Return to Home Page 1997 The Impact of Confucianism on Business to Business Marketing by Paul Herbig Abstract of: The Impact of Confucianism on Business to Business Marketing The basic beliefs and history of Confucianism must be understood in order to build relationships with those believers of the Confucian philosophy. A relationship with a Confucian is not merely a utilitarian relationship, the relationship must be rewarding spiritually as well as financially. A potential business customer must also understand that Confucian followers place more importance on ethics than they do the law. The concept of ethics being more important than law can still be found in the management styles and attitudes of modern day China. Confucianism is also deeply rooted in rituals and hierarchial structure, making it very important for potential business marketers to follow proper etiquette. Most of all, Confucianism instills a deep responsibility and obligation of each individual to his family. Therefore, even if a businessman may have a good product at a good price, it may not be good enough. A Confucian businessman will forgo all other benefits for the benefit of his family; yes, he will even forgo personal profit for the sake of a family member! This paper discusses the many subtleties of Confucianism which must respected and understood to effectively market within a society influence by Confucianism. Introduction In Western cultures, Confucius is thought of as a philosopher, not unlike Socrates. Although there are undeniable comparisons between the lives of these two philosophers, the impact of Confucius has been ingrained in the Chinese and other East Asian cultural beliefs and is apart of every day life. The extent of Confucianism’s impact on these cultures and its involvement in everyday life makes it hard to separate it from a religion, even though Confucius seldom spoke about matters dealing with religion nor did he claim a divine status. The Confucian belief in jen (translates to humanism), the role of ancestors and their rituals as well as the role of family rules every facet of a Confucian’s life. To understand how Confucius effected these cultures and in what way will it effect business to business marketing, we must first have an understanding of the historical significance it has played in these cultures, such as China and Taiwan. Most importantly we must understand what beliefs Confucianism instills in these cultures so that we may be able to effectively market in these cultures. History of Confucius Seventeenth century Jesuit missionaries gave the Latin rendering of “Confucius” to the man referred to as K’ung Fu-tzu, or Master K’ung, whose name was K’ung Ch’iu, also styled K’ung Chung-ni. He was a native to the small state of Lu, whose birthplace is near modern Ch’u-fu (Qufu, Shantung) [Ching, 1993]. Confucius is thought to have been born in 552 BC and lived to be 73 years old. The earliest writing about Confucius dates all the way back to the forth century B.C. As old as this book is, it was still written at least a century after Confucius’s death. This gap in time has made facts about his life hard to substantiate. Many legends exist about his lineage, however, it can not be determined who was even in his immediate family much less from whom he descended. It is not believed that his family had a comfortable life. However, it is thought that his family was in the lower aristocracy but their status had fallen and Confucius was born during hard times for his family. As a young man Confucius is said to have had a successful political career in which he progressed rapidly. However, his career never progressed past the public office in his home state that was comparable to the modern position of police commissioner. He held this position for only a year before he fell out of favor with the administrators. He then sought out kings of feudal states that might take him in as an advisor so he could pass along his beliefs. This proved to be a fruitless undertaking for Confucius; therefore, turned away by the administrators and rulers of his day, he began to focus on the future. Confucius found his place as a great teacher of philosophy and life to the future kings and rulers of people who could make his ideals a way of life and restore the ancestors’ traditional values of virtue. Although Confucius found his place in life, he never obtained great material wealth. The unprivileged life that he led may explain why Confucianism is still enduring to the common people. This may also be because he was self-conscious and did not see himself above the will of Heaven. Although Confucius did not proclaim a divine status, he did contribute to a philosophical approach toward the ancient religions that were beginning to be questioned during his time. These were ancient religions that were still somewhat barbaric and people were looking for a more rational way of life that sought harmony and peacefulness. It is interesting that in a movement to a new age of ethical wisdom, away from ancient religions, that Confucius would thrive by appealing to the legacy of the ancients [Ching, 1993]. His approach was one ethics and wisdom, even though it called upon the legacy of ones ancestors. Much like Jesus, Confucius’s greatest contributions to history were realized after his own life. Confucianism as a philosophy has been carried out and taught by the Ju-chia, the school of the scholars. The school offered a moral or ethical answer to the question regarding life’s meaning and order in society [Ching, 1993]. The teachings of Confucius can be found in the Analects, which is the a book of Confucius’s conversations with his students. Other books and writing have been limited by the Ch’in emperor (213 B.C.). He conducted book burninsg that destroyed a great many historical Chinese writings; but jprobably the most damaging from a historical point of view was that he unified the writing system in China. This became a huge barrier in latter years when historical books were uncovered because no one was able to translate their meaning. Later in the Han dynasty (206 B.C.