International Journal of Project Management 18 (2000) 307316

www.elsevier.com/locate/ijproman

Cross-cultural project management for international construction

in China
Low Sui Pheng*, Christopher H. Y. Leong
School of Building and Real Estate, National University of Singapore, 10 Kent Ridge Crescent, 119260, Singapore
Received 21 January 1999; received in revised form 16 March 1999; accepted 25 March 1999

Abstract
The need to recognise and manage other cultures is an important component in this era of globalisation. With China poised
to take on a more dominant role in the world economy, there is a pressing need to understand the Chinese style of management.
Likewise, foreign project managers who deal with construction projects in China should be uent in cross-cultural management.
This paper examines key concepts in cross-cultural management as well as key functions in construction project management
with specic reference to China. A real life case study of the New Chinese Hotel project in China will be presented to show how
the interaction between cross-cultural management and construction project management can aect the outcome of a project.
Lessons on the Chinese style of management will be drawn from the case study for international construction rms. 7 2000
Elsevier Science Ltd and IPMA. All rights reserved.
Keywords: Culture; Project Management; International; Construction; China

1. Introduction
There is no one single denition which encapsulates
the term `culture' wholly. It has been referred to as
shared values, expectations and norms found within
countries, regions, social groups, business rms and
even departments and work groups within a rm[1].
Culture is also that complex whole which includes
knowledge, beliefs, arts, morals, customs and any
other capabilities and habits acquired by man as a
member of society. It is a distinctive way of life of a
group of people which forms their complete design for
living[2]. It comprises ``the behavioural norms that a
group of people, at a certain time and place, have
agreed upon to survive and co-exist''[3]. Cross-cultural
management then refers to the control and organisation of two or more cultures. The involvement of frequently large organisations in construction outside
* Corresponding author. Tel.: +65-874-3413; fax: +65-7755502.
E-mail address: bemlowsp@nus.edu.sg (Low Sui Pheng).

their national boundaries, including the establishment

of subsidiaries in other countries, is classied as `international construction'[4].
Each country in which such organisations operate in
can have a distinct economic, political, legal, cultural
and competitive context which businesses must
respond to positively. The problem of integration will
obviously occur for a construction rm which operates
in many dierent countries. Integration can, however,
be a daunting task as it involves maintaining a balance
between global eciency and being responsive to local
cultural dierence in the host countries. Consequently,
to succeed in the international marketplace, construction businesses must deal eectively and eciently
with the diverse cultures encountered. International
construction is not an entirely new concept. It has its
genesis in the numerous military installations and public works projects undertaken by colonial governments
even before the 20th century. This is particularly true
between the two world wars when infrastructural projects were undertaken either by an agency of expatriate
engineers who occupied the senior echelons in public

0263-7863/00/$20.00 7 2000 Elsevier Science Ltd and IPMA. All rights reserved.
PII: S 0 2 6 3 - 7 8 6 3 ( 9 9 ) 0 0 0 2 7 - 7

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Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

works departments, or by consulting engineers who

sent their representatives to direct and supervise the
works of local labour. The operations undertaken by
the British Colonial Oce in Africa, Asia and the Caribbean are good examples of overseas construction
works undertaken in the past. In the period following
the end of World War 2, international construction activities followed very much the same pattern witnessed
between the two world wars. As colonies gained independence in the 1950s and 1960s, new governments
were formed who realised the need for major infrastructural development. This fuelled the demand for
experienced builders and designers, the bulk of whom
came from developed countries[5]. The scope for international construction in developing countries was also
boosted considerably following the emergence of international funding institutions such as the World Bank
and the Asian Development Bank. Many contractors
from the developed world were involved with construction works funded by these agencies in developing
countries. The petrodollar boom in the Middle East
and elsewhere in the 1970's also witnessed a marked
expansion in international construction activities[6]. International construction also gained prominence in the
newly industrialising economies of Asia, at least until
mid-1997 when the Asian currency crisis set in[7].
It is clear from the above history of international
construction business that modern-day construction
rms no longer operate solely in their domestic markets. Consequently, they have to increasingly deal with
individuals from other cultures. Project managers from
these rms must therefore develop skills to interact
with individuals whose behavioural attributes are inuenced by other cultural priorities. The following skills
are important for project managers in the international
marketplace:
.
.
.
.
.

