form of a bow to show his respect.

At a Chinese restaurant the host will do the ordering but he can confer with you if it’s an informal meal. A meal should include at least one poultry dish, one meat and one fish dish and always soup and vegetables. It is also usual to order some rice (fan) and/or noodles (mian), which are basic staple food in China. And at the end of many dinners, fresh fruit such apples or water-melon is served to help digestion.

Tea is as mentioned above always served during dinners but also soft drinks and beers are common for the Chinese. The Chinese beers are light beers usually between 3.4 – 4.3 percent alcohol and are all pretty good. The brewing techniques date back to the period where the foreign influx was substantial and especially TsingTao which was initially brewed Qingdao by the German community is a good choice. Foreign brands such as Carlsberg, Heineken and Budweiser are also often found in the local restaurants.

Spirits

The common word for spirits in China is ‘jiu’ and since most places will serve differerent variations such as Shaoxing-jiu and bai-jiu, you will have to specify your order.

Shaoxing Jiu comes from Shaoxing in Zhejiang Province, which can be reached from Shanghai in 3-4 hours. The Shaoxing wine is kept in earthenware jars to age at least one year before being put on sale, though most wines are matured at least five years or more. The main ingredients are glutinous rice, wheat, a little barley and yeast.

Bai-jiu and mao-tai are the most well-known spirits in China and can be very strong and it is said that it can be compared to French brandy though the taste, depending on the brand, can be quite awful. The main ingredient in bai-jiu is sorghum, which is a cereal grain plant that is used to in a variety of ways including making alcohol. It is said that there are more than 700 makes of sorghum spirits in China – and they are not all of the best quality, with prices fluctuating from RMB3.00 for a bottle to thousands of RMB for the best ones.

Jiu is served in small porcelain cups and the cup is held with in the right hand with the thumb and index finger on the opposite of the top rim. To lift the cup with both hands is courteous, the left hand supporting the underneath of the cup.

When eating Chinese dinner, there is usually one kind if jiu served and the choice depends on the host’s liking. When toasting during a Chinese meal, any drink is acceptable, being soft drink, tea, beer or bai-jiu. The glass is held with both hands and should be held up high while saying out load ‘gan-bei’ meaning bottoms-up and the glass is emptied. Another version is ‘shui-yi’, which means ‘drink-one’ or just a little bit. Which version to use depends on the host, the drinks and the general company. Drinkers are admired in China and if you can keep up with your host(s) in drinking, you will be looked upon with respect.

Table etiquette

At a restaurant, nuts and pickles are usually already on the table when the guests arrive and these should be eaten with chopsticks, however for those that has yet to master the techniques of picking up with chopsticks, the fingers can be used.

During the meal, different sauces may be served for additional flavouring. By using your utensils, the food may be gently dipped into the sauce before eating and when the dipping is common such as in chili or pepper sauce, make sure that you place the untouched part of the food in the sauce and do not deposit any rice from your chopsticks in the condiments.

Diners are also often given a damp hand towel before and after the meal to wipe mouth and hands. After use, the soiled section is folded inwards and the towel placed casually next to your setting on the table.

You will often be invited to start eating by the words ‘chi-fan’ and you may reply in English; ‘let’s eat’. You should also note that to be served a morsel of food from your host’s chopsticks in an honor and you should eat the piece of food even though you may dislike it.

If rice is eaten, then pick up left hand and lead it close to your mouth, while using the chopsticks to push or shovel the rice (food) into your mouth.

There are a few rules about using chopsticks. Chinese superstition has it that if the chopsticks are dropped, it’s a sign of bad luck. Chopsticks must not be stuck upright in the rice bowl as this resembles the joss sticks in an urn at an altar and as such will be interpreted as you wish someone at table dead! Chopsticks must not be crossed one over the other and not used for gesticulating or pointing, except gesturing to invite people to begin eating. They should also not be sucked on.

Eating should be done quietly, chewing with ones mouth closed, although a little noise is in order. And yes, gentle burping as performed by the Chinese is a sign of appreciation of the food consumed.

Upon finishing the meal, which means eating all the rice in the bowl, chopsticks are placed together to the right side of your bowl, either resting on the chopsticks-rest of on the table at right angles next to you – they should not be placed on the rice bowl.

A toothpick is commonly used at the end of the meal, using right hand, while the left hand is held over the mouth as a form of courtesy. After the meal, it is customary for the guest to say ‘xie-xie’, which means ‘thank you’ and the host will reply with something like ‘don’t mention it’.

Finally, remember that if you are entertaining Chinese friends or business partners, that an even number of dishes should be ordered. Also, an even number of people should be invited if possible for good luck. This in particular applies for business dinners!

For complete lists of restaurants, we refer to the many free English magazines that are circulated in Shanghai and other major cities in China. These are kept up-to-date on a monthly basis and if would not the supply of restaurants honor by listing the best ones here as new ones are popping up everyday and old ones closing down.

Bon Appetite!