Doing Business In Year Of The Dragon

Monday marks the start Year of the Dragon in the Asian lunar calendar.

The dragon is traditionally considered a sign of good luck.

So millions of people in China, Korea and many other places are hoping for a really good year.

So, if you do business with anyone in China, you might want to keep that in mind.

Another business tip comes from Martin Fridson, a contributor to Forbes who’s been writing about some of the most common misconceptions western business people might have when dealing with their Chinese counterparts.

One example he mentions is the myth about the Chinese character for crisis which many Westerners believe is a combination of the characters for danger and opportunity.

Not so, says Fridson.

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Lisa Mullins: Today marks the start of the Year of the Dragon in the Asian lunar calendar. The dragon is traditionally as sign of good luck. Millions of people in China, Korea and many other places too are hoping for a really good year. So, if you do business with anybody in China especially, you might want to keep that in mind. Another business tip comes to us from Martin Fridson. He’s a contributor to Forbes who’s been writing about some of the most common misconceptions that western business people might have when dealing with their Chinese counterparts. One example he mentions is the myth about the Chinese character for crisis, which many westerners believe is a combination of the characters for danger and opportunity. Not so, he says.

Martin Fridson: Well, the word for crisis is composed of two characters — the first stands for danger, but the second one is not really opportunity. It should be translated more as incipient moment or crucial point, so it’s a pretty straightforward description of a crisis.

Mullins: But we’ve been hearing this for years and year, there’s no opportunity in crisis, at least not in the Chinese characters?

Fridson: Well, in investments in general, it’s often possible to take advantage of a crisis when investors are panicking and prices are getting depressed below their intrinsic value. The challenge is not to get in too early because often you find that prices go down a lot more before they start to rise. So we shouldn’t take too literally the idea that a crisis automatically represents an opportunity.

Mullins: And literally though in the characters, the Chinese characters, you don’t find the word opportunity.

Fridson: No, that’s right.

Mullins: What are some of the others and maybe some that you’ve encountered, Martin?

Fridson: Well, one that’s gotten very popular is the story that when Henry Kissinger and Richard Nixon went over to meet with China and start to open up the relations between the US and China. Kissinger, who asked Zhou Enlai, what was the impact of the French Revolution? And Zhou Enlai replied too early to tell. So this has taken as a sign of here’s the very long perspective that the Chinese take on any of these issues because here, 200 years later, he was saying it was too early to tell what the impact of the French Revolution was. As it turns out what he was referring to in the early 1970s was the student uprisings in Paris in 1968. So it really didn’t suggest anything along the lines of what the story is repeated and meant to convey.

Mullins: That’s such a tidy little story though.

Fridson: Yeah, it’s one of those things that you wish it were true. Unfortunately, doesn’t happen to be.

Mullins: So how come these things last in our culture then? You know, it’s kind of popular culture, but these things have been repeated so often in business. And you say they can be dangerous or maybe embarrassing in the very least. What’s their staying power?

Fridson: I think they convey something that perhaps has an element of truth in it. They’re great stories. I think everyone who has been in business has found that if you can tell a story you can be a lot more effective in communicating than you can be presenting a lot of statistics. And unfortunately, when you dig into these you find that a lot of them just don’t have any basis.

Mullins: All right, so it sounds like the bottom line maybe for you on this Chinese New Year, for those doing business in China specifically, you get to the table, don’t ask for General Gao’s chicken.

Fridson: Well, General Tso is the most, the name it’s mainly known under. It seems to have picked up some other variance here in the US. But there was a General Tso. He was a prominent general, but as far as we can tell had nothing to do with the very popular dish of General Tso’ chicken, which was invented in New York in the early 1970s.

Mullins: How about Chop Suey, don’t tell me the same.

Fridson: Yeah, that was invented in San Francisco by Americans, similarly, fortune cookies were introduced into Chinese restaurants in the United States by Japanese chefs who had a similar dish in Japan.

Mullins: Martin, you’re throwing everything out the window, we’re gonna have to just start from scratch again. Anyway, Martin Fridson, contributor to Forbes and also he’s a strategist for BNP Paribas Investment Partners. So nice to talk to you.

Fridson: Thank you.

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