Cultural Polarity.
Among the cultural differences between Chinese and American business operations is the perception of authority, accountability, face (‘mianzi’), hierarchy, and risk avoidance. Additionally, a blurring of relationships and  understanding between professional and private conduct may cause unforeseen problems. For example, personal friendships among Chinese businessmen may induce fellow executives to enter into unsound alliances, creating conflict where business goals are concerned and, consequently, warding off U.S. investors as unsound business practices.

Decentralized Marketization.
The conditions for Chinese economic growth, professional accountability, and business transparency, are quite different from the acceptable standards by which the western financial world models economic development. Decentralized marketization among Chinese businesses, such as the freedom to establish prices arbitrarily and the tendency to succumb to powerful cultural influences, a.k.a. Guanxi, promotes unstable networks of business obligations and associations that further broaden the cultural gap between Chinese business practices and western business ethics(2).

A number of organizational restructuring propositions have emerged as the result of the Chinese’s government attempt to address the gap between Chinese business practices and western business ethics. These propositions are concerned with local empowerment, entrepreneurial behavior, regulatory frameworks, ambiguous corporate governance,  and the distribution of intellectual property at the privatization phase. The propositions seek to emulate the western standard and model for proper business and market development. Unfortunately, without testing and successfully surviving the scrutiny of traditional western business analyses, and ultimately that the scrutiny of investors, the Chinese design will continue to struggle and will ultimately require western intervention.  As such, the engagement of western business consultancy at this critical phase of development is necessary to secure confidence in the global financial audience.

Talent Deficit.
Presently, China is experiencing an employment talent shortage at all levels, from skilled to unskilled, as its booming economy is outpacing its ability to sustain skilled workers. This dilemma is a consequence of an overall underdeveloped educational system. As Edward E. Gordon recently argued in an article for “MWorld,” China’s education is inadequate for the long-term support of a modern, globally competitive economy(3).  The average turnover rate for employees in Shanghai and Beijing is 20-25% (higher in other cities), further complicating matters. This figure includes multinational companies, as well as small and medium size. In a desperate attempt to address this problem, the Chinese government is drawing back its own émigrés to try to fill the employment gap