As we mentioned in the introductory article on Building a Successful Partnership in China, good communication is critical to any relationship, whether business or personal. Miscommunication can lead to performance and trust issues, with the latter, if not addressed, becoming a cancer that can quickly destroy a business partnership.
Understanding how your Chinese counterparts think and communicate is important but often very difficult for foreigners. The same can be said on the Chinese side. Most Chinese business managers have minimal experience outside mainland China, so they also struggle with how to work and communicate with their foreign counterparts.
Three major factors contribute to communication issues between foreign and Chinese managers: language, face, and to a lesser extent, etiquette.
When companies are preparing to enter or sell a new product or service in China, marketing plans, whether formal or informal, will always include a plan to recruit or engage partners. The term “partner” is used broadly here. We define a partner as any third party, bound legally (e.g., in some form of joint venture) or less formally (via a contract or agreement) to support a foreign company’s business in China. It could be a channel or retail partner, solution provider, government entity, supplier, etc.
We believe that building a successful partnership is one of the most critical parts of any marketing or business plan. When you hear a horror story of a foreign China business venture gone awry, it is usually due to a problem with a local Chinese partner. These problems range from “missing” revenue or profits, stolen intellectual property, or the inability of the partner to meet goals and success metrics.
Most would define a successful partnership as one that is aligned on business objectives and provides customer or market access, essential relations with key government officials, regional presence, qualified workers, business licenses, and more.
NetBridge Global has recently been listed as a Business Service Provider for China by the United States Commercial and Foreign Service Department (export.gov). U.S Commercial Service provides a surprisingly comprehensive set of services for companies looking to sell their product or service abroad. This includes market research, company due diligence, business matchmaking and more.
NetBridge Global can help companies utilize these services and/or connect them to the right people locally, either in the U.S. or China.
A who’s-who in both the “Big Data” industry and entrepreneurial ecosystem will be speaking at the all-day conference.
Hope to see you there. Registration and agenda details follow.
We attended a very interesting and timely event on China investments in California hosted by the Silicon Valley Business Journal and Asia Society. It featured a panel of both familiar and new faces, including Ben Chen, President of the Chinese Enterprise Association (and President of China Unicom America), Kim Walesh, Director of Economic Development for San Jose, and Victor Wang, President of Hanhai Investments and co-President of China Silicon Valley.
A very good summary of the event can be found in an article by editor-in-chief Greg Baumann who moderated the panel discussion: “Six ways to bridge the Silicon Valley-China gap.” Here are two of the six tips for working with Chinese companies as a teaser (click here to go to the full article for the rest):
- U.S. companies: Understand that small, symbolic gestures of respect and friendship are meaningful.
- Chinese companies: Break out of your circle of Chinese business acquaintances and form new networks.
If you follow the articles we post on NetBridge Global’s China Market Insights portal, you’ll know that we typically emphasize partnerships, relationships and connections as the most critical part of success in doing business with China. The insights from the panel and the summary by Mr. Baumann reinforce this view.
On March 5, 2013, NetBridge Global (NBG) hosted the first of what will be an ongoing series of informative events on “Doing Business in China.” The event was an overwhelming success with 150 people attending live and 30 people logging in via the webcast.
Here is a full HD video of the event on our YouTube Channel:
- Mark Beckford, CEO, NetBridge Global — MODERATOR
- Darlene Chiu, Executive Director, ChinaSF
- Qiming Huang, Chair of the Board of Directors, SVCWireless
- Christine Lee, Senior Vice President and China General Manager, Tapjoy
- Xiang Xia, Commercial Counselor, Consulate-General of China for San Francisco
We would like to thank our co-hosts Asia Society and Silicon Valley China Wireless (SVCWireless) as well as the sponsor K&L Gates San Francisco.