eective communication skills;

eective leadership skills;
good interpersonal skills;
adaptability and exibility;
functional/technical strengths

Without these skills, project managers on overseas

postings may be hindered by cultural problems which
can lead to unnecessary costs/losses to their companies. Nevertheless, while eective cross-cultural management can make or break a building project
overseas, it is not the only one signicant factor which
determines the success of the venture. Other factors
which are equally signicant may include the demand
level for construction services in the host country;
supply of capital, materials and labour; activities of
competitors; national and international economic
trends; laws and regulations as well as organisational
culture.
This paper focuses on two areas. It will examine key

concepts in cross-cultural management as well as key

functions in construction project management with
specic reference to China. With this background in
mind, a real life case study on the New Chinese Hotel
project in China will be presented to show how the interaction between cross-cultural management and construction project management can aect the outcome
of the project. Lessons on the Chinese style of management will be drawn from the case study for international construction rms. The main areas to be
covered in this paper are shown in Fig. 1.
2. Cross-cultural management
Personal relationships are very important in Asian
cultures. Asians have a tendency to rst develop personal relationships with their business partners before
getting down to the specics of negotiation. Family
ties and kinship, in particular, feature prominently in
Asian business dealings. There is also a tendency to
keep relations harmonious by not talking directly
about problems. Confrontations are avoided and
human relationships are highly valued in Asian societies. In contrast, personal relationships to the Americans are less important when doing business.
Americans like to get to the point more quickly and
directly even though such an approach may embarrass
someone personally and publicly[8]. Cultures with a
high social conscience, as in China, prefer to work in
teams and to make decisions through group consensus.
Other cultures, as in North America, place a high premium on individualism and individualistic reactions.
People in these cultures are not inherently team
players[1]. Some cultures such as those in Asia, Northern Europe and South America also emphasize social
status which is reected, among other things, in seating
arrangements and other protocols based on positions.
On the other hand, the North American culture tends
to place more emphasis on competence. In cultures
where status is important, as in Japan and China, talking about problems directly with a person in public is
avoided so as not to embarrass the person or downgrade his status[3]. The time element also holds dierent connotations in dierent cultures. A monochronic
time perspective refers to the treatment of events in an
orderly fashion where things are done separately and
time is compartmentalised, organised and controlled.
It also tends to focus on the present or immediate
future and believe that an individual can aect future
outcomes. Monochronic cultures are prevalent in
North European and North American countries. On
the other hand, a polychronic time perspective is endless and where there is plenty of time which has no
beginning or end. More importantly, many events can
all happen at the same time. This perspective is preva-

Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

lent in countries in Asia, the Middle East and Latin

America. In this context, many topicsinvolving both
the family and businessare discussed concurrently in
meetings. Polychronic cultures tend to be more futuristic and fatalistic in outlook, believing that one cannot
control the future[1].
The key concepts which can be used to explain the
cross-cultural experiences described above are discussed in the following sections.
2.1. Organisational and national culture
Every organisation has its own unique culture which
is not quite the same as others. Consequently, members of an organisation need to learn their own culture. These values can be changed when top
management introduces new beliefs and attitudes.
Although workplace experiences are passed from
senior to junior sta, these may not necessarily be in
line with management beliefs. Organisational culture
can has a strong inuence on the national culture.
Where top management is able to build a strong and
positive culture which reects the national culture, the
behaviour of employees can be rendered more predictable.
National culture is learnt very early in life when
the individual is still unaware of its inuence. Organisational culture, on the other hand, is acquired
much later in life at a conscious level. Hence, it
can be deduced that national culture is more deeply
entrenched in the individual than organisational culture. Consequently, it is more dicult to change
one's national culture than organisational culture.