-220 A.D.) a great importance was put on the classic books of Confucianism, so much so that they were actually inscribed in stone. Confucius and his beliefs have not always been accepted, such as in more recent history during the socialist revolution of 1949 [Jacobs, 1995]. During the cultural revolution, it came under heavy criticism and was described as the source of all evil [Mahatoo, 1990]. However, it has prevailed and is a major influence in many peoples’ lives still today. It is said that more than any other human being on the face of the earth, Confucius laid down a pattern of thinking followed by more people for more generations than one can even conceive. No matter what religion, no matter what form of government, the Chinese (and most other East Asian civilizations) and their way of thinking can in some way be shown to have Confucian elements about them [http://www.pitt.edu, 1996]. Confucianism Through the book of Analects can one discover Confucius’ notions of the virtues, i.e., the positive character traits, to which we should aspire. Foremost among these is Filial Piety, the respect which children owe to parents--and by extension, wives owe to husbands, sisters to brothers, and everyone to ancestors. When such virtue is cultivated in the home, it is supposed to carry over into one’s relations in affairs of state as well [http://www.wsu.edu, 1996]. These traits, filial piety, goodness, being a gentleman, and rituals will be discussed as well as Confucius’ views on education and government. Filial piety is a son or daughters devotion and duty to his or her parents. In the Analects, Confucius was asked by Mang what filial piety is and he answered, “It is being obedient.” He went on to elaborate this statement to Fan Chi by saying “that parents, when alive, should be served according to ritual; that, when dead, they should be buried according to ritual; and that they should be sacrificed to according to ritual.” These definitions of filial piety by Confucius deal with the notion of harmony. Taking care of ones parents is a duty of the children that enables the parents to exist and survive. Once the children have sons and daughters of their own they too will be taken care of in their elderly years. This creates a cycle that allows the elderly to survive and contribute to the knowledge of the younger generations. If this cycle is broken by one generation it will disrupt the harmony and will teach the following generation that taking care of their elders is not their responsibility. This will lead to the abandonment of the elderly generations and their knowledge and contributions to society will be lost. Confucius also views this obligation as one that separates man from beast. He says, “The filial piety of now-a-days means providing nourishment for one’s parents. But dogs and horses likewise are able to do something along that line for their own kind. Without reverence, what is there to distinguish the one support given from the other?” Confucius points out in this statement that the obligation of the children go beyond that of simply providing for their parents. Providing the physical nourishment needed for survival is not enough, the children have to have the compassion, the deep respect and love for their parents as well; because, this is what separates us as humans from animals. Filial piety is the most important virtue that Confucius speaks of and its qualities overlap in the other virtues that we will discuss. Goodness, the quality of being virtuous, is described by Confucius as having very similar characteristics to filial piety but with some added qualities. The relationship between filial piety and goodness can be witnessed by the Confucius’ example on goodness. “A youth, when at home, should behave well toward his parents, and when abroad, respectfully to his elders. He should be earnest and truthful. He should overflow in love to all, and cultivate the friendship of the good. When he has time and opportunity, after doing those things, he should study the polite arts.” This statement by Confucius gives importance to filial piety and expands it to the respect of not only ones parents and grandparents, but to all elders. In goodness we should have respect for our elders as well as we should find love for all people. He refers to the “polite arts” as the etiquette that should be followed in order to show respect for other people. The importance of how we treat other people is emphasized in the Analects 15:23 and is further expressed by Confucius: “When abroad, behave to everyone as if you were receiving an important guest; treat people as if you were assisting at a great sacrifice; do not do to others as you would not wish done to yourself. Thereby you will let no murmuring rise against you in the country, and none in the family....” This may sound familiar to Christians, who know it as the Golden Rule (“do unto others as you would have them do unto you”). Confucius implies that by following this rule you can maintain harmony not only within the country but in your family as well. The idea of the Golden Rule is summed up in one word in Confucianism, reciprocity. When Confucius was asked by Tsze-Kung, “Is there one word which may serve as a rule of practice for all one’s life?” Confucius answered, “Is not reciprocity such a word? What you do not want done to yourself, do not do to others.” Reciprocity is a quality