Custom «Cross Cultural Analysis of Business Practices» Essay Paper Sample

Cross Cultural Analysis of Business Practices


China and America are two countries that are involved with a lot of trade not only with each other but also with the rest of the world. They are also big countries both economically and in size. Citizens in China speak Chinese while those in the U.S.A speak English. Both countries have cultures, etiquette and manners that might work towards the up grading or downfall of their business practices.

Cultural practices are all over the world but are diverse depending on the country in question. The differences in cultures and etiquette may act as a major hindrance in the business world. Differences in culture can hinder the smooth flow of trade and even completely cripple it if it is not looked into and a solution found.

Two countries trading with each other must be able to communicate and come to an understanding of how they will settle their differences if they want to do business with each other and with the rest of the world too. Cultures should be there to strengthen the countries but not to weaken or act as a hindrance.

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This paper will look into how each cultural activity has played a role in improving or deteriorating their business activities. It will also give ways in which some hindrances can be improved depending on how willing the countries are ready to improve their trading (Burton, 2005).

Globalization and its effect on business cultures

Globalization can be defined as an economic interaction of more than two countries while culture is the ways of life a certain group of people adopt in order too guide them in how they run their activities and live in general. U.S and China have very different cultures that if not looked in to could affect their business relationship even with the globe at large. Globalization has enabled these two countries to loosen up on some of the cultures that they hold on too much. The interaction with other countries has made China loosen up on some of the cultures that acted as a hindrance rather than a doorway to making good business. some of these cultures included the belief that businessmen were there to maximize their profits by mainly using the common man, the role of the woman in business, etc. women have gained their equal rights as men in comparison with the past although the Chinese still view the male as the head decision maker despite the seniority of the other party.

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Due to globalization, businessmen have been forced to be more open minded and comfortable in the areas that might have put them to be uneasy in the past. The Chinese have more cultural practices than the Americans so this way of being more open minded has mostly affected them. They are not as uncomfortable of someone wearing white during a business meeting for they are have come to know that it does not indicate a sign of mourning in all cultures.

There are fears that come with globalization. Some countries are afraid that their involvement with other countries might cause them to loose their cultural background. This has made them to pull back or be stricter with the kind of countries they are getting involved with. China has been affected by this and did not really open up completely until some years back.

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Policies and Laws and their effect on business

Both China and U.S have laws and policies that are either improving or pulling the business interaction between them. Very few countries have put in place laws that prevent outsourcing or at least limit outsourcing to a certain level. In one way, this has encouraged countries like the U.S get work which might have otherwise cost more in the country be done in China which is much cheaper. Though this will encourage business between the two countries, on the other hand, it causes unemployment in one country and causes employment in another. Employees in the U.S have complained that the rising level of unemployment in that country is due to outsourcing.

The strict laws that have been kept by both countries concerning carrying out illegal businesses prevent the carrying out of such businesses for both parties. In China possession illegal drugs attracts a death penalty which is actually out almost immediately unlike other countries where one can even stay for years before the execution is done. In the U.S it may attract even a life imprisonment. All these laws are meant to ensure that mutual respect is maintained so that more businesses are carried out in future.

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Political Issues

Politics has been manipulated in the past in order to suit the politicians’ selfish desires without having the interests of the country in mind. However, governments have tried their best to accommodate each other so that there is smooth flow of trade between the two countries.  

While the Americans like to keep eye contact to show that they are concentrating and attentive, the Chinese avoid this as it is a sign of arrogance, defiance or disrespect. This is normally avoided when one is speaking to their seniors or a person of a higher authority. The Chinese should be able to understand the American way and know that they are just showing that they are concentrating and the Americans should also understand the Chinese and know that they are concentrating even without looking at them (Thanasankit, 2003).

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The Americans are used to speaking out fast. This might be a disadvantage to them when they are speaking to a Chinese for they like it slow. They might also loose their audience and so loose out on a great idea a party had. Being slow does not mean that one is dump or slow to learn. It can only be the way the other party likes things done. Being casual makes one comfortable and free with the other party but this might be a disadvantage especially if being casual is considered as rude. Chinese like it official and only childhood friends or long time friends are allowed to call each other by their first names.

Chinese have the habit of exchanging business cards after their meeting or after greetings. This can be taken as an offense by one who does not know about this culture. Americans prefer to first know each other and then offer their business cards at a much later time. This puts the Chinese at an advantage as one gets to know what they do at an earlier time. Though it might look as though they are only interested in doing business with the other party, it is not so. In fact, they are very good at creating long term relationships. The exchange of business cards is just a way of letting the other party know more about them.

