MGT584 – Leading in Teams
What are the key issues facing an expatriate Australian leader in China?
With the growing promenade of global business over the last decade, there is widespread recognition that a globally dispersed workforce through the deployment of expatriates can be crucial for strategic positioning concurrent with adapting resources and changes to the nuances of the competitive global business environment (Ling and Jaw, 2006). The growth has also created an impetus for business leaders to adapt cross culture awareness and competency (Northouse, 2013) into their leadership practice as evident in the Managing Offshore case study, and consequently, is paramount for an expatriate Australian leader in China to expand and adapt their leadership to the culture, values and norms that are expected in China.
This pressure to ascend and lead the Foshan Hua Nan Bundy Tubing Company poses challenges for expatriate Australian Manager’s as Jeff Schwartz experienced in the case study. This is particularly resonant when expatriates are not fully conversant to understanding the cultural nuances of working and living in China. Key issues for an expatriate Australian leader living and working in China are cultural values, interpersonal relationships (Earnhardt, 2009) and adjustability to the Chinese environment (Black, 1988, in Lund and Barker, 2004). Consequently, the success of an Australian expatriate manager working in China can be dependent on their adaptability to embrace the Chinese culture, values and environment (Lund and Barker, 2004), including language, socio-cultural knowledge, long work days including working weekends leaving scarce family time. Australian expatriate managers will undoubtedly experience a ‘culture chock’ and be prepared to adjust to a new foreign work context and lifestyle.
The Hofstede (1997, 2001 in Eunson, 2012) five (5) cultural dimensions of leadership provide a foundation for expatriate leaders; power distance, individualism, uncertainty avoidance, masculinity and long term orientation. (). Jeff Schwartz’s ability to converse with the cultural dimensions of leadership may have enabled him to improve the Foshan Hua Nan Bundy Tubing Company productivity, profits and interpersonal relationships and may have effectively equipped him to handle matters more competently and culturally appropriately. DiMaggio and Powell (1983 in Goodall and Warner, 2007), found that leadership practices are entrenched in a wider communal setting and strongly influenced by local cultural norms and values. A multinational company like Foshan Hua Nan Bundy Tubing success could have hinged on Jeff Schwartz’s abilities to be cognisant of the Chinese cultural values (Earnhardt, 2009). This resonates with the finding of Warner (2005) that Chinese culture can affect individual managerial effectiveness; motivation and can improve working relationships between Managers and the local staff (Warner 2005). Hence, understanding Hofstede’s cultural dimensions for an expatriate Australian leader in China may provide an imperative foundation, as outlined below:
1. Power distance: Chinese individuals with power, embrace the status and privilege more than individuals without such power and privilege. Team members that challenge or disagree with superiors are frowned upon (Earnhardt, 2009). Australian expatriate Manager’s need to establish their leadership early and demonstrate power.
2. Individualism - Interpersonal relationships and team cohesiveness are a focus of the Chinese (Earnhardt, 2009); individuals are selfless and loyal and will sacrifice personal goals for the benefit of the team. Australian expatriates need to be cognisant of this custom and acknowledge the risks of not following pursuit.
3. Uncertainty avoidance - China has a high level of uncertainty avoidance. Managers are more controlling, less approachable and many avoid delegating responsibilities and tasks (Earnhardt, 2009). Unlike Australian Managers, there is less trust in teams.
4. Masculinity - It is common for a China Manager to be decisive, assertive, aggressive and make decisions with confidence and directness. Such approach prevents employees from questioning a Manager’s judgement. Feminine characteristics, such as applying intuitive reasoning, being evasive or indirect are forbidden in China (Earnhardt, 2009). Nonetheless, managing integrity after embarrassing situations poor judgement holds great importance to the Chinese. Unlike Australian Managers, questioning can be regarded as undermining, disrespectful, and can compromise relationships.
