Doing business in Asia can be very rewarding and enjoyable but cultural differences present pitfalls for the uninitiated. An understanding of Asian customs and business practices will smooth the way to fruitful negotiations.
When conducting business in Asia, the first meeting is crucial to establishing relationships and credibility. Asian cultures emphasise dress, gesture and language more than Australian culture so it is useful to develop a basic knowledge of the culture you are dealing with.
- Business meetings in Asia are generally more conservative than in Australia, so formality in manner and dress will be appreciated.
- In more westernised countries like Singapore and Hong Kong, it may be acceptable to use first names, but if in doubt, always opt for the more formal mode of address, particularly in Japan.
- Because of the formality of business meetings in Asia, it may be useful to use a third person, or 'go-between', to arrange a meeting and introduce participants. This person should be regarded as a neutral party, but of significant rank and status.
- Observe protocol and decorum when arranging an appointment, and allow enough time for business counterparts to prepare for the meeting.
- It is considered ill-mannered to list your own achievements at a meeting, so leave this job for a discreet 'go-between'. This person will also conduct the introductions in a manner acceptable to the Asian participants.
- If a suitable 'go-between' cannot be arranged, observe strict formality in establishing business relationships in Asia. A meeting request should clearly state the reason for the meeting, who is to attend and a recommended date, time and venue.
- Allow extra time to attend appointments in Asia as traffic congestion and other difficulties can pay havoc with schedules.
- If you are visiting another person's office in Asia, you will usually be seated facing the door.
- If an Asian colleague/s is visiting your office, the most senior person should be directed to sit facing the door.
- When the people you are meeting enter the room, rise to your feet and move to greet them with a light handshake. Bowing is not always necessary and is better left to those who understand its value and intent.
- After these initial introductions, comes the important practice of exchanging business cards.
Business cards are very important to Asians; they are seen by many cultures as an extension of yourself. The following tips will help minimise embarrassment.
- Keep your cards in good condition by using a business card holder.
- Never use grubby or marked cards.
- The visiting party is usually the first to hand over business cards. The correct way to do this is to present the card with two hands with the right hand forward.
- Hand over cards with your name facing upwards. If possible, have your cards translated into the local language and present this side of the card.
- Never produce a card from or return one to a back pocket.
- Never write on another's business card.
- Briefly study the card and, when seated, place the cards so you can see them clearly.
Small talk is a common way of beginning business meetings. As in Australia, avoid discussing religion or politics and don't bring up family matters unless asked. Positive questions about your counterpart's business activities, natural or national events, sports and hobbies are safe. Small talk is useful in establishing business relationships in Asia, so don't dismiss it.
It is during this period of small talk that you should offer visitors some refreshment. Offer the most senior person a beverage first. If a guest, you may automatically be presented with a beverage. If this happens, you are not obliged to drink it.
Gift giving is common in Asian business, however, it is not necessary to present a gift at the initial meeting unless it has been preceded by considerable correspondence. Gifts should be presented at all subsequent meetings, however.
- Hosts may present gifts at the conclusion of the first meeting - small promotional items are sufficient.
- The visiting party should not present a gift at this early stage as it could cause the host to 'lose face' if he/she is not ready to reciprocate immediately.
Interpreters are useful in maintaining the flow of conversation if you do not speak the language. However, be aware that it is difficult to find a truly neutral interpreter, particularly if he/she is organised by the other party. Treat all information given to an interpreter cautiously.
Always look at your Asian contacts - not at the interpreter - during discussions. The interpreter is considered to be a tool of the discussion, not a part of it.
It is important to follow up on the relationships established during the first meeting. If language is not a problem, telephone to thank your contacts before you leave their country. Follow that up with a formal but friendly letter to the senior contact about a week later. This letter should outline your discussions and express hopes for an ongoing business relationship. Further correspondence should continue in a positive but undemanding manner.
As in Australia, the people you meet may not be the decision-makers, particularly in large companies. It is useful to understand the decision-making process of the company you are dealing with. This will give you a better understanding of the timeframes of decisions and the likelihood of success.
Entertaining is a very important part of Asian business and is often used to establish and maintain relationships.
- When overseas, hosting dinner and/or drinks is one way to build business contacts. In Australia, dinners, drinks, golf, sightseeing and barbeques are also effective.
- Gifts should be presented at these occasions, with the senior member of the Asian delegation receiving the best gift.
- While these occasions are important, don't expect to discuss much business. Social activities 'lubricate' relationships and help Asian contacts know you better so they are more comfortable doing business with you.
- If personal favours are asked, e.g., to assist an Asian student to study in Australia, consider helping if you can, especially if the person seeking the favour ranks highly in the decision-making process.
- When entertaining Asians in Australia, it is customary to insist on paying. It is also wise to pay if you have sought a lunch or dinner with a contact overseas. Entertaining overseas can be very expensive, especially in clubs, so select venues carefully.
- Asians usually like to eat out but the Japanese sometimes entertain at home. If you are invited to a Japanese home, it is a great honour and you should give your hosts an appropriate gift. Remember to remove your shoes before entering a Japanese home.