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In the U.S, deals can be crossed within a very short time which is an advantage as they get to cross many of them. The relationships between the two parties might not be as strong for it might be purely a business relationship. This is also a disadvantage as long term relationships might not be formed. This leads to short term relationships that only end when the deal is finished. However, the Chinese do not make very quick deals as they first like knowing the party or parties they are dealing with and then finally settling down to do business. They are more conservative and they do not like revealing too much about themselves. This does not mean that the Americans just go and spill out everything about them; it just means that the Chinese are much slower than the Americans.

It is always good to cultivate what is known as “guan xi” in China. This means connections. Knowing people and making connections first before entering into business with them is very important to the Chinese. Turning up with legal documents on the first or the second day of a meeting might not be very good if one wants to be in business with a Chinese. It is always good to get to know people first as this might show that one is more interested in the person more than just doing business with them (Peterson, 2004).

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The Chinese do not like to be pushed and so it is not advisable to get them to tell you what they do not want to tell. The good thing about them is that once they establish a relationship with a party, it will go much further than being just a business relationship. The relationship might also last a very long time.

This can be a disadvantage to a party that is impatient and wants to strike a deal as soon as possible. The understanding of each culture is important and should enable a party reach out to the other party in order to make good business relationships (Walker, Walker, & Schmitz, 2003).

Different colours have different meanings depending on the culture in question. In the U.S, colour white signifies peace and is worn during weddings as a sign of purity while the same white signifies mourning and sorrow in the Chinese culture. Red signifies prosperity, power and authority in the Chinese culture while the same colour might not be so pleasing being worn to a business meeting especially by a man. A man wearing a green hat in public in the Chinese culture means that his wife is being unfaithful which is quite embarrassing to do in public. An understanding of such simple details is very important as one might pass the wrong message without their knowledge. No one wants to offend the other party especially on the first day of talking business. Both parties might try and look for a neutral colour that does not pass an absurd message to the other or even worse still, make the other party uncomfortable and offended (Shenkar & Luo, 2008).

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People do different things as a sign of appreciation. Most people may prefer to do someone a favour while others may prefer to offer gifts. It is important to know what a certain gift signifies to the other party before giving them. For example, offering a Chinese a clock, signifies that you want to attend their funeral which of course is not the message that one wants to pass. In the U.S, it is not very advisable to give one lingerie unless you a very close and very free with the other party. This is normally done when one wants to create a romantic mood or in bridal showers. It is alright to give them a wrist watch but do not offer a clock.

Some behaviors might look indecent when done in certain places while to others they are just normal. For example, Chinese are used to smoking such that they smoke a third of the cigarettes produced in the world. If a Chinese starts smoking in the middle of a business meeting, it is only a way of relaxing and they might even listen to you longer. This might not be the case in with the Americans as it might be interpreted as a sign of rudeness. If a Chinese offers a cigarette, it is only advisable to just turn down the offer but do not start giving lectures about the disadvantages of smoking. On the other hand, if an American feels offended, when the cigarette is lit in the middle of a discussion, putting it off for a short period of time will not do much harm (Ambler, Witzel & Xi, 2008).











While Americans are not as superstitious as they look at this as old age beliefs which are not real, the Chinese are very superstitious. It is important that the Americans respect their way of life and learn more about the superstitions that might offend or hinder doing business with them. This will ensure the smooth flow of doing business with both parties.

With today’s technology, there are transactions that are done online without any one on one meetings. This has made many business transactions happen especially in the U.S and other countries. However, this is not the case with the Chinese. They prefer having one on one meetings with all the people they are working with. They also prefer to speak out their problems when there are not too many people around (Bucknall, 2002).

This will help one get to know them better. This is not the case with the Americans as they can easily shoot up their questions, problems or ideas in front of a large audience. The Chinese are more secluded and do not like a lot of publicity and that is why pushing a lot for answers that they do not want to give may not be such a very good idea. They open up at their own pace, wish and time depending on how they have known you.

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It is always advisable to stay behind after one has talked with a large Chinese audience instead of rushing out to the next meeting or appointment. Staying behind will give the ones who were not ready to ask questions or give any ideas publicly a chance to open up to you. According to many, this staying behind has enabled many to make very good business deals or at least get good business ideas. There are times that they prefer to pull someone aside and so, do not get offended (Stone, 2005).


Globalization, political issues, policies and laws of both countries and government and their cultures have all affected the trade relationship between the two countries. 

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