Truth and Trust: More than meets the eye
American notions of truth and trust are founded on an underlying faith that more information is better, and that information, all things being equal, should be made available. This follows from Americans' universalist perspective on the world, and also from our "Layer 1" and "Layer 2" perspective.
Information is treated differently in China. It tends to be closely guarded. If it is shared, sharing generally happens within one's "ingroup": close family, plus colleagues and friends known for a long time. As with so many resources, information tends to be viewed through a lens of scarcity: it won't be shared unless sharing it has a clear value-add for the person doing the sharing. And it's not just scarcity: information is often viewed as a weapon, which can be used against people.
And finally, even though "face" is hardly specific to China, concern for courtesy over truth, in order to save face for someone, can mean that the truth isn't shared in China to the extent it is in the West.
The result for business leaders is that the "truth" can be nigh impossible to discover. Frank Gallo quotes a Chinese leader:
Westerners can be a bit more direct than the Chinese. We tend to keep some of our ideas to ourselves. Therefore, it is sometimes more difficult to understand the true meaning of what a Chinese person says. For 5,000 years, this has been a family-owned and family-run country. Now that it is so much more complicated, people are afraid to say too much to others. Other families might have secrets that they don't want to share. Very few of us are very direct and open. We have to be careful in our choice of words.
— Gao Yong, President, Career International, Inc., Beijing. Quoted in Frank Gallo, Business Leadership in China, Singapore: Wiley (Asia), 2008, p. 85.
It's easy for a Western leader to fall into the trap of assuming that colleagues are openly sharing information just as they would in the West. This leader is in big trouble: s/he will be making key decisions based on, at best, insufficient information or, at worst, false information. Leaders need to build solid relationships with colleagues, find intermediaries, and create novel ways of sussing out information. Patience and a healthy skepticism help too.