Cultural Behavior Of The Market Of China: A Holistic Analysis

China's rich trading history

Question:

Discuss about the Issues in International Business.

Culture is termed as the most basic phenomena and the reason on which the behaviors and wants of people depends. It is the root cause of the trends of business which is done in a specific country. In the following report discussion on the cultural behavior of the market of China is done. China has a very rich trading history as the city of Beijing and Shanghai had been major business centers in the ancient world. To know the cultural behavior of people of China it becomes important to know their cultural background. In the same way it becomes very crucial for the business entrepreneurs to know the cultural behavior of Chinese market and to know the scope of their business. The following report discusses the rationale of the Chinese market. Moving further, cultural analysis of the Chinese market is done in which business culture has been given utmost importance since there is a lot of importance of business and cultural etiquettes in the eyes of the Chinese people. To analyze the cultural dimensions Hofstede’s method of cultural analysis has been done. China being the host country its comparison in culturaland business context husband done with Singapore to know the difference between business trends and their source of changes of behavior.The following report holistically discusses the issues which come in dealing with the international business operations.

Chinese economy is the second largest economy in the world after United States of America. China has opened their domestic market for foreign players since last 25 years. The Chinese government aims to multiply their economic growth and GDP 4 times till the year 2020 (Barai, 2017). This is why the discussion on Chinese market culture has become very important. Chinese Market is known to have a dual economic structure which has modified from the socialist economy which was centrally planned tour social system based on market economy. China has been fortunate in adapting the new technological advancements which has given rise to the fast industrial development and has attracted foreign direct Investments on a huge basis (Bartikowski & Cleveland, 2017). Previously private ownership of assets was not allowed but the regulations have changed and the entries of new foreign players have been observed. In China substantial part of non-agricultural and facilities of the industries I still owned by the state and I planned from their central government. But according to the changing trends and market culture joint ventures have been encouraged giving emphasis to the special economic zones of the coastal cities like Shanghai.These subtle changes in the business culture of China have produced a great number of millionaires and billionaires in China.

Cultural background of people of China

Due to these reasons the cultural aspect of Chinese business becomes so hot topic of discussion and Exploration (Berger et al., 2017). China has been the largest receiver of FDI funds since last two decades because of its liberalization in business culture. China has become one of the largest exporters of electronic goods which has made it one of the biggest manufacturing hubs in the entire world. People of China believe in simple living and hard work which is imbibed in the deep rooted culture which gives an edge to the workforce which father helps in expansion of their business ventures (Chan et al., 2017). After China joined the World Trade Organization there has been a rapid increase in their imports and Exports which has brought huge dividends to the Chinese market. Due to the huge population of China there are still some problems in their infrastructure and transportation services. One reason for this problem can be stated as their culture which restricts them to stick to the old methods. But Chinese people are also very inclined towards innovation and have developed some state of the art infrastructure specimens which can be viewed in the cities of Shanghai and Beijing (Dawson et al., 2017). These innovative trends open new horizons for business ventures of technology in China and attracts big global players to invest in the business of China. Almost all global business ventures who are pioneers in their field of business intent to open their branch in China as it has all the reasons of growth and development. 

China is the most populated country in the world. Its population has grown recently manifolds exceeding all its growth trends. The main reason of its population growth is because of lower death rates in the older population. The birth rate of China is also low but there is a great number of people who are young and have the capacity to work. Still in China there is not an acceptable standard of living for a majority of its population (Ferraro & Briody, 2017). The sole reason for this is there ever expanding population. The concept of being a Chinese citizen does not depend on the race but it is rather focused on the Chinese way of living which is directly related to their culture and historical background.When the basic Chinese culture is taken into consideration it is found that the Chinese culture is very complex and have diverse characteristics. All the historians of Chinese culture have agreed that the Confucian philosophy is the base Chinese culture. It is the most dominant philosophy which has persisted for about 2000 years (Fontana et al., 2017). Chinese like to call themselves Hans derived from the Han dynasty which has a great historical significance in the lives and Minds of Chinese people. It has been observed that all the small ethnic groups in the history of China has been absorbed into the basic Chinese culture. It is not that the Chinese minority nationalities have no legal rights. In fact they have been provided with legal protections and provisions (Gao, 2017). China's minority populations have a great significance in their business culture as they occupy the most strategic geographical positions in the country.

Cultural analysis of the Chinese market using Hofstede's method

Minority population are defined as the people who speak the same language share the same values and live in the same area as the majority.Chinese have great importance for their culture and values which have been inculcated for thousand years. The rich culture is comprised of family values, proper structure of the social life, practicing self-restraint and morality and having huge respect for hard work to achieve in their lives (Herrmann-Pillath & Feng, 2017). Chinese follower collectivist society in which the importance of family precedes over the importance of an individual self.Chinese take their religion very seriously even there are religions like Buddhism, Catholicism, Taoism, Protestantism and Islam which are followed. China regulates the above mentioned religions and the modes of worship (Hill et al., 2017). People who do not follow these religions and practice a faith different from these are subject to harassment and intimidation sometimes leading to detention.Religion in China are derived from many religious systems which are Buddhism, Confucianism and Taoism. These religious philosophies are a reflection of the Chinese way of living.

