Market Cultural Report For China

The Basis for Choosing China

Discuss about the Market Cultural Report for China.

Over the past 25 years of reformation and openness to the other parts of the globe, the economy of China has become the second biggest worldwide after US. The government of China has a goal of doubling the per capita and multiplying its GDP. Since 1978, the market economy widespread mechanism and reduction in the role of the government had been evident (Fogel, 2010). The Chinese government fostered an economic structure that is dualist and had developed from socialist, which was an economy that was centrally planned to an economic market system with socialist characteristics.

Through the increase of technological development, the rapid growth of industries has been attained, leading to high productivity and foreign direct investments. (Fogel, 2010) There was elimination of the people’s communes in 1984, which lead to the introduction of the collective household production in the agricultural sector. Private possession of assets for production was legal, even though there some industrial and agricultural facilities that are planned centrally and state owned. There were few restrictions when China agreed to the world trade.

The reason for selecting China is because of following reasons. The first reason is because China is a developing economy with 1.357 billion population and 9.240trillion US dollars GDP. Also, according to the statistics of World Bank, there is large and cheap work force of 787,632,272, which gives business economies the opportunity to recruit labor force (Fogel, 2010). In comparing the literacy level of China to other developing countries, China’s literacy level is higher (90%) than countries such as India with 60% (J. Hicks, 2007). China also has a pool of skilled labor, with low employment expenses hence, businesses are able to get high revenues since they save much on labor cost.

China has the largest population in the world. according to the census conducted in 1990, china had an average population of 1,1300,000, 000. In recent times, there has been an exponential growth of population in China (Fogel, 2010). The annual estimate of population growth in china is 15 million people. This number is approximately three times of the total population of Singapore. China added an average of 300 million people between 1964 and 1982 (Fogel, 2010). The population that was added during those years, was more than the population of Soviet Union at that period. The population increase in China was credited to a sharp decrease in mortality rates. Though the birth rate has reduced, the youth population is enormous. From the outlook, there will be rapid population increase in China if the country does not adopt extreme measure of population control.

The major concern in China is to provide an acceptable quality of life to this ever growing and large population. Since 1978, the Chinese government has promoted among the Han, one-child family in an effort to reduce the population growth rate (Liao, 2016). People especially couples are encouraged to have one child only. The government offers reward for one child families. Birth-control techniques and family planning advice are accessible easily and used commonly.

Cultural Factors

The notion of one to be called a Chinese is based not only on race. But it is based on a cultural notion. One becomes a Chinese when he/she is able to speak and behave like a Chinese (Yao, 2014). The Chinese call themselves, sons of Han or Han. This is based on the Han Dynasty, which is considered as a tenure of great historical importance.  The small tribes have been absorbed into the mainstream throughout history especially those who came into contact with the Han Chinese (Fogel, 2010). This process of absorption of small tribe still continues up to date. However, there are defined rules that guide and protects the Chinese minority citizens.

Minority nationals in China are defined traditionally, as a group of individuals who occupies same geographical area, share a common sense of social values, and speak a common language. Because of the occupation of strategic territories, the minority nationalities are important in Chinese society (Madsen, 2010). They are significant although they just form a small percentage of the total Chinese population. Majority of minority nationalities resides along the sparsely populated Chinese frontiers. Culturally, they have a relationship with the neighboring nations such as Mongolia, Thailand, Myanmar, and Kyrgyzstan. The China’s national security will be threatened if this group becomes hostiles. Therefore, in order for the government to enhance national security, the minorities of China are protected. 

The structure of the Chinese administrative system expresses the guarantees of protecting national minorities (Fogel, 2010). There are five independent regions, apart from the 22 provinces. These five independent regions are built on the five of the bigger and highly significant national minorities location. Additionally, there are smaller administrative units organized in an independent banners, prefectures, and leagues (Fogel, 2010). These small units are subdivided basing on the location of smaller minority nationalities. This kind of the administrative system is orchestrated in a way that ensures the minority citizens maintains their identities at the same time have the political equality with the Han. The country is promoting the Putonghua language at the same time, to be the national official language. The government encourages all of its citizens to learn it. In general, the Han lives harmoniously with all minority nationalities. The government has formulated measures to facilitate economic development in

The Chinese culture is complicated. However, researchers across the globe comes to an agreement that in spite of the differences, the communities in China shares some common characteristics.  The cultural values that are shared are derived from the philosophy of Confucian (Khairullah, 2013). The Chinese identity is informed by the Confucian philosophy. The influence of the Confucian teachings is less likely to end, bearing in mind that his thoughts abbot the Chinese way of life has dominated the country for more than 2000 years (K. F. Lau, 2009). This continues being so even after the occupation of Britain for more than two decades. The most significant Chinese values include the significance of family; the emphasis on achievement through hard work; cultivation of self-restraint and morality; and the social life’s structure of hierarchy. The children are required to learn on how to talk and answer elders and their parents. It is assumed that as a whole the family will prosper and thrive if at home there is harmony. 

