ADAPT AND SURVIVE: BUSINESS IN THE ASIAN CENTURY
Australian entrepreneurship in the Asian Century will open up many opportunities. Historically, there has never been a better time to engage Asia writes Jon Michail.
Understanding culture and image plays an integral part in conducting business in different Asian countries, but you should never assume that doing business in these countries is the same in each region. China is different from Thailand and even more so than India. And dependent on what business you are in, there are also large differences you can’t ignore. For instance, large businesses and government will engage differently from SMEs or non-profits.
The one thing that does unite the Asian region and that Australian businesses should be aware of is that businesses in these regions are very entrepreneurial and hungry to do a deal. They are highly competitive, ambitious and engaging.
Yet, there are several different elements we must understand about the different cultures.
Singapore is regarded as clean and above board with very professional and Western processes in play.
Indonesia on the other hand can be quite duplicitous – have you ever been ripped off changing Australian currency at an exchange in Bali? That’s a good indicator of the business culture that exists there starting from a very low base. Duplicity is common in Asia in general from politics to business. Yet Indonesia is becoming one of our most important allies, which means we must be respectful of their practices and understand how to deal with them.
China is vast and booming, but there are so many aspects in play across a broad range of industries that it is difficult to keep up with their processes. One of the most important things to remember is that image is vitally important. In Chinese culture a solid gold Rolex at times speaks much louder than the colour of your money.
I have launched several eclectic businesses in China on and off for over 20 years. The most important lesson I have discovered is to pick the right partners.
For instance during my involvement in China as an importer, business was conducted in a fairly straightforward manner; you buy their goods, haggle, pay their price and wait for delivery.
There were the typical importing problems including quality control, products delivered that were different from sample and under delivering. These are common problems, but can be negated by choosing the right sources.
In recent times I have been exporting our services. This is a much more difficult practice as the Chinese do not like to pay for services if they perceive they can get those services for nothing.
This is where a good partner will make a difference in building your business by positioning and selling the value of your proposition – especially if it’s a new concept. This is also where image comes into play.
Asia and China in general are very image conscious. You can’t afford to openly offend your hosts. There will be severe consequences if you do.
For instance one client I have was invited to dinner. Now there are certain foods that don’t naturally appeal and you don’t have to eat them, although sometimes it doesn’t hurt to go with the flow. However if you are to decline you must do this in a very sensitive manner. If you are too rigid in your approach then you offend the host. My client has
a strong personality and failed to realise there was a sense of etiquette involved. She insulted the cuisine, dressed too casually for the meeting and missed her opportunity. She noted to me that her host contacted others in the company and politely mentioned if they could send someone else. There are other etiquette-based protocols including the consumption of alcohol and invitations to clubs, where sometimes it is important to attend. However, if you must decline, do it politely and with respect.
Some academics or government leaders may try to underplay these differences in culture, image and etiquette, however in my experience every Australian business planning to enter the Asian market must observe these protocols. Unfortunately, my client who is a renowned businesswoman in Australia did not understand the hierarchies in play and the nuances that she should for someone in her position. She failed to make the right first impression.
To understand the image and culture you are dealing with, you must again find an able and willing partner.
Keeping with China, your partner must speak Chinese and side with you when in discussions. However, it’s not uncommon to have a duplicitous translator, agent or associate, therefore always be aware that all may not be what it seems. Always remember Asia is not Australia.
You can negate some of these problems by displaying strength, excellent branding, maturity, respect and an association with wealth. These will be seen to be in your favour. The ultimate respect is doing business yourself: don’t send a young kid to do the job of the senior executive. Maturity in personality and age are big advantages.
Social awareness is an imperative. Understanding the protocols and etiquette of your hosts is paramount even if you are the buyer.
For a long time to come the Asian region will offer the world business opportunities that will create extraordinary wealth for the disciplined and well-planned.
To take advantage of this be professional, well researched and always look the part even if your host doesn’t.
You will be judged constantly, even if the relationship ‘feels’ perfect.
Understanding culture and image plays an integral part in conducting business in different Asian countries.’