Negotiating with Chinese Companies: Persistance Pays

My friend Andrew Hupert, who teaches MBA level negotiation courses at NYU, just came out with the second part of his Negotiating in China: Secrets of Success series [link no longer exists]. In his most recent post, Andrew sets out three rules the “heavy-lifters of international negotiation have to say about reaching the contract-signing ceremony milestone in China.”

I love his first rule:

1) Persistence. They were all told it was impossible — that there was no way, no how, no chance. Persistence in China is about long term patience and composure – not threats or horse-trading. I remember the first time I put this lesson to work – long, long ago when the Portman Shangri La was the only hotel that international business people stayed in and one’s travel options were much more limited than they are today. An uncooperative concierge told me that the flight I wanted was booked and that there was nothing he could do. Instead of getting confrontational, I got comfortable. I took off my jacket and hung it on the back of the chair, put my bag down and settled in for a long conversation. As soon as he saw that I was neither leaving nor providing the adrenaline rush of a good barbarian throw-down, he quickly started supplying me with other options. I got to Beijing in time – which wouldn’t have happened if I had been issuing ultimatums or complaining. Persistence in China means becoming a very dull but not unpleasant part of your counter-party’s environment. If you go away when they tell you ‘no chance’ you’ll end up with nothing – but if you try too hard the discussion will quickly escalate into an emotional dispute. Your Chinese counter-part will enjoy a few moments of high-energy exchange, and then quietly and permanently check you off his ‘to do’ list. Westerners who get emotional, desperate or nasty are not deemed appropriate long term partners, and the initial ‘mei you ban fa’ – there’s nothing we can do’ is simply Chinese due diligence. If you don’t have the sense or smarts to try again, then you probably don’t have the resolve and maturity to be a serious business collaborator.

I particularly like the part about becoming “very dull but not unpleasant”, as this is a tactic I have often had to employ throughout Asia and reading that paragraph immediately brought to mind one of my toughest negotiations over $15 USD (yes 15).

Let me set the stage. I have stayed at the Westin in Seoul so many times that I had my picture taken and a mini party thrown for me when I hit 100 stays. And that was so many years ago that I may have even hit another 100 since then. I arrive at the hotel and ask at the desk about renting a cell phone. I usually get my cell phones at the airport upon landing in Korea (US cell phones do not work in Korea) but I had either forgotten to do so this time or had been in too much of a rush. The desk attendant told me I would need to go to the business center and I did. I signed for the phone and then went to my room, where I discovered there was already a cell phone waiting for me. I returned the cell phone to the business center (this was maybe 20 minutes after I first got it) and was assured I would not be charged for it.

At least ten days later, I go to check-out on the concierge floor. I sit down and examine the bill, which totals more than $4,000 (I had been there a long long time). I notice the bill has a $15 charge for the business center cell phone and I point that out to my desk attendant and tell her the story as to why I (actually my client) do not owe that money. She looks at me and says nothing. And when I say nothing, I mean nothing.

I quickly realize she thinks she is going to try to wait me out because she knows I am hoping to catch the airport shuttle that leaves in five minutes or so and then not again for another half hour. I too say nothing but keep sitting there. I pull out my International Herald Tribune and continue to say nothing. Finally, she picks up the phone and calls the front desk in the lobby and then gets off and proclaims to me that they know nothing about my being entitled to a write-off of the $15 charge. I very patiently tell her that I did not know why she had called the front desk because it was the business center that told me I would not have to pay and perhaps she should call them. She gave me a blank look and then did nothing for maybe another five minutes. She then picked up the phone and though I probably did not understand a word she was saying, I think I understood everything and I think she said the following to the business center:

I’ve got this crazy wae-guk (foreigner) sitting here and he won’t leave. I thought I could just wait him out like I do with all Americans, but he is not leaving. He is claiming he is entitled to $15 back from the business center and that you made a mistake charging him. I know you are too loyal and hard-working to have made such a mistake but what should I do? Do I have your permission to give him a $15 credit?

Then (and I swear I am not exaggerating here) an additional ten minutes of conversation ensued between the two of them and then my person got off and re-ran the bill and presented it to me and said, Mr. Harris, the $15 has been credited. I then graciously thanked her and she noted that I had missed my bus. I politely told her I would take the next one and that would be no problem.

I had triumphed. My persistence and calm had paid off.

I returned to the US and armed with a Westin bonus of four free weekend nights, I went to Portland, Oregon, with my family. We got two rooms and stayed two nights at the Westin in Portland and when I went to check out, my bill was $6, for one beer from the mini-bar. I politely said that we had never taken anything from the mini-bar and the desk person immediately said, “don’t worry about it” and it was written off.

Now I know Korea is not China and I know a “negotiation” with a hotel desk person is not the same thing as negotiating a major deal (though it sure felt major to me), but……

6 responses to “Negotiating with Chinese Companies: Persistance Pays”

  1. Interesting strategy, will have to try this sometime. I usually end up acquiescing to ridiculous demands because I convince myself that the trouble isn’t worth my time. But friends of mine are still getting some mileage out of playing the “white man” card–i.e. becoming righteously indignant and forcing a potential loss of face for the bureaucrat.

  2. I loved Andrew’s post, too. All too familiar! I think most people who live in China (not just those who are doing business) have experienced the need to be persistent!
    I liked your point about staying cool, waiting her out. The temptation to get upset and yell is huge. In other cultures, that is what gets attention. Here, quiet “dull” persistence gets you much further.

  3. Loved both the stories. Persistence is a key trait to possess (or quickly acquire) when in China. It is useful in almost any situation (in China).

  4. Interesting story, but I’m not sure that spending 30 minutes for USD 15 should be called a triumph, maybe rather a Pyrrhic victory.

  5. Benjamin,
    It was a triumph not so much over that particular person, but over my own Western tendency to over-emphasize the quick result.

  6. MORE efficient than patience is a portable picture book of one’s past & present family, awards, adventures, perhaps an amusing & self-deprecating pratt fall picture that makes you look human, and so on. Remember, for all the talk of China’s rise, America is still the world’s 800 ton Godzilla. And China has an ancient tradition that still has emotional weight regarding strangers & foreigners: Without proof of human family, you just might be a ghost or a fox spirit, neither of which are good. And some foreigners, as you well know, have not been good. So smile at the girl gently, say “I’m sorry, I’m only a baby three hundred year old American, and this is my dear family”, do the picture book ritual, then ask for her help, and give her some time create A WAY in her far more complex culture. After all, what would you do if Godzilla got down on all fours at your door step so that his head was on a level with, and about the same size as you house, rang your doorbell, and asked, while obviously making an real effort not break all your windows and deafen you with his voice, “I’m so sorry to disturb you Sir, but my good Mrs. Godzilla forgot to get the matches for our littlun’s birthday cake, and now its my fault. Can you help Me? Would you spare me a match or lighter?” Yhea, good reader, just what, exactly, would you do, huh? And afterwards, how would you feel? 😉

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