309

The concept of changing one's organisational culture

can be fraught with risks but may be inevitable in
some cases, as for example, when the existing internal system has deteriorated or when environmental conditions have changed. Top management must
initiate this change. It should also be highlighted
that the development and survival of organisational
change is not entirely dependent on individuals who
make up the organisation. This as evident in cases
where people come and go within a company and
yet the organisational culture remains[9]. The design
of company's goals is therefore aected by organisational culture. As goals change, organisational culture also changes in tandem.
The organisational culture of an existing company
reects the national culture in strong forms. It is logical for members of an organisation to resist plans to
impose a culture that does not reect their national
values. Hence, an understanding between top management and employees is critical to avoid unnecessary
conicts. Where organisational culture is weak and
appears to have little inuence, workplace values and
behaviour provide a clear reection of national cultures and values. On the other hand, where an organisational culture is strong, the manager cannot take for
granted that what he observes in the workplace is typical of a wider context[1]. Cultural control can be
achieved by using implicit norms that induce employees of dierent nationalities to commit to a project. To
full the technical requirements, training can be provided to employees by explicitly writing all instructions
in manuals. For the non-technical requirements, an
emphasis should be placed on developing an awareness

Fig. 1. Theme of paper.

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Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

of organisational culture and by integrating any newcomer into the company.

2.2. Cross-cultural communications
While certain forms of communication are acceptable in one country, these may be considered taboo in
another. Hence, while direct physical contacts (for
example, a peck on the cheek) may be practised by
North Americans, these are not accepted in most
Asian countries. The Japanese, for example, will avoid
using language which may cause oence. However, the
Japanese indirectness as evident in their `evasive' manner in saying `yes' may actually rebound to their disadvantage and cause the foreign party to lose face.
Cultural values, task as well as situational variables
help to determine the norms for communication.
The dichotomy of one-way as opposed to two-way
communication can also be an issue in cross-cultural
management. One-way communication is characterised
by the use of authority by the superior with the subordinates providing little or no feedback which may be
perceived otherwise as a challenge. This is prevalent in
societies where there is a desire to preserve social harmony and to avoid situations where disagreement may
arise. In organisations where one-way communication
dominates, attempts by senior managers to involve
their subordinates in decision-making may threaten
social norms and be resisted. On the other hand, twoway communication is adopted when a company
enters a new market and jobs undertaken by employees are no longer routine. Complex and frequently
open-ended situations may render the need for managers to adopt a more participative style of management by involving their subordinates in decisionmaking.
In cross-cultural management, managers should also
be sensitive to the non-verbal signals used as these signals may have a signicance which is dierent from
what they are accustomed to in their own culture.
When perceived wrongly, these signals may be interpreted dierently in a dierent cultural setting. For
example, Americans are not comfortable with silence
and reserve. Taking time for reection is often seen as
evidence of ineective management. On the other
hand, in Japan, managers dismiss this propensity for
action and decision as impulsiveness. For the Japanese,
taking quick decisions may signal a poor grasp of the
importance of making the decision on hand and an
insucient reaction. Silence is an indication of deep
mutual respect. Hence, close friends in Japan drink
silently together. Where formalised exchanges are concerned, Americans tends to pay less attention to protocol. In Japan, however, failure to show respect by
carefully exchanging and inspecting business cards can
get business negotiations o to a bad start.

Likewise, the dress code considered appropriate in

the oce, at meetings as well as in formal and informal social functions should be understood in cross-cultural management. In this context, North European
managers tend to dress more informally than their
Latin American counterparts. While style is important
for the latter, Anglo and Asian managers do not want
to stand out or attract attention in their dressing[10].
2.3. Cross-cultural dispute resolution
The Japanese generally prefer to resolve disagreements through compromise both within their own organisation as well as between other organisations.
They also tend to avoid contractual arrangements
which emphasise rigid performance criteria. Flexibility
is instead focused upon when interpreting contractual
agreements. In other countries, cross-cultural dispute
resolution can depend on many factors, including:
. level of tolerance of disagreement;
. localised strategies for resolving conicts;
. perception of the extent of appropriate intervention
by a superior.
In this case, assertiveness is valued more highly in a
culture that is both individualistic and masculine in
outlook. Consequently, conicts are resolved by
thrashing them out in the open. Non-assertiveness is
associated with an admission of defeat by this group
of people[11].
2.4. Cross-cultural negotiation
Problems at the negotiation stage can be inevitable
when a company from a developed country is trying to
access the market in a developing country. These problems occur because managers from the developed
country tend to assume the responses and behaviour
of their clients in the developing country without really
understanding what they want and what they can
oer. Unnecessary conicts consequently arise[5]. The
problems encountered in the negotiation stage may be
magnied further when the cultural climate in both
countries is diversely dierent, consequently leading to
a breakdown in communications.
3. Project management in China
As with many other developing countries, China
is still dependent on the developed countries for
capital and technology in many sectors of its economy. Its human resource is underdeveloped as
insucient funds are set aside for establishing training and education centres. A signicant proportion
of the Chinese population, particularly those in the

Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

rural areas, are largely unskilled. Because of its past

closed-door policy, growth areas in human resource
as well as technology were stied in China.
Like other sectors in the Chinese economy, the construction industry is also dependent on foreign capital,
technology and expertise. This is particularly true in
mega infrastructural and sophisticated industrial projects where the Chinese lack the track records. There
are, however, several characteristics which foreign project managers must be aware of when they function in
the Chinese construction industry. Some of these
characteristics are highlighted below.
. Trust and mutual respect are important values in
the Chinese community. Foreign project managers
should not therefore impose too much of their
power and authority over their Chinese counterparts
but should instead emphasise trust and mutual
understanding.
. Family businesses are still very dominant in China
and there is a heavy reliance on family contacts
both locally and internationally. When negotiating a
deal with a Chinese construction company, the
foreign project manager should be prepared to face
a horde of subcontractors who are connected in one
way or another to the main Chinese contractor.
There must be tactfulness and diplomacy in dealing
with situations of this nature. It is important for the
foreign project manager not to complain or jeopardise anybody's position within the company,
because the bond and mutual trust between the
main Chinese contractor and subcontractors is dicult to break.
. There are also constraints in the use of international
standard forms of contract in the Chinese construction industry. This is because little or no provision
at all is included in these forms to provide for
amendments in order to suit local conditions. The
contract documents used are frequently lengthy and
refer to standards, codes and specications which
are not readily available and if available, are often
applied rigidly. The situation for the foreign project
manager is made worse by the language barrier. The
local Chinese advisors do little to help, and prefer to
rely on provisions in these documents either as a
means to ducking the issue, or in the belief that this
is the only way to achieve high quality standards.
Foreign project managers should therefore be extra
vigilant when dealing with procurement matters in
the Chinese construction industry.
. The Chinese also tend to concentrate more on the
prot element and other related nancial matters
such as credit terms and cash ow arrangements.
Consequently, designs and construction methods are
chosen out of sheer economic convenience. As a
result, negotiations with the Chinese on resource al-

311

location can be an uphill task for the foreign project

manager.
. Bureaucracy and bribery are still prevalent in China
in spite of the recent eorts made by Jiang Zieming's government to eradicate these ills. The
approvals of numerous government/provincial
departments need to be obtained before a construction project can commence. This is particularly so
for projects with foreign equity participation. Along
the way, connections at the right places, kickbacks,
etc. have been known to help hasten the application
process. While not condoning these practices, the
foreign project manager will need to learn how best
to deal with them discreetly.

4. Case studythe New Chinese Hotel

The key concepts in cross-cultural management as
well as construction project management in the context
of China are examined above. A real life case study of
the New Chinese Hotel project is presented below to
highlight how cross-cultural management and construction project management interact to aect the
outcome of the project. It will also, in the process,
show up the Chinese style of management as a response to inputs made by foreign investors from the
U.S.A. For reasons of condentiality, the names, locations and dates of events annotated in the case study
below have been changed to preserve the anonymity of
all the parties involved.
4.1. The parties involved
Asian Properties Company (APC) is owned by the
Asian Development Corporation (ADC) and Wedd International Corporation, both of whom are U.S.A.
based companies. ADC, formed in April 1979 and
owned by the Legreb Group of Companies and the
Eastern Region Construction Company, specialised in
consortiums, joint ventures and compensation deals in
China. The Yangtze River Tourist Service Bureau
(YRTSB) is a state-owned organisation charged by the
Chinese government to promote and regulate nationwide travel in China. The organisation structure for
this case study is shown in Fig. 2. The following calendar of events took place as part of this case study
involving the construction of a new hotel.
4.2. Late 1970's
China announced a new open-door policy that welcomed and actively sought out foreign capital to
nance modernisation projects in the country. In the

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Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

early stages of this relatively liberal policy, joint ventures emerged as one of the most common structures
for procuring foreign investment projects. This mode
of procurement allowed Chinese partners to gain the
much needed management skills and access to new
technologies.
4.3. 1988
The Legreb Group, the US based pioneer with more
than 30 years of experience in project development in
the former USSR and East European bloc of
countries, extended its businesses into China.
4.4. Late 1988
ADC engineered a consortium to establish APC for
the Legreb Group's entry into China. APC thereafter
assembled a project team which comprised several
team members with diverse interests related to this
venture.