5. Long Term Orientation - China is viewed as a pragmatic culture, with the belief that truth is contingent upon the context, situation and time (Earnhardt, 2009). Australia holds a normative culture. Australia Managers hold a strong concern with the belief that trust must be focused on absolute fact, hold a normative thinking style and have a focus on achieving prompt and agile outcomes.
Living arrangements and the social structure outside the work environment include general peculiarities in China, such as an enormity of people, different customs (queuing and custom of trade), heavy air pollution, communication barriers (the written and spoken Chinese language is the most difficult to contend with and will be challenging outside the work environment), chaotic traffic, cuisine and unfamiliar bacterial strain (Meriläinen, 2008). Leisure time and social activities of the expatiate Manager and their family will require significant adjustment. The exhausting work and long working days will create pressure on families and leave little leisure family time. A supportive spousal relationship has been cited as a pivot coping strategy for an Australian expatiate working in China. Expatiates with young school aged children may also face the burden of their children learning English in a totally novel environment (Meriläinen, 2008).
Chinese culture and adaptable leadership can underscore the complexity of an expatriate Australian leader in China and requires leaders to expand and adapt their leadership to the culture, values and norms that are expected in China. The integration of culture into leadership can expand and develop a richer understanding of the expatriate’s leadership adaptability, (Northouse, 2013) and concurrent with preparing to overcome a ‘culture shock’, recognising the importance of spousal and family’s adjustment by adjusting to the local living and working environment, may adequate enable a successful expatriate outcome for an Australian Manager.
How might a company better prepare staff for working in China?
The globalisation of business markets and growing opportunities in manufacturing and technology has made China a lucrative business market and a viable centre for global business. Business functions including leadership styles operate significantly different from Australian business functions. China. The key to successful integration into Chinese operations is a sound understanding and appreciation of Chinese Business Culture (Chen, 2001). To best prepare staff to work in China, an organisation needs to understand Chinese Business Culture and its practical application; in particular the importance of the Confucian influence, the significance of Face and the different business customs.
The Confucian influence is strong in Chinese business culture, and determines many of the ways in which the Chinese structure business, employ, promote and compromise in business operations. The Confucian ethical structure results in strong feelings of social hierarchy, valuing relationships, rights of inheritance and social law (Kehler, and Kroenstadt; 2005) (Yeung, and Tung, 1996), which translate into business as:
· A strong focus on Guanxi – good relationships, connections and networks
· A Confucian culture that puts the person and society before all else, including economics
· The amalgamation of business and personal life, and
· Patriarchal structures and a strong sense of an individual’s role
To prepare staff to work within the China Confucian inspired business model, staff need to:
· Understand the importance of Confucian history and its impact on the Chinese culture and belief systems
· Understand the Confucian impact on economics (the focus on the human element, as opposed to a more rationalist western view), and structures to value and recognise staff
· Well-developed relationship building skills and (preferably) an existing network within China
· Develop an understanding of the requirements in Chinese business (the 7.5 hour work day is non-existent, as Chinese business people attend social gatherings and meetings well outside of business hours)
The concept of face is intrinsically linked to Chinese business success, and individual achievement and losing face is viewed as serious and can affect the how a person is able to function in their society. “...... Face is lost when the individual, either through his action or that of people closely related to him, fails to meet essential requirements placed upon him by virtue of the social position he occupies (Yao Fai Ho, 1976)” . Face influences business as:
· Increased focus on reputation and social status
· Focus on reciprocity, where mutually restrictive power is exerted on members of the social network (Yao Fai Ho, 1976)
· High focus on relationship development and relationship management
Western staff can prepare to operate effectively in the Chinese business environment by learning about the Chinese conceptualization of face and related communication strategies, (Cardon, and Scott, 2003) including, but not limited to:
· The process of giving face, through praise, compliments, and appreciation
· The process of giving or receiving an apology (there are key social norms that need to be adhered to in this instance to avoid losing face)
· The common etiquette practices in China such as not publically displaying emotions
In China, business is akin to ones measure of individual values such as individualism, collectivism and Confucianism (Ralston, et al., 1999), meaning there is a high focus on business ethics and culture. Business processes are often rigid, with a high focus on values-based decision making, shaped by factors such as paternalism, personalism and high-context communications (Martinsons and Westwood, 1997). Many business decisions will therefore be made across multiple levels of a company, over a dinner table with family, at a social event or gathering, or in general conversation; as opposed to the hierarchical and non-personal western model.