of goodness and a quality of a gentleman. Confucius took the notion of the gentleman, as one who owned land and had some political power, and reworked it into a moral notion which captures the essence of the good life. The graciousness and self-discipline which characterize such a gentleman are fostered by, and expressed in ritual and music. But this also leads to many detailed guidelines about how to dress and how to perform the rituals [http://www.wsu.edu, 1996]. Confucianisms’ notion of a gentleman is based mainly in his morals. This was expressed by Confucius when he said “Riches and honors are what men desire; but if they cannot be obtained in the proper way, they should be let go. Poverty and meanness are what men dislike; but if they cannot be avoided in the proper way, they should not be avoided. If a gentleman abandons virtue, how can he fulfill the requirements of his title? A gentleman, not even for the space of a single meal, will act contrary to virtue. Even in moments of haste, and in times of danger, he clings to virtue.” This is a statement of admiration for high moral character with no tolerance for wavering from those morals. Confucianism also sees a gentleman as a man who does not seek recognition or fame, but is concerned with his betterment and improving on those characteristics which he is lacking. Confucius also notes a distinction and contrast between a gentleman and a petty man: A petty man is referred to as the opposite of a gentleman and is distinguished by the petty man’s traits of demanding from others rather than himself as well as pointing out the bad qualities of other men instead of focusing on the admirable qualities of them. Confucius also states “A gentleman, well studied in literature, and abiding by the rules of ritual, will not go very wrong.” This refers to the rules of etiquette a gentleman follows in his life and the importance of ritual to maintain harmony. Rituals are somewhat stringent and should be followed strictly by all gentlemen. Confucius defines some of these rituals in the Analects: “A gentleman does not wear a deep purple or a puce color, nor in his at-home clothes does he wear red. In warm weather, he wears a single-layered garment, either of coarse or fine texture, but when going out he wears it over another garment. He wears lambskin with a garment of black, fawn with white, and fox with yellow. His fur dressing gown should be long, but with the right sleeve short. His night clothes must be half again as long as his body. When staying at home, he wears thick furs of the fox or the badger. So long as he is not in mourning, he wears all the trimmings of his girdle... He does not wear lamb’s fur or a black cap when making a visit of condolence. And on the first day of the month he must put on his court robes and present himself at court.” While today, these particular rituals may not be carried out per precisely as they are stated, it is a good representation of the attention to detail that rituals should be performed. Without the rituals to follow, Confucius believed that otherwise virtuous acts lost their goodness. He expressed this when he said “Respectfulness, without the rules of ritual becomes laborious bustle; carefulness, without the rules, becomes timidity; boldness becomes insubordination; straightforwardness becomes rudeness.” United States businessmen and marketers should pay particular attention to this quote and the comment on boldness in relation to insubordination. While Americans. are known for being straight forward and bold; therefore, businesspersons would be wise to remember to follow the proper rituals. Confucius also puts importance on music and believes that music is the finishing touch of a gentleman. Therefore, traditional music should always be respected. In order to understand and enjoy music as well as learn the many specific rituals of a gentleman, it is important that you receive education on these matters. In filial piety, the importance of taking care of one’s elders and learning from them can not be overstated. The elders are a great source for teaching the rituals that must be learned and passed down from teacher to student and from generation to generation in order to maintain harmony. Confucius believed that teachers only relay the knowledge of the ancients and therefore all knowledge comes from the ancients. Confucius conveyed this when teaching Yu what true knowledge is, “when you know a thing, to realize that you know it; and when you do not know a thing, to allow that you do not know it: this is knowledge.” Confucius went on to say in reference to his teaching of knowledge, “...(I have been) a transmitter and not a maker, believing in and loving the ancients....” Confucius believed that the teachings of the ancients and all the values we have discussed are important for people to have a good, virtuous life with harmony. It is important for all people to posses these values; but, it is absolutely a necessity for these values to be present in a leader. It is a must if the people of a nation are to trust the government under which they are ruled. Confucius believed that a hierarchy must exist and that hierarchy must be respected for society to be in harmony. In order for people to find harmony in their lives they must believe in the governmental structure and have faith in their rulers. The importance of faith in a ruler is expressed in the following discussion between Zigong and Confucius as recorded in the Analects: Zigong asked about government. The Master said, “The requisites of government are that there be sufficient food, sufficient military equipment, and the confidence of the people in their ruler.” Zigong said, “If one had to dispense with one of those three, which should be