[[*A loveless world is a dead world, and always there comes an hour when one is weary of prisons, of one's work, and of devotion to duty, and all one craves for is a loved face; the warmth and wonder of a loving heart*]]
- "The Plague" by Albert Camus
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In honor of the dinner I had with friends from my AMS class, (no class today as lecturer was away) here's a little (ok, not so little) entry that may kill you with the word count. It's basically a reflective essay written for my Asian Management Systems class - that "high brow" MIB-standard class I had to get special permission to take. I think the subject is rather interesting and note-worthy. Please enjoy/suffer through:
ASIAN MANAGEMENT SYSTEMS AND ITS RELATION TO EMERGING MANAGEMENT PRACTICES.
In discussing Asian Management Systems, the traditional view that comes into mind is often one that suggests that corruption and cronyism is rife in the business practices of these systems. While the former are prevalent characteristics of Asian businesses, culture also plays a dominant role in influencing emerging management practices of the new Asian economies. This essay seeks to explore the notion of culture in relation to emerging management practices in Asia and hence, the resulting importance of Social network theory.
The most significant aspect of culture that influences Asians - particularly the Chinese; ethnic Chinese make up a large population of Asian Business owners - both in their personal life and in the corporate world, is the concept of “guan xi” (social connections); implying that society and business is built upon relationships – reciprocity of obligations are built upon the constructs of personal trust (xin yong) and demonstrative affection (gan qing). “Guan xi” has three dimensions: Normative, Affective and Instrumental. In the first instance, bonds are formed out of obligation such as one’s obligation to family and kin; in the second instance, bonds are based on developed ties i.e. with friends; and the last instance are bonds that are developed in the hope of achieving outcomes.
The first instance is a cornerstone in the establishment of the Chinese Family Business (CFB), predominantly outside Mainland China, in lieu of the need to protect and provide for the family unit. The normative concept of “guan xi” has helped to shape the organizational structure of the main form of Chinese business – where “guan xi” plays an important role in choosing employees; the preference will always be for kin over outsiders. Having “guan xi” implies that the individual is someone worthy of personal trust (xin yong) due to the demonstrative affection “gan qing” developed i.e. the person can be trusted to act honorably in a manner beneficial to the firm.
The second and last instances are key relationships in doing business in the Chinese context or even, in the daily operations of a company. An affective “guan xi” between an individual and someone in a particular firm presents one with an advantage in doing business with that firm. However, affective relationships with a business partner is one that is coincidental and does not necessarily occur, although there will be preference for firms to do business with a friend due to “guan xi” and resulting trust.
In the third instance, “guan xi” is especially sought out due to specific objectives. An individual can make use of his “guan xi” with a friend to get an introduction to a potential business partner, thereby, establishing an instrumental bond with that party. “Guan xi” is essential as it is one way of offsetting the risk of doing business with one partner over another i.e. one of us (zi ji ren) versus outsiders (wai ren). Therefore, we see that “guan xi” is a cultural nuance that affects more than the Chinese’s personal lives but their business practices as well.
The concept of “guan xi” is closely related to another cultural aspect known as “Face”. The concept of Face exists in two-folds in the Chinese culture: “Inner Face” (lian) and “Outer Face” (mian zi). The former has to do with the individual’s feelings and self-respect while the former has to do with the person’s social persona and reputation. Both are important in a social context but “mian zi” has nuances of greater stakes to lose as the lost of “mian zi” reflects not just on the individual but on those the individual has affiliations with. Conversely, “mian zi” is also essential in building “guan xi” with others; one must be of significant social standing for others to want to give “mian zi” to you and hence, establish “guan xi” with you.
The concept of face does not apply to the Chinese alone. In Japanese culture, “face” is an important concept in management practices, specifically the idea of “Inner Face”; it is an ingrained cultural concept within the Japanese individual. The fear of losing “inner face” has led to a high degree of self-governance in terms of all aspects of an individual’s behavior – socially, ethically, personally and in the work force. The “right” behavior is determined by the context of the reference group. For example, within a management team, a particular method of achieving tasks may be seen as the right way of doing things. It is also interesting to note that culturally, there is no “loss of face” if a manager scolds a subordinate within his team but it is considered so if there is the presence of outsiders – those not within the reference group. We, thus, see that the concept of “inner face” applies not just to the individual per se, but collectively for the individual reference group (inner circle).
Social network theory is the idea that firms are connected not through common resources or transactions, but rather through a series of relationships. This concept is an emergent theory in management practices, particularly for Asian Management systems. From the above discussion, we see that “guan xi” and “face” – two correlated cultural concepts - play a major role in doing business in the Asian context; although the Chinese are more concerned with the idea of “giving face” while the Japanese focus on “not losing face”.
The relational network view, thus, becomes an important concept in doing business the Asian way. “Guan xi” aids the building of relationships and it is this relational network that allows firms to build up networks that provide firms with access to scarce resources and facilitates knowledge transfer across firms and industries. In a knowledge-based economy, relationships become key in attaining competitive advantages and, efficient and effective operations of business.
Hence, it can be seen that while Asian management systems may seem steeped in traditional practices, due to the large influences of culture on business practices, they are neither out-of-date nor stodgy. Rather, its cultural implications have correlations with the emerging management practices that advocate social network theory.
Codes were taken from all over the internet and if you think you see a code that's yours, let me know and I'll add your name to this list of credits.
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