China Mobile is feeling the heat from the popularity of the free app-based messaging service WeiBo (Weixin in China) as Weibo cuts into China Mobile’s text messaging revenue. It is planning to fight back with a new push for it’s similar “Fetion” platform. From CAIJING Magazine, March 22, 2013:
China Mobile May Restructure Fetion to Fight back Weixin amid Slower Business – The Chinese mobile operator … developing Fetion into an integrated telecommunication product, according to a leaked document. China Mobile, the world’s largest mobile phone operator, is planing a comeback by restructuring its instant SMS service against the increasing popular Weixin which has garnered over 300 million users home and abroad.
“Been there, done that.” China is promoting the development of a new open source operating system, probably to compete with Android, based on the popular Ubuntu O/S. This is well-travelled territory as China has tried and failed to develop and promote their own “standards,” the microprocessor “Godson” and the WiFi Standard “WAPI)” as the most famous examples. From BBC News, March 22, 2013:
China to create home-grown operating system – China is working with software firm Canonical on an open-source operating system customized for Chinese users. The collaboration will produce a version of Canonical’s Ubuntu operating system called Kylin which will be released in April.
What Lenovo Could Gain From Buying BlackBerry - BlackBerry’s share price is rising because Lenovo Chief Executive Officer Yang Yuanqing suggested his company is seriously considering acquiring it. Yang: “BlackBerry could possibly make sense, but first I need to analyze the market and understand what exactly the importance of this company is.”
The king of Chinese eCommerce, Alibaba, will launch its own credit-line. From The Economic Observer, March 12, 2013: Read More
In an extended visit to Beijing in January this year, we had a meeting with officials from the China Council for the Promotion of International Trade (CCPIT). They have an Economic Information Department which generates copious amounts of data and reports on the Chinese economy. We walked away with at least 10 pounds worth of books and reports on Chinese industry and the economy, in both Mandarin and English.
If you are in any way skeptical about the data that the Chinese government produces (I think everybody agrees that whatever industry or market one is looking at, it’s BIG!), there is a solution for you, albeit an expensive one. Read More
Great article from the Wall Street Journal on the challenges of selling mobile apps in China, hitting nearly all the key points, including challenging business models, piracy, payment systems, local competition, and most of all, how to make money. From WSJ Online Feb 20, 2013:
For App Makers, China Is Untapped and Untamed – China is emerging as the next battleground for global app makers—but cracking the world’s largest smartphone market is proving to be vexing. App makers must navigate dozens of app stores with looser rules than in the U.S., fend off a proliferation of cloned apps, and steer around a thicket of regulations and intense competition from local developers.
China’s smartphone market is now as big as the total population of the United States. Lenovo, Yulong’s Coolpad, ZTE and Huawei round out the top five after Samsung. From the South China Morning Post on Mar 6, 2013:
Mainland China’s smartphone market to top 300 million units this year – The market for smartphones in China is forecast to exceed 300 million units this year, representing an industry-leading 32.8 per cent of total global shipments. The market is also expected to be bolstered by rapidly growing domestic demand for Chinese-brand smartphones.
This week NetBridge Global (NBG) hosted the event “Doing Business in China.” Co-hosting the event with Asia Society and Silicon Valley China Wireless (SVCWireless), and sponsored by K&L Gates, the event was an overwhelming success with 150 people attending live and 30 people logging in via the webcast.
The first speaker was Mr. Xiang Xia, Commercial Counselor for the China Consulate-General o San Francisco. Mr. Xia provided insights into the Chinese government’s position on promoting foreign investment and addressing intellectual property issues, and the importance of picking the right local partner. He emphasized, as we have as well, that understanding the cultural differences between foreigners and the Chinese is very important. He used examples of the importance of “face” and “guanxi.” You can read more about this topic in our article: Building a Successful Partnership: Minimizing Communication Issues.
One of the coolest and fastest ramping smartphone apps is getting a dedicated presence in the United States as China’s Tencent opens a “customer relations department” specifically for the WeChat application.
Tencent, made famous (and wildly rich) from the popular Chinese QQ instant messaging (IM) service, released the English version of WeChat in April 2012 and has since grown to over 300M users globally.