4.5. February 1989

APC succeeded in securing letters of intent from
both the YRTSB and the municipal government for
the development and construction of the proposed
hotel project. To APC's dismay, letters of intent were
discovered to be neither binding nor conclusive in
China. APC realised that both YRTSB and the municipal government were still discussing proposals with
their other prospective partners. At this juncture, APC
acknowledged that it is important to negotiate directly
with the key decision-maker and to structure an attractive oer which appeals to the Chinese. Two China
experts from the APC team immediately went to work
on this task. After delving through layers of Chinese
bureaucracy, they nally identied the Secretary-General of YRTSB as the government ocial who holds
the decision-making power.
4.6. May 1989
A formal joint venture agreement was nally signed
with YRTSB. Although binding, the document was

Fig. 2. Organisation structure of case study.

Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

subject to the terms of a nal contract to be negotiated

within ve months. The size, class and site of the hotel
as well as the method for co-operation, the sharing of
prots and losses and the period for joint operations
were outlined in the agreement. The duration of the
project was set to be 10 years, after which APC would
relinquish all rights of ownership to YRTSB at the
end of this period. APC has a 49% equity share in the
joint venture with YRTSB for the New Chinese Hotel.
Payments of loans as well as the repatriation of prots
were also established in the contract. All these developments were, however, taking place at a time when
Chinese commercial law was still not well established
in the country. Foreign partners were therefore sceptical over the methods used by the Chinese to enforce
`mutual discussion or agreement'. Nevertheless, APC
in its enthusiasm to conclude negotiations and begin
the project, dismissed this reservation and proceeded
to nalise the contract.
4.7. October 1989
The nal joint venture contract was signed. YRTSB
and APC drafted contracts in both the Chinese and
English language which were binding. Nonetheless, the
perfect translation of contractual documents was impossible to achieve. Although both parties certied
that the agreements carried the same contents, numerous discrepancies were still present when the contracts
were signed.
4.8. Mid-1990
Misunderstandings concerning the construction of
the hotel occurred. When the Chinese confessed their
lack of expertise in construction project management,
their American counterparts interpreted this confession
to mean that the Chinese wanted the hotel to be built
on a turnkey basis and proceeded to hire a foreign
contractor to undertake the entire building project.
When the Chinese expressed their unhappiness over
the turnkey proposal, the APC team then realised that
there was a serious communication gap in the working
relationship with their Chinese counterparts. In actual
fact, YRTSB was looking forward to working with the
foreign contractor in this project to help facilitate technology and skills transfer.
4.9. End-1990
Construction works for the proposed hotel began in
end-1990. Dissatisfaction arising from cultural conicts
was frequent during this stage. At one stage, the Chinese complained that the drawings provided by the
architectural rm based in Los Angeles did not include
detailed shop drawings. Then again, architects in

313

China supply both working as well as shop drawings,

while architects in the US provide only the working
drawings. The project was planned to be completed
within 2426 months. However, numerous construction delays caused the project completion date to be
extended by two years after the original deadline. The
progress of construction was slow because of poor project management and the exceptionally low skills level
of Chinese labour. The Chinese construction workers,
most of whom were originally farmers from the rural
areas, experienced much diculty in delivering acceptable standards of building quality as well as in learning new construction technology. In addition, the
state-owned China Construction Company (CCC),
which acted on behalf of YRTSB, was slow in making
critical decisions which were necessary to avoid project
bottlenecks. The construction management team, made
up of both American engineers and several YRTSB
appointed members, was less eective than expected.
The dierences in cultures between the two organisations were serious enough to aggravate progress
further. This was because insucient time and attention were paid to identify such cultural problems
during the negotiation stage.
4.10. End-1991
By then, the US$72 million construction fund
secured through a syndicated loan was exhausted.
APC then proposed more money be borrowed in order
to continue with construction works. YRTSB, however, refused to do so because the Chinese government
will not approve further requests for additional funding. As a result of this disagreement, construction
work stopped. Attempts to resolve this impasse based
on the principle of `mutual trust' failed.
4.11. Early 1992
On knowing that the failure of the joint venture
would lead not only to adverse publicity but also
serious nancial losses and loss of face, YRTSB
resumed negotiations with APC. Eventually, YRTSB
agreed to foot all additional costs needed to complete
the project. In return, APC agreed to postpone the
completion of the hotel until the end of 1994.
4.12. December 1994
YRTSB unocially opened the New Chinese Hotel
in order to avoid paying damages to APC as specied
in the new agreement.
4.13. 1996
APC was denied the right to repatriate prots back

