The importance of understanding ‘face’ for doing business in Asia

Whilst the focus of this blog is the intersection of telecoms and technology with law and regulation, it does occasionally stray into ‘softer’ topics. With the first anniversary of our Singapore office coming up after the lunar new year, I was reflecting on what I had learnt in my time here.

Just after arrival I had blogged about the importance of face to face meetings, but with hindsight I was only scratching the surface of a much bigger issue in the high context cultures of SE Asia – that of ‘face’.

When arriving somewhere new, I try to ask those more experienced what is the most important thing they have learnt. Almost every conversation (and every conversation with those who were very successful) came back to the issue of ‘face’: building it, respecting it and, above all, making sure that your business partners do not lose face.

For individuals from low-context cultures such as Europe and the US, the whole concept can be baffling. Why on earth would you ‘waste valuable time’ on a short business trip to Asia, meeting, having dinner and talking about everything but the deal? Why don’t meetings start on time, and then briskly move through an agreed agenda in a smooth path to achieving the objective? If there is a problem, why not raise it clearly then argue out agreement through force of business logic? Surely the most efficient way to resolve things is to send an email with a numbered list of points for the other side to respond to?

The problem is that all of these things (that make sense in the context of a deal being negotiated in London, New York or Berlin) may not work as well in Asia. Success depends on building long term sincere relationships through building face for your Asian business partner and ensuring that you do not (even inadvertently) cause them to lose face. If your business partner loses face that may, sometimes entirely unexpectedly for the non-Asian party, jeopardise the deal for reasons which can appear inexplicable.

With thanks to @singarbitration, here are a few tips to make things run more smoothly:

1. Business tends to be done based on long-standing personal relationships or the proper introductions and/or connections, so make sure you have the right introduction if you want to make contact with a new business partner.
2. Many local businesses may be risk averse and cautious when it comes to doing business with a party for the first time, especially if there is no prior relationship and time hasn’t been spent building a relationship.
3. The Confucian mindset still holds sway. Rank is always respected and age tends to correspond with seniority, both of which are revered. 
4. Status and hierarchy are important in business culture where companies tend to have a top-down structure. Decisions are nearly always taken by the senior management and subordinates avoid questioning or criticising their superiors.
5. Show respect to your business contact (especially if more senior than you in age or rank) by being polite, but avoid being too friendly.
6. People are reluctant to do anything which may risk them losing face, e.g.  over-promising and subsequently under-delivering. One can “lose” face not just for himself, but also on behalf of the group that the person represents.
7. Expats who have lived here for many years may think and act more like locals. Do not make the mistake of assuming that just because you’re dealing with an expat, he or she will be comfortable doing business on the same terms as, say, in Europe or the US.
8. Many business people are soft-spoken and passive when it comes to verbal communication, preferring to listen more and to say less. This does not mean that they don’t have an opinion or an idea about something. You will just need to give them the space and opportunity to voice their views in a forum that they are comfortable with, e.g. informal one to one rather than large group meetings. Look out for non-verbal cues in particular.
9. When in a discussion, do not interrupt. It is polite to take a slight pause before responding to a question because it indicates that you’ve given the question appropriate thought. Responding to a question too quickly can be translated as thoughtlessness and even rude behaviour.
10. You will find that many business people do not like dealing with people who ‘talk big’ or act as though they know better. You are likely to make better progress if you tone down your sales pitch and show humility and respect.
11. Communicate your message clearly, but avoid being too direct or blunt. That goes for comments or feedback as well.
12. If you get a response like “I will try” or “I’ll see what I can do”, that is usually a polite way of saying ‘no’, or declining a request whilst at the same time allowing both parties to save face.
13. Business negotiations happen at a slow pace and decisions are not made hastily. Local businesses and government take time to make decisions. Decisions are consensus driven which naturally takes time in larger organisations.
14. As a foreign visitor, bear in mind that first visits do not usually result in business. You can mention a deal and see if the other side is interested, but don’t push too hard.
15. Show that you are patient as this indicates that you are sincere about doing business, here for the long-term and not looking only for short-term gains.
16. You generally need several face-to-face meetings with a contact before you can make any meaningful progress. Face-to-face contact is generally key to developing the necessary personal relationship and trust. It is not enough to just send regular emails, or phone them every now and then.
17. Meetings typically start with handshakes and exchanging of business cards. You may wish to arrange the cards as you sit down in the general order of where people are sitting so that you remember the names of the people who you are speaking with.
18. Use both hands when you exchange business cards. Do not give a tattered card. Study the business card as a show of courtesy and respect. It also gives a sense of where the person fits into the business hierarchy.
19. When meeting a person for the first time, it is prudent to use the appropriate title and last name until told differently.
20. Business meetings tend to start with informal chats. Talking about travel especially if you have been traveling in Asia recently is a good (and safe) ice breaker.

 (For those interested in the theory behind this, you can read a lot more here: Beyond Culture, Riding the Waves of Culture and Understanding Intercultural Communication.)