With the United States and Canada ranked among the world’s top industrial powers, the benefits of entering the North America marketplace can be substantial. There are a variety of ways to enter a foreign market, while partnering is almost always a necessity. For the Chinese visitor to North America, partnering helps bridge the cultural gap between East and West, bringing local knowledge, contacts and customers to your business. To establish a partnership with a company based in North America, it is essential that you understand the social and business culture of this market.
Individualism vs. Collectivism
Where a collectivist mindset guides business in China, the individual rules in North America. The concept of individualism emphasizes personal achievement, independence and self-reliance and has a number of implications for the workplace. Business is frequently carried out autonomously, ties with colleagues are relatively loose and there is a level of distance and privacy within the business relationship. Perhaps most significantly, individualism ordains that one’s position in society (and office hierarchy) rests on their personal accomplishments, rather than on status, age or gender.
This means that working with a North American partner will require an understanding of their goal for economic or technical advancement, rather than a more traditional Chinese objective of advancement for the good of the whole.
Egalitarianism vs. Hierarchy
Individualism informs another important element of North American culture – equality. A collective belief in equal rights, equal social responsibilities and equal opportunities underlines many social relationships and is based on individual merit. This particular take on egalitarianism contributes to the belief that hard work is rewarded with success and prosperity, commonly referred to as the “American Dream”. This system of merit diverges from China’s hierarchical system, in which status, age and gender are concomitant with respect, responsibility and authority. While there is still very much a distinction between management and subordinates in North America, titles are seldom used and Americans will insist on using first names almost immediately. Similarly, while final decisions are often made by one person with chief authority, the decision-making process reflects cooperative interaction across power levels.
Decision making in the North American marketplace may also be left to that person who has an extroverted task focused personality, rather than a particular title or role in a company. It is important for Chinese business people to understand the political and personality profiles of their target clients so as to be sure that they have connected with everyone in the buying or negotiating group. This includes establishing who might be an economic, technical or operational decision maker.
Guanxi in America
As with Chinese business culture, positive working relationships are absolutely vital when doing business in North America. Not unlike the Chinese concept of Guanxi, Americans seek to develop a sense of trust and mutual respect through friendliness and openness. They also resemble their Chinese counterparts in that they are uncomfortable with excessive displays of emotion and prefer an impersonal approach to negotiations. It should be noted that the purpose of most business discussions in North America is to arrive at a signed contract, which is to say that long-term relationships are secondary to short-term gains. Americans take the idiom, “time is money” very seriously so be prepared to “cut to the chase” and clearly state the mutual benefit during negotiations.
Low Context vs. High Context
North America is described as a “low context” culture, whereby meaning and information is communicated through words. This communication style contradicts the high context style embraced by Chinese culture, in which implications and inferences are made through non-verbal forms of communication. Americans deal with conflict openly and are not afraid to say ‘no’ or to openly criticize others. While this does not reflect their personal feelings about you, it can be quite off-putting for those from a culture that tends to handle conflict privately and indirectly. This confrontational style is related to their competitive nature in which Americans would rather be seen as winners, than as conciliatory. Use this difference to your advantage by creating a first offer with plenty of room for maneuver so your American counterparts can feel like victors at the end of a hard bargaining session.
Obviously, a low context style has its pros and cons. On the plus side, a direct and aggressive style of speech leaves much of the guess work out of negotiating, while on the other hand, it may cause embarrassment and the disruption of “mianzi” or “face”. Attempt to match their style with confidence and try not to read too deeply into their body language.
Details are Important
Being that time is an important factor in any negotiation, having the details available for scrutiny is critically important. North American decision makers are partial to presentations formatted with an up-front executive summary, with access to details at their discretion. Details, graphics and images must be accurate, original and never plagiarized. American business people are highly sensitive to piracy and will quickly dishonor an entire negotiation or business opportunity based on just one perception of infringement.
Business Etiquette DO's and DON'T's
When doing business internationally, it is important to remember that the way your business operates will be determined by the culture of that country, not yours. Gaining insight into the cultural differences you may find in North America will help you manage these differences and even draw benefits from what might otherwise be cultural roadblocks.
Are you wanting to expand your business into the North American market? We can help. We provide strategic direction, tactical training and consultancy advice to business professionals wanting to grow their businesses. Contact us at email@example.com or telephone Chuck Bean at +1.403.703.9525.
Chuck Bean is the President of www.themethodeffect.com serving North American Businesses. He has held posts as President of Baxter Bean & Associates, Inc., President of Baxter Bean Creative, President of StandandCommand, COO – Packers Plus Energy Services, Vice President of Wyant Corp and President of Trainport, one of the original online training portals. He is a public speaker, trainer/consultant and business strategist. He is a panel expert with ChinaGoAbroad, Speaker at the University of Tulsa, Mount Royal University and University of Calgary, and has authored/contributed to books with Dr. Stephen Covey, Dr. Deepak Chopra, and Dr. Ken Blanchard. He and his wife Natasha make their homes between Calgary Canada and Phoenix Arizona.