Guanxi in Jeopardy
October 9, 2013
Electrowide is a United States based company that is responsible for developing new and advance electronic equipment that is put in cars. They are recently going through an entire company change up where they have chosen to practice more lean production methods and improve the way they do business all around. Along with this they have decided that it would be beneficial to expand overseas. They have chosen the Beijing based company of Motoshuzhou to expand to. Electrowide wishes to sell their equipment to Motosuzhou hoping that it will be able to be more successfully distributed throughout the world and across automotive industries, especially to those in China. However, the first few weeks of negotiation was spent on small talk and sightseeing, not business relations. The US team made up of Tom Sherman, Barb Morgan, and Mark Porter, were more interested in sight seeing and late night partying than getting down to business. At one point, Tom even began to skip the meetings all together. Barb took notes during the meetings and made several observations regarding the Chinese teams mannerisms, which may have been false. Due to the U.S. teams lack of preparation and research on the joint venture, the 8-week stay was a failure. The United States culture is very different from that of the Chinese culture. Cultures are one thing that you need to look into and prepare for when doing business overseas.
1) The United States and China vary greatly in their negotiation processes. The main characteristics of the Chinese culture are that you speak in short, simple sentences that do not contain a lot of slang. Make sure you pause every so often to be sure that everyone understands what you have said. You do not have just one presentation, you will present to different levels of the organization, separately. The have a strong belief in the...