Recognising one's limits, knowing when not to cave in and networking are three attributes essential for any foreign executive taking on China
A popular warning for incoming expatriate executives to China goes like this: After staying in China for a month, you will have learned so much that you want to write a book. After staying for a year, you will have learned so much, but made enough mistakes along the way, that you want to write a magazine article. After staying for a year, you will have learned so much but made so many mistakes that you don’t dare write a thing.
Should you do this? After all, the expense is small if it guarantees government approval of your business license, and hongbao is part of Chinese New Year celebrations. The answer: This is one instance when strength and inflexibility is in order. The Singaporean manager explained several strong reasons against using this method of guanxi building. First, once you start down the slippery slope of offering gifts of cash, you may invite in a flood of similar requests. Second, using a middleman is risky — you never know whether or not he actually delivered your money to the officials. Instead, it is better to play your ‘foreign card’ in such situations, and take a zero tolerance attitude toward any behaviour that would be considered unethical by your company.
(This story appears in the 30 April, 2010 issue of Forbes India. To visit our Archives, click here.)