Business in China

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Business in China

1. What challenges do foreign firms face when they seek to transfer their home management style to China? 2. Discuss the reform of Chinese state-owned enterprises and related government policy changes. Evaluate the impact within the state-owned businesses and the chinese society.

Chinese management

Doing business in China requires a throughout understanding of their management philosophy and practices. Their management style is different in many respects from mainstream Western Management and is characterized by a combination of a paternalistic approach and an intuitive, entrepreneurial, and fast-decision making style.

Challenges for foreign firms in China

MNEs generally start off with clear
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* Salary differences between western and Chinese players * Uncertain political environment and unpredictable policy changes * Lack of reliable statistics and market information
Learning market in China is important as sometimes foreign companies fail to understand what Chinese consumer wants. They should do a careful research before entering the market. Example can be the low ales of Apple iPone in China. The reasons for failure were the no wi-fi due to government regulations and also gray market. The Copycat of Iphone was sold on twice lower price than the original.
However, there have been successful cases as well. Wal-Mart learned how to do business Chinese way. The initial problems were that consumers wanted fresh harvested products and no ‘packaged’ products. Then Wal-Mart reacted and began to display fresh meat uncovered, installed fish tanks and began selling live turtles for soup. Conclusion: Foreign firms do face various obstacles in entering the Chinese market, however they can be overcome if the right levels of research is carried out and they come to terms with the differences in business structure and social environment. Chinese management | Western management | Family business-small firmsHR: * Family/relatives * Low training opportunities * Only family members in high positionsRecruitment: * Family and extended family membersDecision-Making: * Autocratic * Top down decisions *

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