Language and Ethnic Groups

The government of China recognizes the Taoism, Protestantism, Buddhism, Catholicism, and Islam as the official religion (Travel China Guide, 2016). The government regulate the religious groups. Individuals who practices other faiths apart from the official religions are intimidated, harassed, and detained. China as a country was under the spotlight for violating the religious freedom in 2006.

In China, the religious beliefs are varied, and derives its principles from different religions. However, the general Chinese religious concept shares same characteristics with other mainstream religions (Madsen, 2010). The religion is dualistic, highlighting the two complimentary and opposed universal principles, yang and yin. However, yang and yin are the double expression of the eternal single cosmic principle. The principle is known as Tao.

In Singapore, personal time is highly valued. However, in China, this is very different. In China, they have a saying that goes, life is business (Siew, n.d.). Actually, this is true for people in China talks about business all the time. Whether as employee or business owner, the individual’s social life is focused on business. They love personal lunches and dinner and business banquets. Most of these events take place after the normal business hours. This means that they occupy most of the weekends and evenings.

If a Chinese person invites a dignitary or receives an invitation to a function or a meeting, he/ she will feel deeply honored (J. Hicks, 2007). The business deal signing and other formal business contracts are commonly carried out in an informal setting such as in the bars and restaurants. It is also a business etiquette to have as many business cards as possible.

If you are a host or a guest it is important to demonstrate respect by being punctual. It may be necessary to make earlier arrival by say, half an hour. This is because Chinese are very punctual when it comes to time (Fogel, 2010). When meeting a Chinese, the first meeting may be hierarchical and unproductive. When meeting the Chinese for the first time, it is advisable to avoid moving things faster. This is because the Chinese are prepared to spend time to achieve their goal. At such, they are very patient individuals. 

Chinese refer to the development of long term relationship as Guanxi (Fogel, 2010).   This concept works in both Chinese and Singaporean cultures (Siew, n.d.). Nonetheless, there is a difference on how this concept is carried out. For instance, in Singapore, business does not usually involve the giving of gifts. In China, the exchange of gifts enhances the business relationship and it is seen as a normal thing. 

The cultural dimensions of Geert Hofstede include: collectivism versus individualism, power distance, femininity versus masculinity, long-term orientation and avoidance of uncertainty which are majorly applied in the comparison of nations’ cultural differences between. 

PDI -Power Distance Index): Describes the level to which inferior members of institutions and organizations expect and accept the distribution of power (Hofstede, 2011). PDI suggest that inequality is authorized by both leaders and followers.

Individualism (IDV) and collectivism: Describe the integration of individuals into groups. Individualism and collectivism correlates to the magnitude to which people are incorporated into groups (Yao, 2014). In individualism, everyone is required to look after themselves or their immediate families, while in collectivism from birth onwards people integrated in strong extended families hence being protected in exchange for their unwavering loyalty.

Cultural Values

Masculinity (MAS) versus femininity: Describes the division of responsibilities among genders. Hofstede’s research indicates that the value of women is lower as compared to that of men (Hofstede, 2011). Masculine is referred to as the assertive role while feminine is the caring and modest role. 

Uncertainty Avoidance Index (UAI): Means the tolerance of the society to ambiguity and uncertainty (Hofstede, 2011). It shows how culture conditions its members to either feel comfortable or uncomfortable in unorganized situations. People living in countries with uncertainty avoidance are motivated and emotional through the inner nervous energy as compared to uncertainty accepting countries who are tolerant. 

Short and Long Term Orientation: Refers to the qualities of perseverance and prudence (Liao, 2016). Short Term Orientation related qualities include: respecting culture, social responsibilities, fulfillment, and protection of one’s integrity. All negative and positive values of cultural dimensions are in the Confucius teachings. Confucius was a Chinese philosopher who was very influential and lived in 500 B.C. The cultural dimensions are also applied in countries with no heritage of Confucian.

The figure below shows the Hofstede’s rankings of the Chinese culture’s five dimensions. 

Graph 2. Cultural Dimensions of Hofstede’s in China

The cultural dimension of Geert Hofstede in China indicates a relatively high (80) Power Distance level in comparison with the world average of 55 (Yao, 2014). This shows the inequality level of wealth and power existing in the societies. Power inequality is imposed on the people but it is tolerated by the people as a custom. In China, there is also the existence of Long-term Orientation (LTO) that is high (118). This illustrates the society’s time perception and a persevering attitude which is conquering difficulties with time. In the ranking of individualism Chinese was ranked low (10) (Hofstede, 2011). This can be associated with the high extent on the emphasis of collectivist in the society as compared to the emphasis on the individualism values that was imposed on the people by the communist reign. By individualism being ranked low means that China is a close and dedicated nation starting from the family up to extensive relationships. In the culture of collectivist, loyalty is paramount. China as a nation encourages strong relationships whereby every member of the society is responsible for other members of the group. 