given up first?” “The military equipment, “ said the Master. Zigong again asked, “If one had to dispense with one of the two remaining, which should be given up?” The Master answered, “Give up the food. From of old, death has always been the lot of men; but if the people have no faith in their rulers, they cannot stand.” The statement that Confucius makes is a bold contradiction to the well known Maslow’s Hierarchy of Needs that are deeply embedded in Western management and marketing theories. What he suggests is that food and nourishment of the body is not the most important and primary obligation of the government to its people; rather, it is the peace of mind and feeling of security that comes from a belief in their ruler that they require most from their leader. The notion that men are destined to die, but they do not have to be insecure in their live is a notion that may seem harsh at first. However, if all men are destine to die but not all men are not destined to stand proud, which is a greater accomplishment. From this ideology we can see where to concept of “face” comes from in Asian cultures. It does not take a special man to live, but it does take a special man to stand proud. It is this characteristic in a man that lends him to virtuous, thereby if government facilitates a man becoming virtuous all other things will fall into place. This is why Confucius feels that government should not govern by laws and punishment to maintain order. Laws and punishment simply encourage people to try to get around the laws (known to Americans as “loop holes”) and will try to avoid the punishment for breaking these laws. He suggests that people should be governed by virtue and ritual to maintain the order. If virtue and ritual are the driving force of order people will feel shame when they are not virtuous and will aspire to be good. This belief of Confucius has implications for Western cultures, and Americans in particular. Americans reliance on and the importance put on the legal systems and lawyers brings this Confucian belief in direct contradiction to what we belief and understand. To a Confucian follower, the involvement of a lawyer may not be viewed as reassuring as it would by Americans. It would instead be viewed as a sign of distrust and an insult to Confucians virtuousness. To tie these categories of Confucianism together we must look at the over all theme of Confucianism. Confucianism looks into the moral character of human beings and the kindness and neighborliness that should be share between all people. Confucius defines the relationships that should occur in a civilization in harmony. These human interactions are categorized in five relationships; the ruler-minister, father-son, husband-wife, elder-younger brother, and friend-friend. While three of these relationships are obviously family relationships, the other two are thought of in terms of family. The attitude that a friend-friend relationship should be given the same respect as a family relationship is conducive to the Confucian society becoming a close net group (this is an important aspect of the Confucian society that this paper will address in latter paragraphs). These relationships are viewed with reciprocity for each other and an obligation exists within human relationships. It is believed that the family relations should carry over in to social behavior, such as respecting others’ elders and to be kind to others’ children as you would your own. Along with the strong importance given to human relationships it is also importance to be loyal to oneself and to be conscious of and to be considerate towards others. It is believed that a gentleman should be recognized by his moral character and not by his status at birth. An important part of becoming a gentleman is the knowledge of rituals. Confucianism holds a great importance to rituals because this links a person to the past and his ancestors. To be a gentleman it is important to seek education, this is evidenced by the word used for scholar which derives from a word that originally meant warrior, a position of great respect during the time the word was derived. The Effects of Confucianism on Society The effects of Confucianism on Chinese society has been profound. Although it is not a religion and Confucius claimed no divine status, he has so much respect and influence that his birthday is celebrated as Teacher’s Day in Taiwan and is a national holiday in the Republic of China. However, the main and most important effect in relation to this paper is the importance of family. Filial piety is a very important virtue which dominates social structure. The obligation to family has caused a very close net family that does not openly accept outsiders. A persons duties are to his family first. This has caused some problems with the development of social and economic advancement. It is believed that this obligation to family is the down fall of many economically successful businesses because they are passed down to family members who are not competent. This can be best demonstrated by the story of the rise and fall of Wang Laboratories. Wang was founded by An Wang. He emigrated from Shanghai to the United States when he was twenty-five. Wang Laboratories went public in the late 1950's and was one of the great American high-tech entrepreneurial success stories of the next generation. But when An Wang was ready to retire in the mid-1980s, he insisted on having his American-born son, Fred Wang, take over the business. Fred Wang was promoted over the heads of several more senior, more proven managers, including John Cunningham, whom most people inside the company believed to be the logical successor to An Wang. The blatant nepotism evident in his promotion alienated a string