I can’t offer any such stories, and I be surprised if many of these stories exist. At the same time, I think what’s missing from the piece is the flipside: what can Western organizations gain from a deeper understanding of Chinese culture? In other words, why stop at not being an asshole? Once we’ve achieved non-asshole status, how can learning more about Chinese mindsets help Western organizations reach their highest aspirations?

The case that I’m continually building in this blog is that if Western leaders are mindful of culture, and of what people bring to the table as a result of culture, the upper limit on their success is much higher than without such mindfulness.

“Don’t be an asshole” is great advice the world over, and will save your business time and money. What more can we do to help our organizations thrive in China?

The most common theme I witnessed was suspicion, on the part of some of the Americans, of the motives of the Chinese partners. I kept being reminded of the bugaboo of attributing intentions (usually erroneously) based solely on behavior. There was a particular kind of behavior observed by the Americans which made them uncomfortable, and it didn’t take long, as the Americans talked among themselves later, to create agreement about the (ill) intentions behind the behaviors. This is a savvy group of executives, though, and they were receptive to other interpretations of the behavior.

One thought that recurred frequently during the week was this: what about all the other organizations working in China, which either aren’t aware of intercultural issues, or which are aware but don’t want to invest in intercultural consulting? I thought of how intercultural misunderstanding grows over time, often without our noticing, until it’s too late. A former colleague once put forth the “fish poop” model of human relations: over time, a fish tank accumulates fish poop. From one day to the next, you won’t necessarily notice a difference. But over time you end up with a stinky, fetid mess of a place to try to live, let alone thrive. Human relations, like fish tanks, require constant attention to accumulating fish poop — especially in intercultural environments, where the poop is likely to come fast and furious.

My experience with this company left me with a profound appreciation for them and companies like them, who can see the importance of the intercultural piece for their future success.

…even under the most favorable circumstances, China isn’t always transparent, and if you’re not careful, disagreements can still occur. Instead of overreacting or leaping to conclusions, the best policy is to take the time to listen and to understand. (p. 179)

Humility, empathy, equanimity.

Next:

90 percent of the mistakes made in China are due to misunderstanding and miscommunication. (p. 177)

It’s a good idea to take figures like this “90 percent” with a grain of salt. At the same time, it’s worth some reflection: What if it’s true? What if we could reduce our mistakes by up to 90 percent by dedicating ourselves to minimizing misunderstanding and miscommunication? What leader wouldn’t want that return on investment?

Two years into his tenure, Schulze recommended reducing the work week for Chinese workers from six days to five. In an internal memo, he reasoned: “The employees will gain more time for their housework and still have time for rest and social activities.” (p. 257)

From an American perspective it’s easy to see the appeal: reduced costs from one more idle day per week, plus rested and rejuvenated workers. Why wouldn’t workers want more time away from the factory, to do “housework,” pariticipate in “social activities,” and such?

It turns out there were plenty of reasons Schulze’s proposal didn’t fly, and was never implemented. Here we’ll take a look at one major cultural factor.

Deep in our American bones is a belief that, when we’re not consumed with life’s usually unpleasant necessities like work, we should be off doing fun, fulfilling things — in short, pursuing happiness, just like the Declaration of Independence says is our unalienable right.

People the world over want happiness; there’s nothing particularly American about that. What sets Americans apart is our quasi-religious belief in our right to pursue happiness, and our often absolute prioritization of the pursuit of happiness over other things.

In China other concerns often take precedence. I’ve already looked at this in earlier posts on following dreams. Pursuing happiness is closely related to this; the stakes are just lower than they are with dreams, because we aren’t talking about the entire purpose of someone’s life.

In the case of Beijing Jeep, Jim Mann’s own words best capture the cultural miscalculation. Schulze’s proposal “recommended for China the American ideal of regularly alternating hard work and leisure.” (p. 258) To an American it’s natural to assume this ideal; to the Chinese workers and management, there were countless practical obstacles, including the factory being thrown off kilter with other Chinese factories (all of which were at that time on a six-day work week), and calling, in Mann’s words, “for fundamental changes in the entire rhythm of Chinese life.” (p. 258)

Beyond some frustration on the part of Ed Schulze, the repercussions for Beijing Jeep were minimal. It’s not hard to imagine other scenarios, though, where a cultural miscalculation like this could cost real time, money and goodwill. It’s crucial that we remain mindful of our own cultural assumptions and their impact on our success.

