Negotiation

Negotiating with the Chinese is not a game that can be played in a closed room. It is a process with a before and an after. Westerners often have a tendency to overestimate their technical advantages, and find it difficult to admit that their efforts to promote a “quality” culture are not more successful in China. Quality and price will not necessarily lead to the closing of a contract there. Human factors play an important role. Success in China largely depends more upon knowing‐how‐to‐be than knowing‐how ‐to‐do.

Stopping short of caricaturing the West, we could say that business comes first, and friendship afterwards. In China, however, friendship comes first and business afterwards. The preliminary stage in negotiations is, therefore, a decisive stage where you carefully learn to know and appreciate each other. This stage will lead to the finding of common interests for both parties. If so, in the eyes of the Chinese, the closing of the contract should arrive naturally.

The “real” negotiation should be, therefore, only a secondary episode crowning a common understanding that has already grown during the previous stage. The essence is in the determination to respect the principle of equity: the win‐win situation, that is, where both parties will have to make reasonable efforts to avoid damaging each other’s interests. Westerners’ perceptions of sluggish negotiations with the Chinese often come from a poor identification of these stages.

The Chinese have an emotional practice of business. Thatʹs why a big firm may miss a market opportunity without understanding what happened, and a small enterprise may paradoxically have a better chance of success if, due to its size, it worships the human grain. Mutual understanding and greater knowledge of each other therefore serve as the foundation of a successful negotiation. As an old Chinese quote states: Where you do not find your interests, you will never find mine.