Managing Relationships With Chinese Joint Venture Partners

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As recent news reports in the United States have continued to detail, joint ventures in China can pose special challenges for American executives. This paper describes how U.S. executives can improve product quality when working with Chinese producers by better managing business relationships with executives from China. In the United States, business relationships are viewed functionally and evaluated by both sides on a cost/benefit basis. Executives from China often emphasize guanxi, in which the relationship is examined relative to moral and social norms of the Chinese culture. This difference in orientations can create problems when people from these two different cultures engage in exchange, especially when the intended time frame for the Americans is long term and high product quality is important for business success. Consequently, to improve multinational business practice, control procedures for monitoring progress within international alliances are provided to help executives working with Chinese business people.