Micro public relations

Micro public relations here refers to relations with your Chinese colleagues, business partners, investment partners , government officials and people of different social functions. The discussion below is not intended to provide a panacea for dealing with various types of relationships, but rather the general rules that foreign business people should pay attention to in order to get along with the Chinese.

Your business partners

First impressions
It is important in the initial meeting to establish a good 'first impression '. Showing respect for local customs and habits is a good start, but adopting some of them may 'shorten the distance' in the first meeting and win recognition from the Chinese partners. For example, using two hands to present and receive business cards is considered to be good manners. Lightly knocking on the table with your forefinger and middle finger when you are served a cup of tea or drink will be taken as a sign of significant social experiences in southern coastal areas of China, particularly in Guangdong area. Proposing or accepting a toast at a dinner table with one hand holding the cup and the other the bottom of it is seen as respectful to the Chinese hosts . Neatly dressed and well organized businesspeople will always leave a good impression on their Chinese partners.

Nurturing your image
Apart from social rituals, foreign firms should also establish an image of professionalism and authoritativeness in order to gain the trust of their Chinese partners. For example, as an importer of Chinese products, the capability of your distribution network should be discussed in as much detail as possible to ensure trust and to assure the Chinese partner of the advantages of using the network you have outside of China. A bank reference will help eliminate possible doubts about your credibility.

As an exporter, you are expected to understand the products and technology you are trying to promote in China. If you are to make a presentation about your company, visual aids and properly translated brochures are extremely useful for a better understanding by your Chinese counterparts. Some foreign companies have Chinese version brochures , but the translation is almost as difficult to understand as the foreign language. Some reference of export acceptability will be helpful in building up confidence in trading your products in China. Sales into China also often involve many technical exchanges between the foreign sellers and the Chinese buyers and an important part of this effort is endorsements from relevant technical authorities in China. The endorsements can be explicit and implicit. Explicit endorsement usually take the form of technical certifications issued by relevant Chinese organizations, while implicit endorsements can be any type of public relations activity that you have had with well-known officials, technical experts or past projects in China. Evidence that your technology and products have gained endorsements and certifications elsewhere are also a plus. All of these should have a favourable impact on the decision making of the Chinese partners.

Dealing with hidden relations
When you are sure you have given your Chinese partners a good impression in your initial contact and that they are also impressed by your technology and products, you may then advance to the stage of business negotiation. In a business negotiation, you may expect to deal only with negotiators . In fact there could be other unknown decision- makers , particularly when the business involves decisions made by other organizations that are not directly participating in the negotiation. For example, if you are selling power plant equipment, the organizations involved in the decision making will include, among others, the State Power Corporation (previously the Ministry of Electric Power), the local power supply authority, design institute, environmental protection authority, banks providing the financing, and so on. These may not appear to be direct concerns in the negotiation but they are influencing the decision making process and will have to be dealt with appropriately to facilitate the decision-making process. It is recommended that foreign suppliers help the Chinese partners solve the problems arising from these hidden relations by giving understanding and patience to your counterpart in the first place and providing the necessary proofs to alleviate possible concerns. At the same time, some lobbying of these organizations by the foreign partners may be helpful. For this purpose, informal meetings, technical seminars and entertainment can be organized through a contact who knows when and where these activities will be appropriate. These negotiations could be very delicate, and making inappropriate proposals could be even worse than doing nothing.

Keeping a good track record
Business relations are a long- term commitment in China. Keeping a good track record will not only improve your position in the market, but also enhance your corporate image from a public relations perspective. Good track records with previous customers in terms of product quality, technology reliability and after-sales technical support will save the time for building trust in the products and technology with a new client. Even if you had not been able to gain publicity in the media, your good track record tends to generate good word-of- mouth publicity among the people in the industry. Good track records can accumulate into an impressive list of references, which will speak for itself in your promotional efforts.

