In forming such joint venture arrangements, the challenges the Chinese business negotiations pose is so great that there had been instances that many a number of business deals between China and other western countries including USA had failed because of poor negotiations. As John Graham and Mark Lam (2003) see this is because often "Americans see Chinese negotiators as inefficient, indirect and even dishonest, while the Chinese see American negotiators as aggressive, impersonal and excitable". Differences in the management style and problems in negotiations have deep cultural origins. Despite these hindrances, it is possible to win the negotiations with Chinese businessmen, provided a clear understanding of the social, cultural and economic aspects of the negotiation with Chinese entrepreneurs is evolved. This paper presents an in-depth analysis of the intricacies of Chinese negotiations including the cultural background of such negotiations. The paper also deals with the influence of Confucian traits like hierarchy, harmony and faces on communication, characteristics of communication and the Chinese perception of negotiation. Further the paper will also discuss the challenges the Chinese negotiation process poses for managing the international business in China.
2.0 Literature Review:
A number of studies had been conducted in the area of business negotiations of the Sino - Western and Sino - American joint venture arrangements. These studies which started around the 1980s have made an in-depth study into the peculiarities of the negotiations of business deals with Chinese government and businessmen. Most important studies have been conducted by Blackman 1997; Chen 1993; Davidson 1987; Deverge 1986; Fang 1999; Frankenstein 1986; Lee and Lo 1988; Pye 1982; Stewart & Keown 1989; Tung 1982. The primary objective of these studies is to bring out an exhaustive narration of the socio-cultural implications of the negotiations with the Chinese and the intricacies thereof. It cannot be said that these studies have completely made the recommendations for the successful negotiation of business deals with the Chinese business empires. An abstract of these studies is detailed in the following sections.
3.0 Role of Culture in Chinese Negotiation:
The Chinese culture which is 5000 years old has large influence on their business negotiations. The rural origin of a majority of the people has made them to retain their agrarian values. Social and economic theories attached more importance to the agricultural base rather than commerce and business. Because of the rural base, the human values assumed more prominence in the negotiations than the business profits and gains. John Graham and Mark Lam (2003) say that "Chinese negotiators are more concerned with the means than the end; with the process more than the goal."
'Morality' is the next aspect of culture that greatly affects the Chinese negotiations. Confucianism, which is a 2500 years ancient Chinese philosophical tradition, makes morality the all pervasive factor throughout the negotiation process. For coherence sake, the detailed discussion on 'Confucianism' is included in the section on Chinese Business Culture.