After the trip my friend was on to other clients and never found out what became of the exec and his venture. But my friend wasn’t optimistic. As is so often the case, Westerners — especially Americans — depersonalize business in a way that sets them up to fail in China. Goodwill matters. It matters a lot. It makes no difference how tired or energized you are, how hopeful or hopeless things look, how cut and dried things seem to be. Without goodwill, you’re swimming upstream, if not entirely sunk.

I turn again to Jack Perkowksi’s experiences, told of in Managing the Dragon. His company, ASIMCO, invested vast amounts of time and money in establishing goodwill with their brake-manufacturing partner in Langfang. In recounting what this accomplished for ASIMCO, Mr. Perkowski writes:

In the end, despite all of our changes in management and export focus, the Langfang joint venture will probably never be a big moneymaker for ASIMCO by itself. But because of the strong relationship we’ve built with our Chinese partner there, we’ve since spawned two wholly owned businesses.

(pp. 175-6)

Mr. Perkowski goes on to detail successful, moneymaking businesses that sprang from the Langfang success — which was founded upon goodwill.

Goodwill alone won’t get you far. Business will always to some extent still be business: you have to deliver quality goods and services that your customers want, and do so cost- and time-effectively. But if you’ve got the business practices down, goodwill can multiply itself, along with time and money, to create truly enduring, successful businesses in China.

The West, and especially the U.S., worships logic and rationality. Our economic and political institutions are founded upon it. In the context of public life, we speak of feelings in mostly derisive terms. To be “emotional” is to be weak. This makes sense in the context of American universalism: emotion is subject to personal whim, and could endanger the Platonic perfection we seek in our institutions. And relationships based on positive feelings could divert our attention from what is “true,” and have us make bad decisions. There’s plenty of psychological evidence that all humans, including Americans, make decisions based on emotion anyway. But Americans still see ourselves as a people who privilege rationality.

Logic and rationality don’t hold the same sway in China. Relationships, including business relationships, are based on many factors; personal feelings are one important factor. You’ll hear Chinese people talk about how they have a “good feeling” (hǎo gǎnjué 好感觉) toward someone, and that they’re willing to do more things for this person because of it. It used to drive me crazy at markets when people told me they’d give me a better price because I speak Chinese (and that they therefore had a better feeling towards me). “What in heaven’s name could my speaking Chinese possibly have to do with how much you charge me?” I would ask myself indignantly. Whether or not the actual price was lower doesn’t matter. It’s enough that it was advanced as a reason for a discount.

In his brilliant book Managing the Dragon, Jack Perkowski writes the following on the importance of trust — a form of goodwill — in business relationships in China:

I learned how strongly and favorably the Chinese react when they realize that you trust them.…The fact that I could set up a wholly owned facility to manufacture higher-technology compressors…would never have been possible if a certain amount of trust didn’t exist between the two shareholders.…Everybody feels involved, like we’re all part of the same family.

(pp. 177-8; I also recommend that you persue Mr. Perkowski’s Managing the Dragon Blog)

Of course trust and goodwill matter in the U.S. too. But when push comes to shove in the U.S., we rely on public institutions like the courts to arbitrate. In China, where such public institutions are unreliable, building and maintaining goodwill must be a top priority for you and your organization.

PRINCIPLE TWO: Keep an Open Mind. Assume Nothing.

Doing business in an emerging market means taking nothing for granted. I have a mantra for my own legal work in these countries that translates well to the business world: “Assume nothing, but assume that you are assuming things without even realizing you are doing so.”

Things will be different. Very different. Things you take for granted in your home country might not exist in the emerging market country. Things you take for granted in your home country might be the exact opposite in the emerging market country. Things you think will be totally different in the emerging market country may be exactly the same. Things you thought you knew about emerging market countries based on what you know from another emerging market country may be completely different in a neighboring country, or even in another region within the same country.

The principle, one more time: Keep an open mind, and assume nothing.

Well put.

China is an emerging market that can be particularly disorienting in this regard. The culture-savvy leader’s curiosity, empathy and equanimity are strong allies in this setting.

