Cultural Challenges Doing Business In China

With the globalization of world business, China has become an appealing market for foreign investors. The problem of cross-cultural management arises as the cooperation between China and its culturally different Western partners continues to increase at an unprecedented rate. It can also be observed that most of the failures faced by cross-national companies are caused by neglect of cultural differences. The globalization of the world economy, on one hand, has created tremendous opportunities for global collaboration among different countries; on the other hand, however, it has also created a unique set of problems and issues relating to the effective management of partnerships with different cultures. With the increasing importance of the China market in the world economy, many international companies rushed and planned to enter China to explore business opportunities. They enter the huge market by forming joint ventures or participating in mergers and acquisitions. This has spurred the need for cross-cultural research in China.This paper presents an understanding on the general cultural differences between China and other countries by applying the cultural dimensions of Hofstede and Bond. It also discusses the impact of these cultural differences on their management practice from five aspects: cooperative strategies, conflict management, decision-making, work-group characteristics, and motivation systems.