Warm the threshold
Even if business with your Chinese partners is quite sporadic, keeping the relationship warm should be considered part of your long term strategy. A Christmas/ New Year card will remind them of your existence and tell them they are remembered . Occasional phone calls will give the relationship a personal touch. When you travel to China for unrelated business, having a chat over lunch /dinner would bring the relationship even closer. When the paths of your business do cross sometime in the future, you will still be treated as an old friend.

Your investment partner

Trust
While in business you can have alternative partners, in an investment venture you could not possibly do so unless you wished to terminate the venture prematurely. You will have to stay with your investment partner for a considerable period of time: identification and selection of a good partner is very important, and is discussed in detail in Chapter 4.5. Once you have chosen your partner and the contract has been signed, success depends very much on how well you co- operate with your partners. Trust is the basic element of successful cooperation in a joint venture.

The rules for building trust here differ little from elsewhere. Cultural clashes can be a cause of mistrust . In addition however, the fact that you and your Chinese colleagues represent the interests of two different organ- isations can be an obstacle to building trust. In the absence of trust, the Chinese colleagues may read some hidden purpose into what you do and vice versa. This is particularly hazardous to the development of the joint venture and eventually your own interest. While keeping good personal relations with the Chinese management, it is advisable for foreign executives to do things under the umbrella of mutual interests. When there is a disagreement , it will never lead you anywhere if you try to convince your Chinese partners that this is the way things are done in your company. Blaming your Chinese counterparts to cause loss of face is especially detrimental to the working relations. It is better, for example, to say that there is an alternative that may work. Any material efforts that you make for the mutual benefit of the two parties will bring you closer to gaining trust from your Chinese partner.

Educating your partner
Dealing with your Chinese partner is a learning process on both sides. One of the general perceptions of Chinese enterprises when introducing foreign elements into a venture is to learn what is called 'advanced managerial expertise'. One side of the education could be a kind of demonstration by which your partner can learn your management style on site. The other side is the formal training that can be conducted both on the job at the location of the joint venture and off the job at the foreign partner's factory. The training can enhance understanding of the Western management style and at the same time be conducive to gaining the support of local management. Once you have the understanding and support of the local partner, it will be much easier to carry out a business decision.

Communication with your partner
In an investment venture in China, communication between partners is a delicate matter. Mishandling communications may cause misunderstanding and eventually impede the efforts by both sides towards a harmonious relationship. Poor communications can lead to business failure. Establishing a good communications mechanism is a job for both partners. In many cases, foreign executives find that their Chinese colleagues remain silent at corporate meetings that are intended to solicit comments and suggestions from all managers; Chinese managers should be encouraged to talk openly about corporate decisions.

For the foreign partner, it is important to understand the reporting structure of the Chinese partner and the roles of the Chinese directors in the board. In the initial period of the joint venture, an appropriate channel of communication should be discussed with the Chinese partner in order to avoid possible misunderstanding in future communications. Routine meetings and internal circulation of corporate documents are the means of communication that are familiar to Chinese executives.

Internal organizations

Treat trade unions as a means of communication with employees
According to relevant laws and regulations, a joint venture in China must have a trade union in order to protect the rights and interests of employees. Apart from its role as a spokesperson on behalf of the employees, if a harmonious relationship can be established a trade union can also serve as an effective channel of communication with employees. Any effort to turn a trade union into a mere cipher will not help eliminate possible conflicts with employees. On the contrary, to delegate some responsibilities to the trade union may help improve relationships between the employer and employees. In a Chinese organization, a trade union also has an employment relations and welfare function. In a joint venture, it is advisable to have the trade union assume a similar function. The union can be used to increase awareness by employees that their well being is one of the primary interests of the venture. In furthering a better relationship with employees, the union can also be delegated the task of organizing employee activities, through which management can initiate closer, less formal and friendlier interactions with employees.

