China has a high context culture using Hall’s analogy for various reasons. First, the Chinese communicate indirectly, and their words cannot be taken at face value hence need to pay attention to facial expressions and body movements, among other nonverbal cues (Kim et al. 514). Secondly, they make decisions thinking about how it will affect others, like their family or corporation. Thirdly, information in a Chinese company flows in a communication chain from managers to subordinates (Kim et al. 518). Fourthly, the Chinese tend to avoid head-to-head situations, especially with their seniors. Lastly, her residents consider it modest to play down their achievements.
China’s Cultural Environment using Trompenaars’ framework
Trompenaar’s framework describes the culture of a place using seven spectrums. China is particularistic as people follow laws according to the situation and the parties involved (Treven 34). China’s culture revolves around collectivism as it places more value on the societal structure than on personal setup. The country’s cultural environment is discursive as there is no clear distinction between an employee’s work and personal interaction. The Chinese culture is impartial since people go to great lengths to hide their feelings and thoughts (Treven 44). China also leans towards ascription as people gain social standing based on their potency, wealth, and influence (Treven 39). The Chinese view time as multi-active as they work on different initiatives at once, and they prefer going back and forth before concluding a matter. China’s culture centers on extrinsic directives as people tend to avoid confrontations and base their choices on others.
Challenges for American Investors
The first challenge that American investors are likely to encounter is communication barriers. The investors may have problems understanding the Chinese as they do not openly express their views (Chung 132). Additionally, they may find the hierarchical structure rigid since it hinders effective manager-subordinate relationships, affecting productivity (Kim et al. 518). They may view the lack of distinction between work and social life as intrusive to their private space. The differing perspective on time may cause friction between the investors and local employees since staying on a matter for long could be a lack of progress (Chung 136). Most social media avenues are inaccessible in Chinese, limiting the advertisement options for a business.
Opportunities for American Investors
The social networks that American investors develop may last a lifetime and contribute to long-term gains in their investment. The Chinese value friendships and are unlikely to break trust for personal profit (Chung 134). Furthermore, their companies may experience low turnover rates due to the high emotional control, avoiding unnecessary confrontations that may escalate volatile situations. The collectivism approach will aid the firm to breakthrough in the market by maximizing consumer recommendations of the company’s products and services to their loved ones (Treven 36). The close interpersonal relationships among employees may also foster teamwork, promoting the firm’s performance.
Recommendations to Navigate China’s Cultural Environment
American entrepreneurs can formulate a unique corporate culture that incorporates Chinese norms. The organizational culture should be inclusive of the Chinese cultural environment but still, shift the firm towards globalization (Dong and Liu 230). For instance, the organization can have a hierarchical structure but incorporate programs that promote open communication among subordinates and middle-level management. Investors can also adopt strategies that foster social welfare (Kim et al. 524). They can develop programs that will involve and help the community to promote public relations and build ties with the locals thus enhancing the business brand, relationships, and consumer loyalty.
Culture is a complex concept, but its comprehension is vital in a business setting. Hall classified culture in terms of communication as either high or low context. China has a high context culture since words have deeper meanings, and it is vital to pay attention to body language. China’s culture has seven different dimensions according to Trompenaars’s framework. An American investor may encounter various challenges and opportunities in China.
Chung, Mona. “Cultural Obstacles to Negotiations: New Research in China.” Doing Business Successfully in China, 2011, pp. 127–154.
Dong, Keyong, and Ying Liu. “Cross‐Cultural Management in China.” Cross-Cultural Management: An International Journal, vol. 17, no. 3, 2010, pp. 223–243.
Kim, Donghoon, et al. “High-versus Low-Context Culture: A Comparison of Chinese, Korean, and American Cultures.” Psychology and Marketing, vol. 15, no. 6, 1998, pp. 507–521. Web.
Treven, Sonja. “The Connection between Culture and Organizational Behavior.” International Business & Economics Research Journal (IBER), vol. 4, no. 7, 2011, pp. 30–57.