Interview with Allan Hudson, Business Development Manager at AH Celtic Ltd.

I managed a company helping people to understand the Chinese Market and culture

Company profile:
www.ahceltic.co.uk

Who are your clients? Multi-nationals
What is your mission? To promote cultural understanding
What problem do you resolve? Problems which arise from cultural differences

What kind of problems between Western companies and Chinese manufacturers do you see?

Approach — people don’t understand how to build relationships or interpret signals. People are unable to recognise growing warmth of hosts, exchange of gifts, reference to business friendships, favours asked for or given, facilitation or outside the box thinking from the Chinese in helping you reach your goals, the public recording of joint face, photo opps, shared civic initiatives, joint appearances at business fairs, trade shows and TV/radio appearances. None of the above happens if the Chinese are not happy with the building relationship or the trustworthy character of you as a business person and the business entity that you represent.

People also can’t get maximum support from stakeholders before embarking on their China journey. They don’t choose interpreters who believe in their company, values and business proposition or choose a hotel which offers business reputation and face. They should cultivate their reputation carefully in China. Deploy relationship finesse from the beginning. Choose a team based on their flexibility and fluidity instead of sales ability. They also struggle to choose local partners with a good reputation.

How a Western company can find a reliable Chinese supplier?

Build the relationship phase well. Match your negotiation status of both leaders and team well to the Chinese negotiating team. Work fluidly towards clearly set objectives. Remain available throughout the negotiating process (the Chinese do deals suddenly). Record support and build joint face (the Chinese do not back out of deals in which they are publicly invested. Prove market prominence/dominance. Prove financial solidity of company. Prove your company’s knowledge base. Be willing to share and cascade the latter. See the contract as only part of the deal. See the relationship as the whole deal. Make friends: the Chinese do not like to disappoint business friends.

What is necessary for TOP managers of western companies for start-up business with China?

Get maximum support from stakeholders before embarking on your China journey. You should carefully choose interpreters who believe in your company, values and business proposition. Work with them before you ask them to interpret face to face so that they can convey the spirit of your conversation as well as the specific words. Choose a hotel which offers you business reputation and face. Cultivate your reputation carefully in China. Deploy relationship finesse from the beginning. Choose your team for their flexibility and fluidity. Be careful at all times to choose local partners with a good reputation.

Above all don’t rush in with the Western mindset of being direct. Be strategic and think of the personal side of relationship building. Knowing a person’s personality can help more than having a hotshot product. Giving a gift with personal meaning eg an English dictionary for someone with a child studying English etc goes a lot further than a good rpesentation (in fact drop your powerpoint presentation immediately)

What are the risks while working with a Chinese manufacturers and with what they are related?

The biggest risk is bad faith. This can be created while no surface sign is revealed. The biggest arena for creating this is a business meeting. The Chinese will not seek confrontation. A meeting is not intended as a place to share information and face hard and fast questionning/. It is certainly not the place for airing criticism. A meeting is a place to celebrate success and the information is exchanged through other channels.

The second biggest risk is not being able to maintain a relationship which is primarily raised by erecting boundaries to a relationship. The Chinese don’t seperate or compartmentalise business and friendship. You need to be available at all times to maintain a relationship and if you haven’t heard from your partner, you call them. Otherwise the Chinese will think that you are not honest or honourable.

What kind of advice could you give to Western companies: how to effectively sell Chinese products?

There are many indicators. They require attentiveness but are not difficult to spot if we pay attention. The following are among the most reliable feedback mechanisms:

1. Trusted interpreters: a detailed debrief should inform you not just of how well you communicated your business case but also Chinese levels of receptivity to it, the nature of your progress as well as the general mood, any gaps in your business dialogue or within your relationship journey.
2. Finding yourself moving from leaders to their support/negotiating teams suggests that the big themes are understood and that you are moving toward the detail. This does not happen if the relationship has faltered.
3. Other indicators: growing warmth of hosts, exchange of gifts, reference to business friendships, favours asked for or given, facilitation or outside the box thinking from the Chinese in helping you reach your goals, the public recording of joint face, photo opps, shared civic initiatives, joint appearances at business fairs, trade shows and TV/radio appearances. None of the above happens if the Chinese are not happy with the building relationship or the trustworthy character of you as a business person and the business entity that you represent.

How usually do you prefer to conduct negotiations?

I prefer to negotiate by working with a trusted interpreter who will carry out negotiations with junior administrators. This usually takes place in cigarette breaks while I work on my friendships with the main protagonists. The negotiation always takes place in a spirit of exchange and always gives the opportunity for a win-win situation. I always make sure that something is offered and put my network at their disposal.

Who usually makes main decisions? International sale manager or director of the company?

In my case they were one and the same. The important thing is to make sure that however the decision making structure works, in China you present someone as the decision maker and keep to that format, whatever internal changes you make or whoever needs to agree to get a concencus. China works on concencus too so they will understand that you need to create one, in fact they will aid you by supplying information to help you create a coalition. In China, when you meet someone you are meeting the public face of a company, whatever level they are in the hierarchy. You must bear that in mind when you give them information as this will be transmitted to their colleagues.

Could you tell us a short interesting story from your experience, which shows difference of the Chinese and Western business culture?

My favourite was being overweight at an airport (my luggage!) and having to leave some of my clothes and business materials with a civil servant from the local municipality. Within two days of getting home my extra luggage had appeared and when I unpacked I found that the presents I had bought for my nieces and nephew had mysteriously multiplied with a lot of the latest games and dvds cherished by youngsters suddenly appearing.

And the last question. What would you like to tell to our audience?

Respect China and enjoy it, but most of all go there. You will not realise how much you are missing until you do. The Chinese are increadibly passionate and most of all loyal if they respect you. I have seen on many occasions companies who have had a good relationship for a number of years visit their partners after a competitor launches a top new product onto the market. Full of speeches to beg for continued support, they are often stunned to hear their Chinese partner open the conversation by saying «how can we work together to get you back to the top?». That sums up China for me

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