The China Experience

Consultant shares the good, the challenging when headed to the Far East for business

One benefit of working in the aviation business in China is that most people, at least upper management, speak a reasonable level of English. And, most understand some amount of English, but aren’t comfortable attempting to speak it in return. As a result, it’s not necessary to learn Chinese in order to do business there, but it does help to learn some of the basic words or phrases as a courtesy to your hosts. Knowing a few words such as “nee how” (hello) and “sheh sheh” (thank you) can take one a long way.

Outside of the building relationships, the most important things to know about doing business in China are the importance of honor, the attitude regarding time, and the best approach to problem-solving. As with most businesses, it is very important to show a high level of respect for seniority and authority. While one may clearly see that there are better ways to reach a goal or solve a problem, it’s important to make sure that one is very careful in presenting ideas in a way that allows others to follow appropriate protocols, or even to “save face” if there were errors in processes or procedures.

I found people to be very accepting and appreciative of new and innovative ideas; but it was still important that those ideas were presented in a certain manner. In initial staff meetings I attended, there was significant fascination with capitalism and market-based ideas designed to increase revenues and manage expenses.

The second item noted was the attitude regarding time. I mention this because “hurry up and wait” seems to be alive and well in China’s business culture. While they are very appreciative of new ideas, concepts, and ways to improve processes and procedures, they do not make decisions in a hasty manner. Consistent with the approach to building business relationships, the decisionmaking process is often drawn out while all possible scenarios and alternatives are evaluated, and all pertinent parties are consulted. Because of this approach, it’s important to be careful in the wording of deadlines and delivery dates in any proposal. Submit a proposal in August and indicate a delivery date by the end of the year, even if a notice-to-proceed is not issued until mid-October, there is an expectation that the delivery date of December 31 is still viable.

China’s greatest resource is people — billions ready and willing to do more than a day’s work for what we would consider much less than a day’s reasonable wage. As a result, the answer to many of China’s perceived aviation problems are to “throw manpower at it.” At times, there was a hesitancy to address efficiency issues that would result in fewer employees doing the same job. In my experience, the typical airport maintained ten times the number of staff for a similar size/activity airport in the U.S. Much of this goes back to the time when the Central Government owned all airports and were used as employment bases, without regard to potential inefficiencies. Thus, while many recommendations regarding staffing reductions and employee cross-training were very well received, they were never implemented due to political pressures and requirements of the transition to private ownership.

Since my work with CMAC ended, I have completed many other projects throughout China for other organizations. I teamed up with an investment banker in Hong Kong to form Kompass Partnerships, Ltd., a company that pairs U.S. and Chinese aviation companies. While the opportunities for U.S. companies in China are somewhat endless, most U.S. businesses will be unable to develop a relationship with a Chinese partner due to a number of challenges. Finding the right partner is the obvious challenge; developing that relationship through the barriers of language and culture is another. Different parts of China exhibit very different cultures and business attitudes. Foods are unique in different regions, dialects vary, and the attitudes toward “outsiders” can be different. One must continuously exhibit flexibility, tolerance, patience, and most of all respect.

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Michael A. Hodges, MAI is president and CEO of Airport Business Solutions, a Tampa-based aviation valuation and consulting firm.

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