-To Bow Heads or Shake Hands - : A Study of Direct and Indirect Communication in Chinese Management

Abstract: The world-wide globalisation that has taken place during the past decades has led to more Multinational Enterprises (MNEs) choosing to relocate some parts of their organisation to other countries. China, which is in command of the world’s lowest-cost manufacturing plants, is the first destination for MNEs. Although China presents a great opportunity for MNEs, this investment does not come without its difficulties, MNEs wishing to invest in China are confronted with certain challenges. MNEs are faced with dealing with the notable differences in Western and Chinese business culture. One particular difference is related to intercultural communication between western managers and Chinese managers. The theory of low context and high context cultures states that the Chinese communicate indirectly and Western countries directly. The main purpose of this research is to find out if the Chinese manager, after obtaining experience negotiating with foreign managers from low context cultures, adopts a more direct communication style. The purpose of this research is to answer the following question: Does the Chinese manager have a preference for direct or indirect communication when negotiating with foreign managers? The following hypotheses were stated: Ho: Chinese managers prefer direct communication during business negotiations with foreign managers. Ha: Chinese managers prefer indirect communication during business negotiations with foreign managers A quantitative method with a positivistic epistemology was used for the research. Quantitative research is an exploratory study with a deductive approach and therefore the most appropriate method for this research was a survey. A survey was chosen for data collection and a questionnaire based on the research model was developed and used as the survey instrument to collect data from the target group. The target group was stated as Chinese managers with at least three years work experience, fluent in English and with experience in negotiations with managers from cultures considered as low-context cultures such as Germany, Sweden and the United States of America. The target group was selected from the MBA programs at Fudan University. The SPSS program was utilised to analyse the responses and to test the hypothesis. Numeric values were assigned to each of the responses, with 5 being the most direct and 1 being the most indirect. The scale was appropriately reversed for negative questions. Descriptive statistics were obtained about distribution, variability and central tendency of the variables. t tests were applied to compare group means. Furthermore, a regression analysis was conducted to estimate a linear relationship between direct communication and the lack of miscommunication showed by the descriptive test. All tests were conducted at a 95% confidence level. The result of the hypothesis test indicated that Chinese managers have preference towards direct communication when conducting business negotiations with foreign managers.