Party organizations are task forces
The Chinese communist party has over 60 million members active in different sectors and industries in China. In each Chinese organization there is a party committee or branch responsible for the organization of the communist party. There are also some party organisations active in many Sino-foreign joint ventures . Because of ideological differences, the foreign management of a joint venture may have a certain degree of reluctance in accepting such organizations in the joint venture. In reality, however, many foreign managers have found that such organizations play an important role in the execution of decisions made by the board. Party members are supposed to be people of excellence and the elite at all levels of an organization. Party principles require members to take the lead in the face of difficulties and to set examples for non-members through their work. They can always be referred to for help in critical situations. In dealing with the party organisations, respect should be given to party members and they should be encouraged to take proactive roles at different levels of management. Appropriate time should also be allocated to these organizations for their own activities. As an offshoot of a good relationship with the party organizations, they can be used as task forces to help the management realize management objectives and enhance employee communications.

Employees

In internal public relations, a good image of the management team is of pivotal importance in establishing the trust of employees. Trust can be established through candid communication. The following list of rules is not exhaustive but should be taken into account when dealing with employees:

• The first meeting with employees is very important in terms of building trust. Employees should be clearly briefed on corporate objectives and their association with the well-being of employees;

• When introducing 'western advanced management', communications should be understandable and free of ambiguity. On points that are particularly 'foreign', there should be clarity. To play safe, implementation of management policy on a trial basis will allow adjustments at later stages;

• Communications with employees should be regular and ongoing. Employees should be informed of the progress that the company is making both in good and bad times;

• Employee participation in the management process should be encouraged. If possible, a platform should be provided for employees' suggestions and comments;

• A sense of employee pride should be developed by creating a unique corporate culture. Employee contributions should be recognised and appreciated in the form of both spiritual and material rewards;

• A ladder of promotion should be established in order to encourage employees to be career-motivated. Promotion schemes should be designed to meet different career needs, such as promotion to management positions and technical skills. Pay schemes should be linked to promotions.

Government officials

Because of the pervasive red-tape and bureaucracy in almost every government across the world, companies outside China tend to employ or engage professional lobbyists to deal with governments and government officials. In China, however, lobbying is not a professional trade. Although there is an increasing number of public relations companies who claim to have special connections with Chinese government officials, no such organizations could realistically offer the service of dealing with government officials on behalf of the client on a regular basis. Like anywhere else, government functionaries can be very influential over corporate decisions or in business deals, and therefore maintaining a good relationship with them is imperative for foreign firms doing business in China. The advantages of having a good relationship with government officials are as follows :

• Advice on corporate decisions. Government officials are involved in policy making process of the governments at different levels. They are also well informed with regard to trends and policy orientation. Their judgement on corporate decisions can be extremely valuable ;

• Gaining government understanding. Contacts with government officials on a good relationship basis will help a company to deliver or communicate the messages of corporate strategies/actions and gain government understanding of the corporate position;

• Facilitation of government procedures. Advice by government officials on how to meet reporting requirements will save a lot of time and effort to gain consent or approval from the government organizations;

• Publicity for corporate image. A formal meeting between the CEOs and high ranking officials such as ministers, provincial governors and city mayors will receive a lot of publicity in the local media. A meeting with central level officials will be covered by TV and newspapers;

• De facto recognition. The comments made by government officials during formal meetings and a picture taken with them may appear to be an indication of de facto recognition of your company by government organizations.

To the uninitiated, the Chinese government can appear to be an incomprehensible labyrinth. The reporting structure and its associated requirements are even more so. You will be very lucky if your business partners have strong relations with government organizations at different levels. With the help of contact people, consultant organizations and public relations companies, contact with government organizations and officials can also be initiated. Once the contact is initiated, a reasonably good relationship with government officials can be maintained by employing appropriate personal and public relations skills. Government officials can be invited to participate in the ribbon-cutting ceremonies, news conferences, major corporate events, inspection tours , seminars, exhibitions and so on. Sponsoring government-initiated community projects and public affairs can also be a good way of cementing closer relationships with government officials and generating positive publicity.

People of different social functions

Apart from the types of people mentioned above, there are others that cannot be ignored in corporate public relations: industry experts, research professionals, personnel of industry and commerce bureaux, tax bureaux, Customs offices and stars in the recreational industry. These are influential groups. They can be dealt with on a good personal basis with a view to creating external public relations effects. Of special significance are relations with journalists and reporters. Keeping a good relationship with them will always be useful.