Operating a commercial venture in China can be challenging because of various differences and uncertainties in the economic, political, and cultural environment (Liao, 2016). When it comes to business the Chinese prefer doing business with the individuals they understand better and know them. They prefer working with the organizations they know. Therefore, when doing business in China it is crucial to work through intermediaries. The relationships in the businesses are formally built. It takes a lot of time to establish a long lasting relationship in business. There are many government bureaucracies when it comes to starting a business in China. Therefore, it is of utmost importance to exercise patience, 

Foreigners are seen as representatives of their organization in China rather than distinct people. In business relationships rank is extremely important. when communicating one should mind the rank differences of the individual being addressed (Liao, 2016). In China people, do not prefer telephone or written communication rather they prefer to meet face-to-face. It is important to follow social etiquette, at such, business discussions are discouraged in social events and during meals. In China, there is a differentiation between socializing and business. Hence it is important not to mix the two.

Religion

Some of the practices governing businesses are the cultural values. Theses cultural values prefer business appointments to be made in advance in one or two months and submitted in writing. Punctuality is viewed as a virtue in China (Kermeliotis, 2011). By arriving late one could negatively affect the existing business relationship, because lateness is viewed as an insult. Each Chinese participant in a business meeting has own agenda that they will try to introduce, hence it is crucial to note the agendas being introduced. Before the meeting, the Chinese loves to meet with experts to discuss the agendas. Therefore, it is advisable to send the agenda before the actual meeting. 

Conclusion 

China is a developing country that is providing market prospects for foreign investment. China is a huge country with potential economic development which provides access to huge markets and substantial labor savings. Over the past 25 years of reformation and openness to the other parts of the globe, the economy of China had become the second biggest worldwide after US. The government of China has a goal of doubling the per capita and multiplying its GDP. China has the largest population in the world. according to the census conducted in 1990, china had an average population of 1,1300,000, 000. In recent times, there has been an exponential growth of population in China. The annual estimate of population growth in china is 15 million people. This number is approximately three times the total population of Singapore. The Chinese call themselves, sons of Han or Han. This is based on the Han Dynasty, which is considered as a tenure of great historical importance.  The small tribes have been absorbed into the mainstream throughout history especially those who came into contact with the Han Chinese. The cultural dimension of Geert Hofstede in China indicates a relatively high (80) Power Distance level in comparison with the world average of 55. However, as a foreigner, one can be able to do business successfully in China once he/she notes the pertinent issues discussed in this study.

References

Fogel, G. K., 2010. Business Environment in China: Political,and Cultural Factors, s.l.: s.n. 

Hofstede, G., 2011. Dimensionalizing Cultures: The Hofstede Model in Context. Online Readings in Psychology and Culture, 2(1), pp. 4-13.

Hicks, P. K. B. B. S., 2007. Can We Do Business? A Study of the Attitudes of Chinese and Australian Business Students. Australasian Accounting, Business and Finance, 1(3), pp. 23-26. 

1. F. Lau, 2009. Influence of Chinese Cultural Values on Consumer Behavior. Journal of International Consumer Marketing , 11(1), pp. 97-116 . 

Kermeliotis, T., 2011. Doing business in China: Five tips for success. [Online] Available at: https://edition.cnn.com/2011/10/21/business/china-business-investors-culture/[Accessed 17 4 2017]. 

Khairullah, D. H. Z., 2013. Cultural Values and Decision-Making in China. International Journal of Business, Humanities and Technology , 3(2), pp. 2-5. 

Liao, K.-H., 2016. Impact of Traditional Chinese Culture on Business-to-Business Relationship Marketing and Service Firm Performance. Journal of Business-to-Business Marketing , 23(4), pp. 277-291. 

Madsen, R., 2010. The Upsurge of Religion in China. The Journal of Democracy, 21(4), pp. 58-71. 

Siew, H. M., n.d. Doing Business – Singapore vs China. [Online] Available at: https://www.guidemesingapore.com/country-reports/china/doing-business-in-singapore-vs-china[Accessed 18 4 2017]. 

Travel China Guide, 2016. Religions & Beliefs in China. [Online] Available at: www.travelchinaguide.com/intro/religion/[Accessed 17 4 2017]. 

Yao, C., 2014. The impact of cultural dimensions on Chinese expatriates’ career capital. The International Journal of Human Resource Management , 25(5), pp. 609-630.