Icelanders have increased their business dealings with China considerably in recent years; as the Chinese market is very large and economic growth has remained strong there, while growth has declined in Europe. Language skills do not suffice when interacting with other nations, cultural literacy also has considerable impact on contracts and long term business plans.
Bergþóra Aradóttir, MS in Management and Policy Making, studied the experience of Icelandic managers doing business in China in her MA thesis. “The study focuses on the experience of managers of the influence of traditional Chinese culture on the one hand, and the modernisation of the business environment on the other,” says Aradóttir.
Aradóttir says there are many indications that the experience of Icelandic managers doing business in China correspond to a great extent to existing research on Chinese culture and business environment. She says that the results of her study show that Confucian ways of thinking, such as the importance of connections; respect for etiquette: avoidance of confrontation; and emphasis on honour and reputation are still prominent in China, despite the ever changing environment of vast economic growth and modernisation. “However, that fact that business is only business must not be dismissed,” says Aradóttir.
“The results also indicate that the biggest problem for strangers to enter the Chinese business world is suspicion towards strangers and lack of understanding, on both parts, of their culture. Other factors that the research highlights were a different approach in negotiating business deals; the importance of quality control in production, and a lack of initiative and willingness to shoulder responsibility in employees.” Aradóttir points out that it is interesting how many Icelandic companies have managed to succeed in Chine despite the cultural differences.
“The study could be useful to companies that want to expand and are preparing to enter into the Chinese business environment, by following in the footsteps of the Icelandic companies already doing business there.”
When asked about the inspiration for the study, Aradóttir says that she wanted to combine her education in East-Asian Studies and Management and Policy Making. “I chose communications with China as I am extremely interested in Chinese culture and society; and I find China very exhilarating after having lived for a year in Ningbo as an exchange student,” concludes Aradóttir.
Supervisor: Ingjaldur Hannibalsson, Professor at the Faculty of Business.