Staff can face culture shock therefore to integrate into this foreign business model, as indicated in the section above, staff need to be flexible in their approach to managing the integration and change, have a sound understanding of their role and fit in the organisation, the relationships that exist within the company, the way in which decisions are made and the values that are demonstrated within the company, and how these align to their own.
There are distinct advantages to a culturally diverse workforce and organisations working across a global platform. Advantages include significant increases in productivity, workplace satisfaction (Jehn, et al; 1999), shared knowledge, expertise, and corporate global culture. Success integration will be solely dependent on staff adapting and integrating the Chinese business culture, values and customs.. Staff deploying to China must have a comprehensive awareness of the Chinese culture and an ability to adapt to the local environment including, the ability to build strong, professional relationships and flexibility to work and socialise within Chinese values, customs and expectations.
What preparation would Chinese staff need to work effectively in Australia?
Living and working in China is more complex compared to Australia. . Adaptability is critical when working in another country. Orientation on Australian cultural nuances and how practices differ from China will be paramount in assisting workers from China to be informed on appropriate behaviors, values and customs expected in the Australian work environment. Such as Australians are quite vocal and loud, and contribute significantly to meetings. This differs from the Chinese, where the custom is a quieter and withdrawn practice. Understanding the loudness and conversation as a normal, not disrespectful practice, will help the person assimilate into the Australian workplace more comfortably. Well intentioned behavior and actions that do not meet the Chinese cultural norms can be misinterpreted and have a detrimental effect on relationships and teams. Social behaviors are another area that differ, such as touching someone of the opposite sex in public is common in Australia while in China such action is frowned upon and unlike the Chinese custom, staring at people is considered rude (Eunson, 2012).
Workers should also be orientated on the Australian management style, that is generally more trusting and less controlling than the traditional Chinese management style (Earnhardt, 2009). Such orientation will help workers adapt to Australian work environments and transition into a culturally safe and adaptable environment. Furthermore, the functionality of managers in Australia should be explained including the separation of business and home life where there are boundaries and no expectation of a manager to become involved in workers private lives, family and events.
Verbal and nonverbal communication styles in China differ to those in Australia, an example being the quiet approach by the Chinese compared with the louder more outspoken western approach. Griffith and Dunham (2015) note that the Chinese style of having little contribution in meeting, can cause frustration to the Australian meeting style. To this regard, Chinese team members need to be supported and encouraged to contribute confidently, without feeling like they are disrespecting others or their own culture. The Australian approach to conflict is a more direct approach from that in China and another matter to be included in the preparation for working in Australia.
Explaining the importance of learning the ability to shift one's frame of reference from the culture they know to the new culture and adjust their behaviour accordingly is essential (Eunson, 2012). Learning and rehearsing newly learnt skills and words, and gestures will ensure consolidated understanding of greetings and farewells, with language and actions critical to showing respect and integrating into a new foreign community (Eunson, 2012). Full orientation to the rules of punctuality, allowing greater personal space than that expected in China, other social norms and having the adaptability to modify any approaches if they are not working and knowing when to apply (Eunson, 2012) will be helpful.
An understanding of how Australian business processes are different to those in China are important. One important difference is the slowness of the approach by the Chinese as they view negotiation as very important to relationship building (Seligman, 2009 in Eunson, 2012). The negotiation process includes researching and assessing whether the other side is trustworthy and sincere, and to determine their weaknesses (Hendon, Hendon and Herbig, 1999 in Eunson, 2012). The Australian style is more a means to an end with the aim of a win win situation Chinese workers also need to be aware that a payment in negotiations is viewed as an unmoral practice and form an illegal practice of bribery and can result in a criminal conviction.