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Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

to the US because of a serious shortage of capital experienced by YRTSB. APC demanded to withdraw
from the partnership with YRTSB.
4.14. 1997
After a bitter negotiation process lasting two years,
APC reached an agreement with YRTSB to be compensated nancially and to reduce its equity interests
in the hotel to just 10%. YRTSB will control the
remaining equity interests in the hotel.
5. Lessons and conclusion
The sequence of events in the APCYRTSB case
study in China suggests that the management of an international building project requires not only an
understanding of key concepts in cross-cultural management but also in project management. Construction
project management is not only about time, cost and
quality control, it is also about human resource management. This is particularly crucial when team players
from dierent nationalities come together to work in
another country. The lessons which can be learnt from
the APCYRTSB case study in China are examined
below.
5.1. Organisational and national culture
Traditional Chinese businesses are frequently built
to revolve around family ties. The business is usually
set up by a family and family bureaucracy dictated by
the patriarch will usually prevail in its dealings with
others. The rules and culture of the business as well as
trade secrets are often passed down from father to
son. In this context, APC did try to understand the
Chinese culture by bringing two China experts into its
team for advice. The China experts understood correctly that the Chinese regard modesty as a virtue and
abhors aggressive salesmanship. APC was therefore
advised to adapt to Chinese customs, regulations and
methods of working to the best of its ability. While an
awareness of organisational culture must be brought
to the attention of all employees, the foreign project
manager has a crucial role to play in integrating cultural diversities among dierent team players.
The national culture in China also portrays the
family. Consequently, family loyalty is an important
component in the Chinese society. From being young,
the Chinese are instilled with the notion that the
family (i.e. China in the wider context) is an important
component in their society. To safeguard this notion,
foreign investors may therefore feel that the decisionmaking process in China is painstakingly long and
characterised by a maze of bureaucracies. Nevertheless,

APC was able to identify the Secretary-General of

YRTSB as the key decision-maker within the bureaucratic maze. This helped APC to secure the project.
5.2. Cross-cultural communications
It is crucial to appreciate the dierent styles of communications in cross-cultural businesses. Failure to do
so may lead to misunderstanding as in the APC
YRTSB's hotel project. In this case, the Chinese confession over their lack of experience in construction
project management was wrongly interpreted to mean
a turnkey project where the turnkey contractor will
provide all design, construction and installation services. Foreign rms in China frequently do not pay
enough attention to what their Chinese partners asked
for and what they can oer[12,13]. Consequently, they
entered into alliances which do not suit either of their
interests in the long term.
5.3. Cross-cultural dispute resolution
The APCYRTSB joint venture eventually failed
despite eorts taken by APC to manage cultural diversities. This appears to be caused by the failure to
establish a proper decision-making process as well as a
method for resolving disputes. In general, the larger
the cultural gap between the two parties, the greater
will be the strain on negotiations. The Americans in
APC adopted the western style of expression which
tended to be highly assertive. On the other hand, the
Chinese have tended to be less rm in expressing their
views. Consequently, if there is a substantial dierence
between their respective cultural frames of reference, it
is common for negotiations to take a legalistic stance
to compensate for ambiguities and misunderstandings.
While technical legalities may seem to ll the ambiguity gap momentarily, these only serve to diminish
trust. Consequently, negotiations begin to take on an
increasingly adversarial style[14]. The fact that discrepancies exist in the two versions of the contract in the
APCYRTSB case study creates a potential area for
dispute. APC, however, chose to ignore this problem
and agreed to settle disputes through mutual discussion. In this case, a proper set of guidelines on the
methods for resolving disputes should have been
agreed upon during the early stages of the negotiation.
These should cover the following issues:
. the level where decisions are to be taken
. the degree of consensus required
. the extent of involving managers in resolving the
dispute
. a form for expressing dissenting opinions
. a form for resolving impasses

Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

. the acceptable length of time to come to an agreement.

