Thursday, 22 May 2014

Chinese business models work well in Chinese business culture compared to Western business models

Six months ago I spoke with the owner of a medium sized Chinese company about modernising her company from the traditional Chinese business model to using a business model from the west.

Interestingly, the lady owner explained that this is exactly what they had done a few years ago and then laughed. She explained that she wanted to increase performance and profits and that the best way forward would be a western business model.

However, applying this with the Chinese business culture was very different. She got the whole company involved in the process but the culture wouldn't mix with the new business model.

In the end the owner and her work force were unhappy, stressed out and decided to go back to their original Chinese business model. The owner said that she was making money, the work force was happy and that she shouldn't have got greedy in the first place.

Even though this was a medium sized company we hear this problem a lot from the larger British companies who have opened a business in China or are dealing with a Chinese company.

Many blame the language barrier and have to use  to try and drive their message and orders forward but when looking closer it is in fact a cultural issue.

Culture is how people are brought up, educated and how they do things. In that country it works so why change it or struggle to try and change it. When you are doing business in a different country, be it France or China you have to do the business culture their way for it to work effectively.

Published by: Gary Rice, Go Frontiers (UK & China)

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