of American managers, who quickly left the company [Cohen, 1990]. The company posted its first loss the year after Fred Wang took over the company. Ninety percent of its market capitalization had disappeared in four years, and in 1992 it filed for bankruptcy [Fukuyama, 1995]. This is an important economic impact caused by the strong family ties that Confucianism encourages. The lack of separation between business and family has continued to spawned small businesses even in to days environment of global business that has companies merging to create large corporations to gain economies of scale and market shares. This is not to say that a Confucian society can not grow and develop economically just because it generally has small firms. This difference (in economic development) clearly cannot be explained by the level of development, since Korea is usually held to be slightly behind Taiwan. Taiwan’s largest private company in 1983, Formosa Plastics, had sales of $1.6 billion and 31,211 employees, compared to the Korean conglomerates Hyundai and Samsung, which in that same period had sales of $8.0 and $5.9 billion and 137,000 and 97,384 employees, respectively. In 1976 the average Taiwanese firm was only half the size of the average Korean firm [Myers, 1986]. A Confucian society can produce profitable and successful companies that are good potential customers for business to business marketers. These companies may simply be smaller and a little more numerous than in other societies. The family structure creates close ties to family members, but it also can create close friend - friend or coworker - coworker relationships. The friend - friend relationship is developed over time to become an extended member of family. Trust of other people in a Confucian society does not generally extend past family and these close friends. An example of this type of trust is a Taiwanese student whom is studying in the United States. The student’s trip and education in the U.S. was financed by a group of coworkers of his mother’s. Instead of using a bank, the group of trusted coworkers pool their savings and periodically each coworker that is interested in borrowing the money makes a bid on it. The highest bidder is awarded the money and the cost of the money is payed back into the savings for the benefit of each participant. This group of people feel more comfortable lending their savings to each other, even with no legal obligation, than they do putting their money in a savings account in a bank. This system brings into contrast the American attitude towards lending and borrowing money. Americans would consider this irresponsible and would not expect to see their money ever again. This attitude of the Taiwanese goes back to the Confucian belief that a society should not be ruled by laws, but rather virtue. The Effects of Confucianism on Business-to-Business Marketing The effects of Confucianism on business-to-business marketing is as profound as they are on the society itself. The characteristics found in Confucianism are found in the dealings of every day business. Even business relationships are expected to be more than merely utilitarian. The relationship has to be valuable as a relationship as well as a valuable business relationship. It is very important to maintain a high level of moral in all facets of life. The end does not justify the means in Confucianism. Profit, quality, or price may be secondary to the uncompromising need for virtue and ritual. To market your product to a Confucian influenced business is to market your business’s goodness as much as it is to market the benefits of your product. The goodness of your business may be judged simply by the way its representatives conduct themselves or the way your advertisements project dignity and follow within the ritual expectations of Confucianism. The relationship is also seen as a long-term relationship that does not necessarily end after the business is transacted and you have made the sale. This relationship must also be built up over several encounters, face to face encounters. This may mean that advertising campaigns should be considered on a longer term basis than what is normal in other societies. A Confucian society may need to become much more comfortable with seeing a product than other cultures. It is also important to meet in person and on a regular basis because the level of relations sought by Confucianism is on an unconscious level that involves the suggestive gestures given by people when conversing face to face. The relationship should always be developed on a personal level first and foremost. These characteristics are in direct conflict with many of the principles of Western business. Therefore, you should be prepared to promote your product by sending representatives to meet with potential clients. This may be more costly but it will be much more effective in establishing the initial sale and will become a long term relationship that will hopefully pay dividends for a long time to come. You must remember that Confucianism promotes relationships on a much more family like basis than in many other cultures. Many cultures make it a point not to take business home with them. Members of these cultures would prefer not to do business with family or friends for fear of losing the family or friendly relationship over a business dispute. This attitude evidences that these cultures tend to put business first over personal relations by conducting business in the fastest, most efficient way possible. This usually means impersonal conversations on the phone, by fax, or E-mail that is direct and efficient with little or no concern for a personal relationship. This is not acceptable to the Confucian way of life. All aspects of