5.4. Cross-cultural negotiations

The Chinese often emphasise the attributes of friendship, mutual interests and the importance of mutual
trust during the initial stages of negotiation. After
these attributes are built up in the later stages of negotiation, the Chinese would often use these to corner
their potential partners in giving them the best possible
terms[12]. In this context, the Chinese would also
evaluate relationships in a utilitarian manner to reect
the value of a business proposal made by their foreign
partners.
In conclusion, the management of international
building projects is increasingly proving to be more
important in this era of globalisation. Project managers working in international building projects
should, together with other members of their teams,
identify prevailing cultural dierences and adopt
appropriate measures to achieve project performance.
In the case of China, the case study indicates that
foreign project managers should recognise the Chinese
style of management when dealing with their Chinese
counterparts.

Acknowledgements
The contributions by Teo Puay Leng, Vincent Benedict, Wee Keng Jee, Stephanie Wong and Bennard
Yap are gratefully acknowledged.

References
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[3] Elashmawi F, Harris PR. Multicultural management: new skills
for global success. Houston, TX, US: Gulf Publishing
Company, 1993.
[4] Low SP, Abdul Aziz AR. Competitive and marketing strategies
for the global construction industry. Trade Link Media
(Southeast Asia Building) Publishers, 1993.
[5] Low SP. Synthesizing construction and marketing in economic
development. Fundamental concepts and case studies.
Aldershot, UK: Avebury Press, 1995.
[6] Low SP. Marketing research for the global construction industry. Singapore: Singapore University Press, 1993.
[7] Low SP, Lim NH. Taking concrete measures. Stock Exchange
of Singapore Journal 1998;26(11):1622.
[8] Foster DA. Bargaining across borders: how to negotiate
business successfully anywhere in the world. New York, US:
McGraw-Hill, 1992.

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[9] Tan OB, Low SP. Technology and the changing structure of the
construction industry. The Professional Builder 1990;5(1):237.
[10] Schneider SC, Barsoux JL. Managing across cultures. PrenticeHall, 1997.
[11] Hofstede G. Cultural consequences: international dierences in
work-related values. Beverly Hills, CA, U.S.A: Sage
Publications, 1994.
[12] Low SP. Thick Face, Black Heart and the marketing of construction services in China. Marketing Intelligence and Planning
1997;15(5):2216.
[13] Low SP. Cultural inuence on construction marketing and management in China. In: Preece C, editor. Proceedings of the First
Leeds International Construction Marketing Conference:
Research into Practice, 2627 August, Leeds, United Kingdom,
105113, 1998.
[14] Low SP. The inuence of Chinese philosophies on mediation
and conciliation in the Far East. Arbitration 1996;61(1):1620.

Dr Low Sui Pheng is Associate Professor and Course Director of the

BSc(Building)(Hons) Programme at the School of Building and Real
Estate, National University of Singapore. He received his Bachelor,
Masters and Doctoral degrees from the National University of
Singapore, the University of Birmingham and the University of
London respectively. A Chartered Builder by profession, he is a
Corporate Member of the Chartered Institute of Building, the Association for Project Management, the Chartered Institute of Marketing
and an Associate of the Chartered Institute of Arbitrators. Dr Low
has published more than 200 papers and eight books in construction
project management and economics and is acknowledged internationally as an authority in the application of ancient Chinese strategies
for international construction marketing and management. He has
consulted widely in the region in Singapore, Malaysia and Indonesia.

Dr Christopher Leong is Senior Lecturer and the Programme Director of the MSc (Project Management) Programme at the School of
Building and Real Estate, National University of Singapore. He has

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Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307316

a BSc(Building)(Hons) from the University of Singapore, an

MSc(Construction Management) from Loughborough University,
and a PhD in Planning Studies from the University of London. He
is a Professional Associate of the Royal Institution of Chartered Surveyors, an Associate of the Chartered Institute of Arbitrators, and a
Fellow of the Society of Project Managers as well as the Singapore

Institute of Surveyors and Valuers. His work experience includes

contract management with the Public Works Department, Singapore,
and project management with a private property development organisation. Dr Leong lectures and consults widely in the areas of contracs and project management for both local and overseas
organisations.