Please read the entire piece by Dan Harris. You’ll find it worthwhile.

The twist here is that in China the stakes are raised to a level that at times approaches the absurd. One small-seeming cultural snafu here or there can cost an enormous amount of time, money and goodwill. One particularly painful example comes to mind.

A friend once told me of an American businessman she knew who had managed to secure a meeting with two top officials of a major Chinese province, in the hope that he could get them to throw their support behind his business. Obviously savvy in important ways, this man knew enough to make it happen. That already puts him further along than probably more than 99% of Americans doing business in China.

The problem for this man was that he lacked cultural savvy, and as a result unknowingly ended up playing fast and loose with resources he might not have even been thinking about as resources: the time and money he had already spent, and the goodwill he had built as a result.

Not having received any intercultural training, the man sauntered into the meeting as if he were in charge, his bearing oozing arrogance. (He should have been politely and firmly — though not fawningly — deferential and respectful, to give them face as gracious hosts.) As the meeting progressed, talk turned to specifics. When the man’s interpreter mentioned something that made the man uneasy, the man expressed some worry. Noticing this, one of the officials said the man should fàngxīn. In this context, the obvious translation into English would be: “Don’t worry,” or “Put your mind at rest.” Instead, the interpreter translated it as “Take it easy.” Feeling pooh-poohed, the man grew more and more angry — highly inappropriate in this setting. (Someone losing his cool loses face along with it.) Things went downhill from there. The meeting ended in disaster, and the American businessman ended up having wasted untold time, money and goodwill: because he lacked some nuts-and-bolts understanding of the Chinese cultural mindset, because he didn’t hire the right interpreter, and — most importantly — because he didn’t have the cultural savvy to realize how quickly his resources could vaporize.

The culture-savvy leader understands that “cultural” issues are business issues. Cultural misunderstandings cost real dollars and hours. In China, the Western leader must always be treating time, money and goodwill as the precious resources that they are, and be mindful of how quickly they can disappear in that environment.

In this environment, equanimity is crucial. Despite cultural breakdowns all around — miscommunication, ruffled feathers, unmet expectations, and plain old prejudice — the culture-savvy leader remains above it all. She expects strong emotions, so she’s not prone to overreacting. Instead of falling back on her heels, she leads from the balls of her feet: solid, stable, grounded, balanced. Her empathy helps her in this: able to see things from many perspectives, she doesn’t take any one view too seriously — including her own. She trusts her instincts, but she’s not wedded to any single idea or way of doing things.

From the outside it might look easy, but it’s anything but. Like any human, she has internal reactions, including those based on her own prejudices. Those reactions are particularly charged. What she’s mastered, though, is the art of identifying her reactions, getting a handle on them, and moving forward toward solutions. She’s got passion and fire, but knows how to have them work for her, rather than vice versa. Her equanimity provides an anchor for her organization to do what it came to do.

Equanimity comes more naturally to some than to others. It is an absolutely essential quality of the culture-savvy leader. Thankfully it can be learned and practiced, like any skill. Do an honest assessment of your equanimity, preferably with the help of others close to you, and be sure to fill in the gaps before setting off for China. Some of the courses offered here might help.

Empathy is not sympathy. Sympathy, while also important, is still self-focused: “If I were in their shoes…” Empathy is deeper: getting yourself as thoroughly into the world of another person as you can, doing your best to experience the world as they do. To do this you have to quiet down your internal mental chatter and just listen. Open up your ears and your heart and let in what others are experiencing.

Sometimes people will come to you; other times you’ll notice something in other people’s behavior, and will seek them out. Either way, be ready to suspend judgment.

There are still those who think “soft skills” like empathy don’t belong in the “hard” world of business. As I discussed in an earlier post on the business of culture, though, what could be “harder” than time, money and goodwill for the success of a business — or of any organization? An environment where people feel heard and understood will unleash their energy and their creativity like nothing else. Problems will be solved faster, more will be accomplished, and people will feel empowered, with a new level of commitment to your organization’s success.

I’ve said it before and I’ll keep saying it: China will present you with day-to-day challenges like few other places will. Generating and sustaining empathy will be one of your greatest challenges as a culturally savvy leader — and one of your most rewarding.