Four Strategies to Negotiate with the Chinese

Engaging in a negotiation with the Chinese can be a confusing and frustrating experience to a lot of people.  Some of the typical complaints include “Why does it take so long to get a response?” and “I thought we already closed that item, why are we discussing it again?”.  To successfully navigate through the negotiation process requires understanding of how the Chinese view negotiations and adapting your interactions accordingly.  Keeping in mind the following four strategies can help you better anticipate and develop plans to achieve your goals.

1. Spend face time
Having face time when negotiating with the Chinese is crucial to achieving your objectives in a timely and productive manner. In relationship – driven societies like China, personal trust is a necessary premise that cannot be fully achieved unless you spend time face-to-face. Trying to seal all the details of a contract via long – distance virtual communication will prove to be painful and extremely lengthy process. This is true no matter whether your position is a customer or a supplier, and no matter how much competitive advantage you think you have. If the other party is not likely to come to you, plan trips to China and spend at least one week for your first visit. Allow non-task oriented activities to take place while you are there, such as sightseeing and social activities. Utilize these activities to build personal rapport, which paves the way for a smoother and faster negotiation process later on

2. Nothing is settled until everything is settled
Western countries, especially the ones that favor logic usually follow a sequential way of managing timelines and task lists. During negotiations, the expectation is that both parties will discuss, negotiate and agree upon a list of open items. And once a particular item is agreed upon, it is considered closed. The Chinese, on the other hand, regard change as constant and a fact of life and therefore manage tasks in a more fluid manner. In a negotiation, all things are considered interconnected, and should the condition for one item changes, all items are up for negotiation (or re-negotiation). The principle is: nothing is settled until everything is settled. For people who are uncomfortable with being in the state of uncertainty and ambiguity, it is important to keep calm and be patient when this happens. Understanding that the cause of this is the style difference, rather than a purposeful tactic to mislead should help ease the mind to focus on the strategies and issues at hand.

3. Use intermediaries
Using “go-betweens” can be a very effective strategy in negotiating with cultures that are relationship – oriented. The trust and good faith that are established with the intermediary can be passed on to the other party by association. Business therefore becomes more personal. And, by using a third party, strong disagreements can be delivered in a non-threatening manner. This is hugely beneficial in China where harmony and the protection of “face” are essential for a productive business relationship. One of the best times to use an intermediary is when the negotiation has hit a difficult point. Facing a seemingly gridlock, you may want to try to apply some aggressive influences. But knowing that it is almost never a good idea to directly confront the Chinese with strong disagreements, you can pass the message to the intermediary instead. The intermediary, understanding both parties and their priorities, will act as an informal broker to achieve a compromised agreement.

4. Be patient
Being patient is a general good advice in doing business with China in any circumstance. In negotiations, time can be a particularly sensitive topic. This is often the result of internal pressures applied by your own organizations. Keeping patient and educating others in your organization to allow more time is essential to ensure that you achieve satisfying results in the end. Inside most Chinese organizations, decision-making is done through a more lengthy process that typically requires multiple parties to consent to a solution. Naturally, the higher the stake the decision, the longer it takes to achieve such consensus. This is different from the more linear and often more speedy decision-making process in the U.S. The best strategy is to plan extra time for the entire process from the beginning, and manage internal and external expectations accordingly along the way.

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