Term Paper: Chinese and Canadian Negotiation Styles

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[. . .] With a complete stranger, they tend to be very stiff which can be disastrous for the negotiation meeting. The fact that they deal with only trusted people, Chinese people are more successful in their negotiation about entering new markets. (Romano, et al., 2000).

Chinese people will also even resort to complete denial and lying if it can help them save face. They would not lose face in any negotiation meeting because honor is important (Silverman, 1997). This doesn't mean that they won't lie or cheat. Chinese business environment is highly corrupt but most businessmen would try to avoid embarrassment in the wake of having been caught by doing whatever they can to deny that they even took the action. It is important to understand that owning up is not an attribute to look for when dealing with Chinese people in a negotiation meeting. Canadians on the other hand do believe in owning up even if it means losing face. This is essential difference between eastern and western style of negotiation.

Chinese negotiating process can be unbearably long and for a Canadian who is looking for swift wrap up, this can be highly frustrating. Chinese tend to take a long time in making decisions in order to be able to make the most correct and appropriate decision. On the other hand Canadians tend to be rather impulsive because they are risk takers. They do not mind a swift resolution even if it later proves to be the wrong one. This is because they do believe that in a volatile business environment, this kind of risk taking is important and swift decisions are needed. Chinese businessman wouldn't however believe in such a theory and hence take a long time in making decisions and considering every aspect of the negotiation process to reach the most suitable and agreeable decision. (Manzelmann, 2001).

Another important feature of Chinese negotiation style in indirect communication which means that instead of rejecting an idea completely with a straight forward No, they would use words like "Ming Bai" (I understand) "Dui," meaning "okay" and such indirect remarks to avoid giving you a direct answer. This can confuse the other party to the extent that they might even take this as a yes when Chinese party is only trying to reject the idea (Kracht, 2003). This is their polite way of rejecting an idea and turning down an offer or advice. However this can confuse Canadians who prefer a more direct answer (James, 2000). They would directly reject an idea if they do not approve of it and even give explanation as to why they feel it is a bad solution. The same is not true for Chinese people who equate directness with rudeness. (Kracht, 2003).

The indirect communication style is not limited to rejection and acceptance of ideas. Instead of graciously accepting praise and compliments on a job well done, Chinese people will prefer not to instead divert the attention to some other factor responsible for their success (Silverman, 1997). They hate showing off but this is not how a Canadian would react to praise. They would be more than happy to graciously accept praise. This is in line with their preference for directness in communication.

Chinese also prefer a more formal way of addressing each other during negotiations. It is not appropriate to address them by first names because last names are always preferred with a prefix like Mr. so and so. On other hand Canadians who are more influenced by the American style of communication would prefer to be on first name basis. (Silverman, 1997).

Unlike Chinese people who can bend rules to please the other party if they trust them, Canadians would not resort to this tactic. They believe in following rules and wouldn't bend them for anyone because this would be unprofessional in their view. They feel it is best to keep the rules the same for everyone so every person in the negotiation party would know what they have bargained for and what does the decision entail. (McBlane, personal communication, Sept, 2003).

Chinese people would depend as much on verbal communication and good relationship as they would on terms of a contract. This is not true for Canadians who are not interested in building relationships and all that really matters is a contract and adherence to the terms of the contract. They can severe a business tie easily if the other party is not honoring the terms of the contract and relationships are very secondary in a business matter. However Chinese businessman would consider relationship just as important as the contract and sometimes even more so. "…trust and harmony are more important to Chinese businesspeople than any piece of paper. Until recently, Chinese property rights and contract law were virtually nonexistent -- and are still inadequate by western standards. So it's no wonder that Chinese businesspeople rely more on good faith than on tightly drafted deals." (Graham and Lam, 2006)

Canadians like Americans would also be very aggressive during a negotiation. They believe in getting the message across forcefully and then proceeding with negotiations. Chinese would however remain completely polite because aggression is equated with lack of self-control (Kracht, 2003).

There are things that two countries can learn from each other's negotiating styles. Chinese can learn to be more direct; this would allow them to communicate with the western world in a much better way. The Canadians can on the other hand show a greater degree of restraint during negotiations with the eastern world because aggression is not preferred anywhere in the eastern world and is most noticeably disapprove of in the Chinese culture and business world.

Similarly Chinese can learn to adopt a swifter way of reaching conflict resolution. They must understand that the world is changing dramatically and no one really has time to spend on long negotiations. Everyone wants a swift and quick end to the long negotiation process. Canadians can learn to be more thorough in their analysis of the situation and control their impulsiveness in reaching a decision. This would help them make better decisions and not make too many mistakes.

The need to learn from each other must be stressed because the two cultures have a lot to offer each other and the more they learn from each other the better it is for business community on the whole because we are now operating in a global world where no one can work in isolation and learning from each other is the wisest thing to do.

Limitation of research

For this research paper, we relied heavily on secondary sources. Hence it was not possible the recent changes in thinking or approach that Chinese might have adopted in their regular communication and interaction with foreigners. The same can also be said of the Canadian people. It is important to use some primary sources like interviews to get a better idea of the changes being adopted by various cultures and countries in their negotiation styles based on their ever increasing interaction with globalized world.


Having discussed both similarities and differences, we can say that the two styles fall on the two extremes of the negotiating spectrum. Chinese people follow the eastern style of thinking in their negotiating style as well. They tend to be less aggressive; they value relationships and like to save face. The Canadians on the other hand tend to be more aggressive, believe in risk taking and do not think building relationships are important. Chinese can bend rules if they like you, Canadians believe that no such concessions are needed because rules are rules and they stay the same for everyone.

The differences are not too stark but they are there and they demonstrate the strong influence of culture on business dealings. It is essential to gain knowledge of different negotiation styles especially now that we are working in a highly globalized world and no one can work in complete isolation. Everyone needs to negotiate at one time or another and China being a very big economic power, people are bound to come into contact with Chinese businessmen sooner or later. Hence it is important for every culture to gain knowledge of the other before the negotiation process starts.


Graham J. And Lam, M. 2006 The Chinese Negotiation. Harvard Business Review.

Silverman, J. (1997). Doing business internationally. New Jersey: Princeton Training


James, D. (2003) Communication guide lines for doing business in Asia

< http://www.bsicorp.net/961104/gettingconnected2.html> (2011, May 1st)

Kracht, J. (2003). Successful negotiations in china -- A practical guide.

(2011, May 1st).

Manzelmann, M. (2001) Negotiation Strategies

(2011, May 1st)

Palich, L.E., Carini, G.R., & Livingstone, L.P. (2003, October 1). Comparing American and Chinese negotiating styles: The influence of logic paradigms.

(2011, May 1st).

Romano, D., Lee, G., Nguyen, H., & Boemihardjo, J. (2000). Understanding the Chinese

business networking Concept: "Guanxi."

(2011, May 1st). [END OF PREVIEW]

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