The implications of culture in Irish-Chinese business transactions

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Geoghegan, Alan
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MBA in Executive Leadership
Dublin Business School
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There has undoubtedly been rapid economic growth in China over the last few decades and the importance of the Chinese market for the aviation industry has greatly increased as China opens up its skies to the West. One of the key challenges for any foreign executive conducting business in China is to understand how cultural differences can impact on business deals. Therefore this study addressed the interesting question of how Chinese culture and in particular the traditional concept of guanxi can impact Irish executives in the aviation industry when conducting business in China. This was investigated through the experiences and perceptions of how Irish executives in the aviation industry establish business relations in China. This research is important because guanxi has often been associated with the success factor of business practices in China. Through a pluralistic research approach using both semi-structured interviews and a survey questionnaire, this research found that Irish executives perceive the use and benefits of guanxi to be extremely important for business success in China. The research examines the differing perceptions of the nature of guanxi while highlighting the main benefits and also the perceived disadvantages of guanxi. It demonstrates that the relevance of guanxi is increasing in modern day China, while at the same time the traditional disadvantages of guanxi such as, it being expensive or perceived as corruption have significantly reduced. Author keywords: Culture, guanxi, China, aviation