Doing business in China is a challenge for every foreign entity. Building relationships with the Chinese people is a tough job as it becomes imperative for a business venture to identify the key partners, clients and Chinese government organizations which can prove to be mutually beneficial to develop proper channels of communication among the Chinese people (Huang & Palvia, 2017). China has a highly competitive environment of business and working through it makes the understanding of business culture in China the most vital aspect. To reach the target markets understanding of the business culture becomes the key as it provides a better understanding of the Chinese people's behavior and helps to respond and anticipate their needs and demands. Knowledge of Chinese culture also helps in avoiding unnecessary misunderstandings and conflicts in the business (Jia et al., 2017). There is a popular saying in Chinese which states that “When you enter a religion, follow its customs.” To gain the knowledge of business culture in China where morals and values of people vary from place to place as they are shaped buy different life experiences determined by the local environment of Chinese cities becomes very important. Behavior of foreign players which signifies modesty, politeness and patience can prove to be handy for laying the foundation of good business in China (Kolk & Tsang, 2017). To know a person from face to face is considered to be the most authentic way of finding out that a person is trustworthy or not in China.Chinese people believe that to do business with a person it is necessary to know their moral values and culture. Chinese have a popular saying which goes like “let's first become friends, then do business”. Whereas, in Malaysia saving faces are more important for the Malaysian people. In the society of Malaysia to lose a face which is considered to be same as losing one's control over emotions is seen as a negative behavior. To control the situation Malaysians use laughter to hide the real feelings of nervousness disapproval or shyness.To make business deals in Malaysia saving face becomes very important as it may alter the business outcomes of the deals made there.When making any business appointments in Malaysia A person should keep in mind the prayer Times as it is a Muslim predominant country. Malaysia is have a lenient attitude towards the notion of punctuality. Malaysian sir very particular about their language of communication and the prefer Bahasa Malaysia.Malaysian respect the authoritative positions and the difference between a subordinate and its superior is very deep and intense. Malaysian sir more concerned about the job titles and descriptions.The system of giving gifts is not prevalent in Malaysia as they are considered to be a bribe.

Issues faced in dealing with international business operations in China

Hofstede’s cultural dimensions are the basic set of rules which defines the cultures keeping a 5 dimensional framework which includes cultural consequences behaviors comparison of values and institutional organizations in different parts of the world. Hofstede categorizes the cultural factors as per our distance long term orientation individualism masculinity or femininity and uncertainty avoidance (Ozkan, 2017). In China attitudes of people towards the distribution of power is quite intense and holds a position of high priority. There is a hierarchical structure determined by the high score in the people of China. They believe that the people should respect and give honor to high status.For a foreign business entity to enter into the Chinese Market one needs to have a proper understanding of the Honorable positions in the Chinese society. A business entrepreneur needs to respect people at the higher ranks which shows the appreciation which is given to the place and position (Xiao & Stanyer, 2017). This can help in a great way to make a positive impression in the market of China.

Individualism is another aspect of culture which needs to be kept in mind for doing business in China. As mentioned above Chinese society is a collectivist one and the value groups of people over an individual interest. Chinese have a very high respect for the relationship which day share with each other and a business entity needs to understand the value of that relationship. Being a collectivist society does not mean that an individual will not consider its own interest (Xue et al., 2017). To have a relevant understanding about this concept will avoid many misunderstandings and conflicts. Chinese people believe that working hard and for long hours have made them successful which is a masculine trait of character. Chinese people strive to be the best in whatever they do and dost they have higher expectations for everything. This states that the masculine trait of character in all dimensions is respected in China. Chinese people and more control oriented and they avoid to be in an uncertain position in whatever they do. Unlike people in Singapore who are easier going and leave things to the chances Chinese operate in a way in which the desired outcome has the most probability to happen. That is why Chinese have a proper structure and I work plan to provide stability in their work. Chinese do not like to take risks which is the sign of mistrust for them(Berger et al., 2017).Chinese society is a very long term oriented one. The aim to succeed in life and intend to preserve that success for April long time. This is why long term orientation is said to be Chinese characteristic. A business venture in China needs to be durable and permanent.

China's economy and its growth potential

Conclusion

Thus it can be concluded from the above report that business culture in China is very different than in any other South Asian country like Malaysia where culture is the base of the people which determines the manner in which they do business.There are many financial and economic implications in China which has made it world's most favorite investment haven for all the big manufacturers and business entrepreneurs. Learning about the cultural aspects of business in China makes any foreign investor or entrepreneur easy to start a business and continue it for a long period of time. China has been the most business oriented country for ages as they are known to develop a Silk route covering the entire South Asia and even the Eastern Europe.The discussion in the above report gives a comprehensive idea about the business culture in China and also identifies the key factors which a foreign entrepreneur should keep in mind if it intends to enter into a business venture in China. Thus it can be concluded that people of China and Malaysia maybe hailing from the same race have different cultural values and moral behavior which reflects in their business process.It can also be said that culture and historical background plays an important role in the growth and development of a country as it determines the way of thinking of its people.

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