life must be conducted with the same virtues. The idea in America that a good person can be a businessman that is cold and ruthless at work but loving and caring at home does not exist within the Confucian ideology. A person can not have these dual personalities and still be virtuous. Therefore, it is important to remember that business and family often overlap in the Confucian society and Confucian clients should be treated in such a fashion as you would treat a family member. A recent article by Wendy Riches in the July/August, 1996 edition of Direct Marketing stated in reference to business to business marketing that you should “stick to a time-honored formula and you won’t go wrong. Attract ATTENTION, Arouse INTEREST, Create DESIRE, CONVINCE to buy, and Call to ACTION.” While this is good advice for doing business in America, we should be careful how we try to obtain these objectives in a Confucian society. When considering the appropriate approach towards obtaining these goals we should consider what is written in the Analects (I, 16), Confucius said “(the good man) does not grieve that other people do not recognize his merits. His only anxiety is lest he should fail to recognize theirs.” This can be applied to marketing by not being to quick to praise your product. You may be better served to learn a little about your perspective customer’s business and praise his and his business’s good points. Over time the customer should become familiar with your product and hopefully praise it in due time. While there are many issues to be aware of when marketing to a Confucian society, business-to-business marketing is surprisingly suited to it. Demand is more inelastic. This is a good fit for doing business in Confucian societies because it allows business relationship to be more stable and not fluctuate with prices. Business buying is a more professional purchasing effort. This fits well because we are ready to go through several phases of presenting the product before the purchase decision is made. In a Confucian society the patriarch of the family business may make the decision, but since we are prepared to go through the normal steps of getting approval of a group of people we will be accustom to the time a amount of presenting that may be required by the patriarch. Buyers and sellers work more closely together and build close long-run relationships. This is obviously a good fit into the expectations of Confucius relationships as explained earlier. Reciprocity is expected, that business buyers often practice reciprocity, buying from suppliers who also buy from them. The benefits of this trait will be enormous in the relationships that should form and the normal transaction of reciprocity will be much more appreciated by the Confucian business than any other business. This gives the relationship a foundation in the philosophy of Confucianism that makes the relationship good in itself because of the adherence to an important virtue. While it may be comforting to realize that Confucianism is not as far removed from existing practices, we should remember what has been said about the Confucian influenced Japanese business organizations. “Japanese and American work organizations are ninety-five percent the same - and different in all the important respects” [Ching, 1993]. The differences between other cultures and that of a Confucian society make developing a relationship a delicate matter. It should be noted again that the involvement of a lawyer will insult the virtue of a Confucian follower and the decision to involve a lawyer in any capacity should be considered very seriously. Conclusion Businesspersons from other cultures must be willing to take the appropriate time to make the acquaintances and develop the trust of the Confucian organization. Confucian organizations expect to have a closeness that gives them comfort and a feeling of trust, understanding and the willingness to sacrifice for one another. Confucianism gives a high importance to the hierarchy and role of individuals to maintain harmony in society and within the organization. It is inevitable, in order to succeed with many East Asian cultures, that businesspersons should become familiar with the teachings of Confucius. A basic understanding of the philosophy will go along way in understanding what is expected of both parties evolved in a relationship. In the Confucian society it is a matter of what is expected as apposed to what should be done. This attitude can make a relationship very sensitive to protocol. The foundation of the relationship on a personal level will be the key to starting a business relationship. This can only be done through frequent personal contact and the developing of trust between the people involved. Businesspersons should take their time and follow the proper channels by giving respect to the hierarchy of the organization and must find a place within the social relationships that Confucius defines. When the marketing techniques that are already in place are analyzed, businesspersons should ask themselves how would “The Master” approach this; and, should turn to his wisdom for a better understanding of what one’s clients would be thinking.. “Only the wisest and the stupidest of men never change.” Confucius, 551?-479? B.C. To be successful at business to business marketing , one must be willing to change our approach to follow within the virtues of Confucianism. References Ching, Julia. Chinese Religions. Maryknoll: Orbis Books, New York. 1993. Cohen, Daniel. The Fall of the House of Wang. Business Month. Volume 135. 1990. pp. 22-31. Fukuyama, Francis. Trust; The Social Virtues and the Creation of Proserity. The Free Press, New York. 1995. 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