When preparing for a business trip to China, most Westerners like to refer to advices that can help them through the first series of business transactions. However, this won't sustain the kind of prolonged, year-in, year-out associations that Chinese and Western businesses can now achieve (Graham & Lam, 2003).
Over the past twenty years, the number of cooperation and cross country transaction has demonstrated to us that a superficial obedience to the rules of etiquette gets you only so far. In fact, breakdowns occur in the negotiation between Western and Chinese businesspeople constantly. The root cause is in fact a failure on the Western side to understand a much broader context of the Chinese culture and their value system.
Confucianism has bound the Chinese people together for some centuries, and the influence of that is also shown in Chinese business negotiations as well (Liu, 2008).
The concept of Confucius served as the foundation of Chinese education for thousands of years. Knowledge of Confucian was the primarily acquired for government offices. Confucius has the idea of maintaining the society in an organized manner under the benevolent moral code. He believes that this would be prosperous and keeps the society politically stable, and therefore safe from attack. He also defined five cardinal relationships: between ruler and ruled, husband and wife, parents and children, older and younger brothers, and friend and friend. Except for the last, all the rest of relationships were strictly hierarchical. The ruled party such as wives, children, younger brothers were counseled to exchange